$45,000,000
LOAN AND SECURITY AGREEMENT
Dated as of July 14, 1997
Between
TRISM, INC.
TRISM SECURED TRANSPORTATION, INC.
TRI-STATE MOTOR TRANSIT CO.
AERO BODY AND TRUCK EQUIPMENT, INC.
TRI-STATE TRANSPORTATION SERVICES, INC.
DIABLO SYSTEMS INCORPORATED, d/b/a DIABLO TRANSPORTATION, INC.
EMERALD LEASING, INC.
McGIL SPECIAL SERVICES, INC.
TRISM EASTERN, INC., d/b/a ▇. ▇. ▇▇▇▇▇▇▇ TRANSFER
TRISM HEAVY HAUL, INC.
TRISM SPECIALIZED CARRIERS, INC.
TRISM SPECIAL SERVICES, INC.
E. L. ▇▇▇▇▇▇ & SONS TRUCKING CO., INC.
TRISM TRANSPORT, INC.
TRISM TRANSPORT SERVICES, INC.
AND
TRISM LOGISTICS, INC.
(collectively, the Borrowers)
and
THE FINANCIAL INSTITUTIONS PARTY
HERETO FROM TIME TO TIME
(collectively, the Lenders)
and
THE CIT GROUP/BUSINESS CREDIT, INC.
(the Agent)
TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS 1
SECTION 1.1 Definitions 1
SECTION 1.2 Other Referential Provisions 25
SECTION 1.3 Exhibits and Schedules 26
ARTICLE 2 REVOLVING CREDIT LOANS 27
SECTION 2.1 Revolving Credit Loans 27
SECTION 2.2 Manner of Borrowing Revolving Credit Loans 27
SECTION 2.3 Repayment of Revolving Credit Loans 29
SECTION 2.4 Revolving Credit Note 29
ARTICLE 3 LETTER OF CREDIT FACILITY 29
SECTION 3.1 Issuance 29
SECTION 3.2 Advances Automatic; Participations 30
SECTION 3.3 Cash Collateral 30
SECTION 3.4 Fees and Expenses 31
SECTION 3.5 Request for Incurrence of Letter of Credit
Obligations 32
SECTION 3.6 Obligation Absolute 32
SECTION 3.7 Indemnification; Nature of Lenders' Duties 33
ARTICLE 4 GENERAL LOAN PROVISIONS 34
SECTION 4.1 Interest, Etc 34
SECTION 4.2 Fees 36
SECTION 4.3 Manner of Payment 37
SECTION 4.4 Loan Accounts: Statements of Account 37
SECTION 4.5 Termination of Agreement 38
SECTION 4.6 Making of Loans 38
SECTION 4.7 Settlement Among Lenders 40
SECTION 4.8 Increased Costs and Reduced Returns 43
ARTICLE 5 CONDITIONS PRECEDENT 44
SECTION 5.1 Conditions Precedent to Revolving Credit
Loans 44
SECTION 5.2 All Loans: Letters of Credit 47
ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF BORROWER 48
SECTION 6.1 Representations and Warranties 48
SECTION 6.2 Survival of Representation and Warranties,
Etc. 58
ARTICLE 7 SECURITY INTEREST 59
SECTION 7.1 Security Interest 59
SECTION 7.2 Continued Priority of Security Interest 59
ARTICLE 8 COLLATERAL COVENANTS 61
SECTION 8.1 Collection of Receivables 61
SECTION 8.2 Verification and Notification 63
SECTION 8.3 Disputes, Returns and Adjustments 63
SECTION 8.4 Invoices 64
SECTION 8.5 Delivery of Instruments 64
SECTION 8.6 Ownership and Defense of Title 64
SECTION 8.7 Insurance 65
SECTION 8.8 Location of Offices and Collateral 66
SECTION 8.9 Records Relating to Collateral 67
SECTION 8.10 Inspection 67
SECTION 8.11 Information and Reports 67
SECTION 8.12 Assignment of Claims Act 68
SECTION 8.13 Covenants Regarding Material Intellectual
Property Collateral 68
ARTICLE 9 AFFIRMATIVE COVENANTS 69
SECTION 9.1 Preservation of Corporate Existence and
Similar Matters 69
SECTION 9.2 Compliance with Applicable Law 69
SECTION 9.3 Maintenance of Property 70
SECTION 9.4 Conduct of Business 70
SECTION 9.5 Insurance 70
SECTION 9.6 Payment of Taxes and Claims 70
SECTION 9.7 Accounting Methods and Financial Records 70
SECTION 9.8 Use of Proceeds 70
SECTION 9.9 Hazardous Waste and Substances:
Environmental Requirements 71
SECTION 9.10 Landlords' Agreements, Mortgagee Agreements
and Bailee Letters 72
SECTION 9.11 Further Assurances 72
ARTICLE 10 INFORMATION 72
SECTION 10.1 Financial Statements 72
SECTION 10.2 Accountants' Certificate 73
SECTION 10.3 Officer's Certificate 74
SECTION 10.4 Copies of Other Reports 74
SECTION 10.5 Notice of Litigation and Other Matters 75
SECTION 10.6 ERISA 75
SECTION 10.7 Accuracy of Information 76
SECTION 10.8 Revisions or Updates to Schedules 76
ARTICLE 11 NEGATIVE COVENANTS 76
SECTION 11.1 Financial Ratios 76
SECTION 11.2 Indebtedness for Money Borrowed 77
SECTION 11.3 Guaranties 77
SECTION 11.4 Investments 77
SECTION 11.5 Unfunded Capital Expenditures 77
SECTION 11.6 Restricted Dividend Payments and
Purchases, Etc. 77
SECTION 11.7 Merger, Consolidation and Sale of Assets 78
SECTION 11.8 Transactions with Affiliates 78
SECTION 11.9 Liens 78
SECTION 11.10 Operating Leases 78
SECTION 11.11 Plans 78
SECTION 11.12 Sales and Leasebacks 78
SECTION 11.13 Capital Structure and Business 78
SECTION 11.14 No Impairment of Intercompany Transfers 79
SECTION 11.15 No Speculative Transactions 79
ARTICLE 12 DEFAULT 79
SECTION 12.1 Events of Default 79
SECTION 12.2 Remedies 82
SECTION 12.3 Application of Proceeds 84
SECTION 12.4 Miscellaneous Provision Concerning Remedies 85
SECTION 12.5 Trademark License 85
ARTICLE 13 ASSIGNMENTS 86
SECTION 13.1 Successors and Assigns; Participations 86
SECTION 13.2 Representation of Lenders 89
ARTICLE 14 AGENT 89
SECTION 14.1 Appointment of Agent 89
SECTION 14.2 Delegation of Duties 90
SECTION 14.3 Exculpatory Provisions 90
SECTION 14.4 Reliance by Agent 90
SECTION 14.5 Notice of Default 91
SECTION 14.6 NonReliance on Agent and Other Lenders 91
SECTION 14.7 Indemnification 91
SECTION 14.8 Agent in Its Individual Capacity 92
SECTION 14.9 Successor Agent 92
SECTION 14.10 Notices from Agent to Lenders 92
SECTION 14.11 Direction from Lenders 93
ARTICLE 15 MISCELLANEOUS 93
SECTION 15.1 Notices 93
SECTION 15.2 Expenses 94
SECTION 15.3 Stamp and Other Taxes 95
SECTION 15.4 Setoff 95
SECTION 15.5 Litigation 97
SECTION 15.6 Reversal of Payments 97
SECTION 15.7 Injunctive Relief 98
SECTION 15.8 Accounting Matters 98
SECTION 15.9 Amendments 98
SECTION 15.10 Assignment 99
SECTION 15.11 Performance of Borrowers' Duties 99
SECTION 15.12 Indemnification 99
SECTION 15.13 All Powers Coupled with Interest 100
SECTION 15.14 Survival 100
SECTION 15.15 Severability of Provisions 100
SECTION 15.16 Governing Law 100
SECTION 15.17 Counterparts 100
SECTION 15.18 Reproduction of Documents 101
SECTION 15.19 Term of Agreement 101
EXHIBITS
EXHIBIT A FORM OF REVOLVING CREDIT NOTE
EXHIBIT B FORM OF NOTICE OF PROPOSED ADVANCE
EXHIBIT C FORM OF BORROWING BASE CERTIFICATE
EXHIBIT D FORM OF OPINION OF COUNSEL FOR BORROWER
EXHIBIT E FORM OF SETTLEMENT REPORT
EXHIBIT F FORM OF STOCK PLEDGE AGREEMENT
EXHIBIT G FORM OF TRADEMARK SECURITY AGREEMENT
EXHIBIT H FORM OF POWER OF ATTORNEY
EXHIBIT I FORM OF GUARANTY
EXHIBIT J FORM OF ASSIGNMENT AND TRANSFER AGREEMENT
EXHIBIT K FORM OF OFFICER'S CERTIFICATE
EXHIBIT L FORM OF SECRETARY'S CERTIFICATE
EXHIBIT M FORM OF RELEASE AND REASSIGNMENT OF TRADEMARKS
SCHEDULES
SCHEDULE 1.1: Subsidiaries for Which Consolidating Balance Sheets are
Prepared
SCHEDULE 2.2: Authorized Officers
SCHEDULE 6.1(a): Jurisdictions in Which Qualified as a Foreign Corporation
and Borrowers' FEIN
SCHEDULE 6.1(b): List of Subsidiaries and Stock Ownership
SCHEDULE 6.1(e): Business Description
SCHEDULE 6.1(f): Government Approvals
SCHEDULE 6.1(g): Liens on Real Property
SCHEDULE 6.1(h): Liens on Other Assets
SCHEDULE 6.1(i): Indebtedness and Guaranties
SCHEDULE 6.1(j): Litigation
SCHEDULE 6.1(k): Tax Returns
SCHEDULE 6.1(o): Benefit Plans
SCHEDULE 6.1(s): Collateral Locations and Location of Chief Executive Office
SCHEDULE 6.1(t): Owned Real Estate
SCHEDULE 6.1(u): Corporate and Fictitious Names
SCHEDULE 6.1(x): Collective Bargaining Agreements
SCHEDULE 6.1(y): Intellectual Property
SCHEDULE 6.1(z): Trade Names
SCHEDULE 6.1(bb): Insurance Policies
SCHEDULE 6.1(cc): Financial Institutions and Bank Accounts
SCHEDULE 6.1(dd): Government Contracts
SCHEDULE 6.1(ff): Material Agreements
SCHEDULE 9.1: Borrowers/Guarantors to be Merged or Dissolved
SCHEDULE 9.8: Use of Proceeds
SCHEDULE 11.8: Loans to Affiliates
SCHEDULE 11.12: Sale-Leaseback
SCHEDULE 11.13: Capital Structure of Borrowers
LOAN AND SECURITY AGREEMENT
Dated as of July 14, 1997
TRISM, INC., a Delaware corporation ("Trism"), TRISM SECURED
TRANSPORTATION, INC., a Delaware corporation ("Trism Secured") TRI-STATE
MOTOR TRANSIT CO., a Delaware corporation ("TSMT"), AERO BODY AND TRUCK
EQUIPMENT, INC., a Delaware corporation ("Aero Body"), TRI-STATE
TRANSPORTATION SERVICES, INC., a Missouri corporation ("Tri-State"), DIABLO
SYSTEMS INCORPORATED D/B/A/ DIABLO TRANSPORTATION, INC., a California c
orporation ("Diablo"), EMERALD LEASING, INC., a Nevada corporation ("▇▇▇"),
▇▇▇▇▇ SPECIAL SERVICES, INC., a Delaware corporation ("McGil"), TRISM
EASTERN, INC. D/B/A ▇.▇. ▇▇▇▇▇▇▇ TRANSFER, a Delaware corporation
("▇▇ ▇▇▇▇▇▇▇"), TRISM HEAVY HAUL, INC., a Delaware corporation ("Heavy
Haul"), TRISM SPECIALIZED CARRIERS, INC., a Georgia corporation (
"Specialized"), TRISM SPECIAL SERVICES, INC., a Georgia corporation
("Special Services"), E.L. ▇▇▇▇▇▇ & SONS TRUCKING CO., INC., an Oklahoma
corporation ("EL ▇▇▇▇▇▇"), TRISM TRANSPORT, INC., a Delaware corporation
("Transport"), TRISM TRANSPORT SERVICES, INC., a Utah corporation
("Transport Services"), TRISM LOGISTICS, INC., a New Jersey corporation
("Logistics") (each of Trism, Trism Secured, TSMT, Aero Body, Tri-State,
Diablo, ▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇, Heavy Haul, Specialized, Special Services,
EL ▇▇▇▇▇▇, Transport, Transport Services and Logistics is herein referred
to individually as a "Borrower" and are collectively referred to herein as
the "Borrowers"), all with a principal place of business at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, the financial institutions party to this Agreement
from time to time (collectively, the "Lenders") and THE CIT GROUP/BUSINESS
CREDIT, INC., a New York corporation (the "Agent") agree as follows:
RECITALS: The Borrowers have requested that Lenders make a revolving credit
facility available to the Borrowers in an aggregate amount up to $45,000,000.
The Borrowers' business is a mutual and collective enterprise, and the
Borrowers believe that the consolidation of all loans and other
accommodations under this Agreement will enhance the Borrowers' aggregate
borrowing powers and facilitate the administration of their relationship
with the Lenders, all to the Borrowers' respective individual mutual
advantage.
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. For the purposes of this Agreement:
"Account Debtor" means a Person who is obligated on a Receivable.
"Acquire" or "Acquisition", as applied to any Business Unit or
Investment, means the acquiring or acquisition of such Business Unit or
Investment by purchase, exchange, issuance of stock or other securities,
or by merger, reorganization or any other method.
"Adjusted Net Worth" means on any relevant date an amount equal to
the Net Worth plus the principal amount of the Subordinated Indebtedness
then outstanding.
"Advance" means amounts advanced by the Lenders to a Borrower pursuant
to Section 2 hereof.
"Affiliate" means, with respect to a Person, (a) any partner, officer,
shareholder (if holding more than 10% of the outstanding shares of capital
stock of such Person), director, employee or managing agent of such Person
or such Person's Affiliates, (b) any other Person (other than a Subsidiary)
that, (i) directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such given
Person, (ii) directly or indirectly beneficially owns or holds 10% or more
of any class of voting stock or partnership or other voting interest of
such Person or any Subsidiary of such Person, or (iii) 10% or more of the
voting stock or partnership or other voting interest of which is directly
or indirectly beneficially owned or held by such Person or a Subsidiary of
such Person. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting
securities or partnership or other voting interest, by contract or otherwise.
"Agency Account" means an account of a Borrower maintained by it with
a Clearing Bank pursuant to an Agency Account Agreement.
"Agency Account Agreement" means an agreement among a Borrower, the
Agent and a Clearing Bank, in form and substance satisfactory to the Agent,
concerning the collection, treatment and remission of payments or other
deposits which represent the proceeds of Receivables or of any other
Collateral.
"Agent" means The CIT Group/Business Credit, Inc., a New York
corporation, and any successor agent appointed pursuant to Section 14.9
hereof.
"Agent's Office" means the office of the Agent specified in or
determined in accordance with the provisions of Section 15.1(c) hereof.
"Agreement" means and includes this Loan and Security Agreement,
including all Schedules, Exhibits and other attachments hereto, and all
amendments, modifications and supplements hereto and thereto.
"Agreement Date" means the date as of which this Agreement is dated.
"Anniversary Date" shall mean the Initial Anniversary Date and the
same date in every year thereafter.
"Applicable Law" means all applicable provisions of constitutions,
statutes, rules, regulations and orders of all governmental bodies and of
all orders and decrees of all courts and arbitrators, including, without
limitation, Environmental Laws.
"Asset Disposition" means the disposition of any asset of any
Borrower or any of its Subsidiaries.
"Assignment and Transfer" means an assignment and transfer in the
form attached hereto as Exhibit J assigning all or a portion of a Lender's
interests, rights and obligations under this Agreement pursuant to
Section 13.1.
"Audited Financial Statements" shall have the meaning assigned to such
term in Section 10.1(a) hereof.
"Availability Shortfall" shall mean a condition which occurs, at any
time and from time to time, when the Borrowers' Borrowing Base Availability
has remained below $8,000,000 for a period of ten (10) consecutive Business
Days during the term hereof.
"Benefit Plan" means an "employee pension benefit plan" as defined in
Section 3(2) of ERISA (other than a Multiemployer Plan) in respect of which
the Borrower or any Related Company is, or with respect to defined benefit
plans (as defined under ERISA) within the immediately preceding six years
was, an "employer" as defined in Section 3(5) of ERISA, including such plans
as may be established after the Agreement Date.
"Billed Eligible Receivables" shall mean the aggregate amount of
Eligible Receivables for which the services related thereto have been
performed by an Operating Company and an invoice has been rendered to the
customer.
"Borrower" and/or "Borrowers" shall have the meanings ascribed to
such terms in the preamble of this Agreement.
"Borrowing Base" means at any time an amount equal to the lesser of:
(a) the Revolving Credit Facility minus the sum of
(i) the Letter of Credit Reserve, plus
(ii) such other reserves as the Agent may establish from
time to time in the exercise of its reasonable credit judgment, or
(b) an amount equal to
(i) the sum of (A) 85% of the face value of Billed Eligible
Receivables due and owing at such time, plus (B) 80% of the face
value of Unbilled Eligible Receivables due and owing at such time
up to the lesser of (1) $7,500,000 or (2) (x) during the first
year of this Agreement, one-third (1/3) of the amount calculated
in clause (b)(i)(A) hereof, and (y) for each year of this
Agreement thereafter, one-fourth (1/4) of the amount calculated
in clause (b)(i)(A) hereof, minus
(ii) the sum of
(A) the Letter of Credit Reserve, plus
(B) such other reserves as the Agent may establish
from time to time in the exercise of its reasonable credit
judgment.
"Borrowing Base Availability" means at any time (a) the Borrowing Base
at such time minus (b) the aggregate principal amount of Revolving Credit
Loans outstanding at such time.
"Borrowing Base Certificate" means a certificate in the form attached
hereto as Exhibit C.
"Business Day" means any day other than a Saturday, Sunday or other
day on which either the office of Chase Manhattan Bank, N.A., in New York,
New York or the Agent's office in Atlanta, Georgia is authorized to close.
"Business Unit" means the assets constituting the business or a
division or operating unit thereof of any Person.
"Capital Expenditures" means, with respect to any Person, all
expenditures made and liabilities incurred for the acquisition of assets
(other than assets which constitute a Business Unit) which are not, in
accordance with GAAP, treated as expense items for such Person in the year
made or incurred or as a prepaid expense applicable to a future year
or years.
"Capitalized Lease" means a lease that is required to be capitalized
for financial reporting purposes in accordance with GAAP.
"Capitalized Lease Obligation" means Indebtedness represented by
obligations under a Capitalized Lease, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in
accordance with GAAP.
"Cash Collateral" means collateral consisting of cash or Cash
Equivalents on which the Agent, for the benefit of itself as Agent and the
Lenders, has a first priority Lien.
"Cash Equivalents" means
(a) marketable direct obligations issued or unconditionally
guaranteed by the United States Government or issued by any agency
thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition
thereof;
(b) commercial paper maturing no more than one year from the date
issued and, at the time of acquisition thereof, having a rating of at
least A-1 from Standard & Poor's Corporation or at least P-1 from
▇▇▇▇▇'▇ Investors Service, Inc.;
(c) certificates of deposit or bankers' acceptances issued in
Dollar denominations and maturing within one year from the date of
issuance thereof issued by any commercial bank organized under the
laws of the United States of America or any state thereof or the
District of Columbia having combined capital and surplus of not less
than $100,000,000.00 and, unless issued by the Agent or a Lender,
not subject to set-off or offset rights in favor of such bank arising
from any banking relationship with such bank; and
(d) repurchase agreements in form and substance and for amounts
satisfactory to the Agent.
"Charges" means all Federal, state, county, city, municipal, local,
foreign or other governmental taxes (including, without limitation, taxes
owed to PBGC at the time due and payable), levies, assessments, charges,
liens, claims or encumbrances upon or relating to (i) the Collateral,
(ii) the Secured Obligations, (iii) the employees, payroll, income or
gross receipts of Borrowers, (iv) the ownership or use of any assets by any
Borrower, or (v) any other aspect of Borrowers' business.
"Chase Manhattan Bank Rate" shall mean the rate of interest per
annum announced by Chase Manhattan Bank, N.A. from time to time as its
prime rate in effect at its principal office in the City of New York. Such
rate is not intended to be the lowest rate of interest charged by Chase
Manhattan Bank, N.A. to its borrowers.
"Clearing Bank" means any banking institution including, without
limitation, Mercantile Bank, with which an Agency Account has been
established pursuant to an Agency Account Agreement.
"Closing Fee" shall have the meaning assigned to such term in
Section 4.2(a).
"Code" means the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral" means and includes all of each and every Borrower's and
each and every Guarantor's right, title and interest in and to each of the
following, wherever located and whether now or hereafter existing or now
owned or hereafter acquired or arising:
(a) all Receivables,
(b) all Contract Rights,
(c) all General Intangibles,
(d) the Stock,
(e) all goods and other property (other than truck tractors,
trailers, computer and communications equipment including satellite
tracking equipment), whether or not delivered,
(i) the sale or lease of which gives or purports to give
rise to any Receivable, including, but not limited to, all
merchandise returned or rejected by or repossessed from
customers, or
(ii) securing any Receivable,
including, without limitation, all rights as an unpaid vendor or
lienor (including, without limitation, stoppage in transit, replevin
and reclamation) with respect to such goods and other property,
(f) all mortgages, deeds to secure debt and deeds of trust on
real or personal property, guaranties, leases, security agreements,
and other agreements and property which secure or relate to any
Receivable or other Collateral, or are acquired for the purpose of
securing and enforcing any item thereof,
(g) all documents of title, policies and certificates of
insurance, securities, chattel paper and other documents and
instruments evidencing or pertaining to any and all items of
Collateral,
(h) all files, correspondence, computer programs, tapes, discs
and related data processing software which contain information
identifying or pertaining to any of the Receivables or any Account
Debtor, or showing the amounts thereof or payments thereon or otherwise
necessary or helpful in the realization thereon or the collection
thereof,
(i) all cash deposited with the Agent or any Lender or any
Affiliate of the Agent or any Lender or which the Agent, for the
benefit of the Lenders, or any Lender or such Affiliate is entitled
to retain or otherwise possess as collateral pursuant to the provisions
of this Agreement or any of the Security Documents or any agreement
relating to any Letters of Credit, and
(j) any and all products and proceeds of the foregoing (including),
but not limited to, any claim to any item referred to in this
definition, and any claim against any third party for loss of, damage to
or destruction of any or all of, the Collateral or for proceeds payable
under, or unearned premiums with respect to, policies of insurance) in
whatever form, including, but not limited to, cash, negotiable
instruments and other instruments for the payment of money, chattel
paper, security agreements and other documents.
"Collateral Monitoring Fee" shall have the meaning assigned to such
term in Section 4.2(c).
"Collection Account" means the Agent's account at, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇., ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇; ABA No. ▇▇▇▇▇▇▇▇▇; For the
Account of The CIT Group/Business Credit Account No.144026613; Reference:
Trism Inc.
"Commitment" means, as to each Lender, the amount set forth opposite
such Lender's name on the signature pages hereof, representing such Lender's
obligation, upon and subject to the terms and conditions of this Agreement
(including the applicable provisions of Section 13.1), to make Revolving
Credit Loans and to purchase participations in Letters of Credit or, from
and after the date hereof, in the Register (as defined in Section 13.1(d))
representing such Lender's obligation to make Revolving Credit Loans and to
purchase participations in Letters of Credit.
"Commitment Fee" means the fee paid by the Borrowers to the Agent
pursuant to and in connection with the execution by the Borrowers of the
Commitment Letter.
"Commitment Letter" shall mean the commitment letter dated June 6,
1997 issued by the Agent to, and accepted by, the Borrowers as the same
may be amended prior to the Effective Date.
"Commitment Percentage" means, as to any Lender, the percentage of the
Total Commitment obtained by dividing such Lender's Commitment by the Total
Commitment.
"Consolidated Balance Sheet" shall mean a consolidated balance sheet
for the Borrowers and the consolidated Subsidiaries of each of the Borrowers,
eliminating all inter-Borrower transactions and prepared in accordance with
GAAP.
"Consolidating Balance Sheet" shall mean a Consolidated Balance Sheet
plus individual balance sheets for each Borrower listed on Schedule 1.1 and
the consolidated subsidiaries of each such Borrower, showing all eliminations
of inter-Borrower transactions and prepared in accordance with GAAP and
including a balance sheet for each such Borrower exclusively.
"Contaminant" means any waste, pollutant, hazardous substance, toxic
substance, hazardous waste, special waste, petroleum or petroleum-derived
substance or waste, or any constituent of any such substance or waste.
"Contracts" shall mean all "contracts," as such term is defined in the
Uniform Commercial Code, now owned or hereafter acquired by any Borrower, in
any event, including all contracts, undertakings, or agreements (other than
rights evidenced by chattel paper, documents or instruments as such terms
are defined in the Uniform Commercial Code) in or under which any Borrower
may now or hereafter have any right, title or interest, including any
agreement relating to the terms of payment or the terms of performance of
any Receivable.
"Contract Rights" means and includes, as to any Person, all of such
Person's then owned or existing and future acquired or arising rights under
contracts not yet earned by performance and not evidenced by an instrument
or chattel paper, to the extent that the same may lawfully be assigned.
"Controlled Disbursement Account" means one or more accounts
maintained by and in the name of the Borrowers with a Disbursing Bank for
the purposes of disbursing Revolving Credit Loan proceeds and amounts
deposited thereto.
"Default" means any of the events specified in Section 12.1 which with
the passage of time or giving of notice or both would constitute an Event
of Default.
"Default Margin" means 2.0% per annum.
"Disbursing Bank" means any commercial bank with which a Controlled
Disbursement Account is maintained after the Effective Date.
"Dollar" and "$" means freely transferable United States dollars.
"EBITDA" means, for any period, an amount equal to the Borrowers'
aggregate consolidated Net Income from recurring operations, excluding
extraordinary items, plus Interest Expense, depreciation and amortization
expense, and taxes.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
in effect from time to time, and any successor statute.
"Early Termination Date" shall mean the date on which the Borrowers
terminate this Agreement or the Revolving Credit Facility, which date is
prior to the Initial Anniversary Date.
"Early Termination Fee" shall mean the fee the Agent, on behalf of
the Lenders, is entitled to charge the Borrowers, in the event any of the
Borrowers terminates the Revolving Credit Facility or this Agreement on a
date prior to the Initial Anniversary Date, and shall be an amount equal to
(a) the Revolving Credit Facility multiplied by (b) (i) one and one-half
percent (1.50%), if any of the Borrowers terminate this Agreement within the
first year thereof; (ii) one percent (1%), if any of the Borrowers
terminate this Agreement within the second year thereof; and (iii) one-half
percent (.50%), if any of the Borrowers terminate this Agreement within the
third year thereof.
"Effective Date" means the later of (a) the Agreement Date, and (b)
the first date on which all of the conditions set forth in Article 5 shall
have been fulfilled.
"Effective Interest Rate" means each rate of interest per annum on the
Revolving Credit Loans in effect from time to time pursuant to the
provisions of Section 4.1.
"Eligible Assignee" means (i) a commercial bank organized under the
laws of the United States, or any State thereof, having total assets in
excess of $1,000,000,000.00 or any commercial finance or asset based
lending affiliate of any such commercial bank; (ii) a savings and loan
association or savings bank organized under the laws of the United States,
or any State thereof, having a net worth of at least $250,000,000.00
calculated in accordance with GAAP; and (iii) any Lender listed on the
signature page of this Agreement; provided in each case that the
representation contained in Sections 13.1(c)(i) and 13.2 hereof shall be
applicable with respect to such institution or Lender.
"Eligible Receivable" means the unpaid portion of a Receivable payable
in Dollars to an Operating Company net of any returns, discounts, claims,
credits, charges or other allowances, offsets, deductions, counterclaims,
disputes or other defenses and reduced by the aggregate amount of all
reserves, limits and deductions provided for in this definition which is
deemed by the Agent in its reasonable credit judgment to be eligible for
inclusion in the calculation of the Borrowing Base. Unless otherwise
approved in writing by the Agent, no Receivable shall be deemed an
Eligible Receivable unless it meets all of the following requirements:
(a) such Receivable is owned by an Operating Company and represents a
complete bona fide transaction which requires no further act under any
circumstances on the part of such Operating Company to make such Receivable
payable by the Account Debtor; (b) such Receivable is not unpaid more than
90 days after the date of the original invoice or past due more than
75 days after its due date; (c) such Receivable does not arise out of any
transaction with any Subsidiary or Affiliate of an Operating Company; (d)
such Receivable is not owing by an Account Debtor more than 50% of whose
then-existing accounts owing to an Operating Company do not meet the
requirements set forth in clause b above; (e) if the Account Debtor with
respect thereto is located outside of the United States of America, Canada
or the United Kingdom (a "Foreign Receivable"), the transportation services
which gave rise to such Receivable were rendered after receipt by an
Operating Company from the Account Debtor of an irrevocable letter of
credit that has been confirmed by a financial institution acceptable to the
Agent and is in form and substance acceptable to the Agent, payable in the
full face amount of the face value of the Receivable in Dollars at a place
of payment located within the United States and has been duly delivered to
the Agent (an "L/C Backed Foreign Receivable"); provided that the
Operating Companies may include in Eligible Receivables, in the aggregate,
an amount of up to $500,000 of Foreign Receivables which are not L/C Backed
Foreign Receivables; (f) if such Receivable is subject to the Assignment of
Claims Act of 1940, as amended from time to time, or any applicable law now
or hereafter existing similar in effect thereto, as determined in the sole
discretion of the Agent, or to any provision prohibiting its assignment or
requiring notice of or consent to such assignment that, upon the request of
the Agent pursuant to Section 8.12 or otherwise, an Operating Company
promptly complies with the requirements of Section 8.12; (g) the Account
Debtor with respect to such Receivable is not insolvent or the subject of
any bankruptcy or insolvency proceedings of any kind or of any other
proceeding or action, threatened or pending, which might, in the Agent's
reasonable credit judgment, have a Materially Adverse Effect on such
Account Debtor; (h) excluding any Receivable owing by any agency or
department of the federal government, such Receivable is not owing by an
Account Debtor, who or along with a group of affiliated Account Debtors
has then-existing accounts owing to an Operating Company which exceed in
face amount 15% of such Operating Company's total Eligible Receivables; (i)
if such Receivable is a Billed Receivable, it is evidenced by an invoice or
other documentation in a form acceptable to the Agent containing only terms
normally offered by an Operating Company, (j) if such Receivable is an
Unbilled Receivable, then no more than fifteen (15) days have elapsed from
the earlier of the date on which (i) such Receivable was created or arose,
(ii) such sale was made or service performed, or (iii) such Receivable could
have been invoiced by the Operating Company; (k) such Receivable is a valid,
legally enforceable obligation of the Account Debtor with respect thereto
and is not subject to any present, or contingent (and no facts (i) exist to
the knowledge of an Operating Company, or (ii) have been disclosed in the
course of any audit, which are the basis for any future), offset, deduction
or counterclaim, dispute or other defense on the part of such Account Debtor;
(l) such Receivable is not evidenced by chattel paper or an instrument of
any kind; (m) such Receivable does not arise out of a rebill or advertising
▇▇▇▇; (n) such Receivable is subject to the Security Interest, which is
perfected as to such Receivable, and is subject to no other Lien whatsoever
other than a Permitted Lien; and (o) any other requirements deemed necessary
by the Agent in its reasonable business judgment and which are customary
either in the commercial finance industry or in the lending practices of
the Agent or the Lenders.
"Environmental Laws" means all federal, state, local and foreign laws
now or hereafter in effect relating to pollution or protection of the
environment, including laws relating to emissions, discharges, Releases or
threatened Releases of pollutants, Contaminants, chemicals, or industrial,
toxic or hazardous substances or wastes into the environment (including,
without limitation, ambient air, surface water, ground water, or land), or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, removal, transport, or handling of pollutants,
Contaminants, chemicals, or industrial, toxic or hazardous substances or
wastes, and any and all regulations, notices or demand letters issued,
entered, promulgated or approved thereunder; such laws and regulations
include but are not limited to the Resource Conservation and Recovery Act,
42 U.S.C. 6901 et seq., as amended; the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. 6901 et seq., as amended; the
Toxic Substances Control Act, 15 U.S.C. 2601 et seq., as amended; the Clean
Air Act, 46 U.S.C. 7401 et seq., as amended; and state and federal lien and
environmental cleanup programs.
"Environmental Lien" means a Lien in favor of any governmental entity
for (a) any liability under Environmental Laws or (b) damages arising from,
or costs incurred by such governmental entity in response to, a Release or
threatened Release of Contaminant into the environment.
"Environmental Liabilities" shall mean, with respect to any Person, all
liabilities, obligations, responsibilities, response, remedial and removal
costs, investigation and feasibility study costs, capital costs, operation
and maintenance costs, losses, damages, punitive damages, property damages,
natural resource damages, consequential damages, treble damages, costs and
expenses (including all fees, disbursements and expenses of counsel, experts
and consultants), fines, penalties, sanctions and interest incurred as a
result of or related to any claim, suit, action, investigation, proceeding
or demand by any Person, whether based in contract, tort, implied or express
warranty, strict liability, criminal or civil statute or common law,
including any arising under or related to any Environmental Laws,
Environmental Permits, or in connection with any Release or threatened
Release or presence of a Hazardous Material whether on, at, in, under,
from or about or in the vicinity of any real or personal property.
"Environmental Permits" shall mean all permits, licenses,
authorizations, certificates, approvals, registrations or other written
documents required by any Governmental Authority under any Environmental
Laws.
"Event of Default" means any of the events specified in Section 12.1,
provided that any requirement for notice or lapse of time or any other
express condition has occurred or been satisfied.
"Financial Officer" means the chief financial officer, Treasurer or
Controller of a Borrower.
"Financing Statements" means all Uniform Commercial Code financing
statements required by Agent and executed by a Borrower, in form and
substance satisfactory to the Agent.
"Fiscal Month" shall mean each calendar month during the Fiscal Year.
"Fiscal Quarter" shall mean each three (3) month period ended March 31,
June 30, September 30 and December 31 of each year.
"Fiscal Year" shall mean each twelve (12) month period commencing on
January 1 of each year and ending on the following December 31.
"Fixed Charge Coverage Ratio" shall mean, for the relevant period,
the ratio determined by dividing an amount equal to (a)(i) the sum of (A)
EBITDA and (B) all amounts paid and accrued with respect to Operating
Leases and which were deducted as operating expenses in calculating EBITDA
less (ii) the sum of (A) all federal, state and local income tax expenses
paid and accrued and (B) Unfunded Capital Expenditures, by (b) the sum of
(i) scheduled payments of principal with respect to Indebtedness, (ii) all
Interest Expense, (iii) all amounts paid and accrued with respect to
Operating Leases and which were deducted as operating expenses in
calculating EBITDA and (iv) all payments with respect to Capitalized Leases
less the portions, if any, of Residual Value Payments relating thereto which
were satisfied by means other than payment in cash or by check or wire
transfer.
"GAAP" means generally accepted accounting principles consistently
applied and maintained throughout the period indicated and consistent
with the prior financial practice of the Person referred to.
"General Intangibles" means, as to any Person, all of such Person's
then owned or existing and future acquired or arising general intangibles,
choses in action and causes of action and all other intangible personal
property of such Person of every kind and nature (other than Receivables),
including, without limitation, Intellectual Property, corporate or other
business records, inventions, designs, blueprints, plans, specifications,
trade secrets, goodwill, computer software, customer lists, licenses,
franchises, tax refund claims, reversions or any rights thereto and any
other amounts payable to such Person from any Benefit Plan, Multiemployer
Plan or other employee benefit plan, rights and claims against carriers and
shippers, rights to indemnification, business interruption insurance
proceeds thereof, property, casualty or any similar type of insurance and
any proceeds thereof, any letter of credit, guarantee, claims, security
interest or other security held by or granted to such Person to secure
payment by an Account Debtor of any of the Receivables.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to,
all governmental bodies, whether federal, state, local or foreign national
or provincial and all agencies thereof.
"Governmental Authority" shall mean any nation or government, any state
or other political subdivision thereof, and any agency, department or other
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Guarantor" shall mean each of TRISM Maintenance Services, Inc., EFB,
Inc., Transportation Recovery Systems, Inc., TRISM Equipment, Inc. and
TRISM Benefits, Inc., and "Guarantors" shall collectively refer to all
of the above-listed entities.
"Guaranty Agreement" means the Guaranty dated as of the Effective Date,
executed by the Guarantors in favor of the Agent, for the benefit of the
Lenders, as amended, modified or supplemented from time to time.
"Guaranty," "Guaranteed" or to "Guarantee" as applied to any
obligation of another Person shall mean and include
(a) a guaranty (other than by endorsement of negotiable instruments
for collection in the ordinary course of business), directly or indirectly,
in any manner, of any part or all of such obligation of such other Person,
and
(b) an agreement direct or indirect, contingent or otherwise, and
whether or not constituting a guaranty, the practical effect of which is
to assure the payment or performance (or payment of damages in the event of
nonperformance) of any part or all of such obligation of such other Person
whether by (i) the purchase of securities or obligations, (ii) the purchase,
sale or lease (as lessee or lessor) of property or the purchase or sale of
services primarily for the purpose of enabling the obligor with respect to
such obligation to make any payment or performance (or payment of damages in
the event of nonperformance) of or on account of any part or all of such
obligation or to assure the owner of such obligation against loss, (iii)
the supplying of funds to, or in any other manner investing in, the
obligor with respect to such obligation, (iv) repayment of amounts drawn
down by beneficiaries of letters of credit, or (v) the supplying of funds
to or investing in a Person on account of all or any part of such Person's
obligation under a guaranty of any obligation or indemnifying or holding
harmless, in any way, such Person against any part or all of such obligations.
"Indebtedness" of any Person means, without duplication, (a)
Liabilities, (b) all obligations for money borrowed or for the deferred
purchase price of property or services or in respect of Reimbursement
Obligations under letters of credit, (c) all obligations represented by
bonds, debentures, notes and accepted drafts that represent extensions of
credit, (d) Capitalized Lease Obligations, (e) all obligations (including,
during the noncancelable term of any lease in the nature of a title
retention agreement, all future payment obligations under such lease
discounted to their present value in accordance with GAAP) secured by any
Lien to which any property or asset owned or held by such Person is subject,
whether or not the obligation secured thereby shall have been assumed by
such Person, (f) all obligations of other Persons which such Person has
Guaranteed, including, but not limited to, all obligations of such Person
consisting of recourse liability with respect to accounts receivable sold
or otherwise disposed of by such Person, and (g) in the case of the
Borrower (without duplication) the Loans.
"Initial Anniversary Date" shall mean the third anniversary of the
Effective Date.
"Intellectual Property" means, as to any Person, all of such Person's
then owned existing and future acquired or arising patents, patent rights,
copyrights, works which are the subject of copyrights, trademarks, service
marks, trade names, trade styles, patent, trademark and service ▇▇▇▇
applications, and all licenses and rights related to any of the foregoing
and all other rights under any of the foregoing, all extensions, renewals
reissues, divisions, continuations and continuations-in-part of any of the
foregoing and all rights to ▇▇▇ for past, present and
future infringements of any of the foregoing.
"Interest Expense" means the interest on Indebtedness during the period
for which computation is being made, excluding (a) the amortization of fees
and costs incurred with respect to the closing of loans which have been
capitalized as transaction costs, and (b) interest paid in kind.
"Interest Payment Date" means the first (1st) day of each calendar
month commencing on August 1, 1997 and continuing thereafter until the
Secured Obligations have been irrevocably paid in full.
"Investment" means, with respect to any Person: (a) the direct or
indirect purchase or acquisition of any beneficial interest in, any share
of capital stock of, evidence of Indebtedness of or other security issued
by any other Person, (b) any loan, advance or extension of credit to, or
contribution to the capital of, any other Person, excluding advances to
employees in the ordinary course of business for business expenses, (c) any
Guaranty of the obligations of any other Person, or (d) any commitment or
option to take any of the actions described in clauses (a), (b) or (c) above.
"IRS" means the Internal Revenue Service.
"Issuing Bank" means any banking institution which is an issuer of a
Letter of Credit and its successors and assigns hereunder.
"Lender" means at any time any financial institution party to this
agreement at such time, including any such Person becoming a party hereto
pursuant to the provisions of Article 13, and its successors and assigns,
and "Lenders" means at any time all of the financial institutions party to
this Agreement at such time, including any such Persons becoming parties
hereto pursuant to the provisions of Article 13, and their successors and
assigns.
"Letter of Credit" means any Letter of Credit issued by an Issuing
Bank for the account of a Borrower pursuant to Article 3.
"Letter of Credit Amount" means, with respect to any Letter of Credit,
the aggregate maximum amount at any time available for drawing under such
Letter of Credit.
"Letter of Credit Facility" means the amount of $15,000,000.
"Letter of Credit Obligations" means, at any time, the sum of (a) the
aggregate Reimbursement Obligations of the Borrowers at such time, plus (b)
the aggregate Letter of Credit Amount of Letters of Credit outstanding at
such time, plus (c) the aggregate Letter of Credit Amount of Letters of
Credit the issuance of which has been authorized by the Agent and the
Issuing Lender pursuant to Section 3.1 but that have not yet been issued,
in each case as determined by the Agent.
"Letter of Credit Reserve" means, at any time, the aggregate Letter of
Credit Obligations at such time, excluding Letter of Credit Obligations that
are fully secured by Cash Collateral; provided that upon satisfaction of the
Mortgaged Real Estate Conditions, the amount of the Letter of Credit Reserves
for purposes of the calculation of the Borrowing Base shall be equal to (x)
the aggregate value of all Letter of Credit Obligations outstanding, at such
time, excluding Letter of Credit Obligations that are fully secured by Cash
Collateral less an amount (not less than $0) equal to (y) the lesser of (i)
an amount up to 75% (as determined in the Agent's commercially reasonable
discretion) of the fair market value of the Mortgaged Real Estate as set
forth in the appraisal to be delivered pursuant to the terms of the
Mortgaged Real Estate Conditions or (ii) $6,000,000 (the amount in clause
(y) hereof, referred to herein as the "Mortgaged Real Estate L/C Reserve");
provided further that, commencing September 30, 1997 and on March 31 and
September 30 of each year thereafter during the term hereof (each an
"Amortization Date") the Mortgaged Real Estate L/C Reserve shall be
reduced by the amount of $300,000 on each such Amortization Date.
"Leverage Ratio" means for any fiscal period, the ratio determined by
dividing (i) the Total Liabilities by (ii) the Net Worth.
"Liabilities" means, as at the end of any fiscal period, all
liabilities determined in accordance with GAAP and included on a balance
sheet.
"LIBOR" shall mean at any time of determination, and subject to
availability, for each interest period the higher of the applicable London
Interbank Offered rate paid in London on dollar deposits from other banks
as (x) quoted by Chase Manhattan Bank, N.A., (y) published under "Money
Rates" in the New York City edition of the Wall Street Journal or, if there
is no such publication or statement therein as to LIBOR, then in any
publication used in the New York City financial community or (z) determined
by the Agent based upon information presented on Telerate Systems at Page
3750 as of 11:00 a.m. (London Time).
"LIBOR Loan" shall mean those Revolving Credit Loans for which the
Borrowers have elected to use LIBOR for interest rate computations.
"LIBOR Option" shall have the meaning assigned to such term in
Section 4.1(a)(i).
"LIBOR Period" shall have the meaning assigned to such term in
Section 4.1(a)(i) hereof.
"Lien" as applied to the property of any Person means: (a) any
mortgage, deed to secure debt, deed of trust, lien, pledge, charge, lease
constituting a Capitalized Lease Obligation, conditional sale or other
title retention agreement, or other security interest, security title or
encumbrance of any kind in respect of any property of such Person or upon
the income and profits therefrom, (b) any arrangement, express or implied,
under which any property of such Person is transferred, sequestered or
otherwise identified for the purpose of subjecting the same to the payment
of Indebtedness or performance of any other obligation in priority to the
payment of the general, unsecured creditors of such Person, and (c) the
filing of, or any agreement to give, any financing statement under the UCC
or its equivalent in any jurisdiction.
"Loan" means any Revolving Credit Loan, as well as all such loans
collectively, as the context requires.
"Loan Account" and "Loan Accounts" shall have the meanings ascribed
thereto in SECTION 4.4.
"Loan Documents" means collectively this Agreement, the Notes, the
Security Documents, the Guaranty Agreement, the Pledge Agreement, and each
other instrument, agreement or document executed by the Borrowers, the
Guarantors or any Affiliate or Subsidiary of the Borrowers or the Guarantors
in connection with this Agreement whether prior to, on or after the Effective
Date and each other instrument, agreement or document referred to herein or
contemplated hereby, all in form and substance acceptable to the Agent.
