$65,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of June 21, 1999
By and Among
IPC INFORMATION SYSTEMS, INC.
as Parent Borrower,
------------------
IPC FUNDING CORP.
as Sub Borrower,
---------------
IPC COMMUNICATIONS, INC.,
as a Loan Party,
---------------
GENERAL ELECTRIC CAPITAL CORPORATION
as Administrative Agent and Collateral Agent,
--------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.
as Syndication Agent,
--------------------
and
THE LENDERS AND THE ISSUING BANK
NAMED HEREIN
as Lenders and Issuing Bank
---------------------------
T A B L E O F C O N T E N T S
SECTION PAGE
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01. CERTAIN DEFINED TERMS..................................................................................3
1.02. COMPUTATION OF TIME PERIODS...........................................................................35
1.03. ACCOUNTING TERMS......................................................................................35
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
2.01. THE ADVANCES AND LETTERS OF CREDIT....................................................................35
2.02. MAKING THE ADVANCES...................................................................................37
2.03. ISSUANCE OF AND DRAWINGS AND REIMBURSEMENT UNDER LETTERS OF CREDIT....................................38
2.04. REPAYMENT OF ADVANCES.................................................................................40
2.05. TERMINATION OR REDUCTION OF THE COMMITMENTS...........................................................42
2.06. PREPAYMENTS...........................................................................................43
2.07. INTEREST..............................................................................................45
2.08. FEES..................................................................................................46
2.09. CONVERSION OF ADVANCES................................................................................47
2.10. INCREASED COSTS, ETC..................................................................................48
2.11. PAYMENTS AND COMPUTATIONS.............................................................................49
2.12. TAXES.................................................................................................51
2.13. SHARING OF PAYMENTS, ETC..............................................................................53
2.14. USE OF PROCEEDS.......................................................................................53
2.15. DEFAULTING LENDERS....................................................................................54
2.16. ASSIGNMENT AND ASSUMPTION OF OBLIGATIONS UNDER EXISTING CREDIT AGREEMENT..............................56
2.17. AMENDMENT AND RESTATEMENT.............................................................................58
ARTICLE III
CONDITIONS OF LENDING
3.01. CONDITIONS PRECEDENT TO EFFECTIVE DATE................................................................59
3.02. CONDITIONS PRECEDENT TO EACH BORROWING AND ISSUANCE...................................................67
3.03. DETERMINATIONS UNDER SECTION 3.01.....................................................................68
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SECTION PAGE
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. REPRESENTATIONS AND WARRANTIES OF HOLDINGS AND THE BORROWERS..........................................69
ARTICLE V
COVENANTS OF THE LOAN PARTIES
5.01. AFFIRMATIVE COVENANTS.................................................................................76
5.02. NEGATIVE COVENANTS....................................................................................84
5.03. REPORTING REQUIREMENTS................................................................................95
5.04. FINANCIAL COVENANTS...................................................................................99
ARTICLE VI
EVENTS OF DEFAULT
6.01. EVENTS OF DEFAULT....................................................................................102
6.02. ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON DEFAULT.............................................106
ARTICLE VII
THE AGENTS
7.01. AUTHORIZATION AND ACTION.............................................................................106
7.02. AGENTS' RELIANCE, ETC................................................................................106
7.03. GE CAPITAL, MSSF AND AFFILIATES......................................................................107
7.04. LENDER PARTY CREDIT DECISION.........................................................................107
7.05. INDEMNIFICATION......................................................................................108
7.06. SUCCESSOR AGENTS.....................................................................................109
7.07. SYNDICATION AGENT....................................................................................110
ARTICLE VIII
MISCELLANEOUS
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SECTION PAGE
8.01. AMENDMENTS, ETC......................................................................................110
8.02. NOTICES, ETC.........................................................................................111
8.03. NO WAIVER; REMEDIES..................................................................................111
8.04. COSTS AND EXPENSES...................................................................................111
8.05. RIGHT OF SETOFF......................................................................................113
8.06. BINDING EFFECT.......................................................................................113
8.07. ASSIGNMENTS AND PARTICIPATIONS.......................................................................114
8.08. EXECUTION IN COUNTERPARTS............................................................................117
8.09. NO LIABILITY OF THE ISSUING BANK.....................................................................117
8.10. CONFIDENTIALITY......................................................................................117
8.11. RELEASE OF COLLATERAL................................................................................118
8.12. JURISDICTION, ETC....................................................................................118
8.13. GOVERNING LAW........................................................................................119
8.14. WAIVER OF JURY TRIAL.................................................................................119
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SCHEDULES
---------
Schedule I - Commitments and Applicable Lending Offices
Schedule II - Guarantors
Schedule III - Excluded Subsidiaries
Schedule IV - Marshalls Group
Schedule V - Specified Subsidiaries
Schedule 3.01(m)(xvi) - Certain Solvency Matters
Schedule 4.01(a) - Stock Ownership
Schedule 4.01(b) - Subsidiaries
Schedule 4.01(d) - Approvals
Schedule 4.01(dd) - Owned Real Property
Schedule 4.01(ee) - Material Contracts and Executive Employment Agreements
Schedule 4.01(ff) - Investments
Schedule 4.01(gg) - Intellectual Properties
Schedule 5.02(a) - Existing Liens
EXHIBITS
--------
Exhibit A-1 - Form of Term Loan Note
Exhibit A-2 - Form of Working Capital Note
Exhibit A-3 - Form of Amended and Restated Working Capital Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement
Exhibit E-1 - Form of Domestic Guaranty
Exhibit E-2 - Form of Foreign Guaranty
Exhibit F - Form of Parent Borrower Charter, as amended by Parent
Borrower Charter Amendment
Exhibit G - Form of Solvency Certificate
Exhibit H - Form of Borrowing Base Certificate
Exhibit I-1 - Form of Specified Intercompany Note
Exhibit I-2 - Form of Loan Party Intercompany Note
Exhibit J - Form of Administrative Agency Agreement
Exhibit K - Worldwide Corporate Structure Chart
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AMENDED AND RESTATED CREDIT AGREEMENT
AMENDED AND RESTATED CREDIT AGREEMENT dated as of June 21,
1999 by and among IPC INFORMATION SYSTEMS, INC., a Delaware corporation (the
"PARENT BORROWER"), IPC FUNDING CORP., a Delaware corporation (the "SUB
BORROWER" and, together with the Parent Borrower, the "BORROWERS"), IPC
COMMUNICATIONS, INC., a Delaware corporation ("HOLDINGS"), as a Loan Party, the
banks, financial institutions and other institutional lenders listed on the
signature pages hereof as the lenders (together with each Person that shall
become a Lender hereunder pursuant to Section 8.07, the "LENDERS"), GENERAL
ELECTRIC CAPITAL CORPORATION ("GE CAPITAL"), as the issuing bank (together with
any bank or other financial institution designated by GE Capital to act as
Issuing Bank hereunder and each Eligible Assignee to which the Letter of Credit
Commitment hereunder shall be assigned pursuant to Section 8.07, the "ISSUING
BANK"), as collateral agent (together with any successor appointed pursuant to
Article VII, the "COLLATERAL AGENT"), and as administrative agent (together with
any successor appointed pursuant to Article VII, the "ADMINISTRATIVE AGENT") for
the Lender Parties (as hereinafter defined) and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING,
INC. ("MSSF"), as syndication agent (together with any successor appointed
pursuant to Article VII, the "SYNDICATION AGENT").
PRELIMINARY STATEMENTS
(1) Pursuant to an Amended and Restated Agreement and Plan of
Merger dated as of December 18, 1997 (as the same may be amended, supplemented
or otherwise modified from time to time in accordance with its terms, to the
extent permitted in accordance with the Loan Documents (as hereinafter defined),
the "MERGER AGREEMENT") between the Parent Borrower and Arizona Acquisition
Corp., a Delaware corporation ("AAC"), AAC merged with and into the Parent
Borrower (the "MERGER").
(2) Simultaneously in connection therewith and to finance the
Merger in part, the Parent Borrower issued approximately $180,000,000 in
original issue amount of 107/8% senior unsecured notes (as the same may be
amended, supplemented or otherwise modified from time to time, to the extent
permitted in accordance with the Loan Documents, the "SENIOR NOTES") pursuant to
the Senior Notes Indenture (as hereinafter defined).