"Lockbox" means each U. S. Post Office Box specified in a Lockbox
Agreement.
"Lockbox Agreement" means each agreement between a Borrower and a
Clearing Bank concerning the establishment of a Lockbox for the
collection of Receivables.
"Margin Stock" means margin stock as defined in Section 221.1(h) of
Regulation U, as the same may be amended or supplemented from time to time.
"Material Intellectual Property" shall mean any Intellectual Property
which is in any manner related to a product or service (or a related group
of products or services) of a Borrower which generates gross revenue to
such Borrower at an annual rate of at least $1,000,000.
"Materially Adverse Effect" means, with respect to any Person, a
materially adverse effect upon such Person's business, assets, liabilities,
condition (financial or otherwise), results of operations or business
prospects, and in addition (i) with respect to a Borrower, includes a
materially adverse effect upon such Borrower's ability to perform its
obligations hereunder or under any other Loan Document to which it is a
party or upon the enforceability of such obligations against such Borrower
and (ii) with respect to a Guarantor, includes a materially adverse effect
upon such Guarantor's ability to perform its obligations under the Guaranty
Agreement, or under any other Loan Document to which it is a party or upon
the enforceability of such obligations against such Guarantor.
"Measurement Period" means, upon and after an Availability Shortfall
during the term hereof the Fiscal Quarter which immediately precedes the
month in which the Availability Shortfall occurs and each Fiscal Quarter
thereafter.
"Minimum Commitment" shall have the meaning ascribed to such term in
Section 13.1(b) hereof.
"Money Borrowed" means, as applied to Indebtedness, (a) Indebtedness
for money borrowed, (b) Indebtedness, whether or not in any such case the
same was for money borrowed, (i) represented by notes payable and drafts
accepted, that represent extensions of credit, (ii) constituting obligations
evidenced by bonds, debentures, notes or similar instruments, or (iii) upon
which interest charges are customarily paid (other than trade Indebtedness)
or that was issued or assumed as full or partial payment for property, (c)
Indebtedness that constitutes a Capitalized Lease Obligation, and
(d) Indebtedness that is such by virtue of clause (f) of the definition
thereof, but only to the extent that the obligations Guaranteed are
obligations that would constitute Indebtedness for Money Borrowed.
"Mortgaged Real Estate" means all real property and improvements owned
by Trism and located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ comprising the
Borrowers' executive officers and principal place of business.
"Mortgaged Real Estate Conditions" shall have the meaning ascribed to
such term in Section 7.3 hereof.
"Mortgages" means and includes any mortgages, deeds of trust, deeds to
secure debt, assignments and other instruments executed and delivered or that
may be executed and delivered by any Borrower to the Agent, for the benefit
of itself and the Lenders, in connection with satisfaction by the
Borrowers of the Mortgaged Real Estate Conditions or otherwise.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which a Borrower or a Related Company is required to
contribute or has contributed within the immediately preceding six years.
"Net Income" or "Net Loss" means, as applied to any Person, the net
income (or net loss) of such Person for the period in question after giving
effect to deduction of or provision for all operating expenses, all taxes
and reserves (including reserves for deferred taxes and all other proper
deductions), all determined in accordance with GAAP, provided that there
shall be excluded: (a) the net income (or net loss) of any Person accrued
prior to the date it becomes a Subsidiary of, or is merged into or
consolidated with, the Person whose Net Income is being determined or a
Subsidiary of such Person, (b) the net income (or net loss) of any Person
in which the Person whose Net Income is being determined or any Subsidiary
of such Person has an ownership interest, except, in the case of net income,
to the extent that any such income has actually been received by such Person
or such Subsidiary in the form of cash dividends or similar distributions,
(c) any restoration of any contingency reserve, except to the extent that
provision for such reserve was made out of income during such period, (d) any
net gains or losses on the sale or other disposition, not in the ordinary
course of business, of Investments, Business Units and other capital assets,
provided that there shall also be excluded any related charges for taxes
thereon, (e) any net gain arising from the collection of the proceeds of any
insurance policy, (f) any write-up of any asset, and (g) any other
extraordinary item.
"Net Outstandings" of any Lender means, at any time, the sum of (a)
all amounts paid by such Lender to the Agent in respect of Revolving Credit
Loans or otherwise under this Agreement, minus (b) all amounts paid by the
Agent to such Lender which are received by the Agent and which, pursuant to
this Agreement, are paid over to such Lender for application in reduction of
the outstanding principal balance of the Revolving Credit Loans or the
Letter of Credit Obligations.
"Net Proceeds" means proceeds received by a Borrower or any of its
Subsidiaries in cash from any Asset Disposition (including, without
limitation, payments under notes or other debt securities received in
connection with any Asset Disposition), net of: (a) the reasonable
transaction costs of such sale, lease, transfer or other disposition;
(b) any tax liability arising solely from such transaction; and (c) amounts
applied to repayment of Indebtedness (other than the Secured Obligations)
secured by a Permitted Lien on the asset or property disposed.
"Net Worth" means, as at the end of any fiscal period, the total
shareholders' equity determined in accordance with GAAP (including
capital stock, additional paid-in capital and retained earnings, after
deducting treasury stock) included on a Consolidated Balance Sheet.
"Non-Ratable Loan" means a Revolving Credit Loan made by the Settlement
Lender in accordance with the provisions of Section 4.7(b)(ii).
"Note" means the Revolving Credit Note and "Notes" means more than
one such Note.
"Operating Companies" shall mean Tri-State Motor Transit Co., Tri-
State Transportation Services, Inc., Diablo Systems Incorporated d/b/a
Diablo Transportation, Inc., Trism Eastern, Inc., d/b/a ▇.▇. ▇▇▇▇▇▇▇
Transfer, Trism Specialized Carriers, Inc., Trism Special Services, Inc.
and Trism Logistics, Inc.
"Operating Lease" shall have the meaning assigned to such term in
Section 11.10 hereof.
"Operating Lease Obligations" means, with respect to an Operating
Lease for any Borrower, as of any date, an amount equal to (a) the monthly
lease payment for such Operating Lease multiplied times (b) the number of
months then remaining in the current term of such Operating Lease.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.
"Permitted Guaranties" means (a) the Guaranty in favor of Agent,
(b) those described on Schedule 6.1(i), and (c) guarantees of Permitted
Obligations.
"Permitted Incremental Obligations" means, for each of the respective
Fiscal Years of the Borrowers ending on December 31, 1997, 1998 and 1999,
an amount equal to (a) $60,000,000 less (b) the sum of (i) all payments
made or scheduled to be made by any Borrower during such Fiscal Year on or
with respect to Purchase Money Indebtedness, Operating Leases and (without
duplication) Indebtedness for Money Borrowed which, in each case, was
incurred by a Borrower prior to the commencement of such Fiscal Year, and
(ii) the aggregate amount of all Unfunded Capital Expenditures by any
Borrower during such Fiscal Year.
"Permitted Investments" means (a) direct obligations of the United
States of America, or any agency, thereof, or obligations guaranteed as to
principal and interest by the United States of America, or any agency
thereof; (b) certificates of deposit issued by any bank or trust company
organized under the laws of the United States of America or any state
thereof and having capital, surplus and undivided profits of at least
Five Hundred Million Dollars ($500,000,000); and (c) commercial paper
rated A-1 or better or P-1 by Standard & Poor's Corporation or ▇▇▇▇▇'▇
Investors Services, Inc. respectively.
"Permitted Liens" means: (a) Liens securing taxes, assessments and
other governmental charges or levies (excluding any Lien imposed pursuant
to any of the provisions of ERISA) or the claims of materialmen, mechanics,
carriers, warehousemen or landlords for labor, materials, supplies or
rentals incurred in the ordinary course of business, but in all cases, only
if payment shall not at the time be required to be made in accordance with
Section 9.6, and (b) Liens consisting of deposits or pledges made in the
ordinary course of business in connection with, or to secure payment of,
obligations under workers' compensation, unemployment insurance or similar
legislation or under surety or performance bonds, in each case arising in
the ordinary course of business; (c) Liens constituting encumbrances in the
nature of zoning restrictions, easements and rights or restrictions of
record on the use of the real estate of a Borrower, which in the reasonable
credit judgment of the Agent do not materially detract from the value of
such real estate or impair the use thereof in such business of such Borrower;
(d) Liens securing Permitted Obligations; (e) Liens of the Agent, for the
benefit of the Lenders, arising under this Agreement and the other Loan
Documents; and (f) Liens arising out of or resulting from any judgment or
award, the time for the appeal or petition for rehearing of which shall not
have expired, or in respect of which a Borrower is fully protected by
insurance or in respect of which such Borrower shall at any time in good
faith be prosecuting an appeal or proceeding for a review and in respect
of which a stay of execution pending such appeal or proceeding for review
shall have been secured, and as to which appropriate reserves have been
established on the books of such Borrower.
"Permitted Obligations" means the aggregate amount of outstanding
Purchase Money Indebtedness, Operating Lease Obligations and Indebtedness
for Money Borrowed which, and only to the extent, is incurred in accordance
with the provisions of this Agreement, including without limitation,
Section 11.2.
"Permitted Existing Indebtedness" means the Indebtedness set forth on
Schedule 6.1(i) hereof.
"Person" means an individual, corporation, partnership, association,
trust or unincorporated organization, or a government or any agency or
political subdivision thereof.
"Plan" means any employee benefit plan as defined in Section 3(3) of
ERISA in respect of which the Borrower or any Related Company is, or with
respect to defined benefit plans (as defined under ERISA) within the
immediately preceding six years was, an "employer" as defined in Section
3(5) of ERISA.
"Pledge Agreement" means the Stock Pledge Agreement dated as of the
Effective Date, among Trism, Trism Secured, Heavy Haul, Transport Services,
TSMT and Specialized and the Agent, for the ratable benefit of the Lenders,
as amended, modified or supplemented from time to time.
"Prime Option" shall have the meaning assigned to such term in
Section 4.1(a)(i).
"Purchase Money Indebtedness" means (a) Indebtedness created to finance
or refinance the payment of all or any part of the lesser of (i) the
purchase price or (ii) the fair market value, of any tangible asset (other
than inventory), and secured only by Purchase Money Liens and (b)
Capitalized Lease Obligations.
"Purchase Money Lien" means any Lien securing Purchase Money
Indebtedness, but only if such Lien shall at all times be confined solely
to the tangible asset (other than inventory) which was financed or
refinanced through the incurrence of the Purchase Money Indebtedness
secured by such Lien.
"Real Estate" means all of each and every Borrower's now or
hereafter owned or leased estates in real property, including, without
limitation, all fees, leaseholds and future interests, together with all of
each and every Borrower's now or hereafter owned or leased interests in the
improvements and emblements thereon, the fixtures attached thereto and the
easements appurtenant thereto, including, without limitation the real
property described on Schedule 6.1(t).
"Receivables" means and includes, as to any Person, all of such
Person's then owned or existing and future acquired or arising (a) rights to
the payment of money or other forms of consideration of any kind (whether
classified under the Uniform Commercial Code as accounts, contract rights,
chattel paper, General Intangibles or otherwise) including, but not limited
to, accounts receivable, letters of credit and the right to receive payment
thereunder, chattel paper, tax refunds, insurance proceeds, Contracts and
Contract Rights, notes, drafts, instruments, documents, acceptances and all
other debts, obligations and liabilities in whatever form from any Person
(other than any of the foregoing relating to the sale of equipment
unless such equipment relates to or was obtained by the Borrowers in
connection with the settlement of a customer Receivable) and
guaranties, security and Liens securing payment thereof and (b) cash and
non-cash proceeds of any of the foregoing.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be amended or
supplemented from time to time.
"Reimbursement Agreement" means, with respect to a Letter of Credit,
such form of application therefor and form of reimbursement agreement
therefor (whether in a single document or several documents) as the
Issuing Bank may employ in the ordinary course of business for its own
account, with such modifications thereto as may be agreed upon by an
Issuing Bank and a Borrower, provided that such application and agreement
and any modifications thereto are not inconsistent with the terms of this
Agreement.
"Reimbursement Obligations" means the reimbursement or repayment
obligations of a Borrower to an Issuing Bank pursuant to Article 3 or
pursuant to a Reimbursement Agreement with respect to amounts that have
been drawn under Letters of Credit.
"Related Company" means, as to any Person, any (a) corporation which
is a member of the same controlled group of corporations (within the meaning
of Section 414(b) of the Code) as such Person, (b) partnership or other
trade or business (whether or not incorporated) under common control (within
the meaning of Section 414(c) of the Code) with such Person, or (c) member
of the same affiliated service group (within the meaning of Section 414(m)
of the Code) as such Person or any corporation described in clause (a) above
or any partnership, trade or business described in clause (b) above.
"Release" means release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the
indoor or outdoor environment or into or out of any property, including the
movement of Contaminants through or in the air, soil, surface water or
groundwater.
"Remedial Action" means actions required to (i) clean up, remove,
treat or in any other way address Contaminants in the indoor or outdoor
environment; (ii) prevent the Release or threat of Release or minimize the
further Release of Contaminants so they do not migrate or endanger or
threaten to endanger public health or welfare or the indoor or outdoor
environment; or (iii) perform pre-remedial studies and investigations and
post-remedial monitoring and care.
"Replacement Letters of Credit" shall have the meaning assigned to
such term in Section 3.3(b) hereof.
"Required Lenders" means, at any time, any combination of Lenders
whose Commitment Percentages at such time aggregate in excess of 66_%.
"Residual Value Payments" means the respective final cash payments
under Capitalized Leases required to be made to the lessors by the
Borrowers upon the termination of such Capitalized Leases.
"Restricted Distribution" by any Person means (a) its retirement,
redemption, purchase, or other acquisition for value of any capital stock
or other equity securities or partnership interests issued by such Person,
(b) the declaration or payment of any dividend or distribution on or with
respect to any such securities or partnership interests, (c) any loan or
advance by such Person to, or other investment by such Person in, the holder
of any of such securities or partnership interests, and (d) any other
payment by such Person in respect of such securities or partnership interests.
"Restricted Payment" means (a) any redemption, repurchase or prepayment
or other retirement, prior to the stated maturity thereof or prior to the
due date of any regularly scheduled installment or amortization payment with
respect thereto, of any Indebtedness of a Person (other than the Secured
Obligations and trade debt), and (b) the payment by any Person of the
principal amount of or interest on any Indebtedness (other than trade debt)
owing to an Affiliate of such Person.
"Revolving Credit Facility" means the amount equal to the lesser of
(i) the principal amount of $45,000,000, or (ii) the sum of 85% of Eligible
Accounts Receivables (as that term is defined in the Subordinated Indenture).
"Revolving Credit Loans" means the aggregate outstanding amount of the
Loans made to the Borrowers, from time to time, pursuant to Section 2.1.
"Revolving Credit Note" means each Revolving Credit Note made by the
Borrowers payable to the order of a Lender evidencing the obligation of the
Borrowers to pay the aggregate unpaid principal amount of the Revolving
Credit Loans made to it by such Lender (and any promissory note or notes
that may be issued from time to time in substitution, renewal, extension,
replacement or exchange therefor whether payable to such Lender or to a
different Lender in connection with a Person becoming a Lender after the
Effective Date or otherwise) substantially in the form of Exhibit A hereto,
with all blanks properly completed, either as originally executed or as the
same may from time to time be supplemented, modified, amended, renewed,
extended or refinanced,
"Schedule of Receivables" means a schedule delivered by the Borrowers
to the Agent, from time to time, pursuant to the provisions of Section 8.11
setting forth a detailed aged trial balance of all the then existing
Receivables, specifying the name of each Account Debtor and balance due
from (and any rebate due to) each Account Debtor obligated on a
Receivable so listed.
"Secured Obligations" means, in each case whether now in existence or
hereafter arising, (a) the principal of, and interest and premium, if any,
on, the Loans, (b) the Reimbursement Obligations and all other obligations
of any Borrower to the Agent or any Lender arising in connection with
the issuance of Letters of Credit, and (c) all indebtedness, liabilities,
obligations, covenants and duties of any Borrower to the Agent or to the
Lenders of every kind, nature and description arising under or in respect
of this Agreement, the Notes or any of the other Loan Documents, whether
direct or indirect, absolute or contingent, due or not due, contractual or
tortious, liquidated or unliquidated, and whether or not evidenced by any
note, and whether or not for the payment of money, including without
limitation, fees required to be paid pursuant to Article 4 and expenses
required to be paid or reimbursed pursuant to Section 15.2.
"Security Documents" means each of the following:
(a) the Mortgage, relating to the property located at ▇▇▇▇▇ Road,
Kennesaw, Georgia,
(b) the Financing Statements,
(c) the Guaranty Agreement,
(d) the Pledge Agreement,
(e) the Trademark Security Agreement, and
(f) each other writing executed and delivered by a Borrower
or any other Person securing the Secured Obligations.
"Security Interest" means the valid and perfected first priority Liens
of the Agent, for the benefit of the Lenders, on and in the Collateral
effected hereby or by any of the Security Documents or pursuant to the terms
hereof or thereof.
"Settlement Date" means each Business Day after the Effective Date
selected by the Agent in its sole discretion subject to and in accordance
with the provisions of Section 4.7(b)(i) as of which a Settlement Report is
delivered by the Agent and on which settlement is to be made among the
Lenders in accordance with the provisions of Section 4.7.
"Settlement Lender" means, for the purposes of Section 4.7, the Agent
in its capacity as a Lender.
"Settlement Report" means each report, substantially in the form
attached hereto as Exhibit E, prepared by the Agent and delivered to each
Lender and setting forth, among other things, as of the Settlement Date
indicated thereon and as of the next preceding Settlement Date, the
aggregate principal balance of all Revolving Credit Loans outstanding,
each Lender's Commitment Percentage thereof, each Lender's Net Outstandings
and all Non-Ratable Loans made, and all payments of principal, interest and
fees received by the Agent from the Borrower during the period beginning on
such next preceding Settlement Date and ending on such Settlement Date.
"Stock" shall mean all of the issued and outstanding stock of all of
the direct and indirect Subsidiaries of Trism, which Stock will be pledged
as Collateral for the Loans.
"Subordinated Indebtedness" means the Indebtedness evidenced by the
Subordinated Indenture.
"Subordinated Indenture" shall mean that certain Indenture, dated as
of December 15, 1993, between Trism, as Issuer, First Trust National
Association, as Trustee, and certain of the Borrowers, as Guarantors,
relating to the sale of $100,000,000 of Trism's 10 3/4% Senior Subordinated
Notes due 2000, as supplemented or amended from time to time.
"Subsidiary"
(a) when used to determine the relationship of a
Person to another Person, means a Person of which an
aggregate of 50% or more of the stock of any class or
classes or 50% or more of other ownership interests is owned
of record or beneficially by such other Person, or by one or
more Subsidiaries of such other Person, or by such other
Person and one or more Subsidiaries of such Person,
(i) if the holders of such stock, or other
ownership interests, (A) are ordinarily, in the absence
of contingencies, entitled to vote for the election of
a majority of the directors (or other individuals
performing similar functions) of such Person, even
though the right so to vote has been suspended by the
happening of such a contingency, or (B) are entitled,
as such holders, to vote for the election of a majority
of the directors (or individuals performing similar
functions) of such Person, whether or not the right so
to vote exists by reason of the happening of a
contingency, or
(ii) in the case of such other ownership
interests, if such ownership interests constitute a
majority voting interest, and
(b) when used with respect to a Plan, ERISA or a
provision of the Code pertaining to employee benefit plans,
also means any corporation, trade or business (whether or
not incorporated) which is under common control with a
Borrower and is treated as a single employer with such
Borrower under Section 414(b) or (c) of the Code and the
regulations thereunder.
"Syndication Fee" shall have the meaning assigned to
such term in Section 4.2(b).
"Termination Date" means the date, which date shall be
the Initial Anniversary Date or an Anniversary Date occurring
thereafter and shall occur only upon ninety (90) days prior
written notice by the terminating party (any of the Agent, a
Lender or a Borrower) unless a Borrower terminates this Agreement
on a date prior to the Initial Anniversary Date and then only
upon payment of the Early Termination Fee by the Borrowers, on
which all Secured Obligations shall have been irrevocably paid in
full and the Revolving Credit Loans shall have been terminated
pursuant to the terms hereof.
"Termination Event" means (a) a "Reportable Event" as
defined in Section 4043(b) of ERISA, but excluding any such event
as to which the provision for 30 days' notice to the PBGC is
waived under applicable regulations, (b) the filing of a notice
of intent to terminate a Benefit Plan or the treatment of a
Benefit Plan amendment as a termination under Section 4041 of
ERISA, or (c) the institution of proceedings to terminate a
Benefit Plan by the PBGC under Section 4042 of ERISA or the
appointment of a trustee to administer any Benefit Plan.
"Total Facilities" means the aggregate of the Revolving
Credit Facility.
"Total Liabilities" means, as at the end of any fiscal
period, total Liabilities determined in accordance with GAAP,
included on the latest Consolidated Balance Sheet.
"Trademark Security Agreement" means the Assignment of
Security Interest in Trademarks, dated on or about the Effective
Date, by a Borrower to the Agent, for the benefit of the Lenders,
as the same may be amended, modified or supplemented from time to
time.
"Trism" shall have the meaning ascribed to such term in
the preamble hereof.
"Unbilled Eligible Receivables" shall mean the
aggregate amount of Eligible Receivables representing amounts for
which the services related thereto have been performed by an
Operating Company but for which no invoice has been rendered to
the customers.
"Unfunded Capital Expenditures" means Capital
Expenditures which are paid for by a Person other than with the
proceeds of Indebtedness for Money Borrowed (other than the
Loans) incurred to finance such Capital Expenditures and other
than those represented by Capitalized Lease Obligations.
"Unfunded Vested Accrued Benefits" means with respect
to any Plan at any time, the amount (if any) by which
(a) the present value of all vested nonforfeitable
benefits under such Plan exceeds
(b) the fair market value of all Plan assets allocable
to such benefits, all determined as of the then most recent
valuation date for such Plan.
"Uniform Commercial Code" means the Uniform Commercial
Code as in effect from time to time in the State of Georgia.
"Unused Line Fee" shall have the meaning assigned to
such term in Section 4.2(d).
SECTION 1.2 Other Referential Provisions.
(1) All defined terms in this Agreement, the Exhibits and
Schedules hereto shall have the same meanings when used in any
other Loan Document, unless the context shall require otherwise.
(2) Except as otherwise expressly provided herein, all
accounting terms not specifically defined or specified herein
shall have the meanings generally attributed to such terms under
GAAP including, without limitation, applicable statements and
interpretations issued by the Financial Accounting Standards
Board and bulletins, opinions, interpretations and statements
issued by the American Institute of Certified Public Accountants
or its committees.
(3) All personal pronouns used in this Agreement, whether used
in the masculine, feminine or neuter gender, shall include all other genders;
the singular shall include the plural, and the plural shall include the
singular. In any circumstance where use of the term "Borrower" as opposed
to the term "Borrowers," or vice versa, would limit, diminish or otherwise
impair or negatively affect any of Lenders' rights hereunder, the plural
shall be substituted for the singular, or vice versa, in such manner as will
result in the maintenance or enlargement of Lenders' rights hereunder or
pursuant hereto. By way of example, but not in limitation, if a reference
to "Borrowers' property" would otherwise be construed as referring only to
property which is jointly owned by all Borrowers, such reference shall
instead be construed as referring to the aggregate total of all of each
Borrower's property.
(4) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provisions of this
Agreement.
(5) Titles of Articles and Sections in this Agreement are for
convenience only, do not constitute part of this Agreement and neither
limit nor amplify the provisions of this Agreement, and all references in
this Agreement to Articles, Sections, Subsections, paragraphs, clauses,
subclauses, Schedules or Exhibits shall refer to the corresponding
Article, Section, Subsection, paragraph, clause or subclause of, or
Schedule or Exhibit attached to, this Agreement, unless specific reference
is made to the articles, sections or other subdivisions or divisions
of, or to schedules or exhibits to, another document or instrument.
(6) Each definition of a document in this Agreement shall include
such document as amended, modified, supplemented or restated from time
to time in accordance with the terms of this Agreement.
(7) Except where specifically restricted, reference to a party
to a Loan Document includes that party and its permitted
successors and assigns permitted hereunder or under such Loan
Document.
(8) Unless otherwise specifically stated, whenever a time is
referred to in this Agreement or in any other Loan Document, such
time shall be the local time in the city in which the principal
office of Agent is located.
(9) Whenever the phrase "to the knowledge of a Borrower" or
words of similar import relating to the knowledge of a Borrower are used
herein, such phrase shall mean and refer to (i) the actual knowledge of
the President or chief financial officer or (ii) the knowledge that such
officers would have obtained if they had engaged in good faith in the
diligent performance of their duties, including the making of such
reasonable specific inquiries as may be necessary of the appropriate persons
in a reasonable credit judgment attempt to ascertain the accuracy of the
matter to which such phrase relates.
(10) The terms accounts, chattel paper, documents, equipment,
instruments, general intangibles and inventory, as and when used
(without being capitalized) in this Agreement or the Security
Documents, shall have the meanings given those terms in the
Uniform Commercial Code.
SECTION 1.3 Exhibits and Schedules. All Exhibits and
Schedules attached hereto are by reference made a part hereof.
ARTICLE 2
REVOLVING CREDIT LOANS
SECTION 1.4 Revolving Credit Loans. Upon the terms and
subject to the conditions of, and in reliance upon the representations and
warranties made under, this Agreement, each Lender agrees, severally, but
not jointly, to make Revolving Credit Loans to the Borrowers from time to
time from the Effective Date to but not including the Termination Date, as
requested or deemed requested by a Borrower in accordance with the terms of
Section 2.2, in amounts equal to such Lender's Commitment Percentage of each
such Loan requested or deemed requested hereunder up to an aggregate
amount at any one time outstanding equal to such Lender's Commitment
Percentage of the Borrowing Base; provided, however, that the aggregate
principal amount of all outstanding Revolving Credit Loans (after giving
effect to the Loans requested) shall not exceed the Borrowing Base. It is
expressly understood and agreed that the Lenders may and at present intend
to use the Borrowing Base as a maximum ceiling on Revolving Credit Loans to
the Borrower; provided, however, that it is agreed that should the
Revolving Credit Loans exceed the ceiling so determined or any other
limitation set forth in this Agreement, such Revolving Credit Loans shall
nevertheless constitute Secured Obligations and, as such, shall be entitled
to all benefits thereof and security therefor. The principal amount of
any Revolving Credit Loan which is repaid pursuant to Section 2.3(c) may be
reborrowed by the Borrower, subject to the terms and conditions of this
Agreement, in accordance with the terms of this Section 2.1. The Agent's
and each Lender's books and records reflecting the date and the amount of
each Revolving Credit Loan and each repayment of principal thereof
shall constitute prima facie evidence of the accuracy of the information
contained therein, subject to the
provisions of Section 4.7.
SECTION 1.5 Manner of Borrowing Revolving Credit Loans.
Borrowings under the Revolving Credit Facility shall be made as
follows:
(1) Requests for Borrowing. A request for a borrowing shall be
made, or shall be deemed to be made, in the following manner:
(1) with respect to Revolving Credit Loans, a Financial Officer
of Trism (or another authorized officer designated by a Financial
Officer and listed on Schedule 2.2 hereto) shall give the Agent
notice, in the form of Exhibit B hereto, for and on behalf of the
Borrowers not later than 1:00 p.m. (New York time) on the
Business Day of the proposed Advance, of its intention to borrow,
specifying the amount of the proposed borrowing, the proposed
borrowing date and which notice shall be given in accordance with
the provisions of Section 4.1 hereof; provided, however, that
upon written notice from Agent, Borrowers shall thereafter
include in each such notice of a proposed Advance the amount of
Borrowing Base Availability after giving effect to such requested
Advance,
(2) unless payment is otherwise made by the Borrowers, the
becoming due of any amount required to be paid under this
Agreement or any of the Notes as interest shall be deemed to be a
request for an Advance on the due date in the amount required to
pay such interest,
(3) unless payment is otherwise made by the Borrowers, the
becoming due of any other Secured Obligation shall be deemed to
be a request for an Advance on the due date in the amount then so
due, and such request shall be irrevocable,
(4) the receipt by the Agent of notification from the Issuing
Bank to the effect that a drawing has been made under a Letter of
Credit and that a Borrower has failed to reimburse the Issuing
Bank therefor in accordance with the terms of the Letter of
Credit, the Reimbursement Agreement and Article 3, shall be
deemed to be a request for an Advance on the date such
notification is received in the amount of such drawing which is
so unreimbursed; and
(5) unless payment is otherwise made by a Borrower, the receipt
by Agent of a demand for reimbursement by a Clearing Bank
pursuant to the provisions of any Agency Account Agreement, shall
be deemed to be a request for an Advance on the date any such
demand is received by Agent in the amount set forth therein;
(1) Unless the Agent has elected periodic settlements pursuant
to Section 4.7, the Agent shall promptly notify the Lenders
of any notice of borrowing given or deemed given pursuant to
this Section 2.2(a) by 2:00 p.m. (New York time) on the
proposed borrowing date with respect to any Advance. The
notice from the Agent to the Lenders shall set forth the
information contained in the Borrowers' notice of borrowing.
Not later than 3:30 p.m. (New York time) on the proposed
borrowing date, each Lender will make available to the
Agent, for the account of the Borrowers, at the Agent's
Office in funds immediately available to the Agent, an
amount equal to such Lender's Commitment Percentage of the
Revolving Credit Loans to be made on such borrowing date.
(2) Disbursement of Loans. The Borrowers, jointly and
severally, hereby irrevocably authorize the Agent to disburse the
proceeds of each borrowing requested, or deemed to be requested,
pursuant to this Section 2.2 as follows:
(1) the proceeds of each borrowing requested under Sections
2.2(a)(i) or (ii) shall be disbursed by the Agent in Dollars in
immediately available funds, (A) in the case of the initial
borrowing, in accordance with notice from the Borrowers to the
Agent referred to in Section 5.1(c)(xi), and (B) in the case of
each subsequent borrowing, by wire transfer to a Controlled
Disbursement Account or, in the absence of a Controlled
Disbursement Account, by wire transfer to such other account as
may be agreed upon by the Borrowers and the Agent from time to
time,
(2) the proceeds of each borrowing deemed requested under
Section 2.2 (a)(iii) or (iv) shall be disbursed by the Agent by
way of direct payment of the relevant interest or Secured
Obligation, as the case may be, and
(3) the proceeds of each borrowing deemed requested under
Section 2.2(a)(iv) shall be disbursed by the Agent directly to
the Issuing Bank on behalf of the Borrowers.
SECTION 1.6 Repayment of Revolving Credit Loans. The
Revolving Credit Loans will be repaid as follows:
(1) Whether or not any Default or Event of Default has occurred,
the outstanding principal amount of all the Revolving Credit
Loans is due and payable, and shall be repaid by the Borrowers in
full, not later than the Termination Date;
(2) If at any time the aggregate outstanding unpaid principal
amount of the Revolving Credit Loans exceeds the Borrowing Base
in effect at such time, the Borrowers shall repay the Revolving
Credit Loans in an amount sufficient to reduce the aggregate
unpaid principal amount of such Revolving Credit Loans by an
amount equal to such excess, together with accrued and unpaid
interest on the amount so repaid to the date of repayment; and
(3) The Borrowers hereby instruct the Agent to repay the
Revolving Credit Loans outstanding on any day in an amount equal
to the amount received by the Agent on such day pursuant to
Section 8.1(b).
SECTION 1.7 Revolving Credit Note. Each Lender's Revolving
Credit Loans and the obligation of the Borrowers to repay such
Revolving Credit Loans shall also be evidenced by a Revolving
Credit Note payable to the order of such Lender. Each Revolving
Credit Note shall be dated the Effective Date and be duly and
validly executed and delivered by the Borrowers.
ARTICLE 3
LETTER OF CREDIT FACILITY
SECTION 1.8 Issuance. Subject to the terms and conditions of
the Agreement, Agent and the Lenders agree to incur, from time to
time prior to the Termination Date, upon the request of Borrowers
and for Borrowers' account, Letter of Credit Obligations by
causing Letters of Credit to be issued (by a bank or other
legally authorized Person selected by or acceptable to Agent in
its sole discretion (each, an "Issuing Bank")) for Borrowers'
account and guaranteed by Agent; provided, however, that if the
Issuing Bank is a Lender, then such Letters of Credit shall not
be guaranteed by Agent but rather each Lender shall, subject to
the terms and conditions hereinafter set forth, purchase (or be
deemed to have purchased) risk participations in all such Letters
of Credit issued with the written consent of Agent, as more fully
described in paragraph (b)(ii) below. The aggregate amount of all
such Letter of Credit Obligations shall not at any time exceed
the lesser of (i) Fifteen Million Dollars ($15,000,000) (the
"Letter of Credit Facility"), or (ii) the Borrowing Base less the
aggregate outstanding principal balance of the Revolving Credit
Loans. No such Letter of Credit shall have an expiry date which
is more than one year following the date of issuance thereof, and
neither Agent nor the Lenders shall be under any obligation to
incur Letter of Credit Obligations in respect of, or purchase
risk participations in, any Letter of Credit having an expiry
date which is later than the Termination Date.
SECTION 1.9 Advances Automatic; Participations. (a) In the
event that Agent or any Lender shall make any payment on or
pursuant to any Letter of Credit Obligation, such payment shall
then be deemed automatically to constitute a Revolving Credit
Loan under Section 2.1 of the Agreement regardless of whether a
Default or Event of Default shall have occurred and be continuing
and notwithstanding Borrowers' failure to satisfy the conditions
precedent set forth in Article 5, and each Lender shall be
obligated to pay an amount calculated by applying such Lender's
Commitment Percentage to the aggregate amount of such payment.
The failure of any Lender to make available to Agent for Agent's
own account an amount equivalent to a Lender's Commitment
Percentage as to any such Revolving Credit Loan or payment by
Agent under or in respect of a Letter of Credit shall not relieve
any other Lender of its obligation hereunder to make available to
Agent an amount equivalent to such other Lender's Commitment
Percentage with respect thereto, but no breach by a Lender shall
cause an increase in any other Lender's Commitment Percentage.
(b) If it shall be illegal or unlawful for Borrowers
to incur Revolving Credit Loans in the circumstances contemplated
by paragraph (a) above because of an Event of Default described
in Section 12.1(g) or (h) or otherwise or if it shall be illegal
or unlawful for any Lender to be deemed to have assumed a ratable
share of the Reimbursement Obligations owed to an Issuing Bank,
or if the Issuing Bank is a Lender, then (i) immediately and
without further action whatsoever, each Lender shall be deemed to
have irrevocably and unconditionally purchased from Agent (or
such Issuing Bank, as the case may be) an undivided interest and
participation in an amount equivalent to such Lender's Commitment
Percentage (based on the Commitments) of the Letter of Credit
Obligations in respect of all Letters of Credit then outstanding
and (ii) thereafter, immediately upon issuance of any Letter of
Credit, each Lender shall be deemed to have irrevocably and
unconditionally purchased from Agent (or such Issuing Bank, as
the case may be) an undivided interest and participation in an
amount equivalent to such Lender's Commitment Percentage (based
on the Commitments) of the Letter of Credit Obligations with
respect to such Letter of Credit on the date of such issuance.
Each Lender shall fund its participation in all payments or
disbursements made under the Letters of Credit in the same manner
as provided in the Agreement with respect to Revolving Credit
Loans.
SECTION 1.10 Cash Collateral. (a) If Borrowers are required to
provide cash collateral for any Letter of Credit Obligations
pursuant to this Agreement prior to the Termination Date,
Borrowers will, jointly and severally, pay to Agent for the
benefit of the Lenders cash or Cash Equivalents in an amount
equal to 105% of the maximum amount then available to be drawn
under each applicable Letter of Credit outstanding. Such funds
or Cash Equivalents shall be held by Agent in a cash collateral
account (the "Cash Collateral Account") maintained at a bank or
financial institution acceptable to Agent. The Cash Collateral
Account shall be in the name of Borrowers and shall be pledged
to, and subject to the control of, Agent, for the benefit of
Agent and Lenders, in a manner satisfactory to Agent. Borrowers
hereby, jointly and severally, pledge and grant to Agent, on
behalf of Lenders, a security interest in all such funds and Cash
Equivalents held in the Cash Collateral Account from time to time
and all proceeds thereof, as security for the payment of all
amounts due in respect of the Letter of Credit Obligations and
other Secured Obligations, whether or not then due. This
Agreement shall constitute a security agreement under applicable
law.
(b) If any Letter of Credit Obligations, whether or
not then due and payable, shall for any reason be outstanding on
the Termination Date, Borrowers shall either (i) provide cash
collateral therefor in the manner described above, or (ii) cause
all such Letters of Credit and guaranties thereof to be canceled
and returned, or (iii) deliver a stand-by letter (or letters) of
credit in guarantee of such Letter of Credit Obligations, which
stand-by letter (or letters) of credit shall be of like tenor and
duration as, and be in an amount equal to 103% of the aggregate
then available to be drawn under, the Letters of Credit to which
such outstanding Letter of Credit Obligations relate and shall be
issued by a Person, and shall be subject to such terms and
conditions, as are be satisfactory to Agent in its sole
discretion (the "Replacement Letters of Credit").
(c) From time to time after funds are deposited in the
Cash Collateral Account by Borrowers, whether before or after the
Termination Date, Agent may apply such funds or Cash Equivalents
then held in the Cash Collateral Account to the payment of any
amounts, in such order as Agent may elect, as shall be or shall
become due and payable by Borrowers to Lenders with respect to
such Letter of Credit Obligations of Borrowers and, upon the
satisfaction in full of all Letter of Credit Obligations of
Borrowers, to any other Secured Obligations then due and payable.
(d) No Borrower nor any Person claiming on behalf of
or through a Borrower shall have any right to withdraw any of the
funds or Cash Equivalents held in the Cash Collateral Account,
except that upon the termination or satisfaction in full of all
Letter of Credit Obligations and the payment of all amounts
payable by Borrowers to Lenders in respect thereof, any funds
remaining in the Cash Collateral Account shall be held and
applied to other Secured Obligations when due and owing and upon
payment in full of all Secured Obligations, any remaining amount
shall be paid to Borrowers or as otherwise required by law.
SECTION 1.11 Fees and Expenses. Borrowers, jointly and
severally, agree to pay to Agent for the benefit of the Lenders,
as compensation to such Lenders for Letter of Credit Obligations
incurred hereunder, (x) all costs and expenses incurred by Agent
or any Lender on account of such Letter of Credit Obligations,
and (y) for each month during which any Letter of Credit
Obligation shall remain outstanding, an amount equal to the fee
set forth in Section 4.2(e) hereof. Such fee shall be paid to
Agent for the benefit of the Lenders in arrears, on the first day
of each month. In addition, Borrowers shall pay to any Issuing
Bank, on demand, such fees (including all per annum fees),
charges and expenses of such Issuing Bank in respect of the
issuance, negotiation, acceptance, amendment, transfer and
payment of such Letter of Credit or as are otherwise payable
pursuant to the application and related documentation under which
such Letter of Credit is issued.
SECTION 1.12 Request for Incurrence of Letter of Credit
Obligations. Borrowers shall give Agent at least three (3)
Business Days prior written notice requesting a guarantee of any
Letter of Credit, specifying the date such Letter of Credit
Obligation is to be incurred, identifying the beneficiary to
which such Letter of Credit Obligation relates and describing the
nature of the transactions proposed to be supported thereby. The
notice shall be accompanied by the form of the Letter of Credit
(which shall be acceptable to the Issuing Bank) to be guaranteed.
Notwithstanding anything contained herein to the contrary, Letter
of Credit applications by a Borrower and approvals by Agent may
be made and transmitted pursuant to electronic codes and security
measures mutually agreed upon and established by and among a
Borrower, Agent and the Issuing Bank.
SECTION 1.13 Obligation Absolute. (a) The obligation of
Borrowers to reimburse Agent and the Lenders for payments made
with respect to any Letter of Credit Obligation shall be
absolute, unconditional and irrevocable, without necessity of
presentment, demand, protest or other formalities, and the
obligations of each Lender to make payments to Agent with respect
to Letters of Credit shall be unconditional and irrevocable.
Such obligations of Borrowers and the Lenders shall be paid
strictly in accordance with the terms hereof under all
circumstances including the following circumstances:
(1) any lack of validity or enforceability of any Letter of
Credit or this Agreement or the other Loan Documents or any other
agreement;
(2) the existence of any claim, set-off, defense or other right
which a Borrower or any of its Affiliates or any Lender may at
any time have against a beneficiary or any transferee of any
Letter of Credit (or any Persons or entities for whom any such
transferee may be acting), Agent, any Lender, or any other
Person, whether in connection with the Agreement, the Letter of
Credit, the transactions contemplated herein or therein or any
unrelated transaction (including any underlying transaction
between a Borrower or any of its Affiliates and the beneficiary
for which the Letter of Credit was procured);
(3) any draft, demand, 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;
(4) payment by Agent or any Issuing Bank under any Letter of
Credit or guaranty thereof against presentation of a demand,
draft or certificate or other document which does not comply with
the terms of such Letter of Credit or such guaranty;
(5) any other circumstance or happening whatsoever, which is
similar to any of the foregoing; or
(6) the fact that a Default or an Event of Default shall have
occurred and be continuing.
SECTION 1.14 Indemnification; Nature of Lenders' Duties. (a)
In addition to amounts payable by Borrowers to Agent and Lenders
as elsewhere provided in this Agreement, Borrowers, jointly and
severally, hereby agree to pay and to protect, indemnify, and
save harmless Agent and each Lender from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and
expenses (including attorneys' fees and, after and during the
continuance of an Event of Default, allocated costs of internal
counsel) which Agent or any Lender may incur or be subject to as
a consequence, direct or indirect, of (i) the issuance of any
Letter of Credit or guaranty thereof, or (ii) the failure of
Agent or any Lender seeking indemnification or of any Issuing
Bank to honor a demand for payment under any Letter of Credit or
guaranty thereof as a result of any act or omission, whether
rightful or wrongful, of any present or future de jure or de
facto government or Governmental Authority, in each case other
than to the extent solely as a result of the gross negligence or
willful misconduct of Agent or such Lender (as finally determined
by a court of competent jurisdiction).
(b) As between Agent and any Lender and Borrowers,
Borrowers hereby, jointly and severally, assume all risks of the
acts and omissions of, or misuse of any Letter of Credit by
beneficiaries of any Letter of Credit. In furtherance and not in
limitation of the foregoing, to the fullest extent permitted by
law neither Agent nor any Lender shall be responsible: (i) for
the form, validity, sufficiency, accuracy, genuineness or legal
effect of any document issued by any party in connection with the
application for and issuance of any Letter of Credit, even if it
should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) for the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds thereof,
in whole or in part, which may prove to be invalid or ineffective
for any reason; (iii) for failure of the beneficiary of any
Letter of Credit to comply fully with conditions required in
order to demand payment under such Letter of Credit; provided
that, in the case of any payment by Agent under any Letter of
Credit or guaranty thereof, Agent shall be liable to the extent
such payment was made solely as a result of its gross negligence
or willful misconduct (as finally determined by a court of
competent jurisdiction) in determining that the demand for
payment under such Letter of Credit or guaranty thereof complies
on its face with any applicable requirements for a demand for
payment under such Letter of Credit or guaranty thereof; (iv) for
errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (v) for errors in
interpretation of technical terms; (vi) for any loss or delay in
the transmission or otherwise of any document required in order
to make a payment under any Letter of Credit or guaranty thereof
or of the proceeds thereof; (vii) for the application of the
proceeds of any drawing under any Letter of Credit or guaranty
thereof; and (viii) for any consequences arising from causes
beyond the control of Agent or any Lender. None of the above
shall affect, impair, or prevent the vesting of any of Agent's or
any Lender's rights or powers hereunder or under the other Loan
Documents.
(c) Nothing contained herein shall be deemed to limit
or to expand any waivers, covenants or indemnities made by a
Borrower in favor of any Issuing Bank in any letter of credit
application, reimbursement agreement or similar document,
instrument or agreement between any Borrower and such Issuing
Bank.
ARTICLE 4
GENERAL LOAN PROVISIONS
SECTION 1.15 Interest, Etc.
(1) General Interest Provisions.
(i) Borrowers shall pay interest to Agent on the
aggregate outstanding Revolving Credit Loans in each case from
time to time outstanding, for the ratable benefit of Lenders in
accordance with the various Loans being made by each Lender, in
arrears on each applicable Interest Payment Date, at the
following rate: with respect to the Revolving Credit Loans
either (i) a floating rate equal to the Chase Manhattan Bank Rate
plus one quarter of one percent (0.25%) (the "Prime Option") or
(b) a fixed rate for interest periods of one-, two-, three- or
six whole months (each, a "LIBOR Period") equal to the reserve
adjusted LIBOR for the specified period plus two and one quarter
percent (2.25%) (the "LIBOR Option"). The LIBOR Option may be
exercised by the Borrowers for all, or any portion, of the
outstanding amounts under the Revolving Credit Facility at any
time upon three (3) Business Day's prior written notice pursuant
to Section 2.2 hereof. Upon such exercise, the LIBOR Option
shall remain in effect until the expiration of the LIBOR Option
Period selected, at which time, unless an additional LIBOR Option
shall have been timely exercised, the rate hereunder upon
expiration shall be the Prime Option. The Borrowers shall not be
entitled to select a LIBOR Option under the Revolving Credit
Facility if a Default or Event of Default exists hereunder. In
the event of any change in the Chase Manhattan Bank Rate, the
rate of the Prime Option shall change as of the first day of the
first month following such change.
(ii) The LIBOR elections must be for $500,000 or whole
multiples thereof and in no event may the Borrowers have in the
aggregate more than four (4) LIBOR Loans outstanding at one time.
If a LIBOR election is not timely made or cannot be made, or if
LIBOR cannot be determined, then the Agent shall use the Prime
Option to compute interest. In the event that the Borrowers
request a LIBOR Loan, the Borrower shall pay to the Agent a $500
LIBOR processing fee, due and payable upon the effective date of
each such LIBOR Loan. In addition, the Borrowers shall pay to
the Agent for the benefit of the Lenders, upon the request of the
Agent such amount or amounts as shall compensate the Agent and/or
the Lenders for any loss, costs or expenses incurred by the Agent
and/or the Lenders (as reasonably determined by the Agent and the
Lenders) as a result of: (i) any payment or prepayment on a date
other than the last day of a LIBOR Period for such LIBOR Loan, or
(ii) any failure of the Borrowers to borrow a LIBOR Loan on the
date for such borrowing specified in the relevant notice; such
compensation to include, without limitation, an amount equal to
any loss or expense suffered by the Agent and/or the Lenders
during the period from the date of receipt of such payment or
prepayment or the date of such failure to borrow to the last day
of such LIBOR Period if the rate of interest obtained by the
Agent and/or the Lenders upon the reemployment of an amount of
funds equal to the amount of such payment, prepayment or failure
to borrow is less than the rate of interest applicable to such
LIBOR Loan for such LIBOR Period. The determination by the Agent
and/or the Lenders of the amount of any such loss or expense,
when set forth in a written notice to the Borrowers, containing
the Agent's and/or the Lenders' calculations thereof in
reasonable detail, shall be conclusive on the Borrowers, in the
absence of manifest error. Calculation of all amounts payable to
the Agent and/or the Lenders under this paragraph with regard to
LIBOR Loans shall be made as though the Agent and/or the Lenders
had actually funded the LIBOR Loans through the purchase of
deposits in the relevant market and currency, as the case may be,
bearing interest at the rate applicable to such LIBOR Loans in an
amount equal to the amount of the LIBOR Loans and having a
maturity comparable to the relevant interest period; provided,
however, that the Agent and the Lenders may fund each of the
LIBOR Loans in any manner the Agent and the Lenders see fit and
the foregoing assumption shall be used only for calculation of
amounts payable under this paragraph. In addition,
notwithstanding anything to the contrary contained herein, the
Agent and the Lenders shall apply all proceeds of Collateral,
including the Receivables, and all other amounts received by it
from or on behalf of the Borrowers (i) initially to the Prime
Option Revolving Loans and (ii) subsequently to LIBOR Loans;
provided, however, (x) upon the occurrence of an Event of Default
or (y) in the event the aggregate amount of outstanding LIBOR
Loans exceeds Borrowing Base Availability or the applicable
maximum levels set forth therefor, the Agent and the Lenders may
apply all such amounts received by it to the payment of Secured
Obligations in such manner and in such order as the Agent may
elect in its reasonable credit judgment. In the event that any
such amounts are applied to Revolving Loans which are LIBOR
Loans, such application shall be treated as a prepayment of such
loans and the Agent and the Lenders shall be entitled to
indemnification hereunder.
(2) If any payment on any Loan becomes due and payable on a day
other than a Business Day, the maturity thereof will be extended
to the next succeeding Business Day and, with respect to payments
of principal, interest thereon shall be payable at the then
applicable rate during any such extension.
(3) From and after the occurrence of an Event of Default, the
unpaid principal amount of each Secured Obligation shall bear
interest while such Event of Default is continuing at a rate per
annum equal to the Default Margin plus the Prime Option, payable
on demand. The interest rate provided for in this Section 4.1(c)
shall to the extent permitted by applicable law also apply to and
accrue on the amount of any judgment entered with respect to any
Secured Obligation and shall continue to accrue at such rate
during any proceeding described in Section 12.1(g) or (h).
(4) The interest rates provided for in this Section 4.1 shall be
computed on the basis of a year of 360 days and the actual number
of days elapsed.
(5) It is not intended by the Lenders, and nothing contained in
this Agreement or any Note shall be deemed, to establish or
require the payment of a rate of interest in excess of the
maximum rate permitted by applicable law (the "Maximum Rate").
If, in any month, the Effective Interest Rate, absent such
limitation, would have exceeded the Maximum Rate, then the
Effective Interest Rate for that month shall be the Maximum Rate,
and if, in future months, the Effective Interest Rate would
otherwise be less than the Maximum Rate, then the Effective
Interest Rate shall remain at the Maximum Rate until such time as
the amount of interest paid hereunder equals the amount of
interest which would have been paid if the same had not been
limited by the Maximum Rate. In this connection, in the event
that, upon payment in full of the Secured Obligations, the total
amount of interest paid or accrued under the terms of this
Agreement is less than the total amount of interest which would
have been paid or accrued if the Effective Interest Rate had at
all times been in effect, then the Borrowers shall, to the extent
permitted by applicable law, pay to the Lenders an amount equal
to the difference between (i) the lesser of (A) the amount of
interest which would have been charged if the Maximum Rate had,
at all times, been in effect and (B) the amount of interest which
would have accrued had the Effective Interest Rate, at all times,
been in effect, and (ii) the amount of interest actually paid or
accrued under this Agreement. In the event the Lenders receive,
collect or apply as interest any sum in excess of the Maximum
Rate, such excess amount shall be applied to the reduction of the
principal balance of the applicable Secured Obligation, and, if
no such principal is then outstanding, such excess or part
thereof remaining shall be paid to the Borrowers.
SECTION 1.16 Fees.
(1) Closing Fee. On the Effective Date, the Borrowers shall pay
to the Agent for the ratable benefit of the Lenders, a closing
fee in the amount of $168,570 less the Commitment Fee in
consideration of making the Loans hereunder, which fee shall be
fully earned and non-refundable as of the Effective Date
(collectively, the "Closing Fee").
(2) Syndication Fee. On the Effective Date, the Borrowers shall
pay to the Agent, solely for the benefit of the Agent, a
syndication fee of $31,250 which shall be deemed fully earned and
nonrefundable as of the Effective Date (the "Syndication Fee") .
(3) Collateral Monitoring Fee. As additional consideration for
the Agent's ongoing costs and expenses of monitoring the
Collateral the Borrowers agree, jointly and severally, to pay to
the Agent annually in advance on the Effective Date and on each
Anniversary Date thereafter during the term of this Agreement or
any extension thereof, a Collateral monitoring fee in the amount
of $18,000 (the "Collateral Monitoring Fee").
(4) Unused Line Fee. As additional compensation for the costs
and risks in making the Loans available to the Borrowers, the
Borrowers agree, jointly and severally, to pay to the Agent, for
the ratable benefit of the Lenders, in arrears, on the first
(1st) Business Day of each month with respect to the immediately
prior month, prior to the Termination Date and on the Termination
Date, a fee for Borrower's non-use of available funds or Letter
of Credit accommodations in an amount equal to one-quarter of one
percent (0.25%) per annum of the difference between
(i) $45,000,000 and (ii) the sum of the average daily outstanding
balances of the Revolving Credit Loans and the Letter of Credit
Obligations during the period for which the Unused Line Fee is
due (the "Unused Line Fee").
(5) Letter of Credit Obligations Fee. The Borrowers agree,
jointly and severally, to pay to Agent for the ratable benefit of
the Lenders as compensation to the Lenders for issuing guaranties
in support of Letters of Credit, in arrears, on the first
Business Day of each month with respect to the immediately
preceding month until all Letter of Credit Obligations have been
paid or otherwise satisfied, a fee in an amount equal to (i) the
average daily aggregate Letter of Credit Amount of all Letters of
Credit outstanding on each day during the previous month,
multiplied by (ii) either (1) monthly interest rate equivalent to
one and one-half percent (1.5%) per annum, or (2) upon the
occurrence and during the continuation of an Event of Default,
three and one-half percent (3.5%) per annum.
(6) Early Termination Fee. If for any reason this Agreement is
terminated or the Loans hereunder are repaid (including, without
limitation, any default, voluntary prepayment and/or termination
of the Revolving Credit Loans by Borrowers or any termination at
the option of the Agent following an Event of Default but
excluding Revolving Credit Loan payments in the ordinary course
of business), on an Early Termination Date, in view of the
impracticality and extreme difficulty of ascertaining actual
damages and by mutual agreement of the parties as to a reasonable
calculation of Lenders' lost profits as a result thereof, the
Borrowers agree, jointly and severally, to pay to Agent for the
ratable benefit of the Lenders, upon the effective date of such
termination or prepayment of all of the Revolving Credit Loans,
the Early Termination Fee.
SECTION 1.17 Manner of Payment.
(1) Except as otherwise expressly provided in Section 8.1(b),
each payment (including prepayments) by the Borrowers on account
of the principal of or interest on the Loans or of any other
amounts payable to the Lenders under this Agreement or any Note
shall be made not later than 1:00 p.m. (New York time) on the
date specified for payment under this Agreement to the Agent, for
the account of the Lenders, at the Agent's Office, in Dollars, in
immediately available funds and shall be made without any setoff,
counterclaim or deduction whatsoever. Any payment received after
1:00 p.m. (New York time) on such day shall be deemed to have
been made on the next succeeding Business Day.
(2) The Borrowers hereby, jointly and severally, irrevocably
authorize each Lender and each Affiliate of such Lender and each
participant herein to charge any account of the Borrowers main
tained with such Lender or with such Affiliate or participant
with such amounts as may be necessary from time to time to pay
any Secured Obligations (whether or not owed to such Lender,
Affiliate or participant) which are not paid when due, and the
proceeds thereof shall be applied as set forth in Section 12.3.
SECTION 1.18 Loan Accounts: Statements of Account.
(1) Each Lender shall open and maintain on its books a loan
account in the Borrowers' names (each, a "Loan Account" and
collectively, the "Loan Accounts"). Each such Loan Account shall
show as debits thereto each Loan made under this Agreement by
such Lender to the Borrowers and as credits thereto all payments
received by such Lender and applied to principal of such Loan, so
that the balance of the loan account at all times reflects the
principal amount due such Lender from the Borrowers.
(2) The Agent shall maintain on its books a control account for
the Borrowers in which shall be recorded (i) the amount of each
disbursement made hereunder, (ii) the amount of any principal or
interest due or to become due from the Borrowers hereunder, and
(iii) the amount of any sum received by the Agent hereunder from
the Borrowers and each Lender's ratable share therein.
(1)
(3) The entries made in the accounts pursuant to subsections (a)
and (b) shall be prima facie evidence, in the absence of manifest
error, of the existence and amounts of the obligations of the
Borrowers therein recorded and in case of discrepancy between
such accounts, in the absence of manifest error, the accounts
maintained pursuant to subsection (b) shall be controlling.
(4) The Agent will account to the Borrowers monthly with a
statement of Loans, charges and payments made to and by the
Borrowers pursuant to this Agreement, and such accounts rendered
by the Agent shall be deemed final, binding and conclusive, save
for manifest error, unless the Agent is notified by the Borrowers
in writing to the contrary within 60 days of the date the account
to the Borrowers was so rendered. Such notice by the Borrowers
shall be deemed an objection to only those items specifically
objected to therein. Failure of the Agent to render such account
shall in no way affect the rights of the Agent or of the Lenders
hereunder.
SECTION 1.19 Termination of Agreement.
(1) On the Termination Date, the Borrowers shall pay to the
Agent, for the account of the Lenders, in same day funds, an
amount equal to all Secured Obligations then outstanding,
including, without limitation, all (i) accrued interest thereon,
(ii) all accrued fees provided for hereunder, and (iii) any
amounts payable to the Lenders pursuant to Sections 4.1, 4.8,
15.2, 15.3 and 15.12, and, in addition thereto, shall deliver to
the Agent, in respect of each outstanding Letter of Credit,
either the Replacement Letter of Credit or the Cash Collateral as
provided in Section 3.3. Upon 90 days prior written notice to
the Agent, the Borrowers may terminate this Agreement on an Early
Termination Date, upon payment in full of all amounts specified
in this Section 4.5 and the Early Termination Fee as specified in
Section 4.2 hereof. Following a notice of termination as
provided for in this Section 4.5 and upon payment in full of the
amounts specified in this Section 4.5, this Agreement shall be
terminated and the Agent, the Lenders and the Borrowers shall
have no further obligations to any other party hereto except for
the obligations to the Agent and the Lenders pursuant to Section
15.12 hereof.
SECTION 1.20 Making of Loans.
(1) Nature of Obligations of Lenders to Make Loans. The
obligations of the Lenders under this Agreement to make the Loans
are several and are not joint or joint and several.
(2) Assumption by Agent. Subject to the provisions of Section
4.7 and notwithstanding the occurrence or continuance of a
Default or Event of Default or other failure of any condition to
the making of Revolving Credit Loans hereunder subsequent to the
Revolving Credit Loans to be made on the Effective Date, unless
the Agent shall have received notice from a Lender in accordance
with the provisions of Section 4.7(c) prior to a proposed
borrowing date that such Lender will not make available to the
Agent such Lender's ratable portion of the amount to be borrowed
on such date, the Agent may assume that such Lender will make
such portion available to the Agent in accordance with Section
2.2(a), and the Agent may, in reliance upon such assumption, make
available to the Borrowers on such date a corresponding amount.
If and to the extent such Lender shall not make such ratable
portion available to the Agent, such Lender and the Borrowers
severally agree to repay to the Agent forthwith on demand
(provided the Borrowers shall be entitled to a five-day grace
period) such corresponding amount (the "Make-Whole Amount"),
together with interest thereon for each day from the date such
amount is made available to the Borrowers until the date such
amount is repaid to the Agent at the Effective Interest Rate or,
if lower, subject to Section 4.1(c), the Maximum Rate; provided,
however, if on the Interest Payment Date next following the date
on which any Lender pays interest to the Agent at the Effective
Rate or the Maximum Rate on a Make-Whole Amount as aforesaid, the
Borrowers default in making the interest payment due on such
Interest Payment Date, then the Agent shall reimburse such Lender
for the excess, if any, of the amount of interest so paid by such
Lender on the Make-Whole Amount over the amount of interest that
such Lender would have paid had the Lender been required to pay
interest on the Make-Whole Amount at the Prime Option. If such
Lender shall repay to the Agent such corresponding amount, the
amount so repaid shall constitute such Lender's Commitment
Percentage of the Loan made on such borrowing date for purposes
of this Agreement. The failure of any Lender to make its
Commitment Percentage of any Loan available shall not (without
regard to whether the Borrowers shall have returned the amount
thereof to the Agent in accordance with this Section 4.6) relieve
it or any other Lender of its obligation, if any, hereunder to
make its Commitment Percentage of such Loan available on such
borrowing date, but no Lender shall be responsible for the
failure of any other Lender to make its Commitment Percentage of
such Loan available on the borrowing date.
(3) Delegation of Authority to Agent.
(1) Without limiting the generality of Section 14.1, each Lender
expressly authorizes the Agent to determine on behalf of such
Lender (A) any reduction or increase of advance rates applicable
to the Borrowing Base, so long as such advance rates do not at
any time exceed the rates set forth in the Borrowing Base
definition, (B) the creation or elimination of any reserves
(other than the Letter of Credit Reserve) against the Revolving
Credit Facility and the Borrowing Base, and (C) whether or not
Receivables shall be deemed to constitute or Eligible
Receivables. Such authorization may be withdrawn by the Required
Lenders by giving the Agent written notice of such withdrawal
signed by the Required Lenders; provided, however, that unless
otherwise agreed by the Agent such withdrawal of authorization
shall not become effective until the thirtieth (30th) Business
Day after receipt of such notice by the Agent. Thereafter, the
Required Lenders shall jointly instruct the Agent in writing
regarding such matters with such frequency as the Required
Lenders shall jointly determine.
(2) Unless and until the Agent shall have received written
notice from the Required Lenders that because of a Default or
Event of Default the Required Lenders do not intend to make
available to the Agent such Lenders' ratable share of Loans made
after the effective date of such notice, the Agent shall be
entitled to continue to make the assumptions described in Section
4.6(b). After receipt of the notice described in the preceding
sentence, which shall become effective on the third (3rd)
Business Day after receipt of such notice by the Agent unless
otherwise agreed by the Agent, the Agent shall be entitled to
make the assumptions described in Section 4.6(b) as to any Loans
as to which it has not received a written notice to the contrary
prior to 11:00 a.m. (New York time) on the Business Day next
preceding the day on which the Loan is to be made. The Agent
shall not be required to make any Loan as to which it shall have
received notice by a Lender of such Lender's intention not to
make its ratable portion of such Loan available to the Agent.
Any withdrawal of authorization under this Section 4.6(c) shall
not affect the validity of any Loans made prior to the
effectiveness thereof.
SECTION 1.21 Settlement Among Lenders.
(1) Revolving Credit Loans. It is agreed that each Lender's Net
Outstandings are intended by the Lenders to be equal at all times
to such Lender's Commitment Percentage of the aggregate principal
amount of all Revolving Credit Loans outstanding.
Notwithstanding such agreement, the several and not joint
obligation of each Lender to fund Revolving Credit Loans made in
accordance with the terms of this Agreement ratably in accordance
with such Lender's Commitment Percentage and each Lender's right
to receive its ratable share of principal payments on Revolving
Credit Loans in accordance with its Commitment Percentage, the
Lenders agree that in order to facilitate the administration of
this Agreement and the Loan Documents that settlement among them
may take place on a periodic basis in accordance with the
provisions of this Section 4.7.
(2) Settlement Procedures as to Revolving Credit Loans. To the
extent and in the manner hereinafter provided in this Section
4.7, settlement among the Lenders as to Revolving Credit Loans
may occur periodically on Settlement Dates determined from time
to time by the Agent, which may occur before or after the
occurrence or during the continuance of a Default or Event of
Default and whether or not all of the conditions set forth in
Section 5.2 have been met. On each Settlement Date payments
shall be made by or to the Settlement Lender and the other
Lenders in the manner provided in this Section 4.7 in accordance
with the Settlement Report delivered by the Agent pursuant to the
provisions of this Section 4.7 in respect of such Settlement Date
so that as of each Settlement Date, and after giving effect to
the transactions to take place on such Settlement Date, each
Lender's Net Outstandings shall equal such Lender's Commitment
Percentage of the Revolving Credit Loans outstanding.
(1) Selection of Settlement Dates. If the Agent elects, in its
discretion, but subject to the consent of the Settlement Lender,
to settle accounts among the Lenders with respect to principal
amounts of Revolving Credit Loans less frequently than each
Business Day, then the Agent shall designate periodic Settlement
Dates which may occur on any Business Day after the Effective
Date; provided, however, that the Agent shall designate as a
Settlement Date any Business Day which is an Interest Payment
Date; and provided further, that a Settlement Date shall occur
at least once during each seven-day period. The Agent shall
designate a Settlement Date by delivering to each Lender a
Settlement Report not later than 12:00 noon (New York time) on
the proposed Settlement Date, which Settlement Report will be in
the form of Exhibit D hereto and shall be with respect to the
period beginning on the next preceding Settlement Date and ending
on such designated Settlement Date.
(2) Non-Ratable Loans and Payments. Between Settlement Dates,
the Agent shall request and the Settlement Lender may (but shall
not be obligated to) advance to the Borrowers out of the
Settlement Lender's own funds, the entire principal amount of any
Revolving Credit Loan requested or deemed requested pursuant to
Section 2.2(a) (any such Revolving Credit Loan being referred to
as a "Non-Ratable Loan"). The making of each Non-Ratable Loan by
the Settlement Lender shall be deemed to be a purchase by the
Settlement Lender of a 100% participation in each other Lender's
Commitment Percentage of the amount of such Non-Ratable Loan.
All payments of principal, interest and any other amount with
respect to such Non-Ratable Loan shall be payable to and received
by the Agent for the account of the Settlement Lender. Upon
demand by the Settlement Lender, with notice thereof to the
Agent, each other Lender shall pay to the Settlement Lender, as
the repurchase of such participation, an amount equal to 100% of
such Lender's Commitment Percentage of the principal amount of
such Non-Ratable Loan. Any payments received by the Agent
between Settlement Dates which in accordance with the terms of
this Agreement are to be applied to the reduction of the
outstanding principal balance of Revolving Credit Loans, shall be
paid over to and retained by the Settlement Lender for such
application, and such payment to and retention by the Settlement
Lender shall be deemed, to the extent of each other Lender's
Commitment Percentage of such payment, to be a purchase by each
such other Lender of a participation in the Revolving Credit
Loans (including the repurchase of participations in Non-Ratable
Loans) held by the Settlement Lender. Upon demand by another
Lender, with notice thereof to the Agent, the Settlement Lender
shall pay to the Agent, for the account of such other Lender, as
a repurchase of such participation, an amount equal to such other
Lender's Commitment Percentage of any such amounts (after
application thereof to the repurchase of any participations of
the Settlement Lender in such other Lender's Commitment
Percentage of any Non-Ratable Loans) paid only to the Settlement
Lender by the Agent.
(3) Net Decrease in Outstandings. If on any Settlement Date the
increase, if any, in the dollar amount of any Lender's Net
Outstandings which is required to comply with the first sentence
of Section 4.7(b) is less than such Lender's Commitment
Percentage of amounts received by the Agent but paid only to the
Settlement Lender since the next preceding Settlement Date, such
Lender and the Agent, in their respective records, shall apply
such Lender's Commitment Percentage of such amounts to the
increase in such Lender's Net Outstandings, and the Settlement
Lender shall pay to the Agent, for the account of such Lender,
the excess allocable to such Lender.
(4) Net Increase in Outstandings. If on any Settlement Date the
increase, if any, in the dollar amount of any Lender's Net
Outstandings which is required to comply with the first sentence
of Section 4.7(b) exceeds such Lender's Commitment Percentage of
amounts received by the Agent but paid only to the Settlement
Lender since the next preceding Settlement Date, such Lender and
the Agent, in their respective records, shall apply such Lender's
Commitment Percentage of such amounts to the increase in such
Lender's Net Outstandings, and such Lender shall pay to the
Agent, for the account of the Settlement Lender, any excess.
(5) No Change in Outstandings. If a Settlement Report indicates
that no Revolving Credit Loans have been made during the period
since the next preceding Settlement Date, then such Lender's
Commitment Percentage of any amounts received by the Agent but
paid only to the Settlement Lender shall be paid by the
Settlement Lender to the Agent, for the account of such Lender.
If a Settlement Report indicates that the increase in the dollar
amount of a Lender's Net Outstandings which is required to comply
with the first sentence of Section 4.7(b) is exactly equal to
such Lender's Commitment Percentage of amounts received by the
Agent but paid only to the Settlement Lender since the next
preceding Settlement Date, such Lender and the Agent, in their
respective records, shall apply such Lender's Commitment
Percentage of such amounts to the increase in such Lender's Net
Outstandings.
(6) Return of Payments. If any amounts received by the
Settlement Lender in respect of the Secured Obligations are later
required to be returned or repaid by the Settlement Lender to the
Borrowers or any other obligor or their respective
representatives or successors in interest, whether by court
order, settlement or otherwise, in excess of the Settlement
Lender's Commitment Percentage of all such amounts required to be
returned by all Lenders, each other Lender shall, upon demand by
the Settlement Lender with notice to the Agent, pay to the Agent
for the account of the Settlement Lender, an amount equal to the
excess of such Lender's Commitment Percentage of all such amounts
required to be returned by all Lenders over the amount, if any,
returned directly by such Lender.
(7) Payments to Agent, Lenders. (A) Payment by any Lender to the
Agent shall be made not later than 1:00 p.m. (New York time) on
the Business Day such payment is due, provided that if such
payment is due on demand by another Lender, such demand is made
on the paying Lender not later than 11:00 a.m. (New York time) on
such Business Day. Payment by the Agent to any Lender shall be
made by wire transfer, promptly following the Agent's receipt of
funds for the account of such Lender and in the type of funds
received by the Agent, provided that if the Agent receives such
funds at or prior to 1:00 p.m. (New York time), the Agent shall
pay such funds to such Lender by 2:00 p.m. (New York time) on
such Business Day. If a demand for payment is made after the
applicable time set forth above, the payment due shall be made by
2:00 p.m. (New York time) on the first Business Day following the
date of such demand.
(B) If a Lender shall, at any time, fail to make any
payment to the Agent required hereunder, the Agent may, but
shall not be required to, retain payments that would
otherwise be made to such Lender hereunder and apply such
payments to such Lender's defaulted obligations hereunder,
at such time, and in such order, as the Agent may elect in
its sole discretion.
(C) With respect to the payment of any funds under
this Section 4.7(c), whether from the Agent to a Lender or
from a Lender to the Agent, the party failing to make full
payment when due pursuant to the terms hereof shall, upon
demand by the other party, pay such amount together with
interest on such amount at the Prime Option.
(3) Settlement of Other Obligations. All other amounts received
by the Agent on account of, or applied by the Agent to the
payment of, any Secured Obligation owed to the Lenders
(including, without limitation, fees payable to the Lenders
pursuant to Sections 4.2(d) and (e) and proceeds from the sale
of, or other realization upon, all or any part of the Collateral
following an Event of Default) that are received by the Agent on
or prior to 1:00 p.m. (New York time) on a Business Day will be
paid by the Agent to each Lender on the same Business Day, and
any such amounts that are received by the Agent after 1:00 p.m.
(New York time) will be paid by the Agent to each Lender on the
following Business Day. Unless otherwise stated herein, the
Agent shall distribute fees payable to the Lenders pursuant to
Section 4.2(d) and (e) ratably to the Lenders based on each
Lender's Commitment Percentage and shall distribute proceeds from
the sale of, or other realization upon, all or any part of the
Collateral following an Event of Default ratably to the Lenders
based on the amount of the Secured Obligations then owing to each
Lender.
SECTION 1.22 Increased Costs and Reduced Returns. Borrowers
agree that if (i) any law hereafter in effect or (ii) any
request, guideline or directive of any Governmental Authority
(whether or not having the force of law and whether or not
failure to comply therewith would be unlawful) not in effect as
of the Effective Date with respect to any law now or hereafter in
effect (and whether or not any such law is presently applicable
to any Lender) or the interpretation or administration thereof by
any Governmental Authority, shall either (y)(A) impose, affect,
modify or deem applicable any reserve, special deposit, capital
maintenance or similar requirement against any Loan, (B) impose
on such Lender any other condition regarding any Loan, this
Agreement, any Note or the facilities provided hereunder, or (C)
result in any requirement regarding capital adequacy (including
any risk-based capital guidelines) affecting such Lender being
imposed or modified or deemed applicable to such Lender or (z)
subject such Lender to any taxes on the recording, registration,
notarization or other formalization of the Loans or any Note, and
the result of any event referred to in clause (i) or (ii) above
shall be to increase the cost to such Lender of making, funding
or maintaining any Loan or to reduce the amount of any sum
receivable by such Lender or such Lender's rate of return on
capital with respect to any Loan to a level below that which such
Lender could have achieved but for such imposition, modification
or deemed applicability (taking into consideration such Lender's
policies with respect to capital adequacy) by an amount deemed by
such Lender (in the exercise of its reasonable discretion) to be
material, then, upon demand by such Lender, Borrowers shall
immediately pay to such Lender additional amounts which shall be
sufficient to compensate such Lender for such increased cost, tax
or reduced rate of return. A certificate of such Lender to the
Borrowers claiming compensation under this Section 4.8 shall be
final, conclusive and binding on all parties for all purposes in
the absence of manifest error. Such certificate shall set forth
the nature of the occurrence giving rise to such compensation,
the additional amount or amounts to be paid to it hereunder and
the method by which such amounts were determined. In determining
such amount, such Lender may use any reasonable averaging and
attribution methods. Notwithstanding anything to the contrary in
this Section 4.8, (i) the Borrower shall not be liable to any
such Lender(s) for any costs, taxes or reduced rates of return
which were incurred or paid by such Lender(s) more than ninety
(90) days prior to the date of the certificate of Lender to be
delivered to the Borrower pursuant to this Section 4.8 and (ii)
if the costs, taxes or reduced rates of return incurred or paid
by the Lender(s) at any time during the term hereof exceed in the
aggregate $250,000 and, in the future any addtional costs, taxes
or reduced rates of return may be mitigated by changing the
location of such Lender(s) office for administration of the Loans
to another existing loan office of such Lender(s) within the
United States of America then such Lender(s) shall use
commercially reasonable efforts to move the administration of the
Loans and this Agreement to such other existing loan office.
ARTICLE 5
CONDITIONS PRECEDENT
SECTION 1.23 Conditions Precedent to Revolving Credit Loans.
Notwithstanding any other provision of this Agreement, the
initial Revolving Credit Loan will not be made, nor will any
Letter of Credit be issued, until the fulfillment of each of the
following conditions prior to or contemporaneously with the
making of the first to be made of such Loans (unless waived in
writing by the Agent):
(1) Fees. Borrowers shall have paid all of the fees payable on
the Effective Date referred to herein, including, without
limitation, the Closing Fee, the Syndication Fee and the
Collateral Monitoring Fee.
(2) Security Interests. The Agent shall have received
satisfactory evidence that the Agent (for the benefit of itself
and the Lenders) has a valid and perfected first priority
security interest as of the Effective Date in all of the
Collateral, subject only to Permitted Liens.
(3) Closing Documents. The Agent shall have received each of
the following documents, all of which shall be satisfactory in
form and substance to the Agent and its counsel and to the
Lenders:
(1) a certificate of the Secretary or Assistant Secretary of
each of the Borrowers in the form attached hereto as Exhibit L
with the required attachments thereto;
(2) a certificate evidencing the good standing of each Borrower
in the jurisdiction of its incorporation;
(3) copies of all financial statements referred to in Section
6.1(m) and meeting the requirements thereof,
(4) signed opinions of Proskauer Rose LLP and local counsel in
Missouri, Georgia and New Jersey reasonably acceptable to the
Agent, as counsel for the Borrowers and the Guarantors,
substantially in the form attached hereto as Exhibit D, opining
as to such matters in connection with the transactions
contemplated by this Agreement as the Agent or its special
counsel may reasonably request,
(5) the Financing Statements duly executed and delivered by the
Borrowers and acknowledgment copies evidencing the filing of such
Financing Statements in each jurisdiction where such filing may
be necessary or appropriate to perfect the Security Interest;
(6) certificates or binders of insurance relating to each of the
policies of insurance covering any of the Collateral together
with loss payable clauses which comply with the terms of Section
8.7,
(7) a certificate of the President or a Financial Officer of
each Borrower in the form attached hereto as Exhibit K.
(8) a Borrowing Base Certificate and a Schedule of Receivables,
prepared as of the Effective Date,
(9) an original Power of Attorney, substantially in the form of
Exhibit H hereto, as executed by the Borrowers in favor of Agent;
(10) Agency Account Agreements, each duly executed by a Borrower
and the Clearing Bank party thereto, or such other agreements
with Agent regarding each of the Borrowers' Lockboxes, Lockbox
Accounts and other cash and deposit accounts, as requested by
Agent;
(11) an initial Notice of Proposed Advance, in the form of
Exhibit B hereto, from the Borrowers to the Agent requesting the
initial Revolving Credit Loan and specifying the method of
disbursement;
(12) copies of all of the most recent existing reports from a
qualified environmental engineering firm or other qualified
consultant acceptable to the Agent with respect to investigations
and audits of all Real Estate;
(13) copies of each of the other Loan Documents duly executed by
the parties thereto, together with evidence satisfactory to the
Agent of the due authorization and binding effect of each such
Loan Document on such party,
(14) a twelve (12) month consolidated cash budget projection
prepared by the Borrowers in the form provided by the Agent; and
(15) such other documents and instruments as the Agent or any
Lender may reasonably request.
(4) Guarantor Documents. The Agent shall have received each of
the following documents, all of which shall be satisfactory in
form and substance to the Agent and its special counsel and to
the Lenders:
(1) a certificate of the Secretary or Assistant Secretary of
each of the Guarantors, in the form of Exhibit L hereto;
(2) a certificate of the President or Financial Officer of each
Guarantor, in the form of Exhibit K hereto;
(3) a certificate evidencing the good standing of each Guarantor
in the jurisdiction of its incorporation;
(4) the Guaranty Agreement, duly executed and delivered by each
Guarantor; and
(5) such other documents and instruments as the Agent or any
Lender may reasonably request.
(5) Notes. Each Lender shall have received a Revolving Credit
Note duly executed and delivered by the Borrowers, complying with
the terms of Sections 2.4.
(6) Other Security Documents. The Agent shall have received
each Security Document (except for those to be executed and
delivered after the Effective Date pursuant to Section 7.3), duly
executed and delivered by the Borrowers.
(7) Availability. The Agent shall be provided with evidence
satisfactory to it, confirmed by a certificate of a Financial
Officer of Trism, that as of the Effective Date, after giving
effect to the initial Advances and the issuance of any Letters of
Credit on the Effective Date, Borrowing Base Availability is not
less than $8,000,000.
(8) No Injunctions, Etc. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened
or proposed before any court, governmental agency or legislative
body to enjoin, restrain, or prohibit, or to obtain damages in
respect of, or which is related to or arises out of this
Agreement or the consummation of the transactions contemplated
hereby or which, in the Lenders' reasonable discretion, would
make it inadvisable to consummate the transactions contemplated
by this Agreement.
(9) Material Adverse Change. As of the Effective Date, and
except as disclosed in the unaudited financial statements
described in Section 6.1(m), there shall not have occurred any
change which is materially adverse, in the Lenders' sole
discretion, to the assets, liabilities, businesses, operations,
condition (financial or otherwise) or prospects of the Borrowers
from those presented by the unaudited financial statements
described in Section 6.1(m).
(10) Release of Security Interests. The Lender shall have
received evidence satisfactory to it of the release and
termination of all Liens other than Permitted Liens.
(11) Commitment Letter. Agent shall have received evidence
satisfactory to it that the Borrowers have complied fully with
the terms of the Commitment Letter.
(12) Due Diligence. The Agent shall have completed, with results
satisfactory to it in its sole discretion, its legal credit and
business due diligence in respect of the Borrower and the
Guarantors and their respective subsidiaries and affiliates,
including, without limitation, review of the Subordinated
Indenture and background reviews with respect to Trism, ▇▇▇▇▇
▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇.
(13) Cash Account. The Borrowers shall have established a system
of lockbox accounts and other bank accounts with respect to the
collection of Receivables as shall be acceptable to Agent, in its
sole discretion.
SECTION 1.24 All Loans: Letters of Credit. At the time of
making of each Loan, including the initial Revolving Credit Loan
and all subsequent Loans, and the issuance of each Letter of
Credit:
(1) all of the representations and warranties made or deemed to
be made under this Agreement shall be true and correct at such
time both with and without giving effect to the Loan to be made
at such time and the application of the proceeds thereof,
(2) the corporate actions of each of the Borrowers, including
shareholder approval if necessary, to authorize the execution,
delivery and performance of this Agreement, the other Loan
Documents and the borrowings hereunder shall remain in full force
and effect and the incumbency of officers shall be as stated in
the certificates of incumbency delivered pursuant to Section
5.1(c)(i) or as subsequently modified and reflected in a
certificate of incumbency delivered to the Agent, and
(3) each request and deemed request for any Advance hereunder
shall be deemed to be a certification by the Borrowers to the
Agent and the Lenders as to the matters set forth in Section
5.2(a) and (b) and the Agent may, without waiving either
condition, consider the conditions specified in Sections 5.2(a)
and (b) fulfilled and a representation by the Borrowers to such
effect made, if no written notice to the contrary is received by
the Agent prior to the making of the Loan then to be made.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BORROWERS
SECTION 1.25 Representations and Warranties. The Borrowers,
jointly and severally, represent and warrant to the Agent and to
the Lenders as follows:
(1) Organization; Power; Qualification; FEIN. Each of the
Borrowers and each of the Guarantors is a corporation, duly organized,
validly existing and in good standing under the laws of the jurisdiction
of its incorporation, has the corporate power and authority to own its
properties and to carry on its business as now being and hereafter proposed
to be conducted and is duly qualified and authorized to do business in each
jurisdiction in which failure to be so qualified and authorized would have a
Materially Adverse Effect. The jurisdictions in which each Borrower is
qualified to do business as a foreign corporation are listed on Schedule
6.1(a). Schedule 6.1(a) lists the federal employer identification number
of each Borrower and each Guarantor.
(2) Subsidiaries and Ownership of the Borrowers. Except for as
disclosed on Schedule 6.1(b), the Borrowers have no Subsidiaries. The
outstanding stock of each Borrower has been duly and validly issued and is
fully paid and nonassessable by such Borrower and the number and owners of
such shares of capital stock of such Borrower are set forth on Schedule
6.1(b). Except as set forth on Schedule 6.1(b), there are no outstanding
rights to purchase, options, warrants or similar rights or agreements
pursuant to which any Borrower may be required to issue, sell, repurchase
or redeem any of its stock or other equity securities or any stock or other
equity securities of its Subsidiaries.
(3) Authorization of Agreement, Notes, Loan Documents and
Borrowing. Each of the Borrowers and each of the Guarantors has the right
and power and has taken all necessary action to authorize it to execute,
deliver and perform each of the Loan Documents to which it is a party in
accordance with their respective terms. Each of the Loan Documents to
which it is a party have been duly executed and delivered by the duly
authorized officers of each Borrower or each Guarantor, as the case may be,
and each is, or when executed and delivered in accordance with this
Agreement will be, a legal, valid and binding obligation of each Borrower
or each Guarantor, as the case may be, enforceable in accordance with
its terms.
(4) Compliance of Agreement, Notes, Loan Documents and Borrowing
with Laws, Etc. The execution, delivery and performance of each of the Loan
Documents to which each Borrower or each Guarantor, as the case may be, is a
party in accordance with their respective terms and the borrowings hereunder
do not and will not, by the passage of time, the giving of notice or
otherwise,
(1) require any Governmental Approval or violate any applicable
law relating to any Borrower, any Guarantor or any of their
Affiliates,
(2) conflict with, result in a breach of or constitute a default
under (A) the articles or certificate of incorporation or by-laws
of any Borrower or any Guarantor, (B) any indenture, agreement or
other instrument to which any Borrower or any Guarantor is a
party or by which any of their property may be bound or (C) any
Governmental Approval relating to any Borrower or any Guarantor,
or,
(3) result in or require the creation or imposition of any Lien
upon or with respect to any property now owned or hereafter
acquired by any Borrower or any Guarantor other than the Security
Interest.
(5) Business. Each Borrower is engaged principally in the
business described on Schedule 6.1(e).
(6) Compliance with Law, Governmental Approvals.
(1) Except as set forth in Schedule 6.1(f), each Borrower
(A) has all material Governmental Approvals,
including permits relating to federal, state and local
Environmental Laws, ordinances and regulations,
required by any Applicable Law for it to conduct its
business, each of which is in full force and effect, is
final and not subject to review on appeal and is not
the subject of any pending or, to the knowledge of such
Borrower, threatened attack by direct or collateral
proceeding, and
(B) is in compliance with each material
Governmental Approval applicable to it and in
compliance with all other material Applicable Laws
relating to it, including, without being limited to,
all material Environmental Laws and all material
occupational health and safety laws applicable to such
Borrower, any of its Subsidiaries or their respective
properties,
except for instances of noncompliance which would not,
singly or in the aggregate, cause a Default or Event of
Default or have a Materially Adverse Effect on such Borrower
and its Subsidiaries as a whole and in respect of which
reserves in respect of such Borrower's or such Subsidiary's
reasonably anticipated liability therefor have been
established on the books of such Borrower or such
Subsidiary, as applicable.
(2) Without limiting the generality of the above, except as
disclosed on a report delivered pursuant to Section 5.1(c)(xii)
or (xiii) or with respect to matters which could not reasonably
be expected to have, singly or in the aggregate, a Materially
Adverse Effect on any Borrower and its Subsidiaries as a whole:
(A) the operations of such Borrower and each of
its Subsidiaries comply in all material respects with
all applicable environmental, health and safety
requirements of Applicable Law;
(B) such Borrower and each of its Subsidiaries has
obtained all environmental, health and safety permits
necessary for its operation, and all such permits are
in good standing and such Borrower and each of its
Subsidiaries is in compliance in all material respects
with all terms and conditions of such permits;
(C) neither such Borrower nor any of its
Subsidiaries nor any of their respective present or
past property or operations are subject to any order
from or agreement with any public authority or private
party respecting (x) any environmental, health or
safety requirements of Applicable Law, (y) any Remedial
Action, or (z) any liabilities and costs arising from
the Release or threatened Release of a Contaminant into
the environment, except for past properties and
operations covered in full by the Seller Indemnity;
(D) none of the operations of such Borrower or of
any of its Subsidiaries is subject to any judicial or
administrative proceeding alleging a violation of any
environmental, health or safety requirement of
Applicable Law;
(E) to the knowledge of such Borrower, none of the
present nor past operations of such Borrower or any of
its Subsidiaries is the subject of any investigation by
any public authority evaluating whether any Remedial
Action is needed to respond to a Release or threatened
Release of a Contaminant into the environment, except
for past operations covered in full by the Seller
Indemnity;
(F) neither such Borrower nor any of its
Subsidiaries has filed any notice under any requirement
of Applicable Law indicating past or present treatment,
storage or disposal of a hazardous waste, as that term
is defined under 40 CFR Part 261 or any state
equivalent;
(G) neither such Borrower nor any of its
Subsidiaries has filed any notice under any requirement
of Applicable Law reporting a Release of a Contaminant
into the environment, except for instances in which the
Release has been remedied in strict compliance with all
Environmental Laws;
(H) except in compliance in all material respects
with applicable Environmental Laws, during the course
of such Borrower's or any of its Subsidiaries'
ownership of or operations on the Real Estate, to the
best of such Borrower's knowledge, there have been no
generation, treatment, recycling, storage or disposal
of hazardous waste, as that term is defined under 40
CFR Part 261 or any state equivalent, use of
underground storage tanks or surface impoundments, use
of asbestos-containing materials, or use of
polychlorinated biphenyls (PCB) used in hydraulic oils,
electrical transformers or other equipment;
(I) neither such Borrower nor any of its
Subsidiaries has entered into any negotiations or
agreements with any Person (including, without
limitation, any prior owner of any of the Real Estate
or other property of such Borrower or any of its
Subsidiaries) relating to any Remedial Action or
environmental related claim;
(J) neither such Borrower nor any of its
Subsidiaries has received any notice or claim to the
effect that it is or may be liable to any Person as a
result of the Release or threatened Release of a
Contaminant into the environment, except for Releases
covered in full by the Seller Indemnity;
(K) neither such Borrower nor any of its
Subsidiaries has any material contingent liability in
connection with any Release or threatened Release of
any Contaminant into the environment, except for
Releases covered in full by the Seller Indemnity;
(L) no Environmental Lien has attached to any of
the Real Estate or other property of such Borrower or
of any of its Subsidiaries;
(M) the presence and condition of all asbestos-
containing material which is on or part of the Real
Estate (excluding any raw materials used in the
manufacture of products or products themselves) do not
violate in any material respect any currently
applicable requirement of Applicable Law; and
(N) neither such Borrower nor any of its
Subsidiaries manufactures, distributes or sells, and
has not, in the past 20 years, manufactured,
distributed or sold, products which contain asbestos-
containing material.
(O) Such Borrower hereby acknowledges and agrees
that Agent (i) is not now, and has not ever been, in
control of any of the Real Estate or any of such
Borrower's affairs, and (ii) does not have the
capacity through the provisions of the Loan Documents
or otherwise to influence such Borrower's conduct with
respect to the ownership, operation or management of
any of its Real Estate or compliance with Environmental
Laws or Environmental Permits.
(3) Schedule 6.1(f) sets forth each notice of a material
violation of any Environmental Laws and occupational health and
safety laws applicable to any Borrower, any of their respective
Subsidiaries or any of their respective properties.