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(3) In connection with the Merger, Citicorp Venture Capital,
Ltd., a New York corporation ("CVC") through an affiliate of CVC, Cable Systems
Holding LLC, a Delaware limited liability company ("CSH") , Cable Systems
International, Inc., a Delaware corporation ("CSI"), and Allegra Capital
Partners III, L.P. (f/k/a ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ III, L.P.) ("ALLEGRA" and,
together with CVC, CSH and CSI, the "EQUITY INVESTORS") made a common equity
contribution of $54,720,624 to AAC in exchange for 2,605,744 shares of common
stock of the Parent Borrower (which, after giving effect to the stock split that
occurred on June 24, 1998, were converted into 5,211,488 shares of common stock
of the Parent Borrower) (the "EQUITY INVESTMENT").
(4) Immediately following the consummation of the Merger, the
Parent Borrower acquired all of the shares of common stock of International
Exchange Networks, Ltd., a Delaware corporation ("IXNET"), not already owned by
the Parent Borrower in exchange for common stock of the Parent Borrower (the
"SHARE EXCHANGE") pursuant to the Share Exchange and Termination Agreement (as
hereinafter defined).
(5) On May 21, 1999, IPC Merger Sub Two, Inc., a Delaware
corporation and a wholly owned Subsidiary of Holdings ("IPC HOLDINGS MERGER
SUB"), merged with and into the Parent Borrower, with the Parent Borrower's
outstanding common stock being converted into shares of common stock of Holdings
on a share for share basis, pursuant to Section 251(g) of the General
Corporation Law of the State of Delaware (the "DGCL"), such that, upon
consummation thereof, the Parent Borrower became a wholly-owned direct
Subsidiary of Holdings (the "REORGANIZATION").
(6) On June 15, 1999, at the first annual meeting of
stockholders of Holdings and by unanimous written consent of the stockholder of
the Parent Borrower, the stockholders of Holdings and the Parent Borrower,
respectively, approved an amendment (the "PARENT BORROWER CHARTER AMENDMENT") to
the Amended and Restated Certificate of Incorporation of the Parent Borrower
(the "PARENT BORROWER CHARTER") deleting in their entirety the provisions of the
Parent Borrower Charter (which had been inserted in the Parent Borrower Charter
in connection with the Reorganization, as required by Section 251(g) of the
DGCL) granting voting rights to the stockholders of Holdings over any act or
transaction by or involving the Parent Borrower that would require for its
adoption under the DGCL or the Parent Borrower Charter the approval of the
stockholders of Parent Borrower, so that upon the effectiveness of the Parent
Borrower Charter Amendment, the sole voting rights under the DGCL and the Parent
Borrower Charter over any act or transaction by or involving the Parent Borrower
are held by Holdings, as the sole stockholder of the Parent Borrower.
(7) The Borrowers, the Lenders, the Prior Lenders (as
hereinafter defined), the Issuing Bank, the Collateral Agent and the
Administrative Agent are party to that Credit Agreement, dated as of April 30,
1998 (as amended and/or modified to date by the Letter Waiver, dated as of May
10, 1998, Letter Amendment and Waiver No. 2, dated as of August 6, 1998, Letter
Amendment No. 3, dated as of December 1, 1998, Letter No. 4, dated as of January
11, 1999, Letter Waiver No. 5, dated as of March 12, 1999, Letter No. 6, dated
as of April 16, 1999, and Letter Amendment and
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Consent No. 7, dated as of May 20, 1999, the "EXISTING CREDIT AGREEMENT"),
pursuant to which a $55,000,000 five-year secured revolving credit facility was
made available to the Borrowers.
(8) The Borrowers have requested that the Existing Credit
Agreement be amended and restated to increase the aggregate amount available
under the credit facility and to amend the credit facility to include a term
loan facility.
(9) The Borrowers have requested that the Existing Credit
Agreement be amended and restated in its entirety to read as set forth herein.
(10) It is intended that the Sub Borrower continue to act as a
borrower hereunder so as to be an agent for the Specified Subsidiaries.
(11) The Borrowers have requested that the Lender Parties make
available a secured credit facility of up to $65,000,000, which will be used for
general corporate purposes of the Parent Borrower and its Subsidiaries (as
hereinafter defined), consisting of a $20,000,000 term loan
facility and a revolving credit facility of up to $45,000,000.
(12) The Lender Parties and Prior Lenders are willing to amend
and restate the Existing Credit Agreement in its entirety so that the Credit
Agreement, as so amended and restated, shall read in its entirety as set forth
herein.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"AAC" has the meaning specified in the Preliminary Statements.
"ADMINISTRATIVE AGENCY AGREEMENT" has the meaning specified in
Section 3.01(m)(xi).
"ADMINISTRATIVE AGENT" has the meaning specified in the
recital of parties to this Agreement.
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"ADMINISTRATIVE AGENT'S ACCOUNT" means the account of the
Administrative Agent maintained by the Administrative Agent with
Bankers Trust Company at its office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Account No. ▇▇-▇▇▇-▇▇▇, ABA No. ▇▇▇- ▇▇▇-▇▇▇, or
such other account as the Administrative Agent shall specify in writing
to the Lender Parties.
"ADMINISTRATIVE AND COLLATERAL AGENT'S FEE LETTER" means the
letter dated June __, 1999 from the Administrative and Collateral Agent
to the Parent Borrower regarding, among other things, the fees to be
paid by the Parent Borrower to the Administrative and Collateral Agent
in connection with the rendering of services by the Administrative and
Collateral Agent pursuant to this Agreement, as such letter may be
amended, supplemented or otherwise modified or replaced from time to
time.
"ADVANCE" means a Term Loan Advance, a Working Capital Advance
or a Letter of Credit Advance.
"AFFILIATE" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
For purposes of this definition, the term "control" (including the
terms "controlled by" and "under common control with") of a Person
means the possession, direct or indirect, of the power to vote 10% or
more of the Voting Stock of such Person or to direct or cause the
direction of the management and policies of such Person, whether
through the ownership of Voting Stock, by contract or otherwise.
"AGENTS" means the Administrative Agent and the Collateral
Agent, collectively.
"AGREEMENT VALUE" means, for any Hedge Agreement on any date
of determination, an amount equal to the greater of (a) the amount, if
any, that would be payable by any Loan Party or any of its Subsidiaries
in respect of "agreement value" as though such Hedge Agreement were
terminated on such date, calculated as provided in the International
Swap Dealers Association Inc. Code of Standard Wording, Assumptions and
Provisions for Swaps, 1992 Edition, and (b) ▇▇▇▇-to-market, in which
the unrealized gain (or loss) on such Hedge Agreement is calculated as
the amount by which the present value of the future cash flows to be
received exceeds (or is less than) the present value of the future cash
flows to be paid pursuant to such Hedge Agreement.
"ALLEGRA" has the meaning specified in the Preliminary
Statements.
"APPLICABLE LENDING OFFICE" means, with respect to each Lender
Party, such Lender Party's Domestic Lending Office in the case of a
Base Rate Advance and such Lender Party's Eurodollar Lending Office in
the case of a Eurodollar Rate Advance.
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"APPLICABLE MARGIN" means (a) during the period from the date
hereof until the date that is one month after the date hereof, 1.50%
for Working Capital Advances that are Base Rate Advances, 2.50% for
Working Capital Advances that are Eurodollar Rate Advances, 1.75% for
Term Loan Advances that are Base Rate Advances and 2.75% for Term Loan
Advances that are Eurodollar Rate Advances, and (b) thereafter, a
percentage per annum determined by reference to the Leverage Ratio as
follows:
Working Capital Advances Term Loan Advances
-----------------------------------------------------------------------------------------------------------------
Level Base Rate Eurodollar Rate Base Rate Eurodollar Rate
Advances Advances Advances Advances
Level I 1.50% 2.50% 1.75% 2.75%
Level II 1.50% 2.25% 1.75% 2.50%
Level III 1.50% 2.00% 1.75% 2.25%
Level IV 1.50% 1.75% 1.75% 2.00%
Level V 1.50% 1.50% 1.75% 1.75%
-----------------------------------------------------------------------------------------------------------------
The Applicable Margin for each Base Rate Advance shall be determined by
reference to the Leverage Ratio in effect from time to time and the
Applicable Margin for each Eurodollar Rate Advance shall be determined
by reference to the Leverage Ratio in effect on the first day of each
Interest Period for such Advance; PROVIDED, HOWEVER, that (A)(x) no
change in the Applicable Margin shall be effective until three Business
Days after the date on which the Administrative Agent receives the
financial statements required to be delivered pursuant to Section
5.03(b) or (c) and a certificate of the chief financial officer of the
Parent Borrower demonstrating such ratio and (y) not more than one
decrease in the Applicable Margin shall occur in any three-month period
and (B) the Applicable Margin shall be at Level I for so long as the
Parent Borrower has not submitted to the Administrative Agent the
information described in clause (A)(x) of this proviso as and when
required under Section 5.03(b) or (c), as the case may be.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Lender Party and an Eligible Assignee, and accepted
by the Administrative Agent, in accordance with Section 8.07 and in
substantially the form of Exhibit C hereto.
"AVAILABLE AMOUNT" of any Letter of Credit means, at any time,
the maximum amount available to be drawn under such Letter of Credit at
such time (assuming compliance at such time with all conditions to
drawing); PROVIDED, THAT, the Available Amount of any Letter of Credit
denominated in a currency other than United States dollars, at any
time, shall be equal
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to the Dollar Equivalent of the amount of the Letter of Credit (as
denominated in such other currency).
"BASE RATE" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be
equal to the higher of:
(a) the rate of interest announced publicly by
Citibank at its head office in New York, from time to time, as
the base rate of Citibank; and
(b) 1/2 of 1% per annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance that bears interest as
provided in Section 2.07(a)(i).
"BBA" means the British Bankers Association.
"BORROWERS" has the meaning specified in the recital of
parties to this Agreement.
"BORROWING" means a borrowing consisting of simultaneous
Advances of the same Type made by the Lenders.
"BORROWING BASE CERTIFICATE" means a certificate in
substantially the form of Exhibit H hereto, duly certified by the chief
financial officer of the Parent Borrower.
"BUSINESS DAY" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the
applicable Business Day relates to any Eurodollar Rate Advances, on
which dealings are carried on in the London interbank market.
"CAPITAL EXPENDITURES" means, for any Person for any period,
the sum of (a) all expenditures made, directly or indirectly, by such
Person or any of its Subsidiaries during such period for equipment,
fixed assets, real property or improvements, or for replacements or
substitutions therefor or additions thereto, that have been or should
be, in accordance with GAAP, reflected as additions to property, plant
or equipment on a Consolidated balance sheet of such Person or have a
useful life of more than one year PLUS (b) the aggregate principal
amount of all Debt (including Obligations under Capitalized Leases)
assumed or incurred in connection with any such expenditures.
"CAPITALIZED LEASES" means all leases that have been or should
be, in accordance with GAAP, recorded as capitalized leases.
"CASH EQUIVALENTS" means any of the following, to the extent
owned by the Parent Borrower or any of its Subsidiaries free and clear
of all Liens other than Liens created under
-8-
the Collateral Documents and having a maturity of not greater than 90
days from the date of issuance thereof: (a) readily marketable direct
obligations of the Government of the United States or any agency or
instrumentality thereof or obligations unconditionally guaranteed by
the full faith and credit of the Government of the United States, (b)
insured certificates of deposit of or time deposits with any commercial
bank that is a Lender Party or a member of the Federal Reserve System,
issues (or the parent of which issues) commercial paper rated as
described in clause (c), is organized under the laws of the United
States or any State thereof and has combined capital and surplus of at
least $1,000,000,000 or (c) commercial paper issued by any corporation
organized under the laws of any State of the United States and rated at
least "Prime-1" (or the then equivalent grade) by ▇▇▇▇▇'▇ Investors
Service, Inc. or "A-1" (or the then equivalent grade) by Standard &
Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.
"CITIBANK" means Citibank, N.A., a national banking
association.
"COLLATERAL" means all "Collateral" referred to in the
Collateral Documents and all other property that is or is intended to
be subject to any Lien in favor of the Administrative
Agent for the benefit of the Secured Parties.
"COLLATERAL AGENT" has the meaning specified in the recital of
parties to this Agreement.
"COLLATERAL DOCUMENTS" means the Security Agreement, the
Intercompany Notes, the Foreign Security Documents, the Local Pledges,
and any other agreement that creates or purports to create a Lien in
favor of the Administrative Agent for the benefit of the Secured
Parties.
"COMMITMENT" means a Term Loan Commitment, a Working Capital
Commitment or a Letter of Credit Commitment.
"CORPORATE REORGANIZATION" has the meaning specified in
Section 3.01(e).
"CORPORATE REORGANIZATION DOCUMENTS" has the meaning specified
in Section 3.01(e).
"CONSOLIDATED" refers to the consolidation of accounts in
accordance with GAAP.
-9-
"CONVERSION", "CONVERT" and "CONVERTED" each refer to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.09 or 2.10.
"CORPORATE OPPORTUNITY AGREEMENT" means the Amended and
Restated Corporate Opportunity Agreement dated as of December 18, 1997
among ▇▇▇▇▇▇▇▇▇▇▇ Electric Company, Inc. (NY), ▇▇▇▇▇▇▇▇▇▇▇ Electric
Company, Inc. (NJ) and IPC Information Systems, Inc., as amended,
supplemented or otherwise modified from time to time in accordance with
its terms, to the extent permitted in accordance with the Loan
Documents.
"CSH" has the meaning specified in the Preliminary Statements.
"CSI" has the meaning specified in the Preliminary Statements.
"CVC" has the meaning specified in the Preliminary Statements.
"DEBT" of any Person means, without double counting either
with respect to such Person or upon consolidation, (a) all indebtedness
of such Person for borrowed money, (b) all Obligations of such Person
for the deferred purchase price of property or services (other than
trade payables not overdue by more than 60 days incurred in the
ordinary course of such Person's business), (c) all Obligations of such
Person evidenced by notes, bonds, debentures or other similar
instruments, (d) all Obligations of such Person created or arising
under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property), (e) all
Obligations of such Person as lessee under Capitalized Leases, (f) all
Obligations, contingent or otherwise, of such Person under acceptance,
letter of credit or similar facilities, (g) all Obligations, contingent
or otherwise, of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any capital stock of or other
ownership or profit interest in such Person or any other Person or any
warrants, rights or options to acquire such capital stock, valued, in
the case of Redeemable Preferred Stock, at the greater of its voluntary
or involuntary liquidation preference plus accrued and unpaid
dividends, (h) all Obligations of such Person in respect of Hedge
Agreements, (i) all Debt of others referred to in clauses (a) through
(h) above or clause (j) below guaranteed directly or indirectly in any
manner by such Person, or in effect guaranteed directly or indirectly
by such Person through an agreement (i) to pay or purchase such Debt or
to advance or supply funds for the payment or purchase of such Debt,
(ii) to purchase, sell or lease (as lessee or lessor) property, or to
purchase or sell services, primarily for the purpose of enabling the
debtor to make payment of such Debt or to assure the holder of such
Debt against loss, (iii) to supply funds to or in any other manner
invest in the debtor (including any agreement to pay for property or
services irrespective of whether such property is received or such
services are rendered) or (iv) otherwise to assure a creditor against
loss, and (j) all Debt referred to in clauses (a) through (i) above of
another Person secured by (or for which the holder of such Debt has an
existing right, contingent or otherwise, to be secured by) any Lien on
property (including,
-10-
without limitation, accounts and contract rights) owned by such Person,
even though such Person has not assumed or become liable for the
payment of such Debt.
"DEFAULT" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"DEFAULTED ADVANCE" means, with respect to any Lender Party at
any time, the portion of any Advance required to be made by such Lender
Party to either Borrower pursuant to Section 2.01 or 2.02 at or prior
to such time which has not been made by such Lender Party or by the
Administrative Agent for the account of such Lender Party pursuant to
Section 2.02(d) as of such time. In the event that a portion of a
Defaulted Advance shall be deemed made pursuant to Section 2.15(a), the
remaining portion of such Defaulted Advance shall be considered a
Defaulted Advance originally required to be made pursuant to Section
2.01 on the same date as the Defaulted Advance so deemed made in part.