(7) Titles to Properties. Except as set forth in Schedule
6.1(g), each Borrower and each of its Subsidiaries is the sole
owner of and has good and marketable title to or a valid
leasehold interest in all its owned Real Estate, is the sole
owner of and has valid and legal title to or a valid leasehold
interest in all personal property and assets used in or necessary
to the conduct of its business. Each Borrower has received all
deeds, assignments, waivers, consents, non-disturbance and
recognition or similar agreements, bills of sale and other
documents, and has duly effected all recordings, filings and
other actions necessary to establish, protect and perfect such
Borrower's right, title and interest in and to all such Real
Estate and other properties and assets. Schedule 6.1(g) also
describes any purchase options, rights of first refusal or other
similar contractual rights pertaining to any Real Estate. As of
the Effective Date, no portion of any Borrower's Real Estate has
suffered any material damage by fire or other casualty loss which
has not heretofore been repaired and restored in all material
respects to its original condition or otherwise remedied. As of
the Effective Date, all material permits required to have been
issued or appropriate to enable the Real Estate to be lawfully
occupied and used for all of the purposes for which they are
currently occupied and used have been lawfully issued and are in
full force and effect.
(8) Liens. Except as set forth in Schedule 6.1(h), none of the
properties and assets of any Borrower or any Subsidiary,
including, without limitation, the Collateral, is subject to any
Lien, except Permitted Liens. Other than the Financing
Statements, no financing statement under the Uniform Commercial
Code of any state which names any Borrower or any Subsidiary as
debtor and which has not been terminated has been filed in any
state or other jurisdiction, and no Borrower nor any Subsidiary
has signed any such financing statement or any security agreement
authorizing any secured party thereunder to file any such
financing statement, except to perfect those Liens listed in
Schedule 6.1(h) and Permitted Liens.
(9) Indebtedness and Guaranties. Set forth on Schedule 6.1(i)
is a complete and correct listing of all of each and every
Borrower's and its Subsidiaries' (i) Indebtedness for Money
Borrowed and (ii) Guaranties of obligations of Persons and
entities other than the obligations of other Borrowers or the
Guarantors. There is no Indebtedness owing by any Borrower or
any Guarantor to any Affiliate of any Borrower or any Guarantor.
Other than as previously disclosed to Agent, no Borrower nor any
Subsidiary is in default of any material provision of any
agreement evidencing or relating to any such Indebtedness or
Guaranty.
(10) Litigation. Except as set forth on Schedule 6.1(j), there
are no actions, suits or proceedings pending (nor, to the
knowledge of any of the Borrowers, are there any actions, suits
or proceedings threatened, nor is there any basis therefor)
against or in any other way relating adversely to or affecting
any Borrower or any Subsidiary or any of their property, or which
challenge any Borrower's right or power to enter into or perform
any of its obligations under the Loan Documents to which it is a
party, or the validity or enforceability of any Loan Document or
any action taken thereunder, in any court or before any
arbitrator of any kind or before or by any governmental body,
which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect on any Borrower and
its Subsidiaries, as a whole.
(11) Tax Returns and Payments. Except as set forth on Schedule
6.1(k), all United States federal, state and local as well as
foreign national, provincial and local and other tax returns of
each Borrower and each of its Subsidiaries required by Applicable
Law to be filed have been duly filed, and all United States
federal, state and local and foreign national, provincial and
local and other taxes, assessments and other governmental charges
or levies upon such Borrower and each of its Subsidiaries and
such Borrower's and any of its Subsidiaries' property, income,
profits and assets which are due and payable have been paid,
except any such nonpayment which is at the time permitted under
Section 9.6. The charges, accruals and reserves on the books of
each Borrower and each of its Subsidiaries in respect of United
States federal, state and local and foreign national, provincial
and local taxes for all fiscal years and portions thereof since
the organization of such Borrower are in the judgment of such
Borrower adequate, and such Borrower knows of no reason to
anticipate any additional assessments for any of such years
which, singly or in the aggregate, could reasonably be expected
to have a Materially Adverse Effect on such Borrower. Proper and
accurate amounts have been withheld by each Borrower from its
respective employees for all periods in full and complete
compliance with all applicable federal, state, local and foreign
law and such withholdings have been timely paid to the respective
Governmental Authorities. Schedule 6.1(k) sets forth as of the
Effective Date those taxable years for which any Borrower's tax
returns are currently being audited by the IRS or any other
applicable Governmental Authority and any assessments or
threatened assessments in connection with such audit, or
otherwise currently outstanding. Except as described on Schedule
6.1(k) as of the Effective Date, no Borrower has executed or
filed with the IRS or any other Governmental Authority any
agreement or other document extending, or having the effect of
extending, the period for assessment or collection of any
Charges. No Borrower and none of its respective predecessors are
liable for any Charges: (a) under any agreement (including any
tax sharing agreements) or (b) to such Borrower's knowledge, as a
transferee. As of the Effective Date, no Borrower has agreed or
been requested to make any adjustment under Code Section 481(a),
by reason of a change in accounting method or otherwise, which
would have a Materially Adverse Effect.
(12) Burdensome Provisions. No Borrower or any of its
Subsidiaries is a party to any indenture, agreement, lease or
other instrument, or subject to any charter or corporate
restriction, Governmental Approval or Applicable Law compliance
with the terms of which could reasonably be expected to have a
Materially Adverse Effect on such Borrower and its Subsidiaries,
taken as a whole.
(13) Financial Statements. The Borrowers have furnished to the
Agent and the Lenders a copy of (i) the Consolidated Balance
Sheet as at December 31, 1996 and the Consolidating Balance Sheet
as at December 31, 1996, and the related statements of income,
cash flow and retained earnings for the twelve-month period then
ended and (ii) their unaudited balance sheet as at March 30,
1997, and the related statement of income for the 3-month period
then ended. Such financial statements are complete and correct
and present fairly and in all material respects in accordance
with GAAP, the financial position of the Borrowers as at the
dates thereof and the results of operations of the Borrowers for
the periods then ended. Except as disclosed or reflected in such
financial statements, the Borrowers have no material liabilities,
contingent or otherwise, and there were no material unrealized or
anticipated losses of the Borrowers.
(14) Adverse Change. Since the date of the financial statements
described in clause (i) of Section 6.1(m) and other than as
disclosed in the unaudited financial statements described in
clause (ii) of Section 6.1(m), (i) no change in the business,
assets, liabilities, condition (financial or otherwise), results
of operations or business prospects of the Borrowers has occurred
that has had, or may have, a Materially Adverse Effect, and (ii)
no event has occurred or failed to occur which has had, or may
have, a Materially Adverse Effect.
(15) ERISA. No Borrower or any Related Company maintains or
contributes to (x) any Benefit Plan other than those listed on
Schedule 6.1(o) as of the Effective Date or (y) thereafter, any
Title IV Plan other than those listed in Schedule 6.1(o). Each
Benefit Plan is in substantial compliance with ERISA to the
extent that ERISA is applicable, and no Borrower or any Related
Company has received any notice asserting that a Benefit Plan is
not in compliance with ERISA. No material liability to the PBGC
or to a Multiemployer Plan has been, or is expected by any
Borrower to be, incurred by such Borrower or any Related Company.
Copies of all such listed Plans, together with a copy of the
latest form 5500 for each such Plan, have been delivered to
Agent. No Borrower or any ERISA Affiliate has failed to make any
contribution or pay any amount due as required by either Section
412 of the Code or Section 302 of ERISA or the terms of any such
Plan. No Borrower or any ERISA Affiliate has engaged in a
prohibited transaction, as defined in Section 4975 of the Code,
in connection with any Plan, which would subject such Borrower to
a material tax on prohibited transactions imposed by Section 4975
of the Code. Except as set forth in Schedule 6.1(o): (i) no
Title IV Plan has any Unfunded Vested Accrued Benefits in excess
of $0; (ii) no ERISA Event or event described in Section 4062(e)
of ERISA with respect to any Title IV Plan has occurred or is
reasonably expected to occur; (iii) there are no pending, or to
the knowledge of any Borrower, threatened claims (other than
claims for benefits in the normal course), sanctions, actions or
lawsuits, asserted or instituted against any Plan or any Person
as fiduciary or sponsor of any Plan; (iv) no Borrower or any
ERISA Affiliate has incurred or reasonably expects to incur any
liability as a result of a complete or partial withdrawal from a
Multiemployer Plan; (v) within the last five years no Title IV
Plan with Unfunded Pension Liabilities has been transferred
outside of the "controlled group" (within the meaning of Section
4001(a)(14) of ERISA) of any Borrower or any ERISA Affiliate; and
(vi) no liability under any Title IV Plan has been satisfied with
the purchase of a contract from an insurance company that is not
rated AAA by the Standard & Poor's Corporation or the equivalent
by another nationally recognized rating agency.
(16) Absence of Defaults. No Borrower or any of its Subsidiaries
is in default under its articles or certificate of incorporation
or by-laws and no event has occurred, which has not been
remedied, cured or waived, which constitutes a Default or an
Event of Default, or which constitutes, or which with the passage
of time or giving of notice or both would constitute, a default
or event of default by such Borrower or any of its Subsidiaries
under any material agreement (other than this Agreement) or
judgment, decree or order to which such Borrower or any of its
Subsidiaries is a party or by which such Borrower, any of its
Subsidiaries or any of such Borrower's or any of its
Subsidiaries' properties may be bound or which would require such
Borrower or any of its Subsidiaries to make any payment under any
thereof prior to the scheduled maturity date therefor.
(17) Accuracy and Completeness of Information. All Schedules
hereto and all material written information, reports and other
papers and data produced by or on behalf of the Borrowers and
furnished to the Agent or any Lender were, at the time the same
were so furnished, complete and correct in all material respects,
to the extent necessary to give the recipient a true and accurate
knowledge of the subject matter. No fact is known to any
Borrower which has had, or may in the future have (so far as such
Borrower can foresee), a Materially Adverse Effect upon any
Borrower or any of its Subsidiaries which has not been set forth
in the financial statements or disclosure delivered prior to the
Effective Date, in each case referred to in Section 6.1(m), or in
such written information, reports or other papers or data or
otherwise disclosed in writing to the Agent and the Lenders prior
to the Agreement Date. No document furnished or written
statement made to the Agent or any Lender by any Borrower in
connection with the negotiation, preparation or execution of this
Agreement or any of the Loan Documents contains or will contain
any untrue statement of a fact material to the creditworthiness
of any Borrower or omits or will omit to state a material fact
necessary in order to make the statements contained therein not
misleading.
(18) Solvency. In each case after giving effect to the
Indebtedness represented by the Loans outstanding and to be incurred, the
transactions contemplated by this Agreement, each Borrower and each of its
Subsidiaries is solvent, having assets of a fair salable value which exceeds
the amount required to pay its debts as they become absolute and matured
(including contingent, subordinated, unmatured and unliquidated
liabilities), and each Borrower and each of its Subsidiaries is able to and
anticipates that it will be able to meet its debts as they mature and has
adequate capital to conduct the business in which it is or proposes to be
engaged.
(19) Receivables.
(1) Status. Each Receivable reflected in the computations
included in any Borrowing Base Certificate meets the criteria
enumerated in clauses (a) through (o) of the definition of
Eligible Receivables, except as disclosed in such Borrowing Base
Certificate or as disclosed in a timely manner in a subsequent
Borrowing Base Certificate or otherwise in writing to the Agent.
(2) Chief Executive Office. The chief executive office and
principal place of business of each Borrower and the books and
records relating to the Receivables and other Collateral is located
at the address or addresses set forth (i) on Schedule 6.1(s) or (ii)
in a written notice which complies with the applicable provisions of
Section 8.8 hereunder; no Borrower has maintained its chief executive
office or books and records relating to the Collateral at any other
address at any time during the five years immediately preceding the
Agreement Date.
(20) Real Property. No Borrower owns Real Estate or leases Real
Estate other than that Real Estate described on Schedule 6.1(t).
(21) Corporate and Fictitious Names. Except as otherwise disclosed
on Schedule 6.1(u), during the five-year period preceding the Agreement Date,
no Borrower or any predecessor thereof has been known as or used any
corporate or fictitious name other than the corporate names of the Borrowers
on the Effective Date.
(22) Federal Reserve Regulations. No Borrower or any of its
Subsidiaries is engaged and none will engage, principally or as one of its
important activities, in the business of extending credit for the purpose
of "purchasing" or "carrying" any "margin stock" (as each of the quoted
terms is defined or used in Regulations G and U of the Board of Governors
of the Federal Reserve System). No Borrower owns any Margin Stock and no
part of the proceeds of any of the Loans will be used for so purchasing or
carrying margin stock or, in any event, for any purpose which violates, or
which would be inconsistent with, the provisions of Regulation G, T, U or
X of such Board of Governors. If requested by the Agent or any Lender, the
Borrowers will furnish to the Agent and the Lenders a statement or
statements in conformity with the requirements of said Regulation G,
T, U or X to the foregoing effect.
(23) Government Regulation. No Borrower is an "investment company"
or a company "controlled" by an "investment company" (as each of the quoted
terms is defined or used in the Investment Company Act of 1940, as amended).
No Borrower is subject to regulation under the Public Utility Holding
Company Act of 1935, the Federal Power Act, or any other federal or state
statute that restricts or limits its ability to incur Indebtedness or to
perform its obligations hereunder. Assuming the accuracy of the
representations set forth in Section 13.2 hereunder, the making of the
Loans by Lenders to Borrowers, the incurrence of the Letter of Credit
Obligations on behalf of Borrowers, the application of the proceeds thereof
and repayment thereof and the consummation of the related transactions will
not violate any provision of any such statute or any rule, regulation or
order issued by the Securities and Exchange Commission.
(24) Employee Relations. Each Borrower and each of its
Subsidiaries has a stable work force in place and is not, except
as set forth on Schedule 6.1(x), party to any collective
bargaining agreement nor has any labor union been recognized as
the representative of any Borrower's or any of its Subsidiaries'
employees, and no Borrower knows of pending, threatened or
contemplated strikes, work stoppage or other labor disputes
involving any Borrower's or any of its Subsidiaries' employees.
(25) Intellectual Property. Each Borrower owns or possesses all
Intellectual Property required to conduct its business as now and
presently planned to be conducted without, to its knowledge,
conflict with the rights of others except as otherwise disclosed
on Schedule 6.1(y), and Schedule 6.1(y) lists all Material
Intellectual Property owned by any Borrower or which any Borrower
has the right to use.
(26) Trade Names. All trade names or styles under which any
Borrower creates Receivables, or to which instruments in payment
of Receivables are made payable, are listed on Schedule 6.1(z).
(27) Brokers. No broker or finder acting on behalf of any
Borrower brought about the obtaining, making or closing of the
Loans or the related transactions, and no Borrower has obligation
to any Person in respect of any finder's or brokerage fees in
connection therewith.
(28) Insurance. Schedule 6.1(bb) lists all insurance policies of
any nature maintained, as of the Effective Date, for current
occurrences by any Borrower, as well as a summary of the terms of
each such policy.
(29) Deposit and Controlled Disbursement Accounts. Schedule
6.1(cc) lists all banks and other financial institutions at which
any Borrower maintains deposits and/or other accounts as of the
Effective Date, including any Controlled Disbursement Accounts,
and such Schedule correctly identifies the name, address and
telephone number of each depository, the name in which the
account is held, a description of the purpose of the account, and
the complete account number.
(30) Government Contracts. Except as set forth in Schedule
6.1(dd), as of the Effective Date, no Borrower is a party to any
contract or agreement with the federal government or any state or
municipal government and the Receivables are not subject to the
Federal Assignment of Claims Act, as amended (31 U.S.C. Section
3727) or any similar state or local law.
(31) Customer and Trade Relations. As of the Effective Date,
there exists no actual or, to the knowledge of any Borrower, threatened
termination or cancellation of, or any material adverse modification or
change in: the business relationship of any Borrower with any customer or
group of customers whose purchases during the preceding twelve (12) months
caused them to be ranked among the ten largest customers of any Borrower;
or the business relationship of any Borrower with any supplier material
to its operations.
(32) Agreements and Other Documents.
(1) As of the Effective Date, Borrowers have made available to
Agent or its counsel, on behalf of Lenders, for their review,
accurate and complete copies (or summaries) of all of the
following agreements or documents to which any it is subject and
each of which are listed on Schedule 6.1(ff): supply agreements
and purchase agreements not terminable by a Borrower within sixty
(60) days following written notice issued by such Borrower and
involving transactions in excess of $1,000,000 per annum; and any
lease of equipment having a remaining term of one year or longer
and requiring aggregate rental and other payments in excess of
$500,000 per annum; and
(2) as of the Effective Date, Borrowers have provided to Agent
or its counsel, on behalf of Lenders, accurate and complete
copies of (A) licenses and permits (other than state, municipal
and other local licenses and permits in which case summaries
thereof are acceptable to the Agent) held by a Borrower, the
absence of which could be reasonably likely to have a Materially
Adverse Effect; (B) instruments or documents evidencing
Indebtedness of a Borrower and any security interest granted by
such Borrower with respect thereto; and (C) instruments and
agreements evidencing the issuance of any equity securities,
warrants, rights or options to purchase equity securities of a
Borrower.
SECTION 1.26 Survival of Representation and Warranties, Etc.
All representations and warranties set forth in this Article 6 and all
statements contained in any certificate, financial statement, or other
instrument, delivered by or on behalf of the Borrowers pursuant to or in
connection with this Agreement or any of the Loan Documents (including,
but not limited to, any such representation, warranty or statement made
in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All
representations and warranties made under this Agreement shall be made or
deemed to be made at and as of the Agreement Date, at and as of the
Effective Date and at and as of the date of each Loan, except that (i)
representations and warranties which, by their terms are applicable only to
one such date shall be deemed to be made only at and as of such date, and
(ii) representations and warranties (x) which are applicable after, as well
as on, the Effective Date and (y) which are also the subject of an express
affirmative or negative covenant which is further conditioned or qualified,
shall be deemed conditioned or qualified, as to dates or times after the
Effective Date, in a manner equivalent to the conditions and qualifications
set forth in such related affirmative or negative covenant. All
representations and warranties made or deemed to be made under this
Agreement shall survive and not be waived by the execution and delivery of
this Agreement, any investigation made by or on behalf of the Lenders or
any borrowing hereunder.
ARTICLE 7
SECURITY INTEREST
SECTION 1.27 Security Interest.
(1) To secure the payment, observance and performance of the
Secured Obligations, the Borrowers hereby, jointly and severally, mortgage,
pledge and assign all of the Collateral to the Agent, for the benefit of
itself as Agent and the Lenders, and grants to the Agent, for the benefit
of itself as Agent and the Lenders, a continuing security interest in, and
a continuing Lien upon, all of the Collateral.
(2) As additional security for all of the Secured Obligations,
the Borrowers, jointly and severally, grant to the Agent, for the benefit
of itself as Agent and the Lenders, a security interest in, and assigns to
the Agent, for the benefit of itself as Agent and the Lenders, all of each
and every Borrower's right, title and interest in and to, any deposits or
other sums at any time credited by or due from each Lender and each
Affiliate of a Lender to a Borrower, or credited by or due from any
participant of any Lender to a Borrower, with the same rights therein as
if the deposits or other sums were credited by or due from such Lender.
Each Borrower hereby authorizes each Lender and each Affiliate of such
Lender and each participant to pay or deliver to the Agent, for the account
of the Lenders, without any necessity on the Agent's or any Lender's part
to resort to other security or sources of reimbursement for the Secured
Obligations, at any time during the continuation of any Event of Default
or in the event that the Agent, on behalf of the Lenders, should make
demand for payment hereunder and without further notice to the Borrowers
(such notice being expressly waived), any of the aforesaid deposits
(general or special, time or demand, provisional or final) or other sums
for application to any Secured Obligation, irrespective of whether any
demand has been made or whether such Secured Obligation is mature, and the
rights given the Agent, the Lenders, their Affiliates and participants
hereunder are cumulative with such Person's other rights and remedies,
including other rights of set-off. The Agent will promptly notify the
Borrowers of its receipt of any such funds for application to the Secured
Obligations, but failure to do so will not affect the validity or
enforceability thereof. The Agent may give notice of the above grant of
a security interest in and assignment of the aforesaid deposits and other
sums, and authorization, to, and make any suitable arrangements with, any
Lender, any such Affiliate of any Lender or participant for effectuation
thereof, and Borrowers hereby irrevocably appoint Agent as its attorney to
collect any and all such deposits or other sums to the extent any such
payment is not made to the Agent or any Lender by such Lender, Affiliate
or participant.
SECTION 1.28 Continued Priority of Security Interest.
(1) The Security Interest granted by the Borrowers shall at all
times be valid, perfected and enforceable against each and every
Borrower and all third parties in accordance with the terms of
this Agreement, as security for the Secured Obligations, and the
Collateral shall not at any time be subject to any Liens that are
prior to, on a parity with or junior to the Security Interest,
other than Permitted Liens.
(2) No Borrower shall be required to file a collateral
assignment in the Patent and Trademark Office for any
Intellectual Property other than Material Intellectual Property.
(3) The Borrowers shall, at their cost and expense, take all
action that may be necessary or desirable, or that the Agent may
reasonably request, so as at all times to maintain the validity,
perfection, enforceability and rank of the Security Interest in
the Collateral in conformity with the requirements of Section
7.2(a), or to enable the Agent and the Lenders to exercise or
enforce their rights hereunder, including, but not limited to:
(1) paying all taxes, assessments and other claims lawfully
levied or assessed on any of the Collateral, except to the extent
that such taxes, assessments and other claims constitute
Permitted Liens,
(2) obtaining, after the Effective Date, any additional or new
landlords' and mortgagees' releases, subordinations or waivers,
and using all reasonable efforts to obtain mechanics' releases,
subordinations or waivers,
(3) delivering to the Agent, for the benefit of the Lenders,
endorsed or accompanied by such instruments of assignment as the
Agent may specify, and stamping or marking, in such manner as the
Agent may specify, any and all chattel paper, instruments,
letters and advices of guaranty and documents evidencing or
forming a part of the Collateral, and
(4) executing and delivering financing statements, pledges,
designations, hypothecations, notices and assignments in each
case in form and substance satisfactory to the Agent relating to
the creation, validity, perfection, maintenance or continuation
of the Security Interest under the Uniform Commercial Code or
other Applicable Law.
(4) The Agent is hereby authorized to file one or more financing
or continuation statements or amendments thereto without the
signature of or in the name of any Borrower for any purpose
described in Section 7.2(c). The Agent will give the Borrowers
notice of the filing of any such statements or amendments, which
notice shall specify the locations where such statements or
amendments were filed. A carbon, photographic, xerographic or
other reproduction of this Agreement or of any of the Security
Documents or of any financing statement filed in connection with
this Agreement is sufficient as a financing statement.
(5) Each Borrower shall ▇▇▇▇ its books and records as directed
by the Agent and as may be necessary or appropriate to evidence,
protect and perfect the Security Interest and shall cause its
financial statements to reflect the Security Interest.
SECTION 1.29 Mortgaged Real Property. The Borrowers may elect
to use the Mortgaged Real Estate to support the Letters of Credit
Obligations upon satisfaction of the following conditions
(collectively, the "Mortgaged Real Estate Conditions"):
(1) The Agent shall receive the Borrowers' written notification
not later than ninety (90) days after the Agreement Date of its
election to use the Mortgaged Real Estate as support for the
Letters of Credit Obligations;
(2) The Agent shall receive the following documents in form
satisfactory to the Agent in its sole discretion: (i) an executed
Mortgage in form and substance satisfactory to the Agent, conveying to
the Agent, for the benefit of itself and the Lenders, a first priority
lien on the Mortgaged Real Estate, subject only to such prior liens as the
Agent shall consent to in writing, (ii) an appraisal indicating a fair
market value of the Mortgaged Real Estate in an amount of at least
$5,000,000, performed at the sole cost and expense of the Borrowers by an
appraiser retained by the Agent; (iii) an environmental audit and risk
assessment performed at the sole cost and expense of the Borrowers by an
environmental engineering company retained by the Agent; (iv) a mortgagee
title insurance policy in favor of the Agent and the Lenders insuring such
mortgage to create and convey such first priority lien, subject only to
to such exceptions consented to by the Agent; and (v) such materials and
other information concerning the Mortgaged Real Estate as the Agent may
require, including, without limitation, (A) current and accurate surveys of
the Mortgaged Real Estate satisfactory to the Agent, (B) zoning letters
as to the zoning status of all of the Mortgaged Real Estate, and (C) owner's
affidavits as to such matters relating to the Mortgaged Real Estate as the
Agent may request.
ARTICLE 8
COLLATERAL COVENANTS
Until the Revolving Credit Facility has been terminated and all
the Secured Obligations have been paid in full, unless the Required Lenders
shall otherwise consent in the manner provided in Section 15.9:
SECTION 1.30 Collection of Receivables.
(1) At the request of the Agent, each Borrower will cause all
monies, checks, notes, drafts and other payments relating to or constituting
proceeds of trade accounts receivable to be forwarded to a Lockbox for
deposit in an Agency Account in accordance with the procedures set out in
the corresponding Agency Account Agreement. Each Borrower will promptly
cause all monies, checks, notes, drafts and other payments relating to or
constituting proceeds of other Receivables, of any other Collateral and of
any trade accounts receivable that are not forwarded to a Lockbox, to be
transferred to or deposited in an Agency Account. In particular, each
Borrower will:
(1) advise each Account Debtor on trade accounts receivable to
address all remittances with respect to amounts payable on
account thereof to a specified Lockbox,
(2) advise each other Account Debtor that makes payment to such
Borrower by wire transfer, automated clearinghouse transfer or
similar means to make payment directly to an Agency Account, and
(3) stamp all invoices relating to trade accounts receivable
with a legend satisfactory to the Agent indicating that payment
is to be made to such Borrower via a specified Lockbox.
(2) The Borrowers and the Agent shall cause all collected
balances in each Agency Account to be transmitted daily by wire
transfer, depository transfer check or other means in accordance
with the procedures set forth in the corresponding Agency Account
Agreement, to the Collection Account:
(1) for application, on account of the Secured Obligations, as
provided in Sections 2.3(c), 12.2, and 12.3, such credits to be
entered as of the Business Day following receipt and to be
conditioned upon final payment in cash or solvent credits of the
items giving rise to them, and
(2) with respect to the balance, so long as no Default or Event
of Default has occurred and is continuing, for transfer by wire
transfer or depository transfer check to a Controlled
Disbursement Account.
(3) Any monies, checks, notes, drafts or other payments referred
to in subsection (a) of this Section 8.1 which, notwithstanding
the terms of such subsection, are received by or on behalf of the
Borrowers will be held in trust for the Agent and will be
delivered to the Agent or a Clearing Bank, as promptly as
possible, in the exact form received, together with any necessary
endorsements for application by the Agent directly to the Secured
Obligations or, if applicable, for deposit in the Agency Account
maintained with a Clearing Bank and processing in accordance with
the terms of the corresponding Agency Account Agreement.
(4) It is expressly agreed by the Borrowers that, anything
herein to the contrary notwithstanding, each Borrower shall remain liable
under each of its Contracts, licenses and other agreements, documents and
instruments evidencing Receivables to observe and perform all the
conditions and obligations to be observed and performed by it thereunder.
Neither Agent nor any Lender shall have any obligation or liability under
any such Contract, license or agreement by reason of or arising out of
this Agreement or the granting herein of a security interest therein or the
receipt by Agent or any Lender of any payment relating to any such Contract,
license or agreement pursuant hereto. Neither Agent nor any Lender shall
be required or obligated in any manner to perform or fulfill any of the
obligations of any Borrower under or pursuant to any such Contract, license
or agreement, or to make any payment, or to make any inquiry as to the
nature or the sufficiency of any payment received by it or the sufficiency
of any performance by any party under any such Contract, license or
agreement, or to present or file any claims, or to take any action to
collect or enforce any performance or the payment of any amounts which
may have been assigned to it or to which it may be entitled at any time
or times.
(5) All chattel paper shall be marked with the following legend:
"This writing and the obligations evidenced or secured hereby are subject to
the security interest of The CIT Group/Business Credit, Inc., as Agent, for
the benefit of itself as a Lender and certain other Lenders." For Agent's
further security, Borrowers agree that Agent shall have a special property
right and security interest in all of each Borrower's books and records
pertaining to the Collateral and, upon the occurrence and during the
continuance of any Event of Default, each Borrower shall deliver and turn
over any such books and records to Agent or to its representatives at any
time on demand of Agent. Prior to the occurrence of a Default or Event of
Default and upon notice from Agent, each Borrower shall permit any
representative of Agent to inspect such books and records and shall provide
photocopies thereof to Agent, for the benefit of Agent and Lenders, as more
specifically set forth in this Agreement.
SECTION 1.31 Verification and Notification. The Agent shall
have the right (a) at any time and from time to time, in the name of the
Agent, the Lenders or in the name of any Borrower, to verify the validity,
amount or any other matter relating to any Receivables or other Collateral
by mail, telephone, telegraph or otherwise, and to review, audit and
make extracts from all records and files related to any such Collateral,
and (b) after an Event of Default, to (i) notify the Account Debtors or
obligors under any Receivables, of the assignment of such Collateral to the
Agent, for the benefit of the Lenders, and to direct such Account Debtor or
obligors to make payment of all amounts due or to become due thereunder
directly to the Agent, for the account of the Lenders, and, upon such
notification and at the expense of the Borrowers, to enforce collection of
any such Collateral and to adjust, settle or compromise the amount or
payment thereof, in the same manner and to the same extent as a Borrower
might have done and (ii) cause the certified independent public accountants
then engaged by any Borrower to prepare and deliver to Agent and each Lender
at the Borrowers' expense at any time and from time to time promptly upon
Agent's request the following reports with respect to Borrowers: (a) a
reconciliation of all Receivables; (b) an aging of all Receivables; (c)
trial balances; and (d) a test verification of such Receivables as Agent
may request.
SECTION 1.32 Disputes, Returns and Adjustments.
(1) In the event any amounts due and owing under any Receivable
for an amount in excess of $100,000 are in dispute between the Account
Debtor and a Borrower, such Borrower shall provide the Agent with prompt
written notice thereof.
(2) Each Borrower shall notify the Agent promptly of all returns
and credits in excess of $100,000 in respect of any Receivable, which notice
shall specify the Receivable affected.
(3) Each Borrower may, in the ordinary course of business unless
a Default or an Event of Default has occurred and is continuing, grant any
extension of time for payment of any Receivable or compromise, compound or
settle the same for less than the full amount thereof, or release wholly or
partly any Person liable for the payment thereof, or allow any credit or
discount whatsoever therein; provided that (i) no such action results in
the reduction of more than $100,000 in the amount payable with respect to
any one Receivable or of more than $500,000 per Fiscal Quarter, not to
exceed $1,000,000 in any Fiscal Year, with respect to all Receivables of
the Borrowers (in each case, excluding the allowance of credits or discounts
generally available to Account Debtors in the ordinary course of the
Borrowers' businesses and appropriate adjustments to the accounts of Account
Debtors in the ordinary course of business), and (ii) the Agent is promptly
notified of the amount of such adjustments and the Receivable(s) affected
thereby.
SECTION 1.33 Invoices.
(1) No Borrower will use any invoices other than invoices in the
form delivered to the Agent prior to the Agreement Date and shall
not make any change in the names, addresses, or substantive
terms, conditions or provisions of the invoice without giving the
Agent 45 days prior notice of the intended use of a different
form of invoice together with a copy of such different form.
(2) Upon the reasonable request of the Agent, each Borrower
shall deliver to the Agent, at such Borrower's expense, copies of
customers' invoices or the equivalent, original shipping and
delivery receipts or other proof of delivery, customers'
statements, customer address lists, the original copy of all
documents, including, without limitation, repayment histories and
present status reports, relating to Receivables and such other
documents and information relating to the Receivables as the
Agent shall specify.
SECTION 1.34 Delivery of Instruments. In the event any
Receivable in an amount in excess of $100,000 is, or Receivables
in excess of $500,000 in the aggregate are at any time evidenced
by a promissory note, trade acceptance or any other instrument
for the payment of money, each Borrower will immediately thereafter
deliver such instrument to the Agent, appropriately endorsed to the Agent,
for the benefit of the Lenders.
SECTION 1.35 Ownership and Defense of Title.
(1) Except for Permitted Liens, the Borrowers shall at all times
be the sole owner or lessee of each and every item of Collateral
and shall not create any lien on, or sell, lease, exchange,
assign, transfer, pledge, hypothecate, grant a security interest
or security title in or otherwise dispose of, any of the
Collateral or any interest therein, except for cash or on open
account or on terms of payment ordinarily extended to its
customers, and except for dispositions that are otherwise
expressly permitted under this Agreement. The inclusion of
"proceeds" of the Collateral under the Security Interest shall
not be deemed a consent by the Agent or the Lenders to any other
sale or other disposition of any part or all of the Collateral.
(2) Each and every Borrower shall defend its title or leasehold
interest in and to, and the Security Interest in, the Collateral
against the claims and demands of all Persons.
SECTION 1.36 Insurance.
(1) Each Borrower shall at all times maintain insurance on the
Collateral and its equipment customary and appropriate to the nature of
such Collateral and equipment including, without limitation, coverage
against loss or damage by fire, theft (excluding theft by employees),
burglary, pilferage, loss in transit and such other hazards as the Agent
shall reasonably specify, in amounts not to exceed those obtainable at
commercially reasonable rates and under policies issued by insurers
acceptable to the Agent in the exercise of its reasonable judgment. All
premiums on such insurance shall be paid by such Borrower and copies of
the policies delivered to the Agent.
(2) All insurance policies required under Section 8.7(a) shall
name the Agent, for the benefit of the Lenders, as an additional insured
and shall contain loss payable clauses in the form submitted to the
Borrowers by the Agent, or otherwise in form and substance satisfactory
to the Required Lenders, naming the Agent, for the benefit of the Lenders,
as loss payee, as its interests may appear, and providing that
(1) all proceeds thereunder shall be payable to the Agent, for
the benefit of the Lenders (provided, however, if no Default or
Event of Default exists, proceeds from any loss not exceeding
$250,000 may be paid to the Borrowers for replacement of the
damaged or destroyed property),
(2) no such insurance shall be affected by any act or neglect of
the insurer or owner of the property described in such policy, and
(3) such policy and loss payable clauses may be canceled,
amended or terminated only upon at least 10 days prior written
notice given to the Agent.
(3) Any proceeds of insurance referred to in this Section 8.7
which are paid to the Agent, for the account of the Lenders, shall be, at
the option of the Required Lenders in their sole discretion, either (i)
applied to replace the damaged or destroyed property, or (ii) applied to
the payment or prepayment of the Secured Obligations.
(4) Each Borrower irrevocably makes, constitutes and appoints
Agent (and all officers, employees or agents designated by Agent), so
long as any Event of Default shall have occurred and be continuing as such
Borrower's true and lawful agent and attorney-in-fact for the purpose of
making, settling and adjusting claims under such "All Risk" policies of
insurance, endorsing the name of such Borrower on any check or other
item of payment for the proceeds of such "All Risk" policies of insurance
and for making all determinations and decisions with respect to such
"All Risk" policies of insurance; provided, however, that in the event
that any claim which is or could be made under any of such insurance
policies exceeds $1,000,000 no such claim shall be settled, compromised or
finally determined, except with the prior written consent of Agent. Agent
shall have no duty to exercise any rights or powers granted to it pursuant
to the foregoing power-of-attorney. Each Borrower shall promptly notify
Agent of any loss, damage, or destruction to the Collateral in the amount
of $200,000 or more, whether or not covered by insurance. After deducting
from such proceeds the expenses, if any, incurred by Agent in the collection
or handling thereof, Agent may, at its option, apply such proceeds to the
reduction of the Secured Obligations, or permit or require such Borrower to
use such money, or any part thereof, to replace, repair, restore or rebuild
the Collateral in a diligent and expeditious manner with materials and
workmanship of substantially the same quality as existed before the loss,
damage or destruction. Notwithstanding the foregoing, if the casualty
giving rise to such insurance proceeds would not reasonably be expected to
have a Materially Adverse Effect and such insurance proceeds do not exceed
$2,500,000 in the aggregate, Agent shall permit such Borrower to replace,
restore, repair or rebuild the property; provided that if such Borrower has
not completed or entered into binding agreements to complete such
replacement, restoration, repair or rebuilding within 180 days of such
casualty, Agent may apply such insurance proceeds to the reduction of the
Secured Obligations. All insurance proceeds which are to be made available
to a Borrower to replace, repair, restore or rebuild the Collateral shall be
applied by Agent to reduce the outstanding principal balance of the
Revolving Loan (which application shall not result in a permanent reduction
of the Revolving Loan Commitment) and upon such application, Agent shall
establish a Reserve against the Borrowing Base in an amount equal to the
amount of such proceeds so applied. Thereafter, such funds shall be made
available to the Borrowers to provide funds to replace, repair, restore or
rebuild the Collateral as follows: (i) Borrowers shall request an Advance
in the amount requested to be released; (ii) so long as the conditions set
forth in Article 2 have been met, the Lenders shall make such Advance; and
(iii) the Reserve established with respect to such insurance proceeds shall
be reduced by the amount of such Advance. To the extent not used to replace,
repair, restore or rebuild the Collateral, such insurance proceeds shall be
applied to the reduction of the Secured Obligations.
SECTION 1.37 Location of Offices and Collateral.
(1) No Borrower will change the location of its chief executive
office or the place where it keeps its books and records relating to the
Collateral or change its name, its identity or corporate structure in any
manner which might make any Financing Statement or other Uniform Commercial
Code amendment, assignment or continuation statement filed in connection
herewith seriously misleading within the meaning of Section 9-402(7) of the
Uniform Commercial Code or any other then applicable provision of the
Uniform Commercial Code without giving the Agent 30 days prior written
notice thereof and complying with the requirements and conditions of
Section 8.8(b).
(2) After Agent's written acknowledgment that any reasonable
action requested by Agent in connection with any changes covered
by Section 8.8(a), including continuation of the perfection of
any Liens in favor of Agent, on behalf of Lenders, in any
Collateral, has been completed or taken, a Borrower may change
the location of its Collateral or the location where it keeps
its books and records relating to the Collateral, provided that
any such new location shall be in the continental United States,
or change its name, its identity or its corporate structure. No
Borrower shall change its fiscal year to a year ending in any day
other than December 31.
SECTION 1.38 Records Relating to Collateral. Each Borrower
will at all times keep complete and accurate records of all Collateral on
a basis consistent with past practices of such Borrower.
SECTION 1.39 Inspection. The Agent and each Lender (by any of
their officers, employees or agents) shall have the right, to the extent
that the exercise of such right shall be within the control of a Borrower,
at any time or times to (a) visit the properties of any Borrower and its
Subsidiaries, inspect the Collateral and the other assets of such Borrower
and its Subsidiaries and inspect and make extracts from the books and
records of such Borrower and its Subsidiaries, including but not limited to
management letters prepared by independent accountants, all during
customary business hours at such premises; (b) discuss such Borrower's and
its Subsidiaries' business, assets, liabilities, financial condition,
results of operations and business prospects, insofar as the same are
reasonably related to the rights of the Agent or the Lenders hereunder or
under any of the Loan Documents, with such Borrower's and its Subsidiaries'
(i) principal officers, (ii) independent accountants, and (iii) any other
Person (except that any such discussion with any third parties shall be
conducted only in accordance with the Agent's or such Lender's standard
operating procedures relating to the maintenance of the confidentiality of
confidential information of borrowers); and (c) verify the amount, quantity,
value and condition of, or any other matter relating to, any of the
Collateral and in this connection to review, audit and make extracts from
all records and files related to any of the Collateral.
The Borrowers will deliver to the Agent, for the benefit of the Lenders,
any instrument necessary for it to obtain records from any service bureau
maintaining records on behalf of the Borrowers.
SECTION 1.40 Information and Reports.
(1) Schedule of Receivables. The Borrowers shall deliver to the
Agent (i) on or before the Effective Date, a Schedule of Receivables as of
a date not more than three (3) Business Days prior to the Effective Date
which schedule shall be reconciled to the balance of the accounts receivable
as set forth in a Consolidated Balance Sheet as of such date, and (ii) no
later than ten (10) days after the end of each Fiscal Month of the Borrowers,
a Schedule of Receivables as of the last Business Day of the Borrowers'
immediately preceding Fiscal Month which schedule shall be reconciled to
(A) the balance of the accounts receivable as set forth in the Consolidated
Balance Sheet as of the end of such Fiscal Month and (B) the Schedule of
Receivables delivered in respect of the next preceding Fiscal Month.
(2) Borrowing Base Certificate. Borrowers shall deliver to the
Agent not later than three (3) Business Days after the last day of each
accounting week of the Borrowers a Borrowing Base Certificate prepared as
of the close of business on the last Business Day of such accounting week,
and upon the Agent's request on each Business Day a Borrowing Base
Certificate as of the third (3rd) preceding Business Day.
(3) Notice of Diminution of Value. Each Borrower shall give
prompt notice to the Agent of any matter or event which has resulted in, or
may result in, the diminution in excess of $100,000 in the value of any of
its Collateral, except for any such diminution (i) in the value of any
Receivables in the ordinary course of business or (ii) which has been
appropriately reserved against, as reflected in financial statements
previously delivered to the Agent and the Lenders pursuant to Article 10.
(4) Additional Information. The Agent may in its discretion from
time to time request that the Borrowers deliver the schedules, certificates
described in Sections 8.11(a), (b) and (c) more or less often and on
different schedules than specified in such Sections and the Borrowers will
comply with such requests. The Borrowers will also furnish to the Agent
and each Lender such other information with respect to the Collateral as
the Agent or such Lender may from time to time reasonably request.
SECTION 1.41 Assignment of Claims Act. Upon the request of the
Agent, the Borrowers shall execute any documents or instruments and shall
take such steps or actions reasonably required by the Agent so that all
monies due or to become due under any contract with the United States of
America, the District of Columbia or any state, county, municipality or
other domestic or foreign governmental entity, or any department, agency or
instrumentality thereof, will be assigned to the Agent, for the benefit of
itself and the Lenders, and notice given thereof in accordance with the
requirements of the Assignment of Claims Act of 1940, as amended, or any
other laws, rules or regulations relating to the assignment of any such
contract and monies due or to become due.
SECTION 1.42 Covenants Regarding Material Intellectual Property
Collateral.
(1) Each Borrower shall notify Agent immediately if it knows
that any application or registration relating to any Material Intellectual
Property (now or hereafter existing) may become abandoned or dedicated, or
of any adverse determination or development (including the institution of,
or any such determination or development in, any proceeding in the United
States Patent and Trademark Office, the United States Copyright Office or
any court) regarding such Borrower's ownership of any Material Intellectual
Property, its right to register the same, or to keep, use and maintain the
same.
(2) Promptly after the date on which (i) a Borrower acquires any
Material Intellectual Property or (ii) any Intellectual Property becomes
Material Intellectual Property, such Borrower shall execute and deliver any
and all Material Intellectual Property security agreements as Agent may
request to evidence Agent's security interest in such Material Intellectual
Property, and the General Intangibles of such Borrower relating thereto or
represented thereby.
(3) Each Borrower shall take all actions necessary or requested
by Agent to maintain and pursue each application, to obtain the relevant
registration and to maintain the registration with respect to all of its
Material Intellectual Property (now or hereafter existing), including the
filing of applications for renewal, affidavits of use, affidavits of
noncontestability and opposition and interference and cancellation
proceedings.
(4) In the event that any of the Material Intellectual Property
Collateral is infringed upon, or misappropriated or diluted by a third party,
Borrowers shall notify Agent promptly after a Borrower learns thereof. Each
Borrower shall, unless it shall reasonably determine that such Material
Intellectual Property is no longer material to the conduct of its business
or operations in accordance with the definition of "Material Intellectual
Property," promptly ▇▇▇ for infringement, misappropriation or dilution and
to recover any and all damages for such infringement, misappropriation or
dilution, and shall take such other actions as Agent shall deem appropriate
under the circumstances to protect such Material Intellectual Property
Collateral.
ARTICLE 9
AFFIRMATIVE COVENANTS
Until the Revolving Credit Facility has been terminated and all the
Secured Obligations have been paid in full, unless the Required Lenders
shall otherwise consent in the manner provided for in Section 15.9, each
Borrower will, and will cause each of its Subsidiaries to:
SECTION 1.43 Preservation of Corporate Existence and Similar
Matters.
(1) Preserve and maintain its corporate existence, rights,
franchises, licenses and privileges in the jurisdiction of its incorporation
and qualify and remain qualified as a foreign corporation and authorized to
do business in each jurisdiction in which the character of its properties or
the nature of its business requires such qualification or authorization,
except where the failure to obtain or maintain such qualification or
authorization would not have a Material Adverse Effect on such Borrower and
its Subsidiaries as a whole provided, that, within one hundred eighty (180)
days after the Effective Date, each of the Borrowers and Guarantors listed
on Schedule 9.1 hereto shall be dissolved or merged with and into the
respective owners of each such Borrower or Guarantor.