"DEFAULTED AMOUNT" means, with respect to any Lender Party at
any time, any amount required to be paid by such Lender Party to any
Agent or any other Lender Party hereunder or under any other Loan
Document at or prior to such time which has not been so paid as of such
time, including, without limitation, any amount required to be paid by
such Lender Party to (a) the Issuing Bank, or an L/C Issuer which is
also a Lender, pursuant to Section 2.03(c) to purchase a portion of a
Letter of Credit Advance made by the Issuing Bank or such L/C Issuer,
as the case may be, (b) the Administrative Agent pursuant to Section
2.02(d) to reimburse the Administrative Agent for the amount of any
Advance made by the Administrative Agent for the account of such Lender
Party, (c) any other Lender Party pursuant to Section 2.13 to purchase
any participation in Advances owing to such other Lender Party and (d)
any Agent or the Issuing Bank pursuant to Section 7.05 to reimburse
such Agent or the Issuing Bank for such Lender Party's ratable share of
any amount required to be paid by the Lender Parties to such Agent or
the Issuing Bank as provided therein. In the event that a portion of a
Defaulted Amount shall be deemed paid pursuant to Section 2.15(b), the
remaining portion of such Defaulted Amount shall be considered a
Defaulted Amount originally required to be paid hereunder or under any
other Loan Document on the same date as the Defaulted Amount so deemed
paid in part.
"DEFAULTING LENDER" means, at any time, any Lender Party that,
at such time, (a) owes a Defaulted Advance or a Defaulted Amount or (b)
shall take any action or be the subject of any action or proceeding of
a type described in Section 6.01(f).
"DGCL" has the meaning specified in the Preliminary
Statements.
"DOLLAR EQUIVALENT" means, on any date of determination, in
relation to an amount denominated in any currency other than United
States dollars, the amount of United States dollars required to
purchase the relevant amount of such other currency as determined by
the Administrative Agent on such date.
-11-
"DOMESTIC GUARANTORS" means Holdings, the Parent Borrower and
each of the Subsidiaries of the Parent Borrower listed on Part A of
Schedule II hereto and all Domestic Subsidiaries that shall be required
to deliver a Domestic Guaranty pursuant to Section
5.01(o).
"DOMESTIC GUARANTY" has the meaning specified in Section
3.01(m)(xii).
"DOMESTIC LENDING OFFICE" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender Party,
as the case may be, or such other office of such Lender Party as such
Lender Party may from time to time specify to the Borrowers and the
Administrative Agent.
"DOMESTIC SUBSIDIARIES" means each of the Subsidiaries of the
Parent Borrower that are incorporated or organized under the laws of
any State of the United States of America or
the District of Columbia.
"EBITDA" means, for any period, the sum, determined on a
Consolidated basis, of (a) net income (or net loss), (b) interest
expense, (c) income tax expense, (d) depreciation expense, (e)
amortization expense and (f) all other non-cash items reducing net
income (other than items that will require cash payments and for which
an accrual or reserve is, or is required by GAAP to be, made), less all
non-cash items increasing net income, in each case of the Parent
Borrower and its Subsidiaries, determined in accordance with GAAP for
such period; PROVIDED, HOWEVER, that for purposes of calculating
EBITDA, such calculation shall be made without giving effect to, and
without duplication of, (i) the amortization or write-off of any
expense incurred in connection with the Prior Transactions and (ii) the
amortization of any amounts required or permitted by Accounting
Principles Board Opinion Nos. 16 and 17.
"EFFECTIVE DATE" means the first date on which the conditions
set forth in Article III shall have been satisfied.
"EFFECTIVE DATE TRANSACTIONS" means the effectiveness of this
Agreement, any Advances made on the Effective Date and each of the
other transactions contemplated hereby.
"ELIGIBLE ASSIGNEE" means (a) a Lender; (b) an Affiliate of a
Lender; and (c) a commercial bank, insurance company, financial
institution, fund or other Person that regularly purchases interests in
loans or extensions of credit of the types made pursuant to this
Agreement, any other Person that would constitute a "qualified
institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933 as in effect on the Effective Date or other
"accredited investor" (as defined in Regulation D of the Securities Act
of 1933, as amended), in each case, which bank, insurance company,
financial
-12-
institution, fund or other Person is approved by the Administrative
Agent and, so long as no Default shall have occurred and be continuing
at the time any assignment is effected pursuant to Section 8.07, the
Parent Borrower, in each case such approval not to be unreasonably
withheld or delayed; PROVIDED, HOWEVER, that neither any Loan Party nor
any Affiliate of a Loan Party shall qualify as an Eligible Assignee
under this definition.
"ELIGIBLE COLLATERAL" means, collectively, Eligible Inventory
and Eligible Receivables.
"ELIGIBLE INVENTORY" means only such Inventory of the Parent
Borrower and the Domestic Guarantors, in the case of Advances made to
the Parent Borrower, and of the Specified Subsidiaries, in the case of
Advances made to the Sub Borrower, as the Collateral Agent, in its
reasonable business judgment on the basis of standards customarily
applied by lenders in transactions of the type contemplated by the Loan
Documents, shall from time to time elect to consider Eligible Inventory
for purposes of this Agreement. The value of such Inventory shall be
determined by the Collateral Agent in its reasonable discretion taking
into consideration, among other factors, the lower of its cost and its
book value determined in accordance with GAAP. By way of example only,
and without limiting the discretion of the Collateral Agent as set
forth above to consider any Inventory not to be Eligible Inventory, the
Collateral Agent may consider any of the following classes of Inventory
not to be Eligible Inventory:
(a) Inventory located on leaseholds as to which the
lessor has not entered into a consent and agreement providing
the Administrative Agent with the right to receive notice of
default, the right to repossess such Inventory at any time and
such other rights as may be acceptable to the Collateral
Agent;
(b) Inventory that is obsolete, unusable or otherwise
unavailable for sale;
(c) Inventory with respect to which the
representations and warranties set forth in Section 9 of the
Security Agreement applicable to Inventory are not true and
correct;
(d) Inventory consisting of promotional, marketing,
packaging or shipping materials and supplies;
(e) Inventory that fails to meet all standards
imposed by any governmental agency, or department or division
thereof, having regulatory authority over such Inventory or
its use or sale;
(f) Inventory that is subject to any licensing,
patent, royalty, trademark, trade name or copyright agreement
with any third party from whom the Parent Borrower, any
Domestic Guarantor or any Specified Subsidiary, as applicable,
has received notice of a dispute in respect of any such
agreement;
-13-
(g) Inventory of the Parent Borrower or any Domestic
Guarantor located outside the United States, or Inventory of
any Specified Subsidiary located outside the nation in which
such Specified Subsidiary is located, as applicable;
(h) Inventory that is not in the possession of or
under the sole control of the Parent Borrower, any Domestic
Guarantor or any Specified Subsidiary, as applicable;
(i) Inventory consisting of work in process; and
(j) Inventory in respect of which the Collateral
Documents, after giving effect to the related filings of
financing statements in respect of the Parent Borrower and
Domestic Guarantors and applicable filings in connection with
the Foreign Security Documents in respect of the Specified
Subsidiaries that have then been made, does not or has ceased
to create a valid and perfected first priority lien or
security interest in favor of the Administrative Agent for the
benefit of the Secured Parties securing the Secured
Obligations.