(2) Deliver to the Agent within sixty (60) days after the
Effective Date, certificates evidencing the good standing of each Borrower
in each jurisdiction in which it is required to be qualified as a foreign
corporation to transact business as presently conducted including, without
limitation, those jurisdictions in which intrastate authority is held (as
listed in Schedule 6.1(f) hereto) and required to be held.
SECTION 1.44 Compliance with Applicable Law. Comply with all
material Applicable Laws relating to such Borrower or such Subsidiary.
SECTION 1.45 Maintenance of Property. In addition to, and not
in derogation of, the requirements of the Security Documents,
(1) protect and preserve all properties material to its business,
including copyrights, patents, trade names and trademarks, and maintain in
good repair, working order and condition in all material respects, with
reasonable allowance for wear and tear, all tangible properties, and
(2) from time to time make or cause to be made all needed and
appropriate repairs, renewals, replacements and additions to such properties
necessary for the conduct of its business, so that the business carried on
in connection therewith may be properly and advantageously conducted at
all times.
SECTION 1.46 Conduct of Business. At all times carry on its
business in an efficient manner and engage only in the business described
in Section 6.1(e).
SECTION 1.47 Insurance. Maintain, in addition to the coverage
required by Section 8.7 and the Security Documents, insurance with
responsible insurance companies against such risks and in such amounts as
is customarily maintained by similar businesses or as may be required by
Applicable Law, and from time to time deliver to the Agent or any Lender
upon its request a detailed list of the insurance then in effect, stating
the names of the insurance companies, the amounts and rates of the
insurance, the dates of the expiration thereof and the properties and risks
covered thereby.
SECTION 1.48 Payment of Taxes and Claims. Pay or discharge
when due (a) all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or upon any properties
belonging to it, except that real property ad valorem taxes shall be
deemed to have been so paid or discharged if the same are paid before
they become delinquent, and (b) all lawful claims of materialmen,
mechanics, carriers, warehousemen and landlords for labor, materials,
supplies and rentals which, if unpaid, might become a Lien on any
properties of such Borrower; except that this Section 9.6 shall not
require the payment or discharge of any such tax, assessment, charge,
levy or claim which is being contested in good faith by appropriate
proceedings and for which reserves in respect of the reasonably anticipated
liability therefor have been appropriately established.
SECTION 1.49 Accounting Methods and Financial Records. Maintain
a system of accounting, and keep such books, records and accounts (which
shall be true and complete), as may be required or as may be necessary to
permit the preparation of financial statements in accordance with GAAP
consistently applied.
SECTION 1.50 Use of Proceeds.
(1) Use the proceeds of the initial Revolving Credit Loan to (i)
refinance and pay off the total outstanding amounts due to Bank of New York
as indicated on Schedule 9.8 and to fund certain of the fees and expenses
associated with the extension of the Loans, and (ii) all subsequent Loans
only for working capital purposes or as is otherwise expressly authorized
herein, and
(2) not use any part of such proceeds to purchase or, to carry
or reduce or retire or refinance any credit incurred to purchase or carry,
any margin stock (within the meaning of Regulation G or U of the Board of
Governors of the Federal Reserve System) or, in any event, for any purpose
which would involve a violation of such Regulation G or U or of Regulation
T or X of such Board of Governors, or for any purpose prohibited by law or
by the terms and conditions of this Agreement.
SECTION 1.51 Hazardous Waste and Substances: Environmental
Requirements.
(1) In addition to, and not in derogation of, the requirements
of Section 9.2 and of the Security Documents, substantially
comply with all Environmental Laws and all Applicable Laws
relating to occupational health and safety (except for instances
of noncompliance that are being contested in good faith by
appropriate proceedings if reserves in respect of such Borrower's
or such Subsidiary's reasonably anticipated liability therefor
have been appropriately established), promptly notify the Agent
of its receipt of any notice of a violation of any such
Environmental Laws or other such Applicable Laws and indemnify
and hold the Agent and the Lenders harmless from all
Environmental Liabilities incurred by or imposed upon the Agent
or any Lender on account of such Borrower's failure to perform
its obligations under this Section 9.9.
(2) Such Borrower shall not cause or permit a Release of any
Contaminant on, at, in, under, above, to, from or about any of
the Real Estate where such Release would (a) violate in any
respect, or form the basis for any Environmental Liabilities
under, any Environmental Laws or Environmental Permits or (b)
otherwise adversely impact the value or marketability of any of
the Real Estate or any of the Collateral, other than such
violations or impacts which could not reasonably be expected to
have a Materially Adverse Effect on such Borrower and its
Subsidiaries as a whole.
(3) Whenever such Borrower gives notice to the Agent pursuant to
this Section 9.9 with respect to a matter that reasonably could
be expected to result in an Environmental Liability to such
Borrower in excess of $500,000 in the aggregate, such Borrower
shall, at the Agent's request and such Borrower's expense (i) cause an
independent environmental engineer acceptable to the Agent to conduct an
assessment, including tests where necessary, of the site where the
noncompliance or alleged noncompliance with Environmental Laws has occurred
and prepare and deliver to the Agent a report setting forth the results of
such assessment, a proposed plan to bring such Borrower into compliance
with such Environmental Laws (if such assessment indicates noncompliance)
and an estimate of the costs thereof, and (ii) provide to the Agent a
supplemental report of such engineer whenever the scope of the
noncompliance, or the response thereto or the estimated costs thereof,
shall materially adversely change.
SECTION 1.52 Landlords' Agreements, Mortgagee Agreements and
Bailee Letters. Such Borrower shall use its reasonable best efforts to
obtain a landlord's agreement, mortgagee agreement or bailee letter, as
applicable, from the lessor of each leased property or mortgagee of owned
property or with respect to any warehouse, processor or converter facility
or other location where Collateral is located, which agreement or letter
shall contain a waiver or subordination of all Liens or claims that the
landlord, mortgagee or bailee may assert against the Collateral at that
location, and shall otherwise be satisfactory in form and substance to
Agent. After the Effective Date, no real property or warehouse space where
Collateral may be stored or located shall be leased or acquired by such
Borrower, unless and until a satisfactory landlord or mortgagee agreement,
as the case may be, shall first have been obtained with respect to such
location. Such Borrower shall timely and fully pay and perform its
obligations under all leases and other agreements with respect to each
leased location or public warehouse where any Collateral is or may be
located. Nothing contained in this Section 9.10 shall impair or otherwise
modify any of Agent's rights under this Agreement, including, without
limitation, Lender's rights pursuant to the respective definitions of
"Eligible Receivables" and "Borrowing Base."
SECTION 1.53 Further Assurances. Each Borrower agrees that it
shall, at its expense and upon request of Agent, duly execute and deliver,
or cause to be duly executed and delivered, to Agent such further
instruments and do and cause to be done such further acts as may be
necessary in the reasonable opinion of Agent to carry out the express
provisions of this Agreement or any other Loan Document.
ARTICLE 10
INFORMATION
Until the Revolving Credit Loans Facility has been terminated and
all the Secured Obligations have been paid in full, unless the Required
Lenders shall otherwise consent in the manner set forth in Section 15.9,
each Borrower will furnish to the Agent and to each Lender at the offices
then designated for such notices pursuant to Section 15.1:
SECTION 1.54 Financial Statements.
(1) Audited Year-End-Statements. As soon as available, but in
any event within 90 days after the end of each Fiscal Year of the Borrowers,
copies of the Consolidated Balance Sheet and the Consolidating Balance
Sheets as at the end of such Fiscal Year and the related statements of
income, shareholders' equity and cash flow for such Fiscal Year, together
with consolidating statements for the Borrowers and the Guarantors, in each
case setting forth in comparative form the figures for the previous Fiscal
Year of the Borrowers and the Guarantors and reported on, without
qualification, by independent certified public accountants selected by
Borrowers and acceptable to the Agent (the "Audited Financial Statements").
(2) Quarterly Financial Statements. As soon as available, but
in any event within forty-five (45) days after the end of each Fiscal
Quarter of the Borrowers, copies of the Consolidated Balance Sheet and the
Consolidating Balance Sheets, as of the end of such Fiscal Quarter, and the
related statements of income, shareholders, equity, and cash flow for such
Fiscal Quarter, together with consolidating statements for the Borrowers
and the Guarantors, in each case setting forth in comparative form the
figures for the previous Fiscal Year of the Borrowers and Guarantors
(including, without limitation, a comparison to the projected budgeted
figures), certified by the Financial Officer of the Borrowers and the
Guarantors, to the best of his knowledge, as presenting fairly the financial
condition and results of operations of the Borrower and the Guarantors as of
the date thereof and for the periods ended on such date, subject to normal
year-end adjustments.
(3) Monthly Financial Statements. As soon as available, but in
any event within thirty (30) days after the end of each Fiscal Month of
the Borrowers, copies of the Consolidated Balance Sheet and Consolidating
Balance Sheets of the Borrowers and the Guarantors as at the end of such
Fiscal Month and the related unaudited income statement for the Borrowers
and the Guarantors for such Fiscal Month and for the portion of the Fiscal
Year through such Fiscal Month, together with consolidating statements
for the Borrowers and the Guarantors, in each case setting forth in
comparative form the figures for the previous Fiscal Year (including,
without limitation, a comparison to the projected budget figures for the
previous Fiscal Year), certified by the Financial Officer of the Borrowers
and the Guarantors to the best of his knowledge as presenting fairly the
financial condition and results of operations of the Borrowers and the
Guarantors as at the date thereof and for the periods ended on such date,
subject to normal year end adjustments.
(4) Projected Financial Statements. As soon as available, but
in any event prior to the last Business Day of each Fiscal Year during the
term hereof, forecasted financial statements prepared by the Operating
Companies on a consolidated basis and approved by Trism's Board of
Directors, consisting of monthly consolidated balance sheets, cash flow
statements and income statements of the Operating Companies, reflecting
projected borrowings hereunder and setting forth the assumptions on which
such forecasted financial statements were prepared, covering the one-year
period commencing on the first day of the next succeeding fiscal year.
All such financial statements referred to in clauses (a) and (b) shall be
complete and correct in all material respects and prepared in accordance
with GAAP (except, with respect to interim financial statements, for the
omission of footnotes and normal year-end adjustments) applied consistently
throughout the periods reflected therein.
SECTION 1.55 Accountants' Certificate. Together with the Audited
Financial Statements referred to in Section 10.1(a), each Borrower shall use
its reasonable best efforts to cause its independent certified public
accountants to deliver a certificate of such accountants addressed to
the Agent
(1) stating that in making the examination necessary for the
certification of such financial statements, nothing has come to their
attention to lead them to believe that any Default or Event of Default
exists and, in particular, they have no knowledge of any Default or Event
of Default or, if such is not the case, specifying such Default or Event
of Default and its nature, and
(2) having attached the calculations, prepared by each Borrower
and reviewed by such accountants, required to establish whether or not each
Borrower is in compliance with the covenants contained in Sections 11.1,
11.2, 11.5, 11.6, 11.10 and 11.12, as at the date of such financial
statements.
SECTION 1.56 Officer's Certificate. Together with each delivery
of financial statements required by Section 10.1 (a), (b) and (c), a
certificate of each Borrower's President or Financial Officer (a) stating
that, based on an examination sufficient to enable him to make an informed
statement, no Default or Event of Default exists or, if such is not the case,
specifying such Default or Event of Default and its nature, when it occurred,
whether it is continuing and the steps being taken by each Borrower with
respect to such Default or Event of Default, and (b) setting forth the
calculations necessary to establish whether or not each Borrower was in
compliance with the covenants contained in Sections 11.1, 11.2, 11.5,
11.6, 11.10 and 11.12 as of the date of such statements.
SECTION 1.57 Copies of Other Reports.
(1) Promptly upon receipt thereof, copies of all reports, if
any, submitted to each Borrower or its Board of Directors by its
independent public accountants.
(2) As soon as practicable, copies of all financial statements
and reports that each Borrower shall send to its shareholders generally
and of all registration statements and all regular or periodic reports which
each Borrower shall file with the Securities and Exchange Commission or
any successor commission.
(3) From time to time and as soon as reasonably practicable
following each request, such forecasts, data, certificates, reports,
statements, opinions of counsel, documents or further information
regarding the business, assets, liabilities, financial condition, results
of operations or business prospects of each Borrower or any of its
Subsidiaries as the Agent or any Lender may reasonably request and that
each Borrower has or (except in the case of legal opinions relating to
the perfection or priority of the Security Interest) without unreasonable
expense can obtain; provided, however, that the Lenders shall, to the extent
reasonably practicable, coordinate examinations of each Borrower's records
by their respective internal auditors. The rights of the Agent and the
Lenders under this Section 10.4 are in addition to and not in derogation
of their rights under any other provision of this Agreement or of any
other Loan Document.
(4) If requested by the Agent or any Lender, each Borrower will
furnish to the Agent and the Lenders statements in conformity with the
requirements of Federal Reserve Form G-3 or U-1 referred to in Regulation
G and U, respectively, of the Board of Governors of the Federal
Reserve System.
SECTION 1.58 Notice of Litigation and Other Matters. Prompt
notice of:
(1) the commencement, to the extent each Borrower is aware of
the same, of all proceedings and investigations by or before any
governmental or nongovernmental body and all actions and
proceedings in any court or before any arbitrator against or in
any other way relating to or affecting any Borrower, any of its
Subsidiaries or any of any Borrower's or any of its Subsidiaries'
properties, assets or businesses, which might, singly or in the
aggregate, result in the occurrence of a Default or an Event of
Default, or have a Materially Adverse Effect on any Borrower and
its Subsidiaries, taken as a whole,
(2) any amendment of the articles of incorporation or by-laws of
any Borrower or any of its Subsidiaries,
(3) any change in the business, assets, liabilities, financial
condition, results of operations or business prospects of any
Borrower or any of its Subsidiaries which has had or may have,
singly or in the aggregate, a Materially Adverse Effect on any
Borrower or its Subsidiaries, taken as a whole, and any change in
the Chief Executive Officer, President or Chief Financial Officer
of such Borrower, and
(4) any Default or Event of Default or any event which
constitutes or which with the passage of time or giving of notice
or both would constitute a default or event of default by any
Borrower or any of its Subsidiaries under any material agreement
(other than this Agreement) to which any Borrower or any of its
Subsidiaries is a party or by which any Borrower, any of its
Subsidiaries or any of any Borrower's or any of its Subsidiaries'
properties may be bound.
SECTION 1.59 ERISA. As soon as possible and in any event
within 30 days after any Borrower knows, or has reason to know, that:
(1) any Termination Event with respect to a Plan has occurred or
will occur, or
(2) the aggregate present value of the Unfunded Vested Accrued
Benefits under all Plans is equal to an amount in excess of $0.00, or
(3) any Borrower or any of its Subsidiaries is in "default" (as
defined in Section 4219(c)(5) of ERISA) with respect to payments tp a
Multiemployer Plan required by reason of such Borrower's or such
Subsidiary's complete or partial withdrawal (as described in Section 4203
or 4205 of ERISA) from such Multiemployer Plan,
a certificate of the President or a Financial Officer of such Borrower
setting forth the details of such event and the action which is proposed to
be taken with respect thereto, together with any notice or filing which may
be required by the PBGC or other agency of the United States government
with respect to such event.
SECTION 1.60 Accuracy of Information. All written information,
reports, statements and other papers and data furnished to the Agent or
any Lender, whether pursuant to this Article 10 or any other provision of
this Agreement or of any other Loan Document, shall be, at the time the
same is so furnished, complete and correct in all material respects to the
extent necessary to give the Agent and the Lenders true and accurate
knowledge of the subject matter.
SECTION 1.61 Revisions or Updates to Schedules. Should any of
the information or disclosures provided on any of the Schedules originally
attached hereto become outdated or incorrect in any material respect, the
Borrowers shall deliver to the Agent and the Lenders as part of the officer's
certificate required pursuant to Section 10.3 such revisions or updates to
such Schedule(s) as may be necessary or appropriate to update or correct
such Schedule(s), provided that no such revisions or updates to any
Schedule(s) shall be deemed to have amended, modified or superseded such
Schedule(s) as originally attached hereto, or to have cured any breach of
warranty or representation resulting from the inaccuracy or incompleteness
of any such Schedule(s), unless and until the Required Lenders in the
exercise of their reasonable credit judgment, shall have accepted in
writing such revisions or updates to such Schedule(s).
ARTICLE 11
NEGATIVE COVENANTS
Until the Revolving Credit Facility has been terminated
and all the Secured Obligations have been paid in full, unless
the Required Lenders shall otherwise consent in the manner set
forth in Section 15.9, no Borrower will directly or indirectly
and will not permit its Affiliates to:
SECTION 1.62 Financial Ratios. Upon and after the event of an
Availability Shortfall, breach any of the financial covenants set forth in
this Section 11.1:
(1) Minimum Adjusted Net Worth. Upon and after the event of an
Availability Shortfall, the Adjusted Net Worth of the Borrowers shall not,
at any time during the then remaining term hereof, be less than $105,000,000.
(2) Minimum Fixed Charge Coverage Ratio. Upon and after the event
of an Availability Shortfall, Borrowers shall have a Fixed Charge Coverage
Ratio for each Measurement Period (i) in Fiscal Year 1997, of not less than
.80 to 1.00, (ii) in Fiscal Year 1998, of not less than .85 to 1.00 and
(iii) at all times thereafter, of not less than .90 to 1.00.
(3) Maximum Leverage Ratio. Upon and after the event of an
Availability Shortfall, the Borrowers shall not permit the Leverage Ratio
at any time (i) through and including the month ended June 30, 1998, to
exceed 8.75:1, (ii) from July 1, 1998 through and including the month ended
June 30, 1999, to exceed 8.25:1, and (iii) at all times thereafter, to
exceed 8.00 to 1.00.
SECTION 1.63 Indebtedness for Money Borrowed. Create, assume,
or otherwise become or remain obligated in respect of, or permit or suffer
to exist or to be created, assumed or incurred or to be outstanding any
Indebtedness for Money Borrowed, except for (a) Indebtedness to the Lenders
arising under this Agreement, (b) Permitted Existing Indebtedness, (c)
Capitalized Lease Obligations and Operating Lease Obligations relating to
sale/leaseback transactions which meet the requirements of Section 11.12, in
an aggregate amount up to $15,000,000 for each of the Fiscal Years during
the term hereof, and (d) Permitted Incremental Obligations.
SECTION 1.64 Guaranties. Become or remain liable with respect
to any Guaranty of any obligation of any other Person, except for Permitted
Guaranties.
SECTION 1.65 Investments. Acquire, after the Agreement Date,
any Business Unit or Investment or, after such date, maintain any Investment
other than Permitted Investments.
SECTION 1.66 Unfunded Capital Expenditures. Make any Unfunded
Capital Expenditures, except that the Borrowers may make aggregate Unfunded
Capital Expenditures in each Fiscal Year during the term hereof in an amount
not to exceed, (a) $60,000,000 less (b) the sum of (i) all payments made or
scheduled to be made by any Borrower during such Fiscal Year on or with
respect to Purchase Money Indebtedness, Operating Lease Obligations and
(without duplication) Indebtedness for Money Borrowed which, in each case,
was incurred by a Borrower prior to the commencement of such Fiscal Year,
and (ii) the aggregate amount of all Purchase Money Indebtedness and
Operating Lease Obligations incurred by any of the Borrowers during such
Fiscal Year.
SECTION 1.67 Restricted Dividend Payments and Purchases, Etc.
Declare or make any Restricted Distribution or Restricted Payment, except
that in each Fiscal Year during the term hereof, Trism may (i) redeem or
purchase from its employees shares of Trism capital stock in an aggregate
amount during the term hereof not to exceed $300,000 and (ii) redeem,
purchase or prepay Subordinated Indebtedness prior to any stated maturity
date or prior to the due date of any scheduled installment or amortization
payment with respect thereto (collectively, a "Prepayment") in an amount up
to $10,000,000 per Fiscal Year, not to exceed $5,000,000 per Fiscal Quarter,
provided that (a) the Adjusted Net Worth before and after giving effect to
any proposed Prepayment of the Subordinated Indebtedness is not less than
$105,000,000 and (b) the Borrowers' Borrowing Base Availability both before
and after giving effect to the Prepayment of the Subordinated Indebtedness
exceeds an amount equal to the sum of (x) $8,000,000 plus (y) the aggregate
amount of the Borrowers' accounts payable sixty (60) days or more past due
plus (z) without duplication with respect to clause (y) hereof, the
aggregate amount of the Borrowers' accounts payable ninety (90) days or
more past the invoice date and (c) no Default or Event of Default exists
or is continuing or will occur as a result of the Prepayment. Subject to
the foregoing conditions and limitations, the Borrowers may elect to make
a Prepayment of the Subordinated Indebtedness by providing prior written
notice thereof which shall contain a certificate of a Financial Officer
certifying (y) that the Borrowers' consolidated Adjusted Net Worth and the
Borrowing Base Availability comply with the requirements set forth in the
immediately preceding sentence and (z) that no Default or Event of Default
exists or is continuing or will occur as a result of the Prepayment.
SECTION 1.68 Merger, Consolidation and Sale of Assets. Merge
or consolidate with any other Person or sell, lease or transfer or otherwise
dispose of all or a substantial portion of its assets to any Person,
including its stock or the capital stock of any of its Subsidiaries, other
than sales of Inventory in the ordinary course of business and except as
permitted pursuant to Section 9.1 hereof.
SECTION 1.69 Transactions with Affiliates. Effect any transaction
with any Affiliate without the express prior written consent of the Agent,
except (i) in the ordinary course of the Borrower's business and (ii) loans
to Affiliates of any of the Borrowers in the aggregate during the term
hereof not to exceed $250,000, excluding the existing loans to Affiliates
set forth in Schedule 11.8 hereto as of the Effective Date.
SECTION 1.70 Liens. Create, assume or permit or suffer to exist
to be created or assumed any Lien on any of the Collateral or its other
assets, other than Permitted Liens.
SECTION 1.71 Operating Leases. Enter into any lease other than
a Capitalized Lease (an "Operating Lease") that would cause the Borrowers
to exceed the Permitted Incremental Obligations.
SECTION 1.72 Plans. Permit any condition to exist in connection
with any Plan which might constitute grounds for the PBGC to institute
proceedings to have such Plan terminated or a trustee appointed to
administer such Plan, and any other condition, event or transaction with
respect to any Plan which could result in the incurrence by such Borrower
of any material liability, fine or penalty.
SECTION 1.73 Sales and Leasebacks. Except as set forth in
Schedule 11.12, enter into any synthetic lease or any arrangement with
any Person providing for such Borrower's leasing from such Person any
real or personal property which has been or is to be sold or transferred,
directly or indirectly, by such Borrower to such Person provided that the
Borrowers may enter into sale/leaseback transactions with aggregate Net
Proceeds in an amount for all Borrowers not to exceed $15,000,000 per
Fiscal Year.
SECTION 1.74 Capital Structure and Business. (a) Make any
material changes in any of its business objectives, purposes or operations
which could reasonably be expected to materially and adversely affect the
repayment of the Loans or any of the other Secured Obligations or could
reasonably be expected to result in a Materially Adverse Effect on such
Borrower and its Subsidiaries as a whole, (b) make any change in its
capital structure as described on Schedule 11.13, including the issuance
of any shares of stock, warrants or other securities convertible into
Stock or any revision of the terms of its outstanding stock, except for
options issued pursuant to the terms of the employee and/or management
stock option plan in effect as of the Effective Date and the shares of
stock issued in connection therewith, or (c) amend its charter or bylaws
in a manner which would adversely affect Agent or Lenders or such
Borrower's duty or ability to repay the Secured Obligations.
SECTION 1.75 No Impairment of Intercompany Transfers. Directly
or indirectly enter into or become bound by any agreement, instrument,
indenture or other obligation (other than this Agreement and the other
Loan Documents) which could directly or indirectly restrict, prohibit or
require the consent of any Person with respect to the payment of dividends
or distributions or the making or repayment of intercompany loans by a
Subsidiary of such Borrower to such Borrower.
SECTION 1.76 No Speculative Transactions. Engage in any
transaction involving commodity options, futures contracts or similar
transactions, except solely to hedge against fluctuations in the prices of
commodities owned or purchased by it and the values of foreign currencies
receivable or payable by it and interest swaps, caps or collars.
ARTICLE 12
DEFAULT
SECTION 1.77 Events of Default. Each of the following shall
constitute an Event of Default, whatever the reason for such event and
whether it shall be voluntary or involuntary or be effected by operation
of law or pursuant to any judgment or order of any court or any order,
rule or regulation of any governmental or nongovernmental body:
(1) Default in Payment. Any Borrower shall default in any
payment of principal of or interest on any Loan or any Note when and as due
(whether at maturity, by reason of acceleration or otherwise).
(2) Other Payment Default. Any Borrower shall default in the
payment, as and when due, of principal of or interest on, any other Secured
Obligation, and such default shall continue for a period of five (5) days
after written notice thereof has been given to such Borrower by the Agent.
(3) Misrepresentation. Any representation or warranty made or
deemed to be made by any Borrower under this Agreement or any Loan Document,
or any amendment hereto or thereto, shall at any time prove to have been
incorrect or misleading in any material respect when made.
(4) Default in Performance. Any Borrower shall default in the
performance or observance of any term, covenant, condition or agreement to
be performed by such Borrower, contained in
(1) Articles 7, 8, 10 or 11, or Sections 9.1 (insofar as it
requires the preservation of the corporate existence of such Borrower),
or 9.8 and the Agent shall have delivered to such Borrower writen
notice of such default; or
(2) any other provision of this Agreement (other than as
specifically provided for otherwise in this Section 12.1) and such
default shall continue for a period of 30 days after written notice
thereof has been given to such Borrower by the Agent.
(5) Indebtedness Cross Default. With respect to Indebtedness
for Money Borrowed,
(1) the maturity of any such Indebtedness, individually or in
the aggregate with other such Indebtedness, in a principal amount
exceeding $5,000,000 shall have (A) been accelerated in accordance
with the provisions of any indenture, contract or instrument
providing for the creation of or concerning such Indebtedness, or (B)
been required to be prepaid prior to the stated maturity thereof, or
(ii) any event shall have occurred and be continuing which would
permit any holder or holders of such Indebtedness, any trustee or
agent acting on behalf of such holder or holders or any other Person
so to accelerate such maturity, and such Borrower or, such Subsidiary
shall have failed to cure such default prior to the expiration of any
applicable cure or grace period.
(6) Other Cross-Defaults. Any Borrower or any of its
Subsidiaries shall default in the payment when due, or in the performance
or observance, of any obligation or condition of any agreement, contract or
lease (other than this Agreement, the Security Documents or any such
agreement, contract or lease relating to Indebtedness for Money Borrowed)
if the existence of any such defaults, singly or in the aggregate, could in
the reasonable judgment of the Agent have a Materially Adverse Effect
on one or more Operating Companies.
(7) Voluntary Bankruptcy Proceeding. Any Borrower or any of its
Subsidiaries shall (i) commence a voluntary case under the federal bankruptcy
laws (as now or hereafter in effect), (ii) file a petition seeking to take
advantage of any other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or composition for adjustment of
debts, (iii) consent to or fail to contest in a timely and appropriate
manner any petition filed against it in an involuntary case under such
bankruptcy laws or other laws, (iv) apply for or consent to, or fail to
contest in a timely and appropriate manner, the appointment of, or the taking
of possession by, a receiver, custodian, trustee, or liquidator of itself or
of a substantial part of its property, domestic or foreign, (v) admit in
writing its inability to pay its debts as they become due, (vi) make a
general assignment for the benefit of creditors, or (vii) take any
corporate action for the purpose of authorizing any of the foregoing.
(8) Involuntary Bankruptcy Proceeding. A case or other proceeding
shall be commenced against any Borrower or any of its Subsidiaries in any
court of competent jurisdiction seeking (i) relief under the federal
bankruptcy laws (as now or hereafter in effect) or under any other laws,
domestic or foreign, relating to bankruptcy, insolvency, reorganization,
winding up or adjustment of debts, (ii) the appointment of a trustee,
receiver, custodian, liquidator or the like of any Borrower, any of its
Subsidiaries or of all or any substantial part of the assets, domestic or
foreign, of such Borrower or any of its Subsidiaries, and such case or
proceeding shall continue undismissed or unstayed for a period of 60
consecutive calendar days, or an order granting the relief requested in
such case or proceeding against such Borrower or any of its Subsidiaries
(including, but not limited to, an order for relief under such federal
bankruptcy laws) shall be entered.
(9) Loan Documents. Any event of default or Event of Default
under any other Loan Document shall occur or any Borrower or any
Guarantor shall default in the performance or observance of any
material term, covenant, condition or agreement contained in, or
the payment of any other sum covenanted to be paid by such
Borrower or any Guarantor under, any such Loan Document or any
provision of this Agreement, or of any other Loan Document after
delivery thereof hereunder, shall for any reason cease to be
valid and binding, other than a nonmaterial provision rendered
unenforceable by operation of law, or such Borrower or other
party thereto (other than the Agent or a Lender) shall so state
in writing, or this Agreement or any other Loan Document, after
delivery thereof hereunder, shall for any reason (other than any
action taken independently by the Agent or a Lender and except to
the extent permitted by the terms thereof) cease to create a
valid, perfected and, except as otherwise expressly permitted
herein, first priority Lien on, or security interest in, any of
the Collateral purported to be covered thereby.
(10) Judgment. A judgment or order for the payment of money
warrant, writ of attachment, execution or similar process which exceeds in
amount or value $500,000 individually or $750,000 in the aggregate shall
be entered against any Borrower by any court and such judgment, order,
warrant, writ of attachment, execution or similar process shall continue
undischarged or unstayed for 30 days.
(11) ERISA. (i) Any Termination Event with respect to a Plan
shall occur that, after taking into account the excess, if any, of (A) the
fair market value of the assets of any other Plan with respect to which a
Termination Event occurs on the same day (but only to the extent that such
excess is the property of any Borrower) over (B) the present value on such
day of all vested nonforfeitable benefits under such other Plan, results in
an Unfunded Vested Accrued Benefit in excess of $100,000, or (ii) any Plan
shall incur an "accumulated funding deficiency" (as defined in Section 412
of the Code or Section 302 of ERISA) for which a waiver has not been
obtained in accordance with the applicable provisions of the Code and ERISA,
or (iii) any Borrower is in "default" (as defined in Section 4219(c)(5) of
ERISA) with respect to payments to a Multiemployer Plan resulting from the
Borrower's complete or partial withdrawal (as described in Section 4203 or
4205 of ERISA) from such Multiemployer Plan.
(12) Qualified Audits. The independent certified public accountants
retained by any Borrower shall refuse to deliver an opinion in accordance
with Section 10.1(a) with respect to the annual financial statements of
such Borrower.
(13) Material Adverse Change. There occurs any act, omission,
event, undertaking or circumstance or series of acts, omissions, events,
undertakings or circumstances which have, or would have, either individually
or in the aggregate, a Materially Adverse Effect.
SECTION 1.78 Remedies.
(1) Automatic Acceleration and Termination of Facilities. Upon
the occurrence of an Event of Default specified in Section 12.1(g) or (h),
(i) the principal of and the interest on the Loans and any Note at the time
outstanding, and all other amounts owed to the Agent or the Lenders under
this Agreement or any of the Loan Documents and all other Secured
Obligations, shall thereupon become due and payable without presentment,
demand, protest, or other notice of any kind, all of which are expressly
waived, anything in this Agreement or any of the Loan Documents to the
contrary notwithstanding, and (ii) the Revolving Credit Loans and the
right of any and all Borrowers to request borrowings under this Agreement
shall immediately terminate.
(2) Other Remedies. If any Event of Default shall have occurred,
and during the continuance of any such Event of Default, the Agent may
without notice, and at the direction of the Required Lenders in their sole
and absolute discretion shall, do any of the following:
(1) declare the principal of and interest on the Loans and any
Note at the time outstanding, and all other amounts owed to the
Agent or the Lenders under this Agreement or any of the Loan
Documents and all other Secured Obligations, to be forthwith due
and payable, whereupon the same shall immediately become due and
payable without presentment, demand, protest or other notice of
any kind, all of which are expressly waived, anything in this
Agreement or the Loan Documents to the contrary notwithstanding;
(2) terminate the Revolving Credit Loans and any other right of
the Borrowers to request borrowings hereunder;
(3) notify, or request each Borrower to notify, in writing or
otherwise, any Account Debtor or obligor with respect to any one
or more of the Receivables to make payment to the Agent, for the
benefit of the Lenders, or any agent or designee of the Agent, at
such address as may be specified by the Agent and if,
notwithstanding the giving of any notice, any Account Debtor or
other such obligor shall make payments to such Borrower, such
Borrower shall hold all such payments it receives in trust for
the Agent, for the account of the Lenders, without commingling
the same with other funds or property of, or held by, such
Borrower, and shall deliver the same to the Agent or any such
agent or designee of the Agent immediately upon receipt by such
Borrower in the identical form received, together with any
necessary endorsements;
(4) settle or adjust disputes and claims directly with Account
Debtors and other obligors on Receivables for amounts and on
terms which the Agent reasonably considers advisable and in all
such cases only the net amounts received by the Agent, for the
account of the Lenders, in payment of such amounts, after
deductions of costs and reasonable attorneys' fees, shall
constitute Collateral and each Borrower shall have no further
right to make any such settlements or adjustments or to accept
any returns of merchandise;
(5) through self-help, without notice, demand or judicial or
other process, enter upon any premises in which Collateral may be
located and, without resistance or interference by any Borrower,
take physical possession of any or all thereof and maintain such
possession on such premises or move the same or any part thereof
to such other place or places as the Agent shall choose, without
being liable to any Borrower on account of any loss, damage or
depreciation that may occur as a result thereof, so long as the
Agent shall act reasonably;
(6) require each Borrower to and each Borrower shall, without
charge to the Agent or any Lender, assemble the Collateral and
maintain or deliver it into the possession of the Agent or any
agent or representative of the Agent at such place or places as
the Agent may designate and as are reasonably convenient to both
the Agent and such Borrower;
(7) at the expense of Borrowers, cause any of the Collateral to
be placed in a public or field warehouse, and the Agent shall not
be liable to any Borrower on account of any loss, damage or
depreciation that may occur as a result thereof, so long as the
Agent shall act reasonably and in its reasonable credit judgment;
(8) through self-help and without notice, demand or judicial or
other process, and without payment of any rent or any other
charge, enter any of any Borrower's premises and, without breach
of the peace, until the Agent, on behalf of the Lenders,
completes the enforcement of its rights in the Collateral, take
possession of such premises or place custodians in exclusive
control thereof, remain on such premises and use the same and any
of any Borrower's Collateral, for the purpose of (A) completing
any work in process, and (B) collecting any Receivable, and the
Agent for the benefit of the Lenders is hereby granted a license
or sublicense and all other rights as may be necessary,
appropriate or desirable to use the Proprietary Rights in
connection with the foregoing, and the rights of each and every
Borrower under all licenses, sublicenses and franchise agreements
shall inure to the Agent for the benefit of the Lenders
(provided, however, that any use of any federally registered
trademarks as to any goods shall be subject to the control as to
the quality of such goods of the owner of such trademarks and the
goodwill of the business symbolized thereby);
(1)
(9) exercise any and all of its rights under any and all of the
Security Documents;
(10) apply any Collateral consisting of cash to the payment of
the Secured Obligations in any order in which the Agent, on
behalf of the Lenders, may elect or use such cash in connection
with the exercise of any of its other rights hereunder or under
any of the Security Documents;
(11) establish or cause to be established one or more Lockboxes
or other arrangement for the deposit of proceeds of Receivables,
and, in such case, each Borrower shall cause to be forwarded to
the Agent at the Agent's Office, on a daily basis, copies of all
checks and other items of payment and deposit slips related
thereto deposited in such Lockboxes, together with collection
reports in form and substance satisfactory to the Agent; and
(12) exercise all of the rights and remedies of a secured party
under the Uniform Commercial Code and under any other Applicable
Law, including, without limitation, the right, without notice
except as specified below and with or without taking the
possession thereof, to sell the Collateral or any part thereof in
one or more parcels at public or private sale, at any location
chosen by the Agent, for cash, on credit or for future delivery,
and at such price or prices and upon such other terms as are
commercially reasonable. Each Borrower agrees that, to the
extent notice of sale shall be required by law, at least 10 days
notice to such Borrower of the time and place of any public sale
or the time after which any private sale is to be made shall
constitute reasonable notification, but notice given in any other
reasonable manner or at any other reasonable time shall
constitute reasonable notification. The Agent shall not be
obligated to make any sale of Collateral regardless of notice of
sale having been given. The Agent may adjourn any public or
private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned.
SECTION 1.79 Application of Proceeds. All proceeds from each
sale of, or other realization upon, all or any part of the Collateral
following an Event of Default shall be applied or paid over as follows:
(1) First: to the payment of all costs and expenses incurred in
connection with such sale or other realization, including attorneys' fees
and expenses actually incurred (including, without limitation, the
expenses and other allocated costs of internal counsel),
(2) Second: to the payment of the Secured Obligations or the
creation of a Cash Collateral Account (with each and every Borrower
remaining liable for any deficiency) as the Agent may elect,
(3) Third: the balance (if any) of such proceeds shall be paid
to the Borrowers, subject to any duty imposed by law, or otherwise to
whomsoever shall be entitled thereto.
The Borrowers shall remain liable, jointly and severally, and will pay,
on demand, any deficiency remaining in respect of the Secured Obligations,
together with interest thereon at a rate per annum equal to the highest
rate then payable hereunder on such Secured Obligations, which interest
shall constitute part of the Secured Obligations.
SECTION 1.80 Miscellaneous Provision Concerning Remedies.
(1) Rights Cumulative. The rights and remedies of the Agent and
the Lenders under this Agreement, the Notes and each of the Loan Documents
shall be cumulative and not exclusive of any rights or remedies which it or
they would otherwise have. In exercising such rights and remedies the Agent
and the Lenders may be selective and no failure or delay by the Agent or any
Lender in exercising any right shall operate as a waiver of it, nor shall
any single or partial exercise of any power or right preclude its other or
further exercise or the exercise of any other power or right.
(2) Waiver of Marshaling. Each Borrower hereby waives any right
to require any marshaling of assets and any similar right.
(3) Limitation of Liability. Nothing contained in this Article
12 or elsewhere in this Agreement or in any of the Loan Documents shall be
construed as requiring or obligating the Agent, any Lender or any agent or
designee of the Agent or any Lender to make any demand, or to make any
inquiry as to the nature or sufficiency of any payment received by it, or
to present or file any claim or notice or take any action, with respect to
any Receivable or any other Collateral or the monies due or to become
due thereunder or in connection therewith, or to take any steps necessary
to preserve any rights against prior parties, and the Agent, the Lenders
and their agents or designees shall have no liability to any Borrower for
actions taken pursuant to this Article 12, any other provision of this
Agreement or any of the Loan Documents so long as the Agent or such Lender
shall act reasonably and in its reasonable credit judgment.
(4) Appointment of Receiver. In any action under this Article 12,
the Agent shall be entitled during the continuance of an Event of Default to
the appointment of a receiver, without notice of any kind whatsoever, to
take possession of all or any portion of the Collateral and to exercise
such power as the court shall confer upon such receiver.
SECTION 1.81 Trademark License. Each Borrower hereby grants to
the Agent, for the benefit of the Lenders, to the extent of such Borrower's
rights therein and to the extent permitted by the various license agreements
relating thereto, the nonexclusive right and license to use the trademarks
set forth on Schedule 6.1(y) and any other trademark then used by any
Borrower, for the purposes set forth in Section 12.2(b)(viii) and for the
purpose of enabling the Agent to realize on the Collateral and to permit
any purchaser of any portion of the Collateral through a foreclosure sale
or any other exercise of the Agent's rights and remedies under the Loan
Documents to use, sell or otherwise dispose of the Collateral bearing any
such trademark. Such right and license is granted free of charge, without
the requirement that any monetary payment whatsoever be made to any Borrower
or any other Person by the Agent. Each Borrower hereby represents, warrants,
covenants and agrees that, except as set forth in the license agreements,
it presently has, and shall continue to have, the right, without the
approval or consent of others, to grant the license set forth in this
Section 12.5.
ARTICLE 13
ASSIGNMENTS
SECTION 1.82 Successors and Assigns; Participations.
(1) This Agreement shall be binding upon and inure to the benefit
of each Borrower, the Lenders, the Agent, all future holders of the Notes,
and their respective successors and assigns, except that no Borrower may
assign or transfer any of its rights or obligations under this Agreement
without the prior written consent of each Lender, and any such attempted
assignment or transfer by any Borrower except in strict compliance with the
provisions hereof shall be null and void, and of no force or effect.
(2) Each Lender may assign to one or more Eligible Assignees all
or a portion of its interests, rights and obligations under this Agreement
(including, without limitation, all or a portion of the Loans at the time
owing to it and the Notes held by it); provided, however, that (i) each
such assignment shall be of a constant, and not a varying, percentage of
all the assigning Lender's rights and obligations under this Agreement,
(ii) the amount of the Commitment of the assigning Lender that is subject
to each such assignment (determined as of the date the Assignment and
Transfer with respect to such assignment is delivered to the Agent) shall
in no event be less than $5,000,000 (the "Minimum Commitment"), (iii) in
the case of a partial assignment, the amount of the Commitment that is
retained by the assigning Lender (determined as of the date the
Assignment and Transfer with respect to such assignment is delivered to the
Agent) shall in no event be less than the Minimum Commitment, (iv) the
parties to each such assignment shall execute and deliver to the Agent, for
its acceptance and recording in the Register (as hereinafter defined) an
Assignment and Transfer, together with any Note or Notes subject to such
assignment and such assignee's commitment percentage of the Agent's
syndication expenses, (v) such assignment shall not, without the consent of
the Borrowers, require a Borrower to file a registration statement with the
Securities and Exchange Commission or apply to or qualify the Loans or the
Notes under the blue sky laws of any state, (vi) the representation contained
in Section 13.2 hereof shall be true with respect to any such proposed
assignee and (vii) such Lender provides notice to the Borrowers of the
identity of the Eligible Assignee. Upon such execution, delivery, acceptance
and recording, from and after the effective date specified in each
Assignment and Transfer, which effective date shall be at least five (5)
Business Days after the execution thereof, (x) the assignee thereunder
shall be a party hereto and, to the extent provided in such Assignment and
Transfer, have the rights and obligations of a Lender hereunder, and (y)
the Lender assignor thereunder shall, to the extent provided in such
assignment, be released from its obligations under this Agreement.
Notwithstanding anything to the contrary in this Section 13.1(b) or
elsewhere in this Agreement, The CIT Group/Business Credit, Inc. ("CITBC")
agrees that, except after the occurrence of an Event of Default, the
principal amount of the Commitment of CITBC during the term hereof shall
in no event be less than the highest Commitment of any other Lender party
to this Agreement.
(3) By executing and delivering an Assignment and Transfer, the
Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim,
such Lender assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this
Agreement or any other instrument or document furnished pursuant hereto;
(ii) such Lender assignor makes no representation or warranty and assumes
no responsibility with respect to the financial condition of any Borrower or
the performance or observance by any Borrower of any of its obligations
under this Agreement or any other instrument or document furnished pursuant
hereto; (iii) such assignee confirms that it has received a copy of this
Agreement, together with copies of the financial statements refereed to in
Section 6.1(m) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Transfer; (iv) such assignee will, independently and without
reliance upon the Agent, such Lender assignor or any other Lender, and
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such assignee confirms that it is an
Eligible Assignee; (vi) such assignee appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers under
this Agreement and the other Loan Documents as are delegated to the Agent
by the terms hereof and thereof, together with such powers as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of
this Agreement are required to be performed by it as a Lender.
(4) The Agent shall maintain a copy of each Assignment and Transfer
delivered to it and a register for the recordation of the names and
addresses of the Lenders and the Commitment Percentage of, and principal
amount of the Loans owing to, each Lender from time to time (the "Register").
The entries in the Register shall be conclusive, in the absence of manifest
error, and each Borrower, the Agent and the Lenders may treat each person
whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection
by any Borrower or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
(5) Upon its receipt of an Assignment and Transfer executed by
an assigning Lender and an Eligible Assignee together with any Note or Notes
subject to such assignment and the written consent to such assignment, the
Agent shall, if such Assignment and Transfer has been completed and is in
the form of Exhibit J, (i) accept such Assignment and Transfer, (ii) record
the information contained therein in the Register, (iii) give prompt notice
thereof to the Lenders and each Borrower, and (iv) promptly deliver a copy
of such Assignment and Transfer to each Borrower. Within five (5) Business
Days after receipt of notice, each Borrower shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes a new Note or Notes to
the order of such Eligible Assignee in amounts equal to the Commitment
Percentage assumed by such Eligible Assignee pursuant to such Assignment
and Transfer and a new Note or Notes to the order of the assigning Lender
in an amount equal to the Commitment retained by it hereunder. Such new
Note or Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note or Notes, shall be
dated the effective date of such Assignment and Transfer and shall otherwise
be in substantially the form of the assigned Notes delivered to the assignor
Lender. Each surrendered Note or Notes shall be canceled and returned
to Trism.