"ELIGIBLE RECEIVABLES" means only such Receivables of the
Parent Borrower and the Domestic Guarantors, in the case of Advances
made to the Parent Borrower, and of the Specified Subsidiaries, in the
case of Advances made to the Sub Borrower, as the Collateral Agent, in
its reasonable business judgment on the basis of standards customarily
applied by lenders in transactions of the type contemplated by the Loan
Documents, shall from time to time elect to consider Eligible
Receivables for purposes of this Agreement. The value of such
Receivables shall be determined by the Collateral Agent in its
reasonable discretion taking into consideration, among other factors,
their book value determined in accordance with GAAP. By way of example
only, and without limiting the discretion of the Collateral Agent as
set forth above to consider any Receivables not to be Eligible
Receivables, the Collateral Agent may consider any of the following
classes of Receivables not to be Eligible Receivables:
(a) Receivables that do not arise out of sales of
goods or rendering of services in the ordinary course of the
business of the Parent Borrower, the Domestic Guarantors and
the Specified Subsidiaries, as applicable;
(b) Receivables on terms other than those normal or
customary in the business of the Parent Borrower, the Domestic
Guarantors and the Specified Subsidiaries, as applicable;
(c) Receivables owing from any Person that is an
Affiliate of the Parent Borrower, any Domestic Guarantor or
any Specified Subsidiary or any of their respective
Subsidiaries, other than (x) Citibank and its Affiliates to
the extent that the aggregate amount of Receivables owing from
Citibank and its Affiliates does not
-14-
exceed 25% of the aggregate amount of Eligible Receivables and
(y) ▇▇▇▇▇▇▇▇▇▇▇ Electric Company, Inc. to the extent that the
aggregate amount of Receivables owing from ▇▇▇▇▇▇▇▇▇▇▇
Electric Company, Inc. does not exceed 10% of the aggregate
amount of Eligible Receivables;
(d) Receivables more than 120 days past original
invoice date or more than 90 days past the date due;
(e) Receivables owing from any Person from which an
aggregate amount of more than 50% of the Receivables owing is
more than 90 days past the date due;
(f) Receivables owing from any Person that (i) has
disputed liability for any Receivable owing from such Person,
PROVIDED, HOWEVER, that if such disputed liability represents
less than 10% of the value of all such Receivables owing from
such Person, such Receivables shall be excluded only to the
extent of such disputed liability, or (ii) has otherwise
asserted any claim, demand or liability, whether by action,
suit, counterclaim or otherwise;
(g) Receivables owing from any Person that shall take
or be the subject of any action or proceeding of a type
described in Section 6.01(f);
(h) Receivables (i) owing from any Person that is
also a supplier to or creditor of the Parent Borrower, any
Domestic Guarantor or any Specified Subsidiary, as applicable,
or (ii) representing any manufacturer's or supplier's credits,
discounts, incentive plans or similar arrangements entitling
the Parent Borrower, any Domestic Guarantor or any Specified
Subsidiary, as applicable, to discounts on future purchase
therefrom except to the extent that the value of such
Receivables exceeds the amount owing by the Parent Borrower,
such Domestic Guarantor or such Specified Subsidiary, as
applicable, or the value of such credits, discounts, incentive
plans or other arrangements, as the case may be;
(i) Receivables of the Parent Borrower or any
Domestic Guarantor arising out of sales to account debtors
located outside the United States, Canada (excluding the
provinces of Quebec, Newfoundland, Nunavut and the Northwest
Territories) or the United Kingdom or Receivables of any
Specified Subsidiary arising out of sales to account debtors
located outside the nation in which such Specified Subsidiary
is located, as applicable;
(j) Receivables arising out of sales on a
▇▇▇▇-and-hold, guaranteed sale, sale-or-return, sale on
approval or consignment basis or subject to any right of
return, setoff or charge-back;
-15-
(k) Receivables owing from an account debtor that is
an agency, department or instrumentality of the United States
or any State thereof or Canada, the United Kingdom, Hong Kong,
Australia or any other foreign country or any political
subdivision of any of the foregoing unless the Parent
Borrower, such Domestic Guarantor or such Specified
Subsidiary, as the case may be, shall have satisfied the
requirements of the Assignment of Claims Act of 1940, as
amended, and any similar State or foreign legislation and the
Collateral Agent is satisfied as to the absence of setoffs,
counterclaims and other defenses on the part of such account
debtor;
(l) Receivables owing under any service contract for
which the services to be performed under such contract shall
not yet have been performed, other than Receivables owing
under maintenance contracts; PROVIDED, THAT, for purposes of
calculating the value of Receivables owing under maintenance
contracts, the related amount contained in the applicable Loan
Party's deferred revenue account may be used (it being
understood that the amount contained in such deferred revenue
account shall be greater than or equal to the value of such
Receivables); and PROVIDED, that, in the case of Receivables
owing under maintenance contracts which constitute Eligible
Receivables, a reserve against Loan Value in an amount equal
to the costs of performing all services under such maintenance
contracts has been established;
(m) Receivables the full and timely payment of which
the Collateral Agent in its reasonable discretion believes to
be doubtful;
(n) Receivables in respect of which the Collateral
Documents, after giving effect to the related filings of
financing statements in respect of the Parent Borrower and
Domestic Guarantors and applicable filings in connection with
the Foreign Security Documents in respect of the Specified
Subsidiaries that have then been made, does not or has ceased
to create a valid and perfected first priority lien or
security interest in favor of the Administrative Agent for the
benefit of the Secured Parties securing the Secured
Obligations; and
(o) Receivables owing from any member of the
Marshalls Group so long as any Debt incurred pursuant to
Section 5.02(b)(iii)(G) remains outstanding.
"ENVIRONMENTAL ACTION" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental
Law, any Environmental Permit or Hazardous Material or arising from
alleged injury or threat to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory
authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory
authority or third party for damages, contribution, indemnification,
cost recovery, compensation or injunctive relief.
-16-
"ENVIRONMENTAL LAW" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or
guidance having the full force and effect of law relating to pollution
or protection of the environment, health, safety or natural resources,
including, without limitation, those relating to the use, handling,
transportation, treatment, storage, disposal, release or discharge of
Hazardous Materials.
"ENVIRONMENTAL PERMIT" means any permit, approval,
identification number, license or other authorization required under
any Environmental Law.
"EQUITY INVESTMENT" has the meaning specified in the
Preliminary Statements.
"EQUITY INVESTORS" has the meaning specified in the
Preliminary Statements.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA AFFILIATE" means any Person that for purposes of Title
IV of ERISA is a member of the controlled group of any Loan Party, or
under common control with any Loan Party, within the meaning of Section
414 of the Internal Revenue Code.
"ERISA EVENT" means (a) (i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such event
has been waived by the PBGC, or (ii) the requirements of subsection (1)
of Section 4043(b) of ERISA (without regard to subsection (2) of such
Section) are met with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver
with respect to a Plan; (c) the provision by the administrator of any
Plan of a notice of intent to terminate such Plan, pursuant to Section
4041(a)(2) of ERISA (including any such notice with respect to a plan
amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of any Loan Party or any ERISA Affiliate in
the circumstances described in Section 4062(e) of ERISA; (e) the
withdrawal by any Loan Party or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions
for imposition of a lien under Section 302(f) of ERISA shall have been
met with respect to any Plan; (g) the adoption of an amendment to a
Plan requiring the provision of security to such Plan pursuant to
Section 307 of ERISA; or (h) the institution by the PBGC of proceedings
to terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of ERISA
that constitutes grounds for the termination of, or the appointment of
a trustee to administer, such Plan.
-17-
"EUROCURRENCY LIABILITIES" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Eurodollar
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender Party
(or, if no such office is specified, its Domestic Lending Office), or
such other office of such Lender Party as such Lender Party may from
time to time specify to the Borrowers and the Administrative Agent.
"EURODOLLAR RATE" means, for any Interest Period for each
Eurodollar Rate Advance comprising part of the same Borrowing, an
interest rate per annum obtained by dividing (a) the BBA Interest
Settlement Rate per annum at which deposits in U.S. dollars are offered
in London, England to prime banks in the London interbank market for
such Interest Period as displayed on Telerate Screen page 3750 as of
11:00 A.M. (London time) two Business Days before the first day of such
Interest Period in an amount substantially equal to such Eurodollar
Rate Advances comprising part of such Borrowing to be outstanding
during such Interest Period by (b) a percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage for such Interest Period. Telerate
Screen page 3750 means the display designated as page 3750 on the Dow
▇▇▇▇▇ Telerate Service (or such other page as may replace page 3750 on
that service or such other service as may be nominated by the BBA as
the information vendor for the purpose of displaying BBA Interest
Settlement Rates for U.S. dollars). If such rate does not appear on
Telerate Screen page 3750 on any relevant date for the determination of
the Eurodollar Rate, the Eurodollar Rate shall be an interest rate
equal to the rate per annum obtained by dividing (i) the average
(rounded upward to the nearest whole multiple of 1/16 of 1% per annum,
if such average is not such a multiple) of the rate per annum at which
deposits in U.S. dollars are offered by the principal office of
Citibank in London, England to prime banks in the London interbank
market at 11:00 A.M. (London time) two Business Days before the first
day of such Interest Period in an amount substantially equal to the
Administrative Agent's Eurodollar Rate Advance comprising part of such
Borrowing to be outstanding during such Interest Period (or, if the
Administrative Agent shall not have such a Eurodollar Rate Advance,
$1,000,000) and for a period equal to such Interest Period by (b) a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage
for such Interest Period.
"EURODOLLAR RATE ADVANCE" means an Advance that bears interest
as provided in Section 2.07(a)(ii).
"EURODOLLAR RATE RESERVE PERCENTAGE" for any Interest Period
for all Eurodollar Rate Advances comprising part of the same Borrowing
means the reserve percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including,
without limitation, any
-18-
emergency, supplemental or other marginal reserve requirement) for a
member bank of the Federal Reserve System in New York City with respect
to liabilities or assets consisting of or including Eurocurrency
Liabilities (or with respect to any other category of liabilities that
includes deposits by reference to which the interest rate on Eurodollar
Rate Advances is determined) having a term equal to such Interest
Period.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXCLUDED SUBSIDIARY" means, at any time, each Subsidiary of
the Parent Borrower listed on Schedule III hereto, and any Subsidiary
of the Parent Borrower formed or acquired after the Effective Date that
does not engage in any material business of any kind, other than the
holding of licenses and/or acting as an agent for a Loan Party at such
time and that does not hold assets or have annual revenues or net
income in the aggregate in excess of $150,000 at such time, in each
case determined based on the most recent financial statements required
to be delivered to the Lender Parties pursuant to Section 5.03(b) or
(c), as the case may be, or if such information cannot be determined
based on such financial statements, in the case of a newly formed
Subsidiary, based on the Parent Borrower's good faith pro forma
estimate of such Subsidiary's assets, annual revenues and net income,
and in the case of a newly acquired Subsidiary, based on such
Subsidiary's assets, annual revenues and net income as of the end of
the most recently ended 12-month period for which financial statements
are available, but excluding, in each case, any such Subsidiary that is
or becomes a Loan Party.
"EXISTING CREDIT AGREEMENT" has the meaning specified in the
Preliminary Statements.
"FACILITY" means the Term Loan Facility, the Working Capital
Facility or the Letter of Credit Facility.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"FISCAL YEAR" means a fiscal year of the Parent Borrower and
its Consolidated Subsidiaries ending on September 30 in any calendar
year.
"FOREIGN GUARANTORS" means each of the Subsidiaries of the
Parent Borrower listed on Part B of Schedule II hereto and all Foreign
Subsidiaries that shall be required to deliver a Foreign Guaranty
pursuant to Section 5.01(o).
-19-
"FOREIGN GUARANTY" has the meaning specified in Section
3.01(m)(xii).
"FOREIGN SECURITY DOCUMENTS" has the meaning specified in
Section 3.01(m)(xi).
"FOREIGN SUBSIDIARIES" means each of the Subsidiaries of the
Parent Borrower other than the Domestic Subsidiaries.
"FUNDED DEBT" of any Person means Debt in respect of the
Advances owing by either Borrower, in the case of such Borrower, and
all other Debt of such Person that by its terms matures more than one
year after the date of its creation or matures within one year from
such date but is renewable or extendible, at the option of such Person,
to a date more than one year after such date or arises under a
revolving credit or similar agreement that obligates the lender or
lenders to extend credit during a period of more than one year after
such date, including, without limitation, all amounts of Funded Debt of
such Person required to be paid or prepaid within one year after the
date of its determination.
"GAAP" has the meaning specified in Section 1.03.
"GE CAPITAL" has the meaning specified in the recital of
parties to this Agreement.
"GUARANTIES" means the Domestic Guaranty and the Foreign
Guaranty.
"GUARANTORS" means the Domestic Guarantors and the Foreign
Guarantors.
"HAZARDOUS MATERIALS" means (a) petroleum or petroleum
products, petroleum by-products or petroleum breakdown products,
radioactive materials, asbestos-containing materials, polychlorinated
biphenyls and radon gas and (b) any other chemicals, materials or
substances designated, classified or regulated as hazardous or toxic or
as a pollutant or contaminant under any Environmental Law.
"HEDGE AGREEMENTS" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"HEDGE BANK" means any Lender Party or an Affiliate of a
Lender Party in its capacity as a party to a Secured Hedge Agreement.
"HOLDINGS" has the meaning specified in the recital of parties
to this Agreement.
"HONG KONG SUBSIDIARIES" means IPC Information Systems Asia
Pacific, Ltd. and IXnet Hong Kong, Limited (formerly known as Saturn
Global Network Services (Hong Kong) Ltd.), each a corporation organized
under the laws of Hong Kong and a direct or indirect wholly owned
Subsidiary of the Parent Borrower.
-20-
"INDEMNIFIED PARTY" has the meaning specified in Section
8.04(b).
"INSUFFICIENCY" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.
"INTERCOMPANY NOTES" means the Specified Intercompany Notes
and the Loan Party Intercompany Notes.
"INTEREST PERIOD" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the
date of such Eurodollar Rate Advance or the date of the Conversion of
any Base Rate Advance into such Eurodollar Rate Advance, and ending on
the last day of the period selected by the applicable Borrower pursuant
to the provisions below and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period
and ending on the last day of the period selected by such Borrower
pursuant to the provisions below. The duration of each such Interest
Period shall be one, two, three, six, nine or twelve months (so long as
an Interest Period of any such duration is available to all of the
Lenders), as the applicable Borrower may, upon notice received by the
Administrative Agent not later than 11:00 A.M. (New York City time) on
the third Business Day prior to the first day of such Interest Period,
select; PROVIDED, however, that:
(a) neither Borrower may select any Interest Period
that ends after the Termination Date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing
shall be of the same duration;
(c) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day; PROVIDED, HOWEVER, that, if
such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the next preceding
Business Day; and
(d) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
-21-
"INVENTORY" means all Inventory referred to in Section 1(b) of
the Security Agreement.
"INVESTMENT" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any capital stock or other
ownership or profit interest, warrants, rights, options, obligations or
other securities or the assets comprising a substantial part or all of
the business of such Person, any capital contribution to such Person or
any other direct or indirect investment in such Person, including,
without limitation, any acquisition by way of a merger or consolidation
and any arrangement pursuant to which the investor incurs Debt of the
types referred to in clause (i) or (j) of the definition of "DEBT" in
respect of such Person.
"INVESTORS AGREEMENT" means the Investors Agreement dated as
of December 18, 1997 among IPC Information Systems, Inc., CSH and
certain other Persons named therein, as amended as of May 21, 1999, and
as such Investors Agreement may be further amended, supplemented or
otherwise modified from time to time in accordance with its terms, to
the extent permitted in accordance with the Loan Documents.
"IPC CANADA" means IPC Information Systems Canada, Inc., a
corporation organized under the laws of Canada.
"IPC HOLDINGS MERGER SUB" has the meaning specified in the
Preliminary Statements.
"IPC UK" means IPC Information Systems, a corporation
organized under the laws of England and Wales and an indirect
wholly-owned Subsidiary of the Parent Borrower.
"IPO NET CASH PROCEEDS" has the meaning specified in clause
(ix) of Section 5.02(f).
"ISSUING BANK" has the meaning specified in the recital of
parties to this Agreement.
"IXNET" has the meaning specified in the Preliminary
Statements.
"IXNET HOLDINGS" means IXnet, Inc., a Delaware corporation.
"LABOR POOL AGREEMENTS" means the Amended and Restated Labor
Pool Agreement dated as of December 18, 1997 between ▇▇▇▇▇▇▇▇▇▇▇
Electric Company, Inc. (NY) and IPC Information Systems, Inc., as
amended, supplemented or otherwise modified from time to time in
accordance with its terms, to the extent permitted in accordance with
the Loan Documents, and the Amended and Restated Labor Pool Agreement
dated as of December 18, 1997 between ▇▇▇▇▇▇▇▇▇▇▇ Electric Company,
Inc. (NJ) and IPC Information Systems, Inc., as amended, supplemented
or otherwise modified from time to time in accordance with its terms,
to the extent permitted in accordance with the Loan Documents.
"L/C CASH COLLATERAL ACCOUNT" has the meaning specified in the
Security Agreement.
-22-
"L/C ISSUER" has the meaning specified in Section 2.01(b).
"L/C RELATED DOCUMENTS" has the meaning specified in Section
2.04(b)(ii)(A).