(6) Each Lender may, without the consent of any Borrower, sell
participations to one or more banks or other entities in all or a portion of
its rights and obligations under this Agreement (including, without
limitation, all or a portion of its commitments hereunder and the Loans
owing to it and the Notes held by it); provided, however, that (i) each such
participation shall be in an amount not less than the Minimum Commitment,
(ii) such Lender's obligations under this Agreement (including, without
limitation, its commitments hereunder) shall remain unchanged, (iii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iv) such Lender shall remain the holder
of the Notes held by it for all purposes of this Agreement, (v) each
Borrower, the Agent and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement; provided, that such Lender may agree with
any participant that such Lender will not, without such participant's
consent, agree to or approve any waivers or amendments which would reduce
the principal of or the interest rate on any Loans, extend the term or
increase the amount of the commitments of such participant, reduce the
amount of any fees to which such participant is entitled, extend any
scheduled payment date for principal or release Collateral securing the
Loans (other than Collateral disposed of pursuant to the terms of this
Agreement or the Security Documents), (vi) any such disposition shall not,
without the consent of the Borrowers, require any Borrower to file a
registration statement with the Securities and Exchange Commission to
apply to qualify the Loans or the Notes under the blue sky law of any state
and (vii) such Lender provides notice to the Borrower of the identity of
the potential participant. The Lender selling a participation to any bank
or other entity that is not an Affiliate of such Lender shall give prompt
notice thereof to each Borrower.
(7) Any Lender may, in connection with any assignment, proposed
assignment, participation or proposed participation pursuant to this Section
13.1, disclose to the assignee, participant, proposed assignee or proposed
participant, any information relating to any Borrower furnished to such
Lender by or on behalf of such Borrower; provided that, prior to any such
disclosure, each such-assignee, proposed assignee, participant or proposed
participant shall agree with such Borrower or such Lender (which in the
case of an agreement with only such Lender, such Borrower shall be
recognized as a third party beneficiary thereof) to preserve the
confidentiality of any confidential information relating to such Borrower
received from such Lender.
(8) Each Borrower shall assist any Lender permitted to sell
assignments or participations under this Section 13.1 as reasonably
required to enable the assigning or selling Lender to effect any such
assignment or participation, including, without limitation, (i) prompt
assistance in the preparation of an information memorandum and the
verification of the completeness and accuracy of the information contained
therein; (ii) preparation of offering materials and projections by any
Borrower and its advisors; (iii) providing the Agent with all information
reasonably deemed necessary by Agent to successfully complete the
syndication; (iv) confirmation as to the accuracy and completeness of such
offering materials, information and projections; (v) participation of any
Borrower's senior management in meetings and conference calls with potential
lenders at such times and places as Agent may reasonable request; and (vi)
the execution and delivery of any and all agreements, notes and other
documents and instruments as shall be requested.
SECTION 1.83 Representation of Lenders. Each Lender hereby
represents that it will make each Loan hereunder as a commercial loan for
its own account in the ordinary course of its business; provided, however,
that subject to Section 13.1 hereof, the disposition of the Notes or other
evidence of the Secured Obligations held by any Lender shall at all times
be within its exclusive control.
ARTICLE 14
AGENT
SECTION 1.84 Appointment of Agent. Each of the Lenders hereby
irrevocably designates and appoints The CIT Group/Business Credit, Inc. as
the Agent of such Lender under this Agreement and the other Loan Documents,
and each such Lender irrevocably authorizes Agent, as the Agent for such
Lender to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and
perform such duties as are expressly delegated to the Agent by the terms
of this Agreement and such other Loan Documents, including, without
limitation, to make determinations as to the eligibility of Receivables and
to adjust the advance ratios contained in the definition of "Borrowing
Base" (so long as such advance ratios, as adjusted, do not exceed those
set forth in the definition of "Borrowing Base"), together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision
to the contrary elsewhere in this Agreement or such other Loan Documents,
the Agent shall not have any duties or responsibilities, except those
expressly set forth herein and therein, or any fiduciary relationship with
any Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or the other
Loan Documents or otherwise exist against the Agent.
SECTION 1.85 Delegation of Duties. The Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-
in-fact selected by it with reasonable care.
SECTION 1.86 Exculpatory Provisions. Neither the Agent nor any
of its trustees, officers, directors, employees, agents, attorneys-in-fact
or Affiliates shall be (i) liable to any Lender (or any Lender's
participants) for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or the other
Loan Documents (except for its or such Person's own gross negligence or
willful misconduct), or (ii) responsible in any manner to any Lender (or
any Lender's participants) for any recitals, statements, representations or
warranties made by any Borrower or any officer thereof contained in this
Agreement or the other Loan Documents or in any certificate, report,
statement or other document referred to or provided for in, or received by
the Agent under or in connection with, this Agreement or the other Loan
Documents or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the other Loan
Documents or for any failure of any Borrower to perform its obligations
hereunder or thereunder. The Agent shall not be under any obligation to
any Lender to ascertain or to inquire as to the observance or performance
of any of the agreements contained in, or conditions of, this Agreement, or
to inspect the properties, books or records of any Borrower.
SECTION 1.87 Reliance by Agent. The Agent shall be entitled to
rely, and shall be fully protected in relying, upon any Note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation,
counsel to any Borrower), independent accountants and other experts
selected by the Agent. The Agent may deem and treat the payee of any
Note as the owner thereof for all purposes unless such Note shall have
been transferred in accordance with Section 13.1. The Agent shall be
fully justified in failing or refusing to take any action under this
Agreement and the other Loan Documents unless it shall first receive
such advice or concurrence of the Required Lenders (or the unanimous
consent of the Lenders with respect to the matters set forth in Section
15.9(b)) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take
any such action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and the Notes
in accordance with a request of the Required Lenders, and such request and
any action taken or failure to act pursuant thereto shall be binding upon
all the Lenders and all future holders of the Notes.
SECTION 1.88 Notice of Default. The Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Agent has received notice from a Lender or a
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the
event that the Agent receives such a notice, the Agent shall promptly
give notice thereof to the Lenders. The Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed
by the Required Lenders; provided that unless and until the Agent shall
have received such directions, the Agent may (but shall not be obligated to)
continue making Revolving Credit Loans to the Borrowers on behalf of the
Lenders in reliance on the provisions of Section 4.6 and take such other
action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable in the best interests of the
Lenders.
SECTION 1.89 Non-Reliance on Agent and Other Lenders. Each
Lender expressly acknowledges that neither the Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the Agent
hereinafter taken, including any review of the affairs of any Borrower,
shall be deemed to constitute any representation or warranty by the Agent
to any Lender. Each Lender represents to the Agent that it has,
independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations,
property, financial and other condition and creditworthiness of any
Borrower and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Lender also represents that it will, in-
dependently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and
decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it
deems necessary to inform itself as to the business, operations,
property, financial and other condition and creditworthiness of
each Borrower. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Agent
hereunder or by the other Loan Documents, the Agent shall not
have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, operations,
property, financial and other condition or creditworthiness of
any Borrower which may come into the possession of the Agent or
any of its officers, directors, employees, agents, attorneys-in-
fact or Affiliates.
SECTION 1.90 Indemnification. The Lenders agree to indemnify
the Agent in its capacity as such (to the extent not reimbursed by a
Borrower and without limiting the obligation of the Borrowers to do so),
ratably according to their respective Commitment Percentages, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including, without limitation, at any
time following the payment of the Notes) be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of this
Agreement or the other Loan Documents, or any documents contemplated by or
referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Agent under or in connection
with any of the foregoing; provided that no Lender shall be liable for the
payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the Agent's gross negligence or willful misconduct
or resulting solely from transactions or occurrences that occur at a time
after such Lender has assigned all of its interests, rights and obligations
under this Agreement pursuant to Section 13.1 or, in the case of a Lender
to which an assignment is made hereunder pursuant to Section 13.1, at a time
before such assignment. The agreements in this subsection shall survive the
payment of the Notes, the Secured Obligations and all other amounts payable
hereunder and the termination of this Agreement.
SECTION 1.91 Agent in Its Individual Capacity. The Agent and
its Affiliates may make loans to, accept deposits from and generally engage
in any kind of business with any Borrower and any Guarantor and their
respective Subsidiaries as if the Agent were not the Agent hereunder.
With respect to its Commitment, the Loans made or renewed by it and any
Note issued to it and any Letter of Credit issued by it, the Agent shall
have and may exercise the same rights and powers under this Agreement and
the other Loan Documents and is subject to the same obligations and
liabilities as and to the extent set forth herein and in the other Loan
Documents for any other Lender. The terms "Lenders" or "Required
Lenders" or any other term shall, unless the context clearly otherwise
indicates, include the Agent in its individual capacity as a Lender or
one of the Required Lenders.
SECTION 1.92 Successor Agent. The Agent may resign as Agent
upon an Event of Default by providing 30 days written notice to the Lenders.
The Agent may be removed by the Required Lenders if the Agent is grossly
negligent or engages in willful misconduct in the performance of its duties
under this Agreement. If the Agent shall resign or be removed as Agent
under this Agreement, then the Required Lenders shall appoint from among
the Lenders a successor agent for the Lenders which successor agent shall
be approved by the Borrowers (which approval shall not be unreasonably
withheld), whereupon such successor agent shall succeed to the rights,
powers and duties of the Agent, and the term "Agent" shall mean such
successor agent effective upon its appointment, and the former Agent's
rights, powers and duties as Agent shall be terminated, without any
other or further act or deed on the part of such former Agent or any of
the parties to this Agreement or any holders of the Notes. After any
Agent's resignation or removal hereunder as Agent, the provisions of
Section 14.7 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Agent under this Agreement.
SECTION 1.93 Notices from Agent to Lenders. The Agent shall
promptly, upon receipt thereof, forward to each Lender copies of any written
notices, reports or other information supplied to it by the Borrowers
(but which the Borrowers are not required to supply directly to the Lenders).
SECTION 1.94 Direction from Lenders. Notwithstanding anything
contained in this Agreement or any other Loan Document to the contrary, the
Agent shall not exercise any of the remedies set forth in Section 12.2 (or
in any other provision of any Loan Document) with respect to any of the
Mortgaged Real Estate or Pledged Collateral (as defined in the Pledged
Agreement) without the prior written consent of any combination of Lenders
whose Commitment Percentages at such time aggregate 50% or more. The
foregoing sentence shall not, as between the Borrowers, the Guarantors and
the Agent, limit or restrict the Agent's right to pursue any remedy against
the Collateral, including the Mortgaged Real Estate and the Pledged
Collateral.
ARTICLE 15
MISCELLANEOUS
SECTION 1.95 Notices.
(1) Method of Communication. Except as specifically provided in
this Agreement or in any of the Loan Documents, all notices and the
communications hereunder and thereunder shall be in writing or by telephone,
subsequently confirmed in writing. Notices in writing shall be delivered
personally or sent by certified or registered mail, postage pre-paid, or
by overnight courier, telex or facsimile transmission and shall be deemed
received in the case of personal delivery, when delivered, in the case of
mailing, when receipted for, in the case of overnight delivery, on the next
Business Day after delivery to the courier, and in the case of telex and
facsimile transmission, upon transmittal, provided that in the case of
notices to the Agent, notice shall be deemed to have been given only when
such notice is actually received by the Agent. A telephonic notice to the
Agent, as understood by the Agent, will be deemed to be the controlling and
proper notice in the event of a discrepancy with or failure to receive a
confirming written notice.
(2) Addresses for Notices. Notices to any party shall be sent
to it at the following addresses, or any other address of which all the
other parties are notified in writing
If to the Borrowers: c/o TRISM, Inc.
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Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chief
Financial Officer
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: Proskauer Rose, LLP
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Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Agent: The CIT Group/Business Credit, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice
President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to a Lender: At the address of such Lender set
forth on the signature page hereof.
(3) Agent's Office. The Agent hereby designates its office
located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or any subsequent
office which shall have been specified for such purpose by written notice
to the Borrowers, as the office to which payments due are to be made and
at which Loans will be disbursed.
SECTION 1.96 Expenses. The Borrowers agree, jointly and
severally, to pay or reimburse on demand all costs and expenses incurred
by the Agent or, following an Event of Default, any Lender, including,
without limitation, the reasonable fees and disbursements of counsel, in
connection with (a) the negotiation, preparation, execution, delivery,
administration, enforcement and termination of this Agreement and
each of the other Loan Documents, whenever the same shall be
executed and delivered, including, without limitation (i) the
out-of-pocket costs and expenses incurred in connection with the
administration and interpretation of this Agreement and the other Loan
Documents; (ii) the costs and expenses of appraisals of the
Collateral; (iii) the costs and expenses of lien and title searches and
title insurance; (iv) the costs and expenses of environmental reports
with respect to the Real Estate; (v) taxes, fees and other charges for
recording the Mortgages, filing the Financing Statements and continuations
and the costs and expenses of taking other actions to perfect, protect,
and continue the Security Interests; provided, however, that the Borrowers
shall not be required to pay the expenses of any Person which becomes a
Lender more than 90 days after the Effective Date incurred in connection
with such Person's so becoming a Lender; (b) the preparation, execution
and delivery of any waiver, amendment, supplement or consent by the Agent
and the Lenders relating to this Agreement or any of the Loan Documents;
(c) sums paid or incurred to pay any amount or take any action required of
the Borrowers under the Loan Documents that the Borrowers fail to pay or
take; (d) out-of-pocket costs of field audits, inspections and
verifications of the Collateral by the Agent and the Lenders, including,
without limitation, standard per diem fees charged by the Agent and the
Lenders in the amount of $650 per diem per auditor and travel, lodging, and
meals in connection therewith, at or prior to the date on which a Person
becomes a Lender and up to two (2) times per year and whenever an Event of
Default exists provided, however, that unless and until a Default or an
Event of Default shall have occurred and be continuing under this
Agreement or any of the other Loan Documents, (i) no field audit charges
or expenses of any Lender other than the Agent shall be charged to or
reimbursable by Borrowers, except for field audit charges incurred for
a single field audit by a prospective Lender, with a commitment of at
least $5 million, conducted in connection with an prospective assignment
or participation hereunder, and (ii) no Lender whose aggregate commitment
with respect to the Financing is less than $5 million shall conduct, or
require Borrowers to pay for, any separate field audit by such Lender;
(e) costs and expenses of forwarding loan proceeds, collecting checks and
other items of payment, and establishing and maintaining each Controlled
Disbursement Account, Agency Account and Lockbox; (f) costs and expenses
of preserving and protecting the Collateral; (g) consulting, after the
occurrence of a Default, with one or more Persons, including appraisers,
accountants and lawyers, concerning the value of any Collateral for the
Secured Obligations or related to the nature, scope or value of any right
or remedy of the Agent or any Lender hereunder or under any of the Loan
Documents, including any review of factual matters in connection therewith,
which expenses shall include the fees and disbursements of such Persons;
and (h) reasonable costs and expenses paid or incurred to obtain payment of
the Secured Obligations, enforce the Security Interests, sell or otherwise
realize upon the Collateral, and otherwise enforce the provisions of the
Loan Documents, or to prosecute or defend any claim in any way arising out
of, related to or connected with, this Agreement or any of the Loan
Documents, which expenses shall include the reasonable fees and
disbursements of counsel and of experts and other consultants
retained by the Agent or any Lender.
The foregoing shall not be construed to limit any other provisions of
the Loan Documents regarding costs and expenses to be paid by the
Borrowers. The Borrowers hereby authorize the Agent and the Lenders to
debit the Borrowers' Loan Accounts (by increasing the principal amount of
the Revolving Credit Loan) in the amount of any such costs and expenses
owed by the Borrowers when due.
SECTION 1.97 Stamp and Other Taxes. The Borrowers will pay any
and all stamp, registration, recordation and similar taxes, fees or charges
and shall indemnify the Agent and the Lenders against any and all
liabilities with respect to or resulting fro any delay in the payment or
omission to pay any such taxes, fees or charges, which may be payable or
determined to be payable in connection with the execution, delivery,
performance or enforcement of this Agreement and any of the Loan
Documents or the perfection of any rights or security interest thereunder,
including, without limitation, the Security Interest.
SECTION 1.98 Setoff.
(1) In addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, during the
continuance of any Event of Default, each Lender, any participant with such
Lender in the Loans and each Affiliate of each Lender are hereby authorized
by the Borrowers at any time or from time to time, without notice to any
Borrower or to any other Person, any such notice being hereby expressly
waived, to set off and to appropriate and to apply any and all deposits
(general or special, including, but not limited to, indebtedness evidenced
by certificates of deposit, whether matured or unmatured) and any other
indebtedness at any time held or owing by any Lender or any Affiliate of
any Lender or any participant to or for the credit or the account of any
Borrower against and on account of the Secured Obligations irrespective
or whether or not the Agent or such Lender shall have made any demand
under this Agreement or any of the Loan Documents, or the Agent or such
Lender shall have declared any or all of the Secured Obligations to be
due and payable as permitted by Section 12.2 and although such Secured
Obligations shall be contingent or unmatured.
(2) If any Lender shall obtain payment of any principal of or
interest on any Loan made by it or on any other Secured Obligation owing to
such Lender through the exercise of any right of set-off, banker's lien or
counterclaim or similar right or otherwise, it shall promptly so notify the
Agent (which shall promptly notify the other Lenders). If, as a result of
such payment, such Lender shall have received a greater percentage of the
principal of or interest on any Revolving Credit Loan to such Lender than
the percentage received by any other Lender or Lenders in respect of the
principal of or interest on any Revolving Credit Loan owing to such other
Lender or Lenders, it shall, at the request of such other Lender or
Lenders, promptly purchase from such other Lender or Lenders participations
in (or, if and to the extent specified by such first Lender, direct
interests in) the principal of or interest on Revolving Credit Loans
owing to such other Lenders in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end that such
first Lender and such other Lender or Lenders (such first Lender and such
other Lender or Lenders being collectively referred to as the "Sharing
Lenders") shall share the benefit of such excess payment (net of any
expenses which may be incurred by such first Lender in obtaining or
preserving such excess payment) pro rata in accordance with the unpaid
amounts of such obligations owing to each of the Sharing Lenders. To such
end all the Sharing Lenders shall make appropriate adjustments among
themselves (by the resale of participations sold or otherwise) if such
payment is rescinded or must otherwise be restored.
(3) The Borrowers agree that any Lender so purchasing a
participation in obligations hereunder of the Borrowers to
another Lender or other Lenders may exercise any and all rights
of set-off, bankers' lien, counterclaim or similar rights with
respect to such participation as fully as if such first Lender
were a direct holder of obligations of the Borrowers in the amount of
such participation. Nothing contained herein shall require any Lender to
exercise any such right or shall affect the right of any Lender to
exercise, and retain the benefits of exercising, any such right with
respect to any other indebtedness or obligation of the Borrowers.
(4) If under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a set- off to
which Section 15.4(b) hereof applies, such Lender shall to the extent
practicable, exercise its rights in respect of such secured claim in a
manner consistent with the rights of the Lenders entitled under this
Section 15.4 to share in the benefits of any recovery on such secured claim.
SECTION 1.99 Litigation. THE BORROWERS, THE AGENT AND EACH
LENDER HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE TRIAL BY
JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN
WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST THE BORROWERS, THE AGENT
AND SUCH LENDER ARISING OUT OF THIS AGREEMENT, THE COLLATERAL OR ANY
ASSIGNMENT THEREOF OR BY REASON OF ANY OTHER CAUSE OR DISPUTE WHATSOEVER
BETWEEN THE BORROWERS AND THE AGENT OR ANY LENDER OF ANY KIND OR NATURE.
THE BORROWERS, THE AGENT AND THE LENDERS HEREBY AGREE THAT THE FEDERAL
COURT OF THE NORTHERN DISTRICT OF GEORGIA SHALL HAVE NONEXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE
BORROWERS AND THE AGENT OR SUCH LENDER, PERTAINING DIRECTLY OR INDIRECTLY
TO THIS AGREEMENT OR THE LOAN DOCUMENTS OR TO ANY MATTER ARISING THEREFROM.
THE BORROWERS EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH JURISDICTION
IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS, HEREBY WAIVING
PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS
ISSUED THEREIN AND AGREEING THAT SERVICE OF SUCH SUMMONS AND COMPLAINT OR
OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO THE BORROWERS AT THE ADDRESS OF THE BORROWERS SET FORTH IN
SECTION 15.1. SHOULD ANY OF THE BORROWERS FAIL TO APPEAR OR ANSWER ANY
SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN 30 DAYS AFTER THE
MAILING THEREOF, IT SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR
JUDGMENT MAY BE RENDERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH
SUMMONS, COMPLAINT, PROCESS OR PAPERS. THE NONEXCLUSIVE CHOICE OF
FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE
ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF ANY
ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY APPROPRIATE JURISDICTION.
SECTION 1.100 Reversal of Payments. The Agent and each Lender
shall have the continuing and exclusive right to apply, reverse and re-apply
any and all payments to any portion of the Secured Obligations in a manner
consistent with the terms of this Agreement. To the extent the Borrowers
make a payment or payments to the Agent, for the account of the Lenders, or
any Lender receives any payment or proceeds of the Collateral for the
Borrowers' benefit, which payment(s) or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set
aside and/or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or equitable
cause, then, to the extent of such payment or proceeds received, the Secured
Obligations or part thereof intended to be satisfied shall be revived and
continued in full force and effect, as if such payment or proceeds had not
been received by the Agent or such Lender, and shall constitute a Prime
Option Loan.
SECTION 1.101 Injunctive Relief. The Borrowers recognize that,
in the event the Borrowers fail to perform, observe or discharge any of its
obligations or liabilities under this Agreement, any remedy at law may prove
to be inadequate relief to the Agent and the Lenders; therefore, the
Borrowers agree that if any Event of Default shall have occurred and be
continuing, the Agent and the Lenders, if the Agent or any Lender so
requests, shall be entitled to temporary and permanent injunctive relief
without the necessity of proving actual damages.
SECTION 1.102 Accounting Matters. All financial and accounting
calculations, measurements and computations made for any purpose relating
to this Agreement, including, without limitation, all computations utilized
by the Borrowers to determine whether it is in compliance with any covenant
contained herein, shall, unless this Agreement otherwise provides or unless
Required Lenders shall otherwise consent in writing, be performed in
accordance with GAAP.
SECTION 1.103 Amendments.
(1) Except as set forth in subsection (b) below, any term,
covenant, agreement or condition of this Agreement or any of the Loan
Documents may be amended or waived, and any departure therefrom may be
consented to by the Required Lenders, if, but only if, such amendment,
waiver or consent is in writing signed by the Required Lenders and, in the
case of an amendment (other than an amendment described in Section 15.9(d)),
by the Borrowers, and in any such event, the failure to observe, perform
or discharge any such term, covenant, agreement or condition (whether such
amendment is executed or such waiver or consent is given before or after
such failure) shall not be construed as a breach of such term, covenant,
agreement or condition or as a Default or an Event of Default. Unless o
therwise specified in such waiver or consent, a waiver or consent given
hereunder shall be effective only in the specific instance and for the
specific purpose for which given. In the event that any such waiver or
amendment is requested by the Borrowers, the Agent and the Lenders may
require and charge a fee in connection therewith and consideration thereof
in such amount as shall be determined by the Agent and the Required Lenders
in their discretion.
(2) Except as otherwise set forth in this Agreement, without the
prior unanimous written consent of the Lenders,
(1) no amendment, consent or waiver shall affect the amount or
extend the time of the obligation of the Lenders to make Loans or
extend the originally scheduled time or times of payment of the
principal of any loan or alter the time or times of payment of
interest on any Loan or the amount of the principal thereof or the
rate of interest thereon or the amount of any commitment fee payable
hereunder or permit any subordination of the principal or interest on
such Loan, permit the subordination of the Security Interests in any
material Collateral or amend the provisions of Article 12 or of this
Section 15.9(b),
(2) no Collateral shall be released by the Agent other than as
specifically permitted in this Agreement,
(3) except to the extent expressly provided herein, the
definition "Borrowing Base" shall not be amended, and
(4) neither the Agent nor any Lender shall consent to any
amendment to or waiver of the amortization, deferral or subordination
provisions of any instrument or agreement evidencing or relating to
obligations of the Borrowers that are expressly subordinate to any of
the Secured Obligations if such amendment or waiver would be adverse
to the Lenders in their capacities as Lenders hereunder;
provided, however, that anything herein to the contrary notwithstanding,
Required Lenders shall have the right to waive any Default or Event of
Default and the consequences hereunder of such Default or Event of
Default and shall have the right to enter into an agreement with the
Borrowers or the Guarantors providing for the forbearance from the
exercise of any remedies provided hereunder or under the other Loan
Documents without waiving any Default or Event of Default.
(3) The making of Loans hereunder by the Lenders during the
existence of a Default or Event of Default shall not be deemed to
constitute a waiver of such Default or Event of Default.
(4) Notwithstanding any provision of this Agreement or the other
loan documents to the contrary, no consent, written or otherwise, of the
Borrowers shall be necessary or required in connection with any amendment
to Article 14 or Section 4.6.
SECTION 1.104 Assignment. All the provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, except that no Borrower may assign
or transfer any of its rights under this Agreement.
SECTION 1.105 Performance of Borrowers' Duties. The Borrowers'
obligations under this Agreement and each of the Loan Documents shall be
performed by the Borrowers at their joint and several cost and expense.
Upon the occurrence of a Default or Event of Default (as those terms are
defined herein and in any of the other Loan Documents) under any of the
Loan Documents, if the Borrowers shall fail to do any act or thing which
they have covenanted to do under this Agreement or any of the Loan
Documents, the Agent, on behalf of the Lenders, may (but shall not be
obligated to) do the same or cause it to be done, at the Borrowers' joint
and several cost and expense, either in the name of the Agent or the
Lenders or in the name and on behalf of the Borrowers, and the Borrowers
hereby irrevocably authorize the Agent so to act.
SECTION 1.106 Indemnification. The Borrowers agree, jointly and
severally, to reimburse the Agent and the Lenders for all costs and expenses,
including reasonable counsel fees and disbursements, incurred, and to
indemnify and hold the Agent and the Lenders harmless from and against all
losses suffered by, the Agent or any Lender in connection with (i) the
exercise by the Agent or any Lender of any right or remedy granted to it
under this Agreement or any of the Loan Documents, (ii) any claim, and the
prosecution or defense thereof, arising out of or in any way connected with
this Agreement or any of the Loan Documents, and (iii) the collection or
enforcement of the Secured Obligations or any of them, other than such
costs, expenses and liabilities arising out of the Agent's or any Lender's
gross negligence or willful misconduct.
SECTION 1.107 All Powers Coupled with Interest. All powers of
attorney and other authorizations granted to the Agent and the Lenders and
any Persons designated by the Agent or the Lenders pursuant to any
provisions of this Agreement or any of the Loan Documents shall be deemed
coupled with an interest and shall be irrevocable so long as any of the
Secured Obligations remain unpaid or unsatisfied.
SECTION 1.108 Survival. Notwithstanding any termination of this
Agreement, until all Secured Obligations have been irrevocably paid in full
or otherwise satisfied, the Agent, for the benefit of the Lenders, shall
retain its Security Interest and shall retain all rights under this
Agreement and each of the Security Documents with respect to such
Collateral as fully as though this Agreement had not been terminated,
the indemnities to which the Agent and the Lenders are entitled under the
provisions of this Article 15 and any other provision of this Agreement and
the Loan Documents shall continue in full force and effect and shall protect
the Agent and the Lenders against events arising after such termination as
well as before, and in connection with the termination of this Agreement
and the release and termination of the Security Interests, the Agent, on
behalf of itself as agent and the Lenders, may require such assurances and
indemnities as it shall reasonably deem necessary or appropriate to protect
the Agent and the Lenders against loss on account of such release and
termination, including, without limitation, with respect to credits
previously applied to the Secured Obligations that may subsequently be
reversed or revoked.
SECTION 1.109 Severability of Provisions. Any provision of this
Agreement or any Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the
extent of such prohibition or unenforceability without invalidating the
remainder of such provision or the remaining provisions hereof or thereof
or affecting the validity or enforceability of such provision in any
other jurisdiction.
SECTION 1.110 Governing Law. This Agreement and the Notes shall
be construed in accordance with and governed by the law of the State of
New York.
SECTION 1.111 Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and shall be binding upon all parties, their successors and assigns,
and all of which taken together shall constitute one and the same agreement.
SECTION 1.112 Reproduction of Documents. This Agreement, each
of the Loan Documents and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by the Agent or any Lender, and (c)
financial statements, certificates and other information previously or
hereafter furnished to the Agent or any Lender, may be reproduced by the
Agent or such Lender by any photographic, photostatic, microfilm, microcard,
miniature photographic or other similar process and such Person may destroy
any original document so produced. Each party hereto stipulates that, to
the extent permitted by Applicable Law, any such reproduction shall be as
admissible in evidence as the original itself in any judicial or
administrative proceeding (whether or not the original shall be in
existence and whether or not such reproduction was made by the Agent or
such Lender in the regular course of business), and any enlargement,
facsimile or further reproduction of such reproduction shall likewise be
admissible in evidence.
SECTION 1.113 Term of Agreement. This Agreement shall remain in
effect from the Agreement Date through the Termination Date and thereafter
until all Secured Obligations shall have been irrevocably paid and satisfied
in full. No termination of this Agreement shall affect the rights and
obligations of the parties hereto arising prior to such termination.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers in several counterparts all as
of the day and year first written above.
BORROWERS:
TRISM, INC.
By:__________________________________
Name:________________________________
Title:_______________________________
TRISM SECURED TRANSPORTATION,
INC.
By:__________________________________
Name:________________________________
Title:_______________________________
TRI-STATE MOTOR TRANSIT CO.
By:__________________________________
Name:________________________________
Title:________________________________
AERO BODY AND TRUCK EQUIPMENT,
INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRI-STATE TRANSPORTATION SERVICES, INC.
By:__________________________________
Name:________________________________
Title:________________________________
DIABLO SYSTEMS INCORPORATED,
d/b/a DIABLO TRANSPORTATION,
INC.
By:__________________________________
Name:________________________________
Title:________________________________
EMERALD LEASING, INC.
By:__________________________________
Name:________________________________
Title:________________________________
McGIL SPECIAL SERVICES, INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRISM EASTERN, INC., d/b/a ▇.
▇. ▇▇▇▇▇▇▇ TRANSFER
By:__________________________________
Name:________________________________
Title:________________________________
TRISM HEAVY HAUL, INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRISM SPECIALIZED CARRIERS,
INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRISM SPECIAL SERVICES, INC.
By:__________________________________
Name:________________________________
Title:________________________________
E. L. ▇▇▇▇▇▇ & SONS TRUCKING
CO., INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRISM TRANSPORT, INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRISM TRANSPORT SERVICES, INC.
By:__________________________________
Name:________________________________
Title:________________________________
TRISM LOGISTICS, INC.
By:__________________________________
Name:________________________________
Title:________________________________
LENDER:
Commitment Amount $45,000,000 THE CIT GROUP/BUSINESS CREDIT,
INC.
By:__________________________________
Name:________________________________
Title:________________________________
AGENT:
THE CIT GROUP/BUSINESS CREDIT,
INC.
By:__________________________________
Name:________________________________
Title:________________________________
SCHEDULE 9.1
BORROWERS AND GUARANTORS TO DISSOLVED OR MERGED
Borrowers
1. E.L. ▇▇▇▇▇▇ & Sons Trucking, Inc., an Oklahoma corporation
2. Emerald Leasing, Inc., a Nevada corporation
3. McGil Special Services, Inc., a Delaware corporation
Guarantors
1. Trism Maintenance Services, Inc., a Delaware corporation
2. EFB, Inc., a Delaware corporation
3. Trism Benefits, Inc., a Missouri corporation
4. Contract Operators Account Services, a Missouri corporation
EXHIBIT A
REVOLVING CREDIT NOTE
$45,000,000.00 July ____, 1997
FOR VALUE RECEIVED, the undersigned, TRISM, INC., a Delaware
corporation, TRISM SECURED TRANSPORTATION, INC., a Delaware
corporation, TRI-STATE MOTOR TRANSIT CO., a Delaware corporation,
AERO BODY AND TRUCK EQUIPMENT COMPANY, INC., a Delaware
corporation, TRI-STATE TRANSPORTATION SERVICES, INC., a Missouri
corporation, DIABLO SYSTEMS INCORPORATED d/b/a DIABLO
TRANSPORTATION, INC., a California corporation, EMERALD LEASING,
INC., a Nevada corporation, McGIL SPECIAL SERVICES, INC., a
Delaware corporation, TRISM EASTERN, INC. d/b/a ▇. ▇. ▇▇▇▇▇▇▇
TRANSFER, a Delaware corporation, TRISM HEAVY HAUL, INC., a
Delaware corporation, TRISM SPECIALIZED CARRIERS, INC., a Georgia
corporation, TRISM SPECIAL SERVICES, INC., a Georgia corporation,
E. L. ▇▇▇▇▇▇ & SONS TRUCKING CO., INC., an Oklahoma corporation,
TRISM TRANSPORT, INC., a Delaware corporation, TRISM TRANSPORT
SERVICES, INC., a Utah corporation, and TRISM LOGISTICS, INC., a
New Jersey corporation (each of the foregoing herein a
"Borrower" and collectively, the "Borrowers"), HEREBY JOINTLY AND
SEVERALLY PROMISE TO PAY to the order of THE CIT GROUP/BUSINESS
CREDIT INC., a New York corporation ("Lender") or its assigns at
Lender's offices in Atlanta, Georgia, or at such other place as
the holder of this Revolving Credit Note (this "Revolving Credit
Note") may designate from time to time in writing, in lawful
money of the United States of America and in immediately
available funds, the amount of FORTY-FIVE MILLION DOLLARS
($45,000,000) or, if less, the aggregate unpaid principal amount
of all advances made pursuant to Section 2.1 of the "Loan
Agreement" (as hereinafter defined). All capitalized terms,
unless otherwise defined herein, shall have the respective
meanings assigned to such terms in the Loan Agreement.
This Revolving Credit Note is issued pursuant to that certain Loan
and Security Agreement of even date among the Borrowers, the financial
institutions party thereto from time to time and Lender, as agent and
lender thereunder (as amended, restated, supplemented or otherwise
modified from time to time, the "Loan Agreement"), and is entitled to the
benefit and security of the Loan Documents referred to therein, to which
Loan Agreement reference is hereby made for a statement of all of the terms
and conditions under which the loans evidenced hereby were made.
Each Borrower jointly and severally promises to pay the principal
amount of the indebtedness evidenced hereby in the amount and on the dates
specified in the Loan Agreement. Each Borrower jointly and severally
promises to pay interest on the unpaid principal amount of this Revolving
Credit Note outstanding from the date hereof until such principal amount
is paid in full at such interest rates and at such times as are specified
in the Loan Agreement.
If any payment on this Revolving Credit Note becomes due and payable
on a day other than a Business Day, the maturity thereof shall be extended
to the next succeeding Business Day and, with respect to payments of
principal, interest thereon shall be payable at the then applicable rate
during such extension.
Upon and after the occurrence of an Event of Default and the
expiration of all cure periods applicable thereto, this Revolving Credit
Note may, as provided in the Loan Agreement, and without demand, notice or
legal process of any kind, be declared, and immediately shall become, due
and payable.
Demand, presentment, protest and notice of nonpayment and protest
are hereby waived by each of the Borrowers.
No delay or failure on the part of Lender in the exercise of any
right or remedy hereunder, under the Loan Agreement or any other Loan
Document or at law or in equity, shall operate as a waiver thereof, and no
single or partial exercise by Lender of any right or remedy hereunder,
under the Loan Agreement or any other Loan Document or at law or in equity
shall preclude or estop another or further exercise thereof or the exercise
of any other right or remedy.
Time is of the essence of this Revolving Credit Note and, in case
this Revolving Credit Note is collected by law or through an attorney at
law, or under advice therefrom, each Borrower jointly and severally agrees
to pay all costs of collection, including reasonable attorneys' fees if
collected by or through an attorney.
THIS REVOLVING CREDIT NOTE HAS BEEN EXECUTED, DELIVERED AND ACCEPTED
AT ATLANTA, GEORGIA, AND SHALL BE INTERPRETED, GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW
PROVISIONS) OF THE STATE OF NEW YORK.
Attest: TRISM, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM SECURED TRANSPORTATION, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRI-STATE MOTOR TRANSIT CO.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: AERO BODY AND TRUCK EQUIPMENT COMPANY, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRI-STATE TRANSPORTATION SERVICE, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: DIABLO SYSTEMS INCORPORATED, D/B/A DIABLO
TRANSPORTATION, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: EMERALD LEASING, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: McGIL SPECIAL SERVICES, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM EASTERN, INC., D/B/A ▇. ▇. ▇▇▇▇▇▇▇
TRANSFER
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM HEAVY HAUL, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM SPECIALIZED CARRIERS, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM SPECIAL SERVICES, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: E. L. ▇▇▇▇▇▇ & SONS TRUCKING CO., INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM TRANSPORT, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM TRANSPORT SERVICES, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM LOGISTICS, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
EXHIBIT B
NOTICE OF PROPOSED ADVANCE
The CIT Group/Business Credit, Inc.
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▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Account Manager
[Date]
Ladies and Gentlemen:
The undersigned, Trism Inc., on behalf of itself and each of the other
Borrowers party to the Loan and Security Agreement, dated as of July ____,
1997 (the "Loan Agreement"; the terms defined therein being used herein as
therein defined), among the Borrowers, the financial institutions party
thereto from time to time (the "Lenders") and The CIT Group/Business Credit,
Inc., as Agent and Lender, and hereby gives you irrevocable notice pursuant
to Section 2.2(a) of the Loan Agreement that the undersigned hereby requests
an Advance under the Loan Agreement, and in that connection sets forth below
the information relating to such Advance (the "Proposed Advance") as
required by Section 2.2(a) of the Loan Agreement:
1. The Business Day of the Proposed Revolving Credit
Advance is ___________________, 19__.
2. The amount of the Proposed Advance is $________.
3. The amount of Borrowing Base Availability after giving
effect to the Advance is $_________.
The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed
Advance:
(A) the representations and warranties contained in Section 6.1
are correct on and as of the date of the making of the Proposed Advance,
before and after giving effect to the making of the Proposed Advance and to
the application of the proceeds therefrom, as though made on and as of such
date (except to the extent expressly stated to be as of an earlier date); and
(B) no event has occurred and is continuing, or would result
from the making of such Proposed Advance or from the application of the
proceeds therefrom, which constitutes an Event of Default or would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
Very truly yours,
TRISM,INC., on behalf of the Borrowers
By:_____________________________
Name:
Title:
EXHIBIT C
BORROWING BASE CERTIFICATE
Weekly Period ended _________________, 199___
Reference is made to the Loan and Security Agreement dated
as of July ____, 1997 (as modified and supplemented and in effect
from time to time, the "Loan Agreement"), between Trism, Inc. and
the other borrowers thereunder (collectively, the "Borrowers"),
the financial institutions party thereto from time to time (the
"Lenders") and The CIT Group/Business Credit, Inc., as Agent and
Lender ("Lender"). Terms defined in the Loan Agreement are used
herein as defined therein.
Pursuant to Section 1.2(a)(iii) of the Loan Agreement, the
undersigned [chief executive officer/chief financial officer] of
the Borrowers, hereby certifies that, (i) the Receivables covered
by this Certificate are Eligible Receivables as that term is
defined in the Loan Agreement, and (ii) to the best of [his/her]
knowledge, attached hereto as Annex 1 is a true and accurate
calculation of the Borrowing Base as at the end of the weekly
accounting period ended _____________, 199___ determined in
accordance with the requirements of the Loan Agreement.
IN WITNESS WHEREOF, the undersigned has caused this
certificate to be duly executed as of the _____ day of _________,
199___.
TRISM, INC., on behalf of the Borrowers
By:___________________________________________
Name:
Title: [chief executive officer/chief financial officer]
BORROWING BASE REPORT
[Insert Form of Report as Generated by CIT]
EXHIBIT D
FORM OF OPINION OF COUNSEL TO BORROWER
July ___, 1997
The CIT Group/Business Credit, Inc., as Agent
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as counsel to TRISM, Inc., a Delaware corporation
("TRISM"), as well as each of its subsidiaries and related companies in
their capacity as borrowers or guarantors collectively (the "Subsidiaries"),
in connection with the preparation, execution and delivery of (i) the Loan
and Security Agreement, dated of even date herewith (the "Loan Agreement"),
among The CIT Group/Business Credit, Inc., in its capacity as agent and
Lender (the "Agent"), the financial institutions party thereto from time to
time (the "Lenders"), TRISM and the Subsidiaries (TRISM and the Subsidiaries
are sometimes collectively referred to herein as the "Companies"), providing
for a senior secured revolving credit loan, including letter of credit
subline, to be made by Lender to the Companies in an aggregate principal
amount not to exceed $45,000,000 (all capitalized terms used herein but not
otherwise defined herein shall have the respective meanings given to such
terms in the Agreement), (ii) the Guaranty Agreement (the "Guaranty"), dated
of even date herewith, executed by the Guarantors (as defined therein) in
favor of Agent, for the benefit of itself and the Lenders, (iii) the Stock
Pledge Agreement (the "Stock Pledge Agreement"), dated of even date
herewith, among TRISM and certain of the other Companies party thereto
(the "Pledgors") and the Agent, for the benefit of itself and the Lenders,
and (iv the other Loan Documents relating to the Loan Agreement, the
Guaranty and the Stock Pledge Agreement. All capitalized terms used but
not defined herein have the respective meanings given to such terms in the
Loan Agreement.
In rendering the opinions expressed below, we have examined:
[Insert Documents Examined]
In such examination we have assumed the genuineness of all
signatures, other than those by or on behalf of the Company and the0
Guarantors, the authenticity of all documents submitted to us as originals,
the conformity to original documents of all documents submitted to us as
certified, conformed or photostatic copies and the authenticity of the
originals of such copies.
Based upon such examination and upon our examination of all such other
documentation, evidence and statutes as we have deemed pertinent, we advise
you that in our opinion:
1. Each Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware, with all requisite corporate power and authority to
own, operate or lease its respective properties and assets and to
carry on its respective business as now being conducted or as
proposed to be conducted. Each Company is duly qualified and is
authorized to do business and is in good standing in each
jurisdiction where the ownership, leasing or operation of its
respective properties or assets or the conduct of its respective
business requires such qualification.
2. Each Guarantor is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware, with all requisite corporate power and authority to
own, operate or lease its respective properties and assets and to
carry on its respective business as now being conducted or as
proposed to be conducted. Each Guarantor is duly qualified and
is authorized to do business and is in good standing in each
jurisdiction where the ownership, leasing or operation of its
respective properties or assets or the conduct of its respective
business requires such qualification.
3. Each Company and each Guarantor has the number of
shares of authorized capital stock with the par value and the
number of shares of issued and outstanding shares of capital
stock as of the date hereof as set forth on Schedule __ to the
Loan and Security Agreement. All such outstanding shares have
been duly and validly issued and are fully paid and
nonassessable.
4. Each Company and each Guarantor has all requisite
corporate power and authority to execute and deliver, and to
perform its respective obligations under each of the Loan
Documents to which it is a party and each Company has all
requisite corporate power and authority to borrow and to assume
liability in respect of Letter of Credit Obligations under the
Loan Agreement.
5. The execution and delivery by each Company of each of
the Loan Documents to which it is a party, the performance of
each Company's obligations pursuant thereto, the consummation of
the transactions contemplated thereby (the "Transactions")
including, without limitation, the borrowings, the assumption of
liability in respect of Letter of Credit Obligations by the
Company and the granting to Agent, for the benefit of itself and
the Lenders, of the Liens thereunder, have been duly authorized
by all necessary corporate action on the part of each Company
required to be taken by law and by the Articles of Incorporation
and the By-laws of the Company, and do not violate, conflict
with, result in a breach or termination of, or a default under
(or constitute an event which, with or without due notice or
lapse of time, or both, would constitute a default under) or
accelerate the performance required by, or result in the creation
of any lien, pledge, security interest, charge or other
encumbrance in favor of anyone other than Agent, upon any of the
properties or assets of any Company under any of the terms,
conditions or provisions of (i) the Articles of Incorporation or
By-laws of such Company, (ii) any law, statute, rule or
regulation applicable to such Company (including, without
limitation, regulations G, T, U and X of the Board of Governors
of the Federal Reserve System), (iii) any judgment, order,
decree, ruling or injunction specifically naming such Company or
specifically applicable to its properties, of any court or
governmental authority, or (iv) any indenture, mortgage, deed of
trust, deed to secure debt, credit agreement, loan agreement or
any other agreement, contract, commitment, instrument or document
under which such Company or its properties are bound or that
purports to effect such Company's ability to borrow funds, pledge
its assets, enter into the Transactions or consummate the
Transactions.
6. The execution and delivery by each Guarantor of each of
the Loan Documents to which it is a party, the performance of
each Guarantor's obligations pursuant thereto, the consummation
of the transactions contemplated thereby (the "Transactions")
including, without limitation, the guaranty of the Obligations by
each Guarantor, have been duly authorized by all necessary
corporate action on the part of each Guarantor required to be
taken by law and by the Articles of Incorporation and the By-laws
of each Guarantor, and do not violate, conflict with, result in a
breach or termination of, or a default under (or constitute an
event which, with or without due notice or lapse of time, or
both, would constitute a default under) or accelerate the
performance required by, or result in the creation of any lien,
pledge, security interest, charge or other encumbrance in favor
of anyone other than Agent, upon any of the properties or assets
of any Guarantor under any of the terms, conditions or provisions
of (i) the Articles of Incorporation or By-laws of such
Guarantor, (ii) any law, statute, rule or regulation applicable
to such Guarantor, (iii) any judgment, order, decree, ruling or
injunction specifically naming such Guarantor or specifically
applicable to its properties, of any court or governmental
authority, or (iv) any indenture, mortgage, deed of trust, deed
to secure debt, credit agreement, loan agreement or any other
agreement, contract, commitment, instrument or document under
which such Guarantor or its properties are bound or that purports
to affect such Guarantor's ability to guaranty the obligations,
pledge its assets or perform any of its other obligations under
the Loan Documents to which it is a party.
7. The Loan Agreement and each of the other Loan Documents
to which the Companies are a party have been duly executed and
delivered by each Company and constitute the legal, valid and
binding obligations of each Company, enforceable against each
Company in accordance with its respective terms.
8. The Guaranty and each of the other Loan Documents to
which the Guarantors are a party have been duly executed and
delivered by each Guarantor and constitute the legal, valid and
binding obligations of each Guarantor, enforceable against each
Guarantor in accordance with its respective terms.
9. No authorization, approval or consent of, and no filing
or registration with, any governmental, public or regulatory
authority or agency or any subdivision thereof is required on the
part of any Company for (a) the authorization, execution or
delivery by any Company of the Loan Documents, (b) the legality,
validity, binding effect or enforceability of any of the Loan
Documents, or (c) for the borrowings, the application for and
assumption of liability in respect of any Letter of Credit
Obligations, the granting of the Liens in favor of Agent or the
performance of any of the other obligations by any Company under
the Loan Agreement and the other Loan Documents to which it is a
party, except for filings of the Financing Statements in respect
of the Liens created by the Loan Agreement.
10. There are no actions, suits, investigations,
proceedings pending or, to our knowledge, threatened against or
affecting any Company or any Guarantor or the property of any
Company or any Guarantor before any court or governmental
department, commission, board, bureau, agency or instrumentality
which would materially and adversely affect the property,
business, prospects, profits or condition (financial or
otherwise) of such Company or such Guarantor, including, without
limitation, any action, suit, investigation or proceeding under
any Environmental Law.
11. None of the provisions of the Loan Agreement or the
other Loan Documents violate any laws of the State of [_________]
relating to interest or usury.
12. The offices and records in the filing jurisdictions
listed in Exhibit A hereto (the "Filing Jurisdictions"), are the
only offices and records maintained or provided for in the Filing
Jurisdictions which must be searched to determine if there are
any UCC financing statements, or judgments, environmental, tax or
ERISA liens of record that would attach to the Collateral.
13. No taxes or other charges, including, without
limitation, intangible taxes or documentary stamp taxes, mortgage
or recording taxes, transfer taxes or similar charges, are
payable to any of the Filing Jurisdictions on account of the
execution or delivery of the Loan Documents or the creation of
the indebtedness evidenced or secured thereby or the recording or
filing of the Loan Documents, except for nominal filing or
recording fees.
14. Each Collateral Document is effective to create in
favor of the Agent, for the benefit of itself and the Lenders, a
valid security interest in all of the right, title and interest
of the each Companies to and under the Collateral as collateral
security for the payment when due of the Obligations. Upon the
filing of the Financing Statement Assignments in the UCC records
in the Filing Jurisdictions, which are all of the offices in
which filings are required to perfect Agent's security interest
in the Collateral, (i) all filings, registrations and recordings
necessary or appropriate to perfect the security interests in the
Collateral granted by the Companies to the Agent to secure the
Obligations, will have been made, (ii) such security interests
will constitute perfected security interests in the Collateral,
(iii) no additional filing or recording of any document or
instrument or other action will be required to perfect Agents
security interest in the Collateral, and (iv) such security
interests will have priority over any other consensual UCC
security interests in the same property that are perfected by the
filing of a UCC-1 financing statement in the Filing
Jurisdictions, except for purchase money security interests.
15. Each Pledgor is the record owner of the shares of
capital stock of the Company in which such Pledgor has granted a
security interest to the Agent, for the benefit of itself and the
Lenders, pursuant to the Stock Pledge Agreement.
16. The execution and delivery of the Stock Pledge
Agreement by each Pledgor creates a valid lien on and security
interest in all of such Pledgor's interest in its "Pledged
Securities" (as such term is defined in the Stock Pledge
Agreement and hereinafter referred to as the "Pledged
Securities"). Assuming that value has been given for purposes of
Section 9-203(1)(b) of the Uniform Commercial Code as in effect
in the State of [________] (the "UCC"), the security interest in
the Pledged Securities will, upon the creation of the security
interest, be perfected by the Agent taking possession and
thereafter retaining possession of the stock certificates
evidencing each Pledgors ownership of its Pledged Securities.
Assuming that the Agent has acquired its security interest in the
Pledged Securities in good faith and without notice of any
adverse claim (as defined in Section 8-302(2) of the UCC), the
Agent's security interest in the Pledged Securities will have
priority over all other security interests theretofore or
thereafter created pursuant to the UCC.
17. The Pledge of the Pledged Securities to the Agent by
each Pledgor pursuant to the Stock Pledge Agreement will not
violate or result in the violation of Section 5 of the Securities
Act of 1933, as amended, or the rules and regulations promulgated
pursuant thereto, or any blue sky or any similar state laws
applicable thereto.
18. The Agent's security interest, for the benefit of
itself and the Lenders, validly secures the payment of all
future Revolving Credit Advances made by the Lenders to the
Company whether or not, at the time such Revolving Credit
Advances are made, an Event of Default or other event not within
the control of Agent or the Lenders has relieved or may relieve
the Lenders from its obligations to make such Revolving Credit
Advances, and is perfected to the extent set forth in paragraph
14 above with respect to such future Revolving Credit Advances.
Insofar as the priority thereof is governed by the UCC, the
Agent's security interest has the same priority with respect to
such future Revolving Credit Advances as it does with respect to
Revolving Credit Advances made on the date hereof.
19. None of the transactions contemplated by the Loan
Agreement, including, without limitation, the use of the proceeds
of any Loans made to the Companies thereunder, will violate or
result in a violation of Section 7 of the Securities Exchange Act
of 1934, as amended, any regulations issued pursuant thereto, or
regulations G, T, U and X of the Board of Governors of the
Federal Reserve System, and to the best of our knowledge no
Company owns or intends to purchase or carry any "margin
securities" as defined in said regulations.
This opinion may be relied upon by you and any participant in your
Loans to the Companies, but by no other person or entity.
Very truly yours,
Proskauer, Rose, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
EXHIBIT E
SETTLEMENT REPORT
[TO BE PROVIDED BY CIT]
EXHIBIT F
STOCK PLEDGE AGREEMENT
This STOCK PLEDGE AGREEMENT (this "Stock Pledge
Agreement"), dated as of July ____, 1997, is made and entered
into among TRISM, INC., a Delaware corporation, TRISM SECURED
TRANSPORTATION, INC., a Delaware corporation, TRISM HEAVY HAUL,
INC., a Delaware corporation, TRISM TRANSPORT SERVICES, INC., a
Utah corporation, TRI-STATE MOTOR TRANSIT CO., a Delaware
corporation, and TRISM SPECIALIZED CARRIERS, INC., a Georgia
corporation, (each a "Pledgor" and collectively, the "Pledgors"),
and THE CIT GROUP/BUSINESS CREDIT, INC., as agent (the "Agent")
for the lenders (the "Lenders") from time to time party to the
Loan Agreement (as defined below).
W I T N E S S E T H :
WHEREAS, the Agent and the Lenders have entered into a
Loan and Security Agreement, dated of even date herewith, with
TRISM, INC., a Delaware corporation and the other borrowers
thereunder (collectively, the "Borrowers") (as amended from time
to time, the "Loan Agreement"), pursuant to which the Lenders
have agreed to make certain loans to the Borrowers (the "Loans"),
the proceeds of which are to be used for working capital and
other corporate purposes of Borrowers; and
WHEREAS, Pledgors are parties to the Loan Agreement,
and, as such, will derive substantial direct and indirect
economic benefit from the making of the Loans; and
WHEREAS, each Pledgor is the record and beneficial
owner of the shares of common stock described in Exhibit A hereto
(the "Pledged Securities"); and
WHEREAS, in connection with the making of the Loans
under the Loan Agreement and as security for the payment and
performance of Pledgor's obligations under the Loan Agreement,
the Agent and the Lenders are requiring that Pledgor execute and
deliver this Stock Pledge Agreement and grant the security
interest contemplated hereby.
NOW, THEREFORE, in consideration of the premises and
the covenants hereinafter contained, and to induce the Lenders to
make Loans under the Loan Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein,
terms defined in the Loan Agreement are used herein as therein
defined, and the following shall have (unless otherwise provided
elsewhere in this Stock Pledge Agreement) the following
respective meanings (such meanings being equally applicable to
both the singular and plural form of the terms defined):
"Agreement" shall mean this Stock Pledge Agreement,
including all amendments, modifications and supplements and any
exhibits or schedules to any of the foregoing, and shall refer to
the Agreement as the same may be in effect at the time such
reference becomes operative.
"Bankruptcy Code" shall mean title 11, United States
Code, as amended from time to time, and any successor statute
thereto.
"Pledged Collateral" shall have the meaning assigned to such
term in Section 2 hereof.
"Secured Obligations" shall have the meaning assigned to such
term in Section 3 hereof.
2. Pledge. Each Pledgor hereby pledges to the Agent
and grants to the Agent, for the benefit of the Agent and the
ratable benefit of the Lenders, a first priority security
interest in, all of the following (collectively, the "Pledged
Collateral"), except as otherwise provided in Section 7.2(a):
2.1 its respective Pledged Securities and the
certificates representing its Pledged Securities, and all
dividends, distributions, cash, instruments and other property or
proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of its
Pledged Securities; and
2.2 all additional shares of capital stock of any
company from time to time acquired by any Pledgor in any manner
(which shares shall be deemed to be part of the Pledged
Securities), and the certificates representing such additional
shares, and all dividends, distributions, cash, instruments and
other property or proceeds from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or
all of such shares.
30 Security for Obligations. This Agreement secures,
and the Pledged Collateral is security for, the prompt payment
and performance of all obligations of each Pledgor under the Loan
Agreement, and all obligations of each Pledgor now or hereafter
existing under this Agreement, including, without limitation, all
costs and expenses of the Agent in connection with preserving,
defending or enforcing the Pledged Collateral or the security
interest granted hereunder and all other costs and expenses of
the Agent and the Lenders incurred in connection with this
Agreement (collectively, the "Secured Obligations").
40 Delivery of Pledged Collateral. All certificates
representing or evidencing the Pledged Securities shall be
delivered to and held by or on behalf of the Agent pursuant
hereto and shall be accompanied by duly executed instruments of
transfer or assignment in blank, including duly executed blank
stock papers, all in form and substance satisfactory to the
Agent. The Agent shall have the right, at any time after the
occurrence of a Default or Event of Default, in its discretion
and without notice to any Pledgor, to transfer to or to register
in the name of the Agent, or any of its nominees, subject to the
terms of this Agreement, any or all of the Pledged Securities.
In addition, the Agent shall have the right at any time to
exchange certificates or instruments representing or evidencing
Pledged Securities for certificates or instruments of smaller or
larger denominations.
50 Representations and Warranties. Each Pledgor jointly and
severally represents and warrants to the Agent and the Lenders that:
5.1 Each Pledgor is (i) a corporation duly organized,
validly existing and in good standing under the laws of the State
of Delaware; (ii) is duly qualified and in good standing under
the laws of each jurisdiction where its ownership or lease of
property or the conduct of its business requires such
qualifications; (iii) has the corporate power and authority to
execute, deliver and perform under this Agreement and the Loan
Documents to which it is a party and has taken all necessary and
appropriate action to authorize the execution, delivery and performance
of this Agreement and such Loan Documents; (iv) has the requisite power
and authority and the legal right to own, pledge, mortgage or otherwise
encumber and operate its properties, and to conduct its business as now or
heretofore conducted; (v) has all material licenses, permits, consents or
approvals from or by, and has made all material filings with, and has given
all material notices to, all governmental departments, commissions, boards,
bureaus, agencies or other instrumentalities, domestic or foreign, having
jurisdiction, to the extent required for such ownership, operation and
conduct; and (vi) is in compliance with all applicable provisions of law
where the failure to comply would have a Materially Adverse Effect.
5.2 Each Pledgor is, and at the time of delivery of the
Pledged Securities to the Agent pursuant to Section 4 hereof will be, the
sole holder of record and the sole beneficial owner of its respective
Pledged Collateral free and clear of any Lien thereon or affecting the
title thereto except for the Lien created by this Agreement.
5.3 Each Pledgor's Pledged Securities included in the Pledged
Collateral constitute all of the issued and outstanding shares of Stock of
the respective issuers thereof as is set forth with respect to each such
issuer on Exhibit A attached hereto. All of the Pledged Securities have
been duly authorized, validly issued and are fully paid and non-assessable;
and there are no existing options, warrants or commitments of any kind or
nature or any outstanding securities or other instruments convertible into
shares of any class of Stock of any corporation, and no Stock of any
corporation is held in the treasury of such corporation.
5.4 Each Pledgor has the right and requisite authority to pledge,
assign, transfer, deliver, deposit and set over its Pledged Collateral to
the Agent, for the ratable benefit of the Lenders, as provided herein.
5.5 None of the Pledged Securities has been issued or transferred
in violation of the securities registration, securities disclosure or
similar laws of any jurisdiction to which such issuance or transfer may be
subject. Each Pledgor's execution, delivery and performance of this
Agreement and the pledge of its respective Pledged Collateral hereunder do
not, directly or indirectly, violate or result in a violation of any such
laws.
5.6 Each Pledgor will not, subsequent to the date of this
Agreement, cause or, to the extent it is able to do so, permit the issuer
of any Pledged Securities to issue any shares of capital stock or securities
convertible into shares of capital stock, unless and except upon first
having obtained the prior written consent of the Agent and the Required
Lenders and such stock or securities are pledged to the Agent, for the
ratable benefit of the Lenders, as required by this Agreement.
5.7 None of the Pledged Securities included in the Pledged
Collateral is, as of the date of this Agreement, Margin Stock and each
Pledgor shall, promptly after learning thereof, notify the Agent of any
Pledged Collateral which is or becomes Margin Stock and execute and deliver
in favor of the Agent and the Lenders any and all instruments, documents
and agreements (including, but not limited to Forms U-1) necessary to cause
the pledge of such Margin Stock to comply with all applicable laws, rules
and regulations.
5.8 No consent, approval, authorization or other order of any
Person and no consent, authorization, approval, or other action by, and no
notice to or filing with, any governmental departments, commissions, boards,
bureaus, agencies or other instrumentalities, domestic or foreign, is
required to be made or obtained by any Pledgor either (i) for the pledge
of its Pledged Collateral pursuant to this Agreement or for the execution,
delivery or performance of this Agreement by any Pledgor or (ii) for the
exercise by the Agent of the voting or other rights provided for in this
Agreement or the remedies in respect of the Pledged Collateral pursuant to
this Agreement, except as may be required in connection with such
disposition by laws affecting the offering and sale of securities generally.
5.9 The pledge, assignment and delivery of the Pledged Collateral
pursuant to this Agreement will create a valid first priority Lien on and a
perfected security interest in the Pledged Collateral pledged by the
Pledgors, and the proceeds thereof, securing the payment of the Secured
Obligations, subject to no other Lien or security interest.
5.10 This Agreement has been duly authorized, executed and
delivered by each Pledgor and constitutes the legal, valid and binding
obligation of each Pledgor enforceable in accordance with its terms.
The representations and warranties set forth in this Section 5
shall survive the execution and delivery of this Agreement.
60 Covenants. Each Pledgor jointly and severally covenants and
agrees that until the Termination Date and the payment in full of the
Secured Obligations:
6.1 No Pledgor will sell, assign, transfer, pledge, or otherwise
encumber any of its rights in or to any Pledged Collateral or any unpaid
dividends or other distributions or payments with respect thereto or ▇▇▇▇▇
▇ ▇▇▇▇ on any thereof. In the event the Agent and the Lenders consent to
any such Lien, (a) the Agent shall subordinate the Liens granted hereunder
to such Lien on terms satisfactory to the Agent and the Lenders in their
sole discretion, and (b) each Pledgor, the Agent and the Lenders shall
take such actions (including any amendments to this Agreement and the other
Loan Documents) as the Agent or the Lenders may request, or as may be
necessary, in connection therewith, all at the cost and expense of the
Pledgors and the Borrowers.
6.2 Each Pledgor will, at its expense, promptly execute,
acknowledge and deliver all such instruments and take all such action as
the Agent from time to time may request in order to ensure to the Agent and
the Lenders the benefits of the Liens in and to the Pledged Collateral
intended to be created by this Agreement, including the filing of any
necessary Uniform Commercial Code financing statements, which may be filed
by the Agent or the Lenders with or without the signature of any Pledgor,
and will cooperate with the Agent and the Lenders, at the Pledgors' expense,
in obtaining all necessary approvals and making all necessary filings under
federal or state law in connection with such Liens or any sale or transfer
of any Pledged Collateral.
6.3 Each Pledgor has and will defend the title to its Pledged
Collateral and the Liens of the Agent, for the benefit of the Agent and the
ratable benefit of the Lenders, thereon against the claim of any Person and
will maintain and preserve such Liens until the Termination Date and the
payment in full of the Secured Obligations.
6.4 Each Pledgor will, upon obtaining any additional shares of
capital stock of Borrower which are not already Pledged Collateral, promptly
(and in any event within three (3) Business Days) deliver to the Agent a
Pledge Amendment, duly executed by such Pledgor, in substantially the form
of Exhibit B hereto (a "Pledge Amendment"), in respect of the additional
Pledged Securities which are to be pledged pursuant to this Agreement.
Each Pledgor hereby authorizes the Agent to attach each Pledge Amendment to
this Agreement and agrees that all Pledged Securities listed on any Pledge
Amendment delivered to the Agent shall for all purposes hereunder be
considered Pledged Collateral.
70 Pledgor's Rights. As long as no Default or Event of Default
shall have occurred and be continuing and until written notice shall be
given to the Pledgors in accordance with Section 8(a) hereof,
7.1 Each Pledgor shall have the right, from time to time, to vote
and give consents with respect to the Pledged Collateral or any part thereof
for all purposes not inconsistent with the provisions of this Agreement, the
Loan Agreement, and any other agreement; provided, however, that no vote
shall be cast, and no consent shall be given or action taken, which would
have the effect of impairing the position or interest of the Agent and the
Lenders in respect of the Pledged Collateral or which would authorize or
effect (except as and to the extent expressly permitted by the Loan
Agreement) (i) the dissolution or liquidation, in whole or in part, of any
issuer of Pledged Securities, (ii) the consolidation or merger of any issuer
of Pledged Securities with any other Person, (iii) the sale, disposition or
encumbrance of all or substantially all of the assets of any issuer of
Pledged Securities, (iv) any change in the authorized number of shares, the
stated capital or the authorized share capital of any issuer of Pledged
Securities or the issuance of any additional Stock of any issuer of Pledged
Securities, or (v) the alteration of the voting rights with respect to the
Stock of any issuer of Pledged Securities;
7.2 (a) Each Pledgor shall be entitled, from time to time, to
collect and receive for its own use and shall not be required to pledge
pursuant to Section 2, all cash dividends paid in respect of its Pledged
Securities to the extent not in violation of the Loan Agreement other than
any and all (A) dividends paid or payable other than in cash in respect of,
and instruments and other property received, receivable or otherwise
distributed in respect of, or in exchange for, any Pledged Collateral, (B)
dividends and other distributions paid or payable in cash in respect of any
Pledged Collateral in connection with a partial or total liquidation or
dissolution, and (C) cash paid, payable or otherwise distributed in
redemption of, or in exchange for, any Pledged Collateral; provided, however,
that until actually paid all rights to such distributions shall remain
subject to the Lien created by this Agreement; and
(b) all dividends (other than such cash dividends as are
permitted to be paid to any Pledgor in accordance with clause (b) above)
and all other distributions in respect of any of the Pledged Securities,
whenever paid or made, shall be delivered to the Agent (in accordance with
Section 6.4 hereof if in the form of a stock dividend) to hold as Pledged
Collateral and shall, if recovered by any Pledgor, be received in trust for
the benefit of the Agent and the Lenders, be segregated from the other
property or funds of such Pledgor, and be forthwith delivered to the Agent
as Pledged Collateral in the same form as so received (with any necessary
indorsement).
80 Defaults and Remedies. 8.1 Upon the occurrence of an Event
of Default and during the continuation of such Event of Default, then or at
any time after such declaration and following written notice to the Pledgors,
the Agent (personally or through an agent) is hereby authorized and empowered
to transfer and register in its name or in the name of its nominee the whole
or any part of the Pledged Collateral, to exchange certificates or
instruments representing or evidencing Pledged Securities for certificates
or instruments of smaller or larger denominations, to exercise the voting
rights with respect thereto, to collect and receive all cash dividends and
other distributions made thereon, to sell in one or more sales after ten
(10) days' notice of the time and place of any public sale or of the time
after which a private sale is to take place (which notice each Pledgor
agrees is commercially reasonable), but without any previous notice or
advertisement, the whole or any part of the Pledged Collateral and to
otherwise act with respect to the Pledged Collateral as though the Agent
was the outright owner thereof; provided, however, the Agent shall not
have any duty to exercise any such right of sale or to preserve the same
and shall not be liable for any failure to do so or for any delay in doing
so. Any sale shall be made at a public or private sale at the Agent's
place of business, or at any public building to be named in the notice of
sale, either for cash or upon credit or for future delivery at such price
as the Agent may deem fair, and the Agent or any Lender may be the
purchaser of the whole or any part of the Pledged Collateral so sold and
hold the same thereafter in its own right free from any claim of any Pledgor
or any right of redemption. Each sale shall be made to the highest bidder,
but the Agent reserves the right to reject any and all bids at such
sale which, in its discretion, it shall deem inadequate. Demands of
performance, except as otherwise herein specifically provided for, notices
of sale, advertisements and the presence of property at sale are hereby
waived and any sale hereunder may be conducted by an auctioneer or any
officer or agent of the Agent.
8.2 If, at the original time or times appointed for
the sale of the whole or any part of the Pledged Collateral, the
highest bid, if there be but one sale, shall be inadequate to
discharge in full all the Secured Obligations, or if the Pledged
Collateral be offered for sale in lots, if at any of such sales,
the highest bid for the lot offered for sale would indicate to
the Agent, in its discretion, the unlikelihood of the proceeds of
the sales of the whole of the Pledged Collateral being sufficient
to discharge all the Secured Obligations, the Agent may, on one
or more occasions and in its discretion, postpone any of said
sales by public announcement at the time of sale or the time of
previous postponement of sale, and no other notice of such
postponement or postponements of sale need be given, any other
notice being hereby waived; provided, however, that any sale or
sales made after such postponement shall be after ten (10) days'
notice to the Pledgors.
8.3 In the event of any sales hereunder, the Agent
shall, after deducting all costs or expenses of every kind
(including reasonable attorneys' fees and disbursements) for
care, safekeeping, collection, sale, delivery or otherwise, apply
the residue of the proceeds of the sales to the payment or
reduction, either in whole or in part, for the benefit of the
Agent and the ratable benefit of the Lenders, of the Secured
Obligations in accordance with Section 13.3 of the Loan
Agreement.
8.4 In the event that it becomes necessary to comply
with any Federal or State law or regulation or to make or file
any registration thereunder in order for Agent to exercise any of
Agent's rights hereunder, each Pledgor expressly agrees to do or
cause to be done all acts and prepare and execute all documents
necessary to affect such compliance or registration, and to bear
all reasonable costs in connection therewith. Each Pledgor
agrees to indemnify and to hold Agent and the Lenders harmless
from and against any claim or liability; and to hold Agent and
the Lenders harmless from and against any claim or liability
caused by (i) any omission or alleged omission to state a
material fact required to be stated, or necessary to make the
statements, in light of the circumstances in which they are made,
not misleading (as required in any registration or prospectus) or
(ii) a failure to register or comply with any such law or
regulation.
8.5 If, at any time when the Agent shall determine to
exercise its right to sell the whole or any part of the Pledged
Collateral hereunder, such Pledged Collateral or the part thereof
to be sold shall not, for any reason whatsoever, be effectively
registered under the Securities Act of 1933, as amended (the
"Act"), the Agent may, in its discretion (subject only to
applicable requirements of law), sell such Pledged Collateral or
part thereof by private sale in such manner and under such
circumstances as the Agent may deem necessary or advisable, but
subject to the other requirements of this Section 8, and shall
not be required to effect such registration or to cause the same
to be effected. Without limiting the generality of the forego
ing, in any such event the Agent in its discretion (a) may, in
accordance with applicable securities laws, proceed to make such
private sale notwithstanding that a registration statement for
the purpose of registering such Pledged Collateral or part
thereof could be or shall have been filed under said Act (or
similar statute), (b) may approach and negotiate with a single
possible purchaser to effect such sale, and (c) may restrict such
sale to a purchaser who will represent and agree that such
purchaser is purchasing for its own account, for investment and
not with a view to the distribution or sale of such Pledged
Collateral or part thereof. In addition to a private sale as
provided above in this Section 8, if any of the Pledged
Collateral shall not be freely distributable to the public
without registration under the Act (or similar statute) at the
time of any proposed sale pursuant to this Section 8, then the
Agent shall not be required to effect such registration or cause
the same to be effected but, in its discretion (subject only to
applicable requirements of law), may require that any sale
hereunder (including a sale at auction) be conducted subject to
restrictions (i) as to the financial sophistication and ability
of any Person permitted to bid or purchase at any such sale,
(ii) as to the content of legends to be placed upon any
certificates representing the Pledged Collateral sold in such
sale, including restrictions on future transfer thereof, (iii) as
to the representations required to be made by each Person bidding
or purchasing at such sale relating to that Person's access to
financial information about any issuer of Pledged Securities and
such Person's intentions as to the holding of the Pledged
Collateral so sold for investment, for its own account, and not
with a view to the distribution thereof, and (iv) as to such
other matters as the Agent may, in its discretion, deem necessary
or appropriate in order that such sale (notwithstanding any
failure so to register) may be effected in compliance with the
Bankruptcy Code and other laws affecting the enforcement of
creditors' rights and the Act and all applicable state securities
laws.
8.6 Each Pledgor acknowledges that notwithstanding the
legal availability of a private sale or a sale subject to the
restrictions described above in paragraph 8.5, the Agent may, in
its discretion, elect to register any or all the Pledged
Collateral under the Act (and any applicable state securities
law) in accordance with its rights hereunder. Each Pledgor,
however, recognizes that the Agent may be unable to effect a
public sale of any or all the Pledged Collateral and may be
compelled to resort to one or more private sales thereof. Each
Pledgor also acknowledges that any such private sale may result
in prices and other terms less favorable to the seller than if
such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed
to have been made in a commercially reasonable manner. The Agent
shall be under no obligation to delay a sale of any of the
Pledged Collateral for the period of time necessary to permit the
registrant to register such securities for public sale under the
Act, or under applicable state securities laws, even if any
Pledgor would agree to do so.
8.7 Each Pledgor agrees, to the maximum extent
permitted by applicable law, that following the occurrence and
during the continuance of an Event of Default it will not at any
time plead, claim or take the benefit of any appraisal,
valuation, stay, extension, moratorium or redemption law now or
hereafter in force in order to prevent or delay the enforcement
of this Agreement, or the absolute sale of the whole or any part
of the Pledged Collateral or the possession thereof by any
purchaser at any sale hereunder, and each Pledgor waives the
benefit of all such laws to the extent it lawfully may do so.
Each Pledgor agrees that it will not interfere with any right,
power and remedy of the Agent or any Lender provided for in this
Agreement or now or hereafter existing at law or in equity or by
statute or otherwise, or the exercise or beginning of the
exercise by the Agent or any Lender of any one or more of such
rights, powers or remedies. No failure or delay on the part of
the Agent or any Lender to exercise any such right, power or
remedy and no notice or demand which may be given to or made upon
the Agent or any Lender with respect to any such remedies shall
operate as a waiver thereof, or limit or impair the Agent's or
any Lender's right to take any action or to exercise any power or
remedy hereunder, without notice or demand, or prejudice its
rights as against any Pledgor in any respect.
8.8 Each Pledgor further agrees that a breach of any of the
covenants contained in this Section 8 will cause irreparable injury to
the Agent and the Lenders, that the Agent and the Lenders have no adequate
remedy at law in respect of such breach and, as a consequence, agrees that
each and every covenant contained in this Section 8 shall be specifically
enforceable against each Pledgor, and each Pledgor hereby waives and agrees
not to assert any defenses against an action for specific performance of
such covenants except for a defense that the Secured Obligations are not
then due and payable in accordance with the agreements and instruments
governing and evidencing such obligations.
8.9 The rights and remedies of the Agent under this Agreement
shall be cumulative and not exclusive of any rights or remedies which it
would otherwise have. In exercising such rights and remedies the Agent may
be selective and no failure or delay by the Agent in exercising any right
shall operate as a waiver of it, nor shall any single or partial exercise
of any power or right preclude its other or further exercise or the exercise
of any other power or right.
90 Power of Attorney; Proxy. 9.1 Upon and after an Event of
Default, each Pledgor irrevocably designates, makes, constitutes and
appoints the Agent (and all Persons designated by the Agent) as its true
and lawful attorney (and agent-in-fact) and the Agent, or the Agent's agent,
may, without notice to any Pledgor, and at such time or times thereafter as
the Agent or said agent, in its discretion, may determine, in the name of
any Pledgor or the Agent, (a) transfer any or all of the Pledged Collateral
on the books of the issuer thereof, with full power of substitution in the
premises; (b) endorse the name of any Pledgor upon any checks, notes,
acceptance, money orders, certificates, drafts or other forms of payment
of security that come into the Agent's or any Lender's possession; and (c)
do all acts and things necessary, in the Agent or any Lender's discretion,
to fulfill the obligations of the Pledgors under this Agreement.
9.2 Upon the occurrence of any Event of Defaul thereunder, the
Agent, or its nominee, without notice or demand of any kind to any Pledgor,
shall have the sole and exclusive right to exercise all voting powers
pertaining to any and all of the Pledged Collateral (and to give written
consents in lieu of voting thereon) and may exercise such power in such
manner as the Agent, in its sole discretion, shall determine. THIS
PROXY IS COUPLED WITH AN INTEREST AND IS IRREVOCABLE. The exercise by the
Agent of any of its rights and remedies under this Section shall not be
deemed a disposition of Pledged Collateral under Article 9 of the Uniform
Commercial Code nor an acceptance by the Agent of any of the Pledged
Collateral in satisfaction of any of the Obligations.
100 Waiver. No delay on the Agent's or any Lender's
part in exercising any power of sale, Lien, option or other right
hereunder, and no notice or demand which may be given to or made
upon any Pledgor by the Agent or any Lender with respect to any
power of sale, Lien, option or other right hereunder, shall
constitute a waiver thereof, or limit or impair the Agent's or
any Lender's right to take any action or to exercise any power of
sale, Lien, option, or any other right hereunder, without notice
or demand, or prejudice the Agent's or any Lender's rights as
against any Pledgor in any respect.
110 Termination. This Agreement shall terminate and
be of no further force or effect at such time as the Secured
Obligations shall be paid and performed in full. Upon such
payment and performance in full of the Secured Obligations, the
Agent shall deliver to the Pledgors the Pledged Collateral at the
time subject to this Agreement and then in the Agent's possession
or control and all instruments of assignment executed in
connection therewith, free and clear of the Liens hereof and,
except as otherwise provided herein, all of the Pledgors'
obligations hereunder shall at such time terminate.
120 Lien Absolute. All rights of the Agent's and the Lenders
hereunder, and all obligations of the Pledgors hereunder, shall be
absolute and unconditional irrespective of:
12.1 any lack of validity or enforceability of the Loan
Agreement, the Notes, any other Loan Document or any other agreement or
instrument governing or evidencing any Secured Obligations or any of the
Borrowers' obligations under the Loan Documents;
12.2 any change in the time, manner or place of payment of, or
in any other term of, all or any part of the Secured Obligations or any of
the Borrowers' obligations under the Loan Documents, or any other amendment
or waiver of or any consent to any departure from the Loan Agreement, the
Notes, any other Loan Document or any other agreement or instrument governing
or evidencing any Secured Obligations or any of Borrowers' obligations under
the Loan Documents;
12.3 any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to departure
from any guaranty, for all or any of the Secured Obligations or any of
Borrowers' obligations under the Loan Documents; or
12.4 any other circumstance which might otherwise constitute a
defense available to, or a discharge of, any Pledgor.
130 Release. 13.1 Each Pledgor hereby waives notice of
acceptance of this Agreement, and also presentment, demand, protest and
notice of dishonor of any and all of the Secured Obligations or any of the
Borrowers' obligations under the Loan Documents, and promptness in
commencing suit against any party hereto or liable hereon, and in giving any
notice to or of making any claim or demand hereunder upon any Pledgor.
No act or omission of any kind on the Agent's or any Lender's part shall in
any event affect or impair this Agreement.
13.2 Each Pledgor consents and agrees that Agent may at any time,
or from time to time, in its discretion:
(a) renew, extend or change the time of payment, and/or the
manner, place or terms of payment of all or any part of the Secured
Obligations; and
(b) exchange, release and/or surrender all or any of the
Collateral (including the Pledged Collateral), or any part thereof, by
whomsoever deposited, which is now or may hereafter be held by Agent
in connection with all or any of the Secured Obligations; all in such
manner and upon such terms as Agent may deem proper, and without notice
to or further assent from any Pledgor, it being hereby agreed that each
Pledgor shall be and remain bound upon this Agreement, irrespective of
the value or condition of any of the Collateral, and notwithstanding
any such change, exchange, settlement, compromise, surrender, release,
renewal or extension, and notwithstanding also that the Secured
Obligations may, at any time, exceed the aggregate principal amount
thereof set forth in the Loan Agreement, or any other agreement
governing any Secured Obligations. Each Pledgor hereby waives notice
of acceptance of this Agreement, and also presentment, demand, protest
and notice of dishonor of any and all of the Secured Obligations, and
promptness in commencing suit against any party hereto or liable
hereon, and in giving any notice to or of making any claim or demand
hereunder upon any Pledgor. No act or omission of any kind on Agent's
part shall in any event affect or impair this Agreement.
140 Reinstatement. This Agreement shall remain in full force
and effect and continue to be effective should any petition be filed by or
against any Pledgor for liquidation or reorganization, should any Pledgor
become insolvent or make an assignment for the benefit of creditors or
should a receiver or trustee be appointed for all or any significant part of
any Pledgor's assets, and shall continue to be effective or be reinstated,
as the case may be, if at any time payment and performance of the Secured
Obligations, or any part thereof, is, pursuant to applicable law, rescinded
or reduced in amount, or must otherwise be restored or returned by any
obligee of the Secured Obligations, whether as a "voidable preference",
"fraudulent conveyance", or otherwise, all as though such payment or
performance had not been made. In the event that any payment, or any part
thereof, is rescinded, reduced, restored or returned, the Secured
Obligations shall be reinstated and deemed reduced only by such amount
paid and not so rescinded, reduced, restored or returned.
150 Miscellaneous. This Agreement shall be binding upon each
Pledgor and its successors and assigns, and shall inure to the benefit of,
and be enforceable by, the Agent and the Lenders and their successors and
assigns. Any Lender may assign or otherwise transfer all or a portion of
its rights and obligations under the Loan Agreement (including, without
limitation, all or any portion of its Commitment and the Loans owing to it)
to any Eligible Assignee, and such Eligible Assignee shall thereupon because
vested with all the benefits in respect thereof granted to such Lender
herein or otherwise, subject, however, to the provisions of Articles 14
and 15 (concerning the Agent) of the Loan Agreement. This Agreement shall
be governed by, and construed and enforced in accordance with, the internal
laws in effect in the State of New York without giving effect to principles
of conflict of laws, and none of the terms or provisions of this Agreement
may be waived, altered, modified or amended except in writing duly signed
for and on behalf of the Lenders and the Pledgors. Neither Agent, nor any
of its respective officers, directors, employees, agents or counsel shall
be liable for any action lawfully taken or omitted to be taken by it or them
hereunder or in connection herewith, except for its or their own gross
negligence or willful misconduct.
160 Severability. If for any reason any provision or provisions
hereof are determined to be invalid and contrary to any existing or future
law, such invalidity shall not impair the operation of or effect those
portions of this Agreement which are valid.
170 Notices. Notices hereunder shall be given in the same
manner, and at the addresses, as provided in Section 16.1 of the Loan
Agreement, except that notices to any Pledgor shall be addressed as follows:
c/o Trism, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Fax No.:
180 Section Titles. The Section titles contained in this
Agreement are and shall be without substantive meaning or content of any
kind whatsoever and are not a part of the agreement between the parties
hereto.
190 Counterparts. This Agreement may be executed in any number
of counterparts, which shall, collectively and separately, constitute one
agreement.
20. Indemnification. The Pledgors jointly and severally
agree to reimburse the Agent and the Lenders for all costs and expenses,
including reasonable counsel fees and disbursements, incurred, and to
indemnify and hold the Agent and the Lenders harmless from and against all
losses suffered by, the Agent or any Lender in connection with (i) the
exercise by the Agent of any right or remedy granted to it under this
Agreement or any of the Loan Documents, (ii) any claim, and the prosecution
or defense thereof, arising out of or in any way connected with this
Agreement or any of the Loan Documents, and (iii) the collection or
enforcement of the Secured Obligations or any of them, other than such
costs, expenses and liabilities arising out of the Agent's or any Lender's
gross negligence or willful misconduct.
IN WITNESS WHEREOF, this Stock Pledge Agreement has
been duly executed under seal as of the date first written above.
TRISM, INC.
By: ____________________________________
Title:__________________________________
TRISM SECURED TRANSPORTATION, INC.
By:______________________________________
Title:___________________________________
TRISM HEAVY HAUL, INC.
By:_______________________________________
Title: ___________________________________
TRISM TRANSPORT SERVICES, INC.
By:______________________________________
Title:___________________________________
TRI-STATE MOTOR TRANSIT CO.
By:______________________________________
Title:___________________________________
TRISM SPECIALIZED CARRIERS, INC.
By:______________________________________
Title:___________________________________
EXHIBIT A
to the Stock Pledge Agreement
Attached to and forming a part of that certain Stock Pledge
Agreement dated as of July ____, 1997 by Pledgor to The CIT Group/Business
Credit, Inc., as Agent for the Lenders from time to time party to the Loan
Agreement.
Number of
Pledgor Class Certi- Number Sharess
Name of of ficate of Issued and
Pledgor Issuer Stock Number(s) Shares Outstanding
Trism, Inc. Trism Secured
Transportation, Inc.
Trism, Inc. TRISM Heavy Haul, Inc.
Trism, Inc. TRISM Transport, Inc.
Trism, Inc. TRISM Logistics, Inc.
Trism, Inc. TRISM Equipment, Inc.
Trism, Inc. TRISM Maintenance
Services, Inc.
Trism, Inc. Transportation Recovery
Systems, Inc.
Trism, Inc. EFB, Inc.
Trism Secured Tri-State Motor Transit
Transportation, Co.
Inc.
Trism Secured Diablo Systems
Transportation, Incorporated (d/b/a
Inc. Diablo Transportation,
Inc.)
Trism Secured Emerald Leasing, Inc.
Transportation,
Inc.
Trism Secured McGil Special Services,
Transportation, Inc.
Inc.
Trism Secured TRISM Eastern, Inc.
Transportation, (d/b/a ▇.▇. ▇▇▇▇▇▇▇
Inc. Transfer)
Trism Heavy Haul, TRISM Specialized
Inc. Carriers, Inc.
Trism Heavy Haul, E.L. ▇▇▇▇▇▇ & Sons
Inc. Trucking Co., Inc.
Trism Heavy Haul, TRISM Transport
Inc. Services, Inc.
Tri-State Motor Aero Body and Truck
Transit Co. Equipment Company, Inc.
Tri-State Motor Tri-State Transportation
Transit Co. Services, Inc.
Trism Specialized TRISM Special Services,
Carriers, Inc. Inc.
Trism Special AAA Truck Lease & Sales,
Services, Inc. Inc.
EXHIBIT B
to the Stock Pledge Agreement
PLEDGE AMENDMENT
This Pledge Amendment, dated __________, 199___ is delivered pursuant to
Section 6.4 of the Stock Pledge Agreement referred to below. The undersigned
hereby agrees that this Pledge Amendment may be attached to that certain
Stock Pledge Agreement, dated as of July ___, 1997, by the undersigned, as
Pledgor, to The CIT Group/Business Credit, Inc., as Agent for the Lenders
from time to time party to the Loan Agreement, and that the Pledged
Securities listed on this Pledge Amendment shall be and become a part of the
Pledged Collateral referred to in said Stock Pledge Agreement and shall
secure all Secured Obligations referred to in, and shall be subject to all
of the terms and provisions of, said Stock Pledge Agreement. Except as
specifically amended hereby, the Stock Pledge Agreement remains in
full force and effect.
[______________________________________]
By: ____________________________
Name: __________________________
Title: _________________________
Attest: ________________________
Name: __________________________
Title: _________________________
Name Class of Certificate Number of Number of Shares
of Pledgor Issuer Stock Number(s) Shares Issued and Outstanding
EXHIBIT G
TRADEMARK SECURITY AGREEMENT
This TRADEMARK SECURITY AGREEMENT, dated as of July ____,1997, by
TRI-STATE MOTOR TRANSIT CO., a Delaware corporation ("Grantor"),in favor of
THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation, in its capacity
as Agent for Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to that certain Loan and Security Agreement dated as
of the date hereof by and among Grantor and the other borrowers party thereto
(the "Borrowers"), Agent and the Persons signatory thereto from time to time
as Lenders (including all annexes, exhibits or schedules thereto, as from
time to time amended, restated, supplemented or otherwise modified, the
"Loan Agreement"), Lenders have agreed to make the Loans and to incur Letter
of Credit Obligations for the benefit of Grantor and the other Borrowers
party thereto; and
WHEREAS, Agent and Lenders are willing to make the Loans and to incur
Letter of Credit Obligations as provided for in the Loan Agreement, but only
upon the condition, among others, that Grantor shall have executed and
delivered to Agent, for itself and the ratable benefit of Lenders, this
Trademark Security Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Grantor hereby agrees as
follows:
1. DEFINED TERMS. All capitalized terms used but not otherwise
defined herein have the meanings given to them in the Loan Agreement.
2. GRANT OF SECURITY INTEREST IN TRADEMARK COLLATERAL. Grantor
hereby grants to Agent, on behalf of itself and Lenders, a continuing first
priority security interest in all of Grantor's right, title and interest in,
to and under the following, whether presently existing or hereafter created
or acquired (collectively, the "Trademark Collateral"):
(a) all of its Trademarks and Trademark Licenses to which it is a
party including those referred to on Schedule I hereto;
(b) all reissues, continuations or extensions of the foregoing;
(c) all goodwill of the business connected with the use of, and
symbolized by, each Trademark and each Trademark License; and
(d) all products and proceeds of the foregoing, including, without
limitation, any claim by Grantor against third parties for past, present or
future (i) infringement or dilution of any Trademark or Trademark licensed
under any Trademark License or (ii) injury to the goodwill associated with
any Trademark or any Trademark licensed under any Trademark License.