"LENDER PARTY" means any Lender or the Issuing Bank.
"LENDERS" has the meaning specified in the recital of parties
to this Agreement.
"LETTER OF CREDIT ADVANCE" means an advance made by the
Issuing Bank or any Lender pursuant to Section 2.03(c); PROVIDED, THAT,
the amount of any Letter of Credit Advance as a result of a drawing
under a Letter of Credit denominated in a currency other than United
States dollars shall be equal to the Dollar Equivalent of the amount of
such Letter of Credit Advance (as denominated in such other currency)
on the date such Letter of Credit Advance is made.
"LETTER OF CREDIT AGREEMENT" has the meaning specified in
Section 2.03(a).
"LETTER OF CREDIT COMMITMENT" means, with respect to any
Issuing Bank at any time, the amount set forth opposite such Issuing
Bank's name on Schedule I hereto under the caption "Letter of Credit
Commitment" or, if such Issuing Bank has entered into one or more
Assignments and Acceptances, set forth for such Issuing Bank in the
Register maintained by the Administrative Agent pursuant to Section
8.07(d) as such Issuing Bank's "Letter of Credit Commitment," as such
amount may be reduced at or prior to such time pursuant to Section
2.05.
"LETTER OF CREDIT FACILITY" means, at any time, the amount of
the Issuing Bank's Letter of Credit Commitment at such time, as such
amount may be reduced at or prior to such time
pursuant to Section 2.05.
"LETTER OF CREDIT FEE RATE" means (a) during the period from
the date hereof until the date that is one month after the date hereof,
2.25% per annum and (b) thereafter, a percentage per annum determined
by reference to the Leverage Ratio as follows:
Level Letter of Credit Fee Rate
----------------------------------------------------- -----------------------------------------------------
Level I 2.25%
Level II 2.00%
Level III 1.75%
Level IV 1.50%
Level V 1.25%
----------------------------------------------------- -----------------------------------------------------
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PROVIDED, HOWEVER, that (A) (x) no change in the Letter of Credit Fee
Rate shall be effective until three Business Days after the date on
which the Administrative Agent receives the financial statements
required to be delivered pursuant to Section 5.03(b) or (c) and a
certificate of the chief financial officer of the Parent Borrower
demonstrating such ratio and (y) not more than one decrease in the
Letter of Credit Fee Rate shall occur in any three-month period and (B)
the Letter of Credit Fee Rate shall be at Level I for so long as the
Parent Borrower has not submitted to the Administrative Agent the
information described in clause (A)(x) of this proviso as and when
required under Section 5.03(b) or (c), as the case may be.
"LETTERS OF CREDIT" has the meaning specified in Section
2.01(b).
"LEVEL I" means a Leverage Ratio of 5.5:1.0 or greater.
"LEVEL II" means a Leverage Ratio of 5.0:1.0 or greater, but
less than 5.5:1.0.
"LEVEL III" means a Leverage Ratio of 4.5:1.0 or greater, but
less than 5.0:1.0.
"LEVEL IV" means a Leverage Ratio of 4.0:1.0 or greater, but
less than 4.5:1.0.
"LEVEL V" means a Leverage Ratio of less than 4.0:1.0.
"LEVERAGE RATIO" means, at any time of determination, the
ratio of the aggregate amount of Consolidated Debt of the Parent
Borrower and its Subsidiaries as of the end of the most recently ended
fiscal quarter of the Parent Borrower and its Subsidiaries for which
financial statements are required to be delivered to the Lender Parties
pursuant to Section 5.03(b) or (c), as the case may be, to Consolidated
EBITDA of the Parent Borrower and its Subsidiaries for such fiscal
quarter and for the preceding three fiscal quarters of the Parent
Borrower.
"LIEN" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance
on title to real property.
"LOAN DOCUMENTS" means (a) for purposes of this Agreement and
the Notes and any amendment, supplement or modification hereof or
thereof and for all other purposes other than for purposes of the
Foreign Guaranty, the Specified Intercompany Notes, the Administrative
Agency Agreement, the Security Agreement (solely with respect to the
Foreign Subsidiaries party thereto and their Obligations thereunder)
and the Foreign Security Documents and any amendment, supplement or
modification thereof, (i) this Agreement, (ii) the Notes, (iii) each
Guaranty, (iv) the Collateral Documents, (v) each Letter of Credit
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Agreement and each guaranty or other agreement by the Issuing Bank in
connection with any Letter of Credit issued by an L/C Issuer, (vi) the
Administrative and Collateral Agent's Fee Letter, (vii) the
Administrative Agency Agreement and (viii) each Secured Hedge Agreement
and (b) for purposes of the Foreign Guaranty, the Specified
Intercompany Notes, the Administrative Agency Agreement, the Security
Agreement (solely with respect to the Foreign Subsidiaries party
thereto and their Obligations thereunder) and the Foreign Security
Documents, and any amendment, supplement or modification thereof, (i)
the Foreign Guaranty, (ii) each Specified Intercompany Note, (iii) the
Administrative Agency Agreement, (iv) the Security Agreement (solely
with respect to the Foreign Subsidiaries party thereto and their
Obligations thereunder), and (v) each Foreign Security Document, in
each case as amended, supplemented or otherwise modified from time to
time.
"LOAN PARTIES" means (a) for purposes of this Agreement and
the Notes and any amendment, supplement or modification hereof or
thereof and for all other purposes other than for purposes of the
Foreign Guaranty, the Specified Intercompany Notes, the Administrative
Agency Agreement, the Security Agreement (solely with respect to the
Foreign Subsidiaries party thereto and their Obligations thereunder)
and the Foreign Security Documents and any amendment, supplement or
modification thereof, (i) each Borrower and (ii) each Guarantor
(including, without limitation, Holdings) and (b) for purposes of the
Foreign Guaranty, the Specified Intercompany Notes, the Administrative
Agency Agreement, the Security Agreement (solely with respect to the
Foreign Subsidiaries party thereto and their Obligations thereunder)
and the Foreign Security Documents, and any amendment, supplement or
modification thereof, (i) each Specified Subsidiary and (ii) each
Foreign Guarantor.
"LOAN PARTY INTERCOMPANY NOTE" means a promissory note of a
Loan Party payable to the order of any other Loan Party, in
substantially the form of Exhibit I-2 hereto, evidencing the aggregate
intercompany indebtedness of such Loan Party to such other Loan Party,
as amended, supplemented or otherwise modified from time to time, but
excluding, in any event, the Specified Intercompany Notes.
"LOAN VALUE" means:
(a) in the case of the Parent Borrower, an amount
equal to the sum of: (i) with respect to Eligible Inventory of
the Parent Borrower and the Domestic Guarantors, 25% of the
value thereof, and (ii) with respect to Eligible Receivables
of the Parent Borrower and the Domestic Guarantors, 80% of the
value thereof LESS (iii) a reserve equal to the sum of (x) 3%
(or such different percentage as may be determined in
accordance with the following proviso) of Eligible Receivables
consisting of billed and outstanding progress payments
relating to turrets, (y) 35% (or such different percentage as
may be determined in accordance with the following proviso) of
Eligible Receivables consisting of billed and outstanding
progress payments relating to cabling systems and (z) with
respect to maintenance contracts,
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an amount equal to 27% (or such different percentage as may be
determined in accordance with the following proviso) of the
value of the deferred revenue account on the balance sheet,
PROVIDED, HOWEVER, in each case, that, if the actual labor
costs (calculated on a monthly basis) associated with
performing the services in connection with which such progress
payments or maintenance contracts, as the case may be, are
payable, as a percentage of such Eligible Receivables vary
from the percentage set forth in clause (x), (y) or (z) above,
as the case may be, then (1) if such costs vary by more than
25%, the percentage set forth in clause (x), (y) or (z) above,
as applicable, shall be determined by the Collateral Agent in
its reasonable discretion, and (2) in all other cases, the
percentage set forth in clause (x), (y) or (z) above, as
applicable, shall be mutually agreed between the Parent
Borrower and the Collateral Agent, PROVIDED that until the
Parent Borrower and the Collateral Agent shall have agreed to
a different percentage pursuant to this subclause (2), the
percentage shall remain the percentage in effect immediately
prior to the occurrence of such variance; and
(b) in the case of the Sub Borrower, an amount equal
to the sum of: (i) with respect to Eligible Inventory of the
Specified Subsidiaries, 25% of the value thereof, and (ii)
with respect to Eligible Receivables of the Specified
Subsidiaries, 80% of the value thereof LESS (iii) a reserve
equal to the sum of (x) 3% (or such different percentage as
may be determined in accordance with the following proviso) of
Eligible Receivables consisting of billed and outstanding
progress payments relating to turrets, (y) 35% (or such
different percentage as may be determined in accordance with
the following proviso) of Eligible Receivables consisting of
billed and outstanding progress payments relating to cabling
systems and (z) with respect to maintenance contracts, an
amount equal to 27% (or such different percentage as may be
determined in accordance with the following proviso) of the
value of the deferred revenue account on the balance sheet,
PROVIDED, HOWEVER, in each case, that, if the actual labor
costs (calculated on a monthly basis) associated with
performing the services in connection with which such progress
payments or maintenance contracts, as the case may be, are
payable, as a percentage of such Eligible Receivables vary
from the percentage set forth in clause (x), (y) or (z) above,
as the case may be, then (1) if such costs vary by more than
25%, the percentage set forth in clause (x), (y) or (z) above,
as applicable, shall be determined by the Collateral Agent in
its reasonable discretion, and (2) in all other cases, the
percentage set forth in clause (x), (y) or (z) above, as
applicable, shall be mutually agreed between the Parent
Borrower and the Collateral Agent, PROVIDED that until the
Parent Borrower and the Collateral Agent shall have agreed to
a different percentage pursuant to this subclause (2), the
percentage shall remain the percentage in effect immediately
prior to the occurrence of such variance;
PROVIDED, HOWEVER, that during such periods when collections of
Eligible Receivables are less than 80%, the Collateral Agent may, in
its reasonable discretion, reduce the percentage in the foregoing
clauses (a)(ii) and (b)(ii) to a percentage below 80%.
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"LOCAL PLEDGES" means each pledge, charge and similar
agreement, including, by way of example, each deed of charge over
shares, pursuant to which the Parent Borrower or a Domestic Subsidiary
pledges the stock of, or other ownership interest in, a Foreign
Subsidiary to the Administrative Agent, in each case as amended,
supplemented or otherwise modified from time to time.
"MARGIN STOCK" has the meaning specified in Regulation U.
"MARSHALLS DEBT DOCUMENTS" means the notes delivered to
members of the Marshalls Group and all other instruments and documents
entered into by the Parent Borrower or any of its Subsidiaries and
members of the Marshalls Group which create, evidence or otherwise
relate to Debt permitted to be incurred under Section 5.02(b)(iii)(G)
hereof.
"MARSHALLS GROUP" means Marshalls Finance Limited, a company
incorporated under the laws of England and Wales, and those
Subsidiaries and Affiliates of Marshalls Finance Limited listed on
Schedule IV hereto.
"MATERIAL ADVERSE CHANGE" means any material adverse change in
(a) the business, condition (financial or otherwise), operations,
performance, assets, nature of assets, liabilities (including, without
limitation, tax, ERISA and environmental liabilities) or prospects of
the Parent Borrower and its Subsidiaries, taken as a whole, or (b) the
ability of Holdings, either Borrower or any Specified Subsidiary to
perform its Obligations under any Loan Document or Related Document to
which it is or is to be a party.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) the business, condition (financial or otherwise), operations,
performance, assets, nature of assets, liabilities (including, without
limitation, tax, ERISA and environmental liabilities) or prospects of
the Parent Borrower and its Subsidiaries, taken as a whole, (b) the
rights and remedies of any Agent or any Lender Party under any Loan
Document or Related Document or (c) the ability of Holdings, either
Borrower or any Specified Subsidiary to perform its Obligations under
any Loan Document or Related Document to which it is or is to be a
party.
"MATERIAL CONTRACT" means, with respect to any Person, each
contract to which such Person is a party involving aggregate
consideration payable to or by such Person of $15,000,000 or more or
otherwise material to the business, condition (financial or otherwise),
operations, performance, assets, nature of assets, liabilities
(including, without limitation, tax, ERISA and environmental
liabilities) or prospects of such Person, but shall not include the
Related Documents.
"MERGER" has the meaning specified in the Preliminary
Statements.
"MERGER AGREEMENT" has the meaning specified in the
Preliminary Statements.
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"MORTGAGE" means the Open-End Mortgage, Security Agreement,
Assignment of Leases and Rents and Financing Statement, dated as of
December 1, 1998, by the Parent Borrower to the Administrative Agent,
relating to the Parent Borrower's premises in the Town of ▇▇▇▇▇▇▇▇▇,
Middlesex County, Connecticut.
"MSSF" has the meaning specified in the recital of parties to
this Agreement.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and at least one
Person other than the Loan Parties and the ERISA Affiliates or (b) was
so maintained and in respect of which any Loan Party or any ERISA
Affiliate could have liability under Section 4064 or 4069 of ERISA in
the event such plan has been or were to be terminated.
"MXNET" means MXNet Inc., a Delaware corporation.
"NET CASH PROCEEDS" means, with respect to any sale, lease,
transfer or other disposition of any asset or the sale or issuance of
any Debt or capital stock or other ownership or profit interest, any
securities convertible into or exchangeable for capital stock or other
ownership or profit interest or any warrants, rights, options or other
securities to acquire capital stock or other ownership or profit
interest by any Person, the aggregate amount of cash received from time
to time (whether as initial consideration or through payment or
disposition of deferred consideration) by or on behalf of such Person
in connection with such transaction after deducting therefrom only
(without duplication) (a) reasonable and customary brokerage
commissions, underwriting fees and discounts, legal fees, finder's fees
and other similar fees and commissions, (b) the amount of taxes payable
in connection with or as a result of such transaction and (c) the
amount of any Debt secured by a Lien on such asset that, by the terms
of the instrument evidencing such Debt, is required to be repaid upon
such disposition, in each case to the extent, but only to the extent,
that the amounts so deducted are, at the time of receipt of such cash,
actually paid to a Person that is not an Affiliate of such Person or
any Loan Party or any Affiliate of any Loan Party and are properly
attributable to such transaction or to the asset that is the subject
thereof.
"NO-ACTION LETTER" means, collectively, that certain no-action
letter request, dated May 6, 1999, from Thacher, ▇▇▇▇▇▇▇▇ & ▇▇▇▇ to the
SEC and the response of the SEC thereto, dated May 20, 1999.
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"NON-HOSTILE ACQUISITION" means any acquisition by the Parent
Borrower or any of its Subsidiaries of a Person, so long as (a) the
board of directors (or other governing body) of such Person shall have
approved such acquisition at the time such acquisition is first
publicly announced, (b) if such Person shall have been soliciting bids
for its acquisition, the board of directors (or other governing body)
of such Person shall not have determined either to accept no offer or
to accept an offer other than an offer by the Parent Borrower or any of
its Subsidiaries or (c) such Person shall not have been soliciting bids
for its acquisition or if the board of directors (or other governing
body) of such Person shall have solicited bids for its acquisition but
shall have initially determined either to accept no offer or to accept
an offer other than an offer by the Parent Borrower or any of its
Subsidiaries, in each case the existence, amount and availability for
the acquisition of such Person of the Commitments hereunder shall not
have been disclosed, orally or in writing, until after such time as the
board of directors (or other governing body) of such Person shall have
approved such acquisition by the Parent Borrower or any of its
Subsidiaries and so long as, in any case, such acquisition is otherwise
permitted hereunder.
"NOTE" means a Working Capital Note or a Term Loan Note.
"NOTICE OF BORROWING" has the meaning specified in Section
2.02(a).
"NOTICE OF ISSUANCE" has the meaning specified in Section
2.03(a).
"NPL" means the National Priorities List under CERCLA.
"OBLIGATION" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether
or not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured,
and whether or not such claim is discharged, stayed or otherwise
affected by any proceeding referred to in Section 6.01(f). Without
limiting the generality of the foregoing, the Obligations of any Loan
Party under the Loan Documents include (a) the obligation to pay
principal, interest, Letter of Credit commissions, charges, expenses,
fees, attorneys' fees and disbursements, indemnities and other amounts
payable by such Loan Party under any Loan Document and (b) the
obligation of such Loan Party to reimburse