2. RIGHTS AND REMEDIES.
(a) The security interests granted pursuant to this Trademark
Security Agreement are granted in conjunction with the security interests
granted to Agent, on behalf of itself and Lenders, pursuant to the Loan
Agreement. Grantor hereby acknowledges and affirms that the rights and
remedies of Agent with respect to the security interest in the Trademark
Collateral made and granted hereby are more fully set forth in the Loan
Agreement, the terms and provisions of which are incorporated by reference
herein as if fully set forth herein;
(b) Notwithstanding anything to the contrary herein or in any of
the other Loan Documents, if any Default or Event of Default under the Loan
Agreement or any other Loan Document shall have occurred, or if the Grantor
fails to perform any agreement or to meet any of the obligations to the
Agent hereunder, in addition to any and all other rights and remedies that
Agent may have in the Loan Agreement, in any other Loan Document or at law,
all of Grantor's right, title and interest in and to the Trademark Collateral
shall be automatically granted, assigned, conveyed and delivered to the
Agent or its designee, and Grantor hereby irrevocably constitutes and
appoints Agent and any officer, agent or employee thereof, with full power
of substitution, as its true and lawful attorney-in-fact, with full
irrevocable power and authority in the place and stead of Grantor and in the
name of Grantor or Agent's own name or the name of Agent's designee, all
acts of said attorney being hereby ratified and confirmed, except to the
extent any of the same constitute gross negligence or willful misconduct,
such power being coupled with an interest is irrevocable, upon the
occurrence of a Default or an Event of Default: (i) to complete, date,
execute and file or cause to be filed the Assignment attached hereto as
Exhibit A and incorporated hereby by reference (the "Assignment") in the
United States Patent and Trademark Office and in all other applicable
offices, and to execute and deliver any and all documents and instruments
which may be necessary or desirable to accomplish the purpose of the
Assignment; (ii) to collect proceeds from the Trademarks (including, by way
of example, license royalties and proceeds of infringement suits); (iii) to
convey in any transaction authorized by the Loan Agreement, any goods covered
by the registrations listed on Schedule 1 to any purchaser thereof; (iv) to
make payment or discharge taxes or liens levied or placed upon or threatened
against any goods covered by the registrations listed on Schedule 1, the
legality or validity thereof and the amounts necessary to discharge the
same to be determined by Agent, in its sole discretion, and such payments
made by Agent to become the obligations of Grantor to Agent, due and
payable immediately, without demand.
[signature page follows]
IN WITNESS WHEREOF, Grantor has caused this Trademark Security
Agreement to be executed and delivered by its duly authorized officer as of
the date first set forth above.
TRI-STATE MOTOR TRANSIT CO.
By:_______________________________________
Name:
Title:
ACCEPTED AND ACKNOWLEDGED BY:
THE CIT GROUP/BUSINESS CREDIT, INC.,
as Agent
By:_________________________________
Name:_______________________________
Title:______________________________
ACKNOWLEDGMENT OF GRANTOR
STATE OF _____________ )
) ss.
COUNTY OF ___________ )
On this ____ day of ____________, ____ before me personally appeared
___________________, proved to me on the basis of satisfactory evidence to
be the person who executed the foregoing instrument on behalf of
___________________, who being by me duly sworn did depose and say that he
is an authorized officer of said corporation, that the said instrument was
signed on behalf of said corporation as authorized by its Board of Directors
and that he acknowledged said instrument to be the free act and deed of said
corporation.
{seal} Notary Public
SCHEDULE 1
to
TRADEMARK SECURITY AGREEMENT
TRADEMARK REGISTRATIONS
Registration
Number ▇▇▇▇ Date
1,285,587 TSMT 7/10/84
1,287,292 TSMT (Stylized) 7/24/84
EXHIBIT A
ASSIGNMENT OF TRADEMARKS AND GOODWILL
THIS ASSIGNMENT dated the ____ day of July, 1997 from TRI-STATE MOTOR
TRANSIT, CO., a Delaware corporation (the "Assignor"), to THE CIT GROUP/
BUSINESS CREDIT INC., a New York corporation (the "Assignee"), recites and
provides:
WHEREAS, Assignor is the owner of certain U.S. trademarks and service
marks and the registrations and applications to register therefor listed in
Schedule A hereto ("Trademarks"); and
WHEREAS, Assignee desires to obtain for the Lenders all of the
Assignor's right, title and interest in all such Trademarks.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Assignor hereby grants, assigns
and conveys to Assignee, its successors and assigns, the entire right, title
and interest of Assignor in and to the Trademarks, including without
limitation all proceeds thereof (such as, by way of example, license
royalties and proceeds of infringement suits), and the right to ▇▇▇ for past,
present and future infringements, together with the goodwill of the business
symbolized by the Trademarks. Assignor acknowledges that it has granted
Assignee the right to secure the assets of the Assignor associated with the
business symbolized by the Trademarks, under separate agreement.
Assignor further agrees to execute such further instruments and
documents and perform such further acts as Assignee may deem necessary to
secure to Assignee the rights herein conveyed.
TRI-STATE MOTOR TRANSIT CO.
By:
Name:___________________________________
Title:__________________________________
Attest:
Name:____________________________________
Title:___________________________________
EXHIBIT H
POWER OF ATTORNEY
(a) Each of TRISM, INC., a Delaware corporation, TRISM
SECURED TRANSPORTATION, INC., a Delaware corporation, TRI-STATE MOTOR
TRANSIT CO., a Delaware corporation, AERO BODY AND TRUCK EQUIPMENT COMPANY,
INC., a Delaware corporation, TRI-STATE TRANSPORTATION SERVICES, INC., a
Missouri corporation, DIABLO SYSTEMS INCORPORATED d/b/a DIABLO
TRANSPORTATION, INC., a California corporation, EMERALD LEASING, INC., a
Nevada corporation, McGIL SPECIAL SERVICES, INC., a Delaware corporation,
TRISM EASTERN, INC. d/b/a ▇.▇. ▇▇▇▇▇▇▇ TRANSFER, a Delaware corporation,
TRISM HEAVY HAUL, INC., a Delaware corporation, TRISM SPECIALIZED CARRIERS,
INC., a Georgia corporation, TRISM SPECIAL SERVICES, INC., a Georgia
corporation, E. L. ▇▇▇▇▇▇ & SONS TRUCKING CO., INC., an Oklahoma
corporation, TRISM TRANSPORT, INC., a Delaware corporation, TRISM TRANSPORT
SERVICES, INC., a Utah corporation, and TRISM LOGISTICS, INC., a New Jersey
corporation (each of the foregoing herein a "Borrower" and collectively, the
"Borrowers") (each a "Borrower" and collectively, the "borrowers") hereby
irrevocably constitutes and appoints THE CIT GROUP/BUSINESS CREDIT, INC. and
any officer or agent thereof ("Agent"), for the benefit of Agent and the
ratable benefit of the Lenders under the Loan Agreement (as hereinafter
defined), with full power of substitution, as its true and lawful attorney-
in-fact with full irrevocable power and authority in the place and stead of
any or all of the Borrowers and in the name of any or all of the Borrowers
or in its own name, from time to time in Agent's discretion, for the purpose
of carrying out the terms of that certain Loan and Security Agreement dated
July ____, 1997 by and among the Borrowers, the financial institutions
party thereto from time to time and Agent, as agent and lender (the
"Agreement") and all other Loan Documents (as that term is defined in the
Agreement) executed in connection therewith, to take any and all appropriate
action and to execute and deliver any and all documents and instruments
which may be necessary or desirable to accomplish the purposes of the
Agreement, provided, that Agent furnish notice to the Borrowers one day prior
to taking any such action or promptly thereafter if prior notice of such
action is not possible or in the reasonable determination of Agent not
prudent or such action without notice is necessary for the preservation of
the Collateral or Agent's security interest therein, for the benefit of
Agent and the ratable benefit of the Lenders, and, without limiting the
generality of the foregoing, each Borrower hereby grants to Agent the
power and right, on behalf of each Borrower, and at any time, to do the
following:
(i) in the name of such Borrower, in its own name or
otherwise, take possession of, endorse and receive payment of any
checks, drafts, notes, acceptances, or other Instruments for the payment
of monies due under any Collateral (as that term is defined in the
Agreement);
(ii) continue any insurance existing pursuant to the
terms of the Agreement, and pay all or any part of the premiums
therefor and the costs thereof; and
(iii) receive payment of any and all monies, claims, and
other amounts due or to become due at any time arising out of or in
respect of any Collateral.
(b) Each Borrower hereby irrevocably constitutes and appoints
Agent and any officer or agent thereof, for the benefit of Agent and the
ratable benefit of the Lenders, with full power of substitution, as its true
and lawful attorney-in-fact with full irrevocable power and authority in the
place and stead of such Borrower and in the name of such Borrower or in its
own name, from time to time in Agent's discretion, for the purpose of
carrying out the terms of the Agreement, to take any and all appropriate
action and to execute and deliver any and all documents and instruments
which may be necessary or desirable to accomplish the purposes of the
Agreement and, without limiting the generality of the foregoing, each
Borrower hereby grants to Agent the power and right, on behalf of such
Borrower, without notice to or assent by such Borrower, upon the occurrence
and during the continuation of a Default or an Event of Default (as those
terms are defined in the Agreement) and the expiration of all cure periods
applicable thereto to do the following:
(i) ask, demand, collect, receive and give acquittances and
receipts for any and all money due or to become due under any
Collateral;
(ii) pay or discharge any taxes, liens, security interests,
or other encumbrances levied or placed on or threatened against the
Collateral;
(iii) effect any repairs or obtain any insurance called for
by the terms of the Agreement and pay all or any part of the premiums
therefor and costs thereof;
(iv) direct any party liable for any payment under or in
respect of any of the Collateral to make payment of any and all monies
due or to become due thereunder, directly to Agent or as Agent shall
direct;
(v) sign and endorse any invoices, freight or express bills,
bills of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications, and notices in connection with accounts and
other documents constituting or related to the Collateral;
(vi) settle, compromise or adjust any suit, action, or
proceeding described above and, in connection therewith, give such
discharges or releases as Agent may deem appropriate;
(vii) file any claim or take or commence any other action
or proceeding in any court of law or equity or otherwise deemed
appropriate by Agent for the purpose of collecting any and all such
monies due under any Collateral whenever payable;
(viii) commence and prosecute any suits, actions or
proceedings of law or equity in any court of competent jurisdiction to
collect the Collateral or any part thereof and to enforce any other
right in respect of any Collateral;
(ix) defend any suit, action or proceeding brought against
such Borrower with respect to any Collateral if such Borrower does not
defend such suit, action or proceeding or if Agent believes that such
Borrower is not pursuing such defense in a manner that will maximize
the recovery with respect to such Collateral;
(x) license or, to the extent permitted by an applicable
license, sublicense, whether general, specific or otherwise and whether
on an exclusive or non-exclusive basis, any Patent or Trademark (as
those terms are defined in the Agreement) throughout the world on such
terms and conditions and in such manner as Agent shall, in its sole
discretion, determine; and
(xi) sell, transfer, pledge, make any agreement with respect
to, or otherwise deal with any of the Collateral as fully and completely
as though Agent were the absolute owner thereof for all purposes, and
to do, at Agent's option and the Borrowers' joint and several expense,
at any time or from time to time, all acts and other things that Agent
reasonably deems necessary to perfect, preserve, or realize upon the
Collateral and Agent's Liens (as that term is defined in the Agreement)
therein, for the benefit of Agent and the ratable benefit of the
Lenders, in order to effect the intent of the Agreement, all as fully
and effectively as such Borrower might do.
(c) Each Borrower hereby ratifies, to the extent permitted by
law, all that said attorneys shall lawfully do or cause to be done by
virtue hereof. The power of attorney granted pursuant to this Power of
Attorney is a power coupled with an interest and shall be irrevocable until
the Secured Obligations (as that term is defined in the Agreement) are paid
or otherwise satisfied in full.
(d) The powers conferred on Agent hereunder are solely to
protect Agent's interests in the Collateral and shall not impose any duty
upon it to exercise any such powers. Agent shall be accountable only for
amounts that it actually receives as a result of the exercise of such powers
and none of it officers, directors, employees, agents or representatives
shall be responsible to any Borrower for any act or failure to act,except
for their own gross negligence or willful misconduct.
(e) Each Borrower also authorizes Agent, at any time and
from time to time, (a) to communicate in its own name with any party to any
Contract with regard to the assignment of the right, title and interest of
each Borrower in and under the Contracts and other matters relating thereto,
and (b) to execute, in connection with the sale provided for in Section 13.2
of the Agreement, any endorsements, assignments or other instruments of
conveyance or transfer with respect to the Collateral.
IN WITNESS WHEREOF, each of the undersigned has executed this
Power of Attorney under seal this ____ day July, 1997.
Attest: TRISM, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM SECURED TRANSPORTATION, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRI-STATE MOTOR TRANSIT CO.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: AERO BODY AND TRUCK EQUIPMENT COMPANY, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRI-STATE TRANSPORTATION SERVICE, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: DIABLO SYSTEMS INCORPORATED, D/B/A DIABLO
TRANSPORTATION, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: EMERALD LEASING, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: McGIL SPECIAL SERVICES, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM EASTERN, INC., D/B/A ▇.▇. ▇▇▇▇▇▇▇
TRANSFER
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM HEAVY HAUL, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM SPECIALIZED CARRIERS, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM SPECIAL SERVICES, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: E. L. ▇▇▇▇▇▇ & SONS TRUCKING CO., INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM TRANSPORT, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM TRANSPORT SERVICES, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
Attest: TRISM LOGISTICS, INC.
By:______________________ By:_____________________________________
Secretary Name:
Title: President
EXHIBIT I
GUARANTY
Date: July __, 1997
To: THE CIT GROUP/BUSINESS CREDIT, INC., as Agent
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: TRISM, Inc., a Delaware corporation, TRISM Secured
Transportation, Inc., a Delaware corporation, Tri-State
Motor Transit Co., a Delaware corporation, Aero Body and
Truck Equipment Company, Inc., a Delaware corporation,
Tri-State Transportation Service, Inc., a Missouri
corporation, Diablo Systems Incorporated d/b/a Diablo
Transportation, Inc., a California corporation, Emerald
Leasing, Inc., a Nevada corporation, McGil Special
Services, Inc., a Delaware corporation, TRISM Eastern,
Inc. d/b/a ▇.▇. ▇▇▇▇▇▇▇ Transfer, a Delaware corporation,
TRISM Heavy Haul, Inc., a Delaware corporation, TRISM
Specialized Carriers, Inc., a Georgia corporation, TRISM
Special Services, Inc., a Georgia corporation, E. L.
▇▇▇▇▇▇ & Sons Trucking Co., Inc., an Oklahoma
corporation, TRISM Transport, Inc., a Delaware
corporation, TRISM Transport Services, Inc., a Utah
corporation, and TRISM Logistics, Inc., a New Jersey
corporation (collectively the "Companies")
Gentlemen:
Reference is made to that certain Loan and Security Agreement, dated
July __, 1997 (as may be amended, modified or supplemented from time to
time, the "Agreement"; capitalized terms used but not defined herein shall
have the meanings assigned to such terms in the Agreement), between the
Lenders listed in the Agreement (and any amendments or supplements thereto)
and you, as Lender and agent for the Lenders (you and the Lenders sometimes
referred to herein as, the "Secured Parties"), and the Companies. Each of
the undersigned (herein each a "Guarantor" and collectively the "Guarantors")
hereby unconditionally jointly and severally guarantees and agrees to be
liable for the prompt, full and indefeasible payment and performance when
due of all now existing and future indebtedness, obligations or
liabilities of the Companies to the Secured Parties, howsoever arising,
whether direct or indirect, absolute or contingent, secured or unsecured,
whether arising under the Agreement, the Note or the other documents
executed and delivered in connection with the Agreement, as now written or
as amended or supplemented hereafter, or by operation of law or otherwise,
including, without limitation, all Secured Obligations of the Companies to
the Secured Parties. Furthermore each of the Guarantors agrees to pay to
you, as agent for the Secured Parties, on demand the amount of all expenses
(including reasonable attorney's fees) incurred by you or any of the Secured
Parties in collecting or attempting to collect any of the Companies'
Obligations to the Secured Parties, whether from the Companies, or from any
other obligor, or from the Guarantors, or in realizing upon any collateral;
and agrees to pay any interest at the highest lawful rate on all amounts
payable to you, as agent for the Secured Parties, or the Secured Parties
hereunder, even if such amount cannot be collected from the Companies. (All
of the aforementioned obligations, liabilities, expenses and interest are
hereinafter collectively called the "Guaranteed Obligations"). To the
extent you receive payment, for the benefit of the Secured Parties, on
account of the Guaranteed Obligations, which payment is thereafter set
aside or required to be repaid by you or the Secured Parties in whole or in
part, then, to the extent of any sum not finally retained by you or the
Secured Parties (regardless of whether such sum is recovered from you or the
Secured Parties by the Companies, its trustee, or any other party acting
for, on behalf of or through the Companies or its representative),
the Guarantors' obligation to you, as agent for the Secured Parties, and the
Secured Parties under this Guaranty, as amended, modified or supplemented,
shall remain in full force and effect (or be reinstated) until the
Guarantors have made payment in full to you, for the benefit of the Secured
Parties, therefor, which payment shall be due upon demand.
This Guaranty is executed as an inducement to the Secured Parties to
make loans or advances to the Companies or otherwise to extend credit or
financial accommodations to the Companies, or to enter into or continue
a financing arrangement with the Companies, and is executed in
consideration of the Secured Parties doing or having done any of the
foregoing. Each of the Guarantors agrees that any of the foregoing shall
be done or extended by the Secured Parties, in their sole discretion, and
shall be deemed to have been done or extended by the Secured Parties in
consideration of and in reliance upon the execution of this Guaranty,
but that nothing herein shall obligate the Secured Parties, to do any of
the foregoing.
Notice of acceptance of this Guaranty, the making of loans or advances,
or the extension of credit under the Agreement, the amendment,
execution or termination of the Agreement or any other agreements in
connection therewith, and presentment, demand, protest, notice of
protest, notice of non-payment and all other notices to which
the Guarantors may be entitled (whether under this Guaranty or
the Agreement), and your reliance on this Guaranty are hereby waived.
Each of the Guarantors (a) waives notice of (i) changes in terms or
extensions of the time of payment, (ii) the taking and releasing of
collateral or guarantees (including the release of any of the Guarantors)
and (iii) the settlement, compromise or release of any Guaranteed
Obligations, and agrees that, as to each of the Guarantors, the
amount of the Guaranteed Obligations shall not be diminished by any
any of the foregoing; (b) waives any necessity, whether substantive or
procedural, that judgment previously be rendered against the Companies or
any other person or that the Companies or any person be joined in such
cause, or that separate action be brought against the Companies or any
other person; (c) waives any right to assert in any action or proceeding
on this Guaranty any offsets, counterclaims or defenses (except payment)
including, without limitation, defenses of Statute of Limitations and
laches; (d) waives the performance of each and every condition precedent
to which the Guarantors might otherwise be entitled by law; and (e)
waives each and every right to which it may be entitled by
virtue of applicable suretyship law to the full extent that such a
law permits or does not forbid such waiver
You shall not be required to mitigate damages or take
any other action to reduce, collect or enforce the obligations
or any Collateral therefore. Each of the Guarantors agrees
that neither you, as agent for the Secured Parties, nor the
Secured Parties need attempt to collect any Guaranteed Obligations
from the other Guarantors or any other obligor or to realize upon any
collateral, but may require the Guarantors to make immediate
payment of Guaranteed Obligations to you when due or at any
time thereafter. Neither you nor the Secured Parties shall
be liable for failure to collect Guaranteed Obligations or
to realize upon any collateral or security therefor, or any
part thereof, or for any delay in so doing, nor shall you
or any of the Secured Parties be under any obligation to
take any action whatsoever with regard thereto.
This Guaranty is absolute, unconditional and continuing,
regardless of the validity, regularity or enforceability of any
of the Guaranteed Obligations or the fact that a security
interest or lien in any collateral or security therefor may not
be enforceable by you, for the benefit of the Secured Parties, or
may otherwise be subject to equities or defenses or prior claims
in favor of others or may be invalid or defective in any way and
for any reason, including any action, or failure to act, on your
part. The liability of the Guarantors under this Guaranty shall
be unaffected by the death of any of the Guarantors. Payment by
the Guarantors shall be made to you, for the benefit of the
Secured Parties, at your office from time to time on demand as
Guaranteed Obligations become due, and one or more successive or
concurrent actions may be brought hereon against the Guarantors
(or any one or more of them) either in the same action or in
separate actions. In the event any claim or action, or action on
any judgment, based on this Guaranty, is made or brought against
the Guarantors, the Guarantors agree not to assert against you or
any of the Secured Parties any set-off or counterclaim which the
Companies may have, and, further, the Guarantors agree not to
deduct, set-off, or seek to counterclaim for or recoup, any amounts
which are or may be owed by you or any of the Secured
Parties to the Guarantors, or for any loss of contribution from
any other Guarantor.
Each of the Guarantors represents, warrants and covenants to
you, as agent for the Secured Parties, as an inducement to the Secured
Parties to extend credit or provide financial accommodations to the
Companies or on the Companies' behalf (i) that as of the
date of this Guaranty, the fair saleable value of each of the
Guarantor's assets exceeds its respective liabilities; (ii) that each
Guarantor is meeting current liabilities as they mature; (iii) that the
financial statements of each Guarantor furnished to you are true and
correct and include in the footnotes thereto all contingent liabilities of
each Guarantor and since the date of said financial statements
there has been no material or adverse change in the financial condition,
business, operations, assets or prospects of any of the Guarantors;
(iv) that there are not now pending any material court or administrative
proceedings or undischarged judgments against any of the Guarantors
and no federal or state tax liens have been filed or threatened
against any of the Guarantors nor is any Guarantor in default or
claimed default under any agreement for borrowed money; (v) that each of
the Guarantors shall immediately give you written notice of any
material adverse change in its financial condition, including but
not limited to a litigation commenced, tax liens filed, defaults claimed
under its indebtedness for borrowed money or bankruptcy proceedings, that
is by or against any Guarantor; (vi) that each of the Guarantors
shall at such reasonable times as you request furnish its current
financial statements to you and permit you or your representatives to
inspect any and all of the Guarantors' offices each of the
Guarantors' financial records and properties and make extracts
therefrom in order to evaluate the financial condition of
each Guarantor; (vii) that none of the Guarantors shall (A)
mortgage, assign, pledge, transfer or otherwise permit any lien, charge,
security interest, encumbrance or judgment to exist on
any of its assets or goods, whether real or personal or mixed,
whether now owned or hereafter acquired; (B) incur or create any
Indebtedness; (C) assume, guarantee, endorse, or otherwise become
liable upon the obligations of any person, firm, entity or corporation,
(D) make any advance or loan to or any investment in any firm,
entity, person, corporation or joint venture; (E) without your prior written
consent, will not contract for, purchase, make expenditures for, lease
pursuant to a Lease or otherwise incur obligations with respect to
Capital Expenditures; and (viii) that this Guaranty has been duly
authorized, executed and delivered by each Guarantor and constitutes the
legal, valid and binding obligation of each Guarantor enforceable in
accordance with its terms and does not and will not violate or
conflict with the Certificate of Incorporation, By-Laws, any agreement by
which the Guarantors are bound or any rule of law, regulation or judgment
to which any of the Guarantors is subject, nor is any consent
or approval, which has not been received, required in connection
with the execution, delivery, performance, validity or enforceability
of this Guaranty. Each of the Guarantors represents and warrants that
it has derived or expects to derive a financial or other benefit
commensurate with the liability incurred by each of the Guarantors
hereunder, from the obligations incurred and to be incurred by the
Companies.
All sums at any time to the credit of the Guarantors and any
property of the Guarantors on which you, for the benefit of the
Secured Parties, at any time have a lien or security interest, or
of which you, as agent for the Secured Parties, at any time have
possession, shall secure payment and performance of all Guaranteed
Obligations and any and all other obligations of the
Guarantors to you, as agent for the Secured Parties, however
arising. Each of the Guarantors agrees that if any notification
of intended disposition of collateral or of any other act by you
is required by law and if a specific time period is not stated
therein, such notification, if mailed by first class mail at least
five days before such disposition or act, postage pre-paid,
addressed to the Guarantors at the address set forth for the
Companies in the Agreement or at any other address of the
Guarantors appearing on your records, shall be deemed reasonably
and properly given. The Guarantors shall have no right of
subrogation, indemnification or recourse to any Guaranteed Obligations
or collateral or guarantees therefor, or to any assets of the Companies.
Upon the occurrence of any of the following events:
(1) any Event of Default under, or termination of, the Agreement;
(2) failure of any of the Guarantors to observe or perform any
agreements, warranties or covenants contained herein; or
(3) (a) dissolution or cessation of any of the Guarantors' business;
(b) calling of a meeting of the creditors of any of the Guarantors
for the purposes of compromising the debts of such Guarantor;
(c) failure of any of the Guarantors to meet their debts as
they mature;
(d) commencement by any of the Guarantors of any bankruptcy,
insolvency, arrangement, reorganization, receivership or similar
proceeds under federal or state law (herein collectively
"Insolvency Proceeding");
(e) commencement of any Insolvency Proceeding against any of
the Guarantors,
then, in the case of event (1) above, the liability of all of the
Guarantors for the entire Guaranteed Obligations shall mature,
and in the case of events (2) and (3)(a) through (e) above the
liability of the Guarantors with respect to which such event relates
for the entire Guaranteed Obligations shall mature even
if the liability of the Companies therefor does not.
This Guaranty may be terminated as to any one of the
Guarantors only as of any Anniversary Date (as defined
in the Agreement) and then only upon actual receipt by Agent
of at least ninety (90) days prior written notice of
termination sent by registered or certified mail and executed by
an authorized officer of the terminating Guarantor; provided however,
that any of the Guarantors so terminating this Guaranty shall
remain bound hereunder, and this Guaranty shall continue in full force
and effect, with respect to any and all Guaranteed Obligations created
or arising prior to the effective date of such
termination and with respect to any and all extensions,
renewals or modifications of said pre-existing Guaranteed
Obligations. Termination as to any one of the Guarantors shall
not affect the obligations of any of the other Guarantors, nor
relieve the one giving such notice from liability for any
post termination collection expenses or interest. This is a
continuing agreement and written notice as above provided shall be
the only means of termination, notwithstanding the fact that
for certain periods of time there may be no Guaranteed
Obligations owing to you, as agent for the Secured Parties, by the
Companies.
Your books and records showing the account between the
Secured Parties and the Companies shall be admissible in evidence
in any action or proceeding as prima facie proof of the items
therein set forth. Monthly statements rendered to the Companies
shall be binding upon the Guarantors (whether or not the
Guarantors received copies thereof) and shall constitute an
account stated between you and the Companies unless you shall
have received a written statement of the Companies's exceptions
within thirty (30) days after the statement was mailed to the Companies.
Each of the Guarantors expressly waives any and all rights
of subrogation, reimbursement, indemnity, exoneration, contribution or
any other claim which it may now or hereafter have against
the Companies or any other person directly or contingently
liable for the Guaranteed Obligations guaranteed hereunder, or
against or with respect to the Companies's property (including,
without limitation, property collateralizing its Guaranteed Obligations
to you, as agent for the Secured Parties) arising from the
existence or performance of this Guaranty.
This Guaranty embodies the whole agreement of the parties
and may not be modified except in writing, and no course of
dealing between you, the Secured Parties and any of the Guarantors
shall be effective to change or modify this Guaranty. Your
failure to exercise any right hereunder shall not be
construed as a waiver of the right to exercise the same or
any other right at any other time and from time to time
thereafter, and such rights shall be considered as cumulative
rather than alternative. No knowledge of any breach or
other nonobservance by any of the Guarantors of the terms
and provisions of this Guaranty shall constitute a waiver
thereof, nor a waiver of any obligations to be performed by
the Guarantors hereunder.
This Guaranty may be assigned by you, as agent for the Secured
Parties, and shall be for the benefit of the Secured
Parties and for the benefit of any of their assignees or
transferees, and shall cover any Guaranteed Obligations owed to
you, as agent for the Secured Parties, at the time of assignment
or transfer as well as any and all future Guaranteed Obligations,
loans, advances or extensions of credit made to the Companies by,
or otherwise owed by the Companies to, such assignee or transferee.
This instrument is executed and given in addition to, and not in
substitution, reduction, replacement, or satisfaction of, any other
endorsements or guarantees of the Guaranteed Obligations, now existing or
hereafter executed by any or all of the Guarantors or others in favor of
you or any of the Secured Parties.
Wherever possible, each provision of this Guaranty shall be interpreted
in such manner as to be effective and valid under applicable
law, but if any provision of this Guaranty shall be prohibited by or invalid
under applicable law, said provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder
of such provision or the remaining provisions of this Guaranty.
When used in this agreement, all pronouns shall, wherever
applicable, be deemed to include the singular and plural as well
as the masculine, feminine, and neuter genders. This agreement
shall inure to the benefit of you and each of the Secured Parties
and any of your respective successors and assigns and any parent,
subsidiary or affiliate of yours or any of the Secured Parties;
shall be binding jointly and severally upon the Guarantors and
upon the respective heirs, executors, administrators, successors and
assigns of each of the Guarantors; and shall pertain to the Companies
and its successors and assigns.
This Guaranty may be executed in any number of counterparts,
each of which when so executed shall be deemed an original and such
ounterparts shall together constitute but one and the same document.
EACH OF THE GUARANTORS HEREBY WAIVES, TO THE EXTENT PERMITTED
BY LAW, TRIAL BY JURY AND ALL ACTIONS AND PROCEEDINGS BASED HEREON
OR PERTAINING HERETO. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH LAWS OF THE STATE OF NEW YORK. EACH OF THE
GUARANTORS HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL
COURT LOCATED WITHIN THE STATE OF GEORGIA AND WAIVES ANY OBJECTION TO
JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREINUNDER AND SHALL NOT
ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON
FORUM NONCONVENIENS.
IN WITNESS WHEREOF the Guarantors have executed and delivered this
Guaranty effective as of the date above set forth.
TRISM MAINTENANCE SERVICES, INC.
Address:__________________________ By:________________________________
__________________________________ Title:_____________________________
__________________________________
EFB, INC.
Address:__________________________ By:_______________________________
__________________________________ Title:____________________________
__________________________________
TRANSPORTATION RECOVERY SYSTEMS, INC.
Address:__________________________ By:_______________________________
__________________________________ Title:____________________________
__________________________________
TRISM EQUIPMENT, INC.
Address:__________________________ By:_______________________________
__________________________________ Title:____________________________
__________________________________
TRISM BENEFITS, INC.
Address:__________________________ By:_______________________________
__________________________________ Title:____________________________
__________________________________
EXHIBIT J
ASSIGNMENT AND TRANSFER AGREEMENT
THIS ASSIGNMENT AND TRANSFER AGREEMENT, dated_____, 199_ by and
between THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation, as
assignor (the Assignor")and ___________________, a _______ corporation
(the "Assignee").
RECITALS
Reference is made to the Loan and Security Agreement dated as of
July __, 1997 (as amended, modified, supplemented and in effect from time
to time, the "Loan Agreement"), among Trism, Inc. and the borrowers party
thereto and named therein (each may be referred to herein individually as a
"Company" and collectively as the "Companies"), the financial institutions
party thereto from time to time and named therein (the "Lenders"), and
Assignor, as Agent and Lender, (sometimes referred to herein as the "Agent").
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to such terms in the Loan Agreement. This Assignment
and Transfer Agreement, between the Assignor and the Assignee is dated
as of the Effective Date (as set forth on Schedule 1 hereto and made a
part hereof). The Assignor and Assignee hereby agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the
Assignee without recourse to the Assignor, and the Assignee
hereby irrevocably purchases and assumes from the Assignor
without recourse to the Assignor, as of the Effective Date, an
undivided interest (the "Assigned Interest") in and to all the
Assignor's rights and obligations under the Loan Agreement respecting
those, and only those, financing facilities contained in the
Loan Agreement as are set forth on Schedule 1 (collectively, the
"Assigned Facilities" and individually, an "Assigned Facility"), in a
principal amount for each Assigned Facility as set forth on Schedule 1.
2. The Assignor (i) makes no representation or warranty
and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the
Loan Agreement or any other instrument, document or agreement
executed in conjunction therewith (collectively the "Ancillary
Documents") or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Agreement, any
Collateral thereunder or any of the Ancillary Documents
furnished pursuant thereto, other than that it is the legal
and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any
adverse claim and (ii) makes no representation or warranty
and assumes no responsibility with respect to the financial
condition of the Company or any guarantor or the performance
or observance by the Company or any guarantor of any of its
respective obligations under the Loan Agreement or any of the
Ancillary Documents furnished pursuant thereto.
3. The Assignee (i) represents and warrants that it
is legally authorized to enter into this Assignment and
Transfer Agreement; (ii) confirms that it has received a copy
of the Loan Agreement, together with the copies of the
most recent financial statements of the Company, and such other
documents and information as it has deemed appropriate to make
its own credit analysis; (iii) agrees that it will,
independently and without reliance upon the Agent, the Assignor
or any other Lender and based on such documents and information
as it shall deem appropriate at the time, continue to make
its own credit decisions in taking or not taking action
under the Loan Agreement; (iv) appoints and authorizes the
Agent to take such action as agent on its behalf and to
exercise such powers under the Loan Agreement as are delegated to
the Agent by the terms thereof, together with such powers as
are reasonably incidental thereto; (v) agrees that it will be
bound by the provisions of the Loan Agreement and will
perform in accordance with its terms all the obligations
which by the terms of the Loan Agreement are required to be
performed by it as Lender; and (vi) if the Assignee is
organized under the laws of a jurisdiction outside the United
States, attaches the forms prescribed by the Internal Revenue
Service of the United States certifying as to the
Assignee's exemption from United States withholding taxes
with respect to all payments to be made to the Assignee under
the Loan Agreement or such other documents as are necessary
to indicate that all such payments are subject to such tax at
a rate reduced by an applicable tax treaty.
4. Following the execution of this Assignment and Transfer
Agreement, such agreement will be delivered to the Agent for acceptance
by it and the Companies, effective as of the Effective Date.
5. Upon such acceptance, from and after the Effective Date, the
Agent shall make all payments in respect of the assigned
interest (including payments of principal, interest, fees
and other amounts) to the Assignee, whether such amounts have
accrued prior to the Effective Date or accrue subsequent to
the Effective Date. The Assignor and Assignee shall make all
appropriate adjustments in payments for periods prior to the
Effective Date made by the Agent or with respect to the making of
this assignment directly between themselves.
6. From and after the Effective Date, (i) the Assignee
shall be a party to the Loan Agreement and, to the extent
provided in this Assignment and Transfer Agreement, have the
rights and obligations of a Lender thereunder, and (ii) the
Assignor shall, to the extent provided in this Assignment and Transfer
Agreement, relinquish its rights and be released from its
obligations under the Loan Agreement.
7. THIS ASSIGNMENT AND TRANSFER AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF________________.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Transfer to be executed by their respective duly
authorized officers on Schedule 1 hereto.
Schedule 1 to Assignment and Transfer Agreement
Name of Assignor:___________________________
Name of Assignee:___________________________
Effective Date of Assignment:____________________ , 199_
Assigned Facilities Principal Amount Percentage
(or, with respect Assigned of Each
to Letters of Facility (shown
Credit, face as a percentage
amount) Assigned of aggregate
original
principal amount
[or, with respect
to Letters of
Credit, face
amount] of all
Lenders
Revolving Loans $_______________ _______________%
Letter of Credit $_______________ _______________%
Participation Interest
Total $_______________
Accepted:
THE CIT GROUP/BUSINESS
CREDIT, INC., As Agent [____________________________]
as Assignor
By:______________________ By:__________________________
Title:_______________ Title:______________________
EXHIBIT K
[ONE TO BE EXECUTED BY EACH BORROWER AND GUARANTOR]
OFFICER'S CERTIFICATE
I, the undersigned, [President] of ________________________,
a corporation organized and existing under the laws of the State
of __________ (the "Company"), pursuant to the Loan Agreement,
dated as of July ____, 1997, among the Company and the other
Borrowers listed therein, the financial institutions party
thereto from time to time (the "Lenders") and THE CIT
GROUP/BUSINESS CREDIT, INC., as Agent and Lender (the "Loan
Agreement"; capitalized terms not defined herein shall have the
meanings set forth in the Loan Agreement), DO HEREBY CERTIFY on
behalf of the Company that:
1. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of
____________, with full power and authority to execute and
deliver and to carry out and perform its obligations under the
Loan Agreement;
2. All of the terms and conditions in Article 5 of the
Loan Agreement and all other agreements, covenants and
obligations required by the Loan Agreement to be performed or
complied with by the Company on or before the Closing Date have
been duly performed, complied with or satisfied.
3. On the date hereof, the representations and warranties
contained in the Loan Agreement and in the other Loan Documents
are true and correct in all respects material to the validity and
enforceability of such agreements, both before and after giving
effect to the initial Advance, the application of the proceeds
thereof and the incurrence of Letter of Credit Obligations.
4. The Loan Agreement has been duly authorized, executed
and delivered by and on behalf of the Company;
5. No event has occurred and is continuing, or would
result from the making of an Advance or the incurrence of Letter
of Credit Obligations if made or incurred on the date hereof, or
the application of the proceeds thereof, which constitutes or
would constitute with notice or the passage of time a Default or
Event of Default.
6. There is no action or proceeding pending or, to the
knowledge of the undersigned, threatened, looking toward the
dissolution or liquidation of the Company;
7. Except as otherwise disclosed in Schedule 6.1(j) of the
Loan Agreement, there is no action, suit, proceeding, inquiry or
investigation of any kind, now pending or to the knowledge of the
undersigned threatened against the Company before any court or
other public body;
8. No approval, consent or withholding of objection on the
part of any regulatory body, federal, state or local, is required
in connection with the execution or delivery of or compliance by
the Company with the terms and conditions of the Loan Agreement.
9. There are no agreements among shareholders of the
Company which restrict in any way whatsoever the power and
authority of the Company to (a) execute and deliver and perform
all of its obligations under the Loan Agreement, (b) incur
liabilities, borrow money or issue its notes, bonds or other
obligations or (c) to secure any of the Company's obligations
with mortgages, deeds to secure debt, pledges, security interests
or other encumbrances upon all or any portion of the Company's
assets under the Loan Agreement;
10. There have been no material fines, penalties or other
Charges incurred, or assessed upon or that are pending against
the Company or any of its assets or properties or any failure of
the Company to obtain any licenses, permits, consents or
approvals from or by, to make any filing with or to give any
notice to any Governmental Authority having jurisdiction over the
ownership, operation or conduct of the Company or its business.
11. After giving effect to the Indebtedness represented by
the Loans to be incurred on the date hereof and the granting to
the Agent of the Liens on the Collateral on the date hereof, the
Company and each of its Subsidiaries is solvent, having assets of
a fair salable value which exceeds the amount required to pay its
debts as they become absolute and matured (including contingent,
subordinated, unmatured and unliquidated liabilities), the
Company and each of its Subsidiaries is able to and anticipates
that it will be able to meet its debts as they mature and has
adequate capital to conduct the business in which it is or
proposes to be engaged.
IN WITNESS WHEREOF, the Company has caused the Certificate
to be executed on its behalf by the undersigned on this ___ day
of July, 1997.
[COMPANY NAME]
By:__________________________
Name:
Title:
EXHIBIT L
[ONE TO BE EXECUTED BY EACH BORROWER AND GUARANTOR]
SECRETARY'S CERTIFICATE
I, the undersigned, [Assistant] Secretary of [COMPANY NAME],
a corporation organized and existing under the laws of the State
of __________________ (the "Company"), pursuant to the Loan
Agreement, dated as of July ____, 1997, among the Company and the
other Borrowers listed therein, the financial institutions party
thereto from time to time (the "Lenders") and THE CIT
GROUP/BUSINESS CREDIT, INC., as Agent and Lender (the "Loan
Agreement"; capitalized terms not defined herein shall have the
meanings set forth in the Loan Agreement) DO HEREBY CERTIFY on
behalf of the Company that:
1. Attached hereto as Exhibit A is a true, correct and
complete certified copy of the Articles of Incorporation of the
Company as filed in the Office of the Secretary of State of the
State of ___________________, together with all amendments
thereto adopted through the date hereof, and no amendment to the
Certificate of Incorporation has been authorized or become
effective since the date of the last of such amendments, no
amendment or other document relating to or affecting the
Certificate of Incorporation has been filed in the office of the
Secretary of State of the State of ______________ since such date
and no action has been taken by the Company, its shareholders,
directors or officers in contemplation of the filing of any such
amendment or other document or in contemplation of the
liquidation or dissolution of the Company.
2. Attached hereto as Exhibit B is a true, complete and
correct copy of the By-Laws of the Company which were duly
adopted and are in full force and effect on the date hereof and
at all times since ________________________.
3. Attached hereto as Exhibit C is a true and correct copy
of resolutions which were duly adopted on July ____, 1997 with
respect to the Loan Agreement and the other Loan Documents to
which it is a party and the transactions contemplated thereby,
which resolutions were adopted by the unanimous written consent
of the Board of Directors of the Company, and said resolutions
are in full force and effect and have not been rescinded, amended
or modified. Except as attached hereto as Exhibit C, no other
resolutions have been adopted by the Board of Directors of the
Company which deal with the execution, delivery or performance of
any of the Loan Documents or any other related documents to which
the Company is party or with the transactions contemplated
thereby.
4. Each of the following named individuals is a duly
elected or appointed, qualified and acting officer of the
Company, who holds the office of the Company set forth opposite
his or her name and has held such office as of the date of
signing of any Loan Document. The signature written opposite the
name and title of each such officer is his or her correct
signature.
Name Office Signature
________________________ ___________________ ________________________
_______________________ ___________________ ________________________
______________________ ___________________ ________________________
IN WITNESS WHEREOF, the Company has caused this Certificate
to be executed on its behalf by the Undersigned on this _____ day
of July, 1997.
[COMPANY NAME]
_____________________________
Name:
Title: [Assistant] Secretary
I, ________________________, [President] of _____________
hereby certify that ______________________ is the duly elected
and qualified [Assistant] Secretary of ________________ and that
the signature appearing above is his/her genuine signature.
IN WITNESS WHEREOF, I have hereunto signed by name as of
this ____ day of July, 1997.
[COMPANY NAME]
By:________________________________
Name:_____________________________
Title:______________________________
EXHIBIT M
RELEASE AND REASSIGNMENT OF TRADEMARKS
THIS RELEASE AND REASSIGNMENT OF TRADEMARKS (this "Release
and Reassignment") is made as of July ______, 1997 by ▇▇▇▇▇▇
FINANCIAL , INC. ("▇▇▇▇▇▇"), a Delaware corporation, in favor of
TRI-STATE MOTOR TRANSIT CO. ("TSMT").
PRELIMINARY STATEMENT
A. TSMT granted to ▇▇▇▇▇▇ a security interest in certain
of its trademarks and related property, as more particularly
described on Exhibit A attached hereto (the "Trademarks"), in
order to secure certain financing arrangements provided to TSMT
by ▇▇▇▇▇▇ (the "Financing Arrangement"). Such security interest
in the Trademarks was recorded on January 19, 1993 with the
United States Patent and Trademark Office, at the applicable Reel
and Frame Numbers set forth on Exhibit A.
B. All of the loans made by ▇▇▇▇▇▇ to TSMT have been paid
in full, and the Financing Arrangements have been terminated.
▇▇▇▇▇▇ therefore wishes to release the security interest granted
in the Trademarks, to reassign the Trademarks to TSMT and to
provide TSMT with evidence of such release and reassignment in a
form capable of recordation with the Untied States Patent and
Trademark Office.
In consideration of the premises set forth herein and for
other good and valuable consideration, ▇▇▇▇▇▇ hereby agrees as
follows:
1. ▇▇▇▇▇▇ hereby releases its security interest in, to and
under the Trademarks and reassigns all its right, title and
interest in, to and under the Trademarks to TSMT.
2. This Release and Reassignment shall be governed by and
construed and enforced in accordance with the laws of the State
of Georgia.
IN WITNESS WHEREOF, this Release and Reassignment has been
executed and delivered as of the day and year first written
above.
▇▇▇▇▇▇ FINANCIAL, INC.
By:__________________________________
Title:________________________________
STATE OF ____________ )
) SS
COUNTY OF __________ )
The foregoing Release and Reassignment of Trademarks was
executed and acknowledge before me as of this _____ day of
______, 1997, by _________________________, personally known to
me to be a ___________ of ▇▇▇▇▇▇ Financial, Inc. on behalf of
such corporation.
(SEAL)
_____________________________________
Notary Public
____________ County, ____________
My commission expires: ____________
EXHIBIT A
Registration No. Trademark Reel/Frame Number
1,285,587 TSMT 0928/0268
1,287,292 TSMT (Stylized) 0928/0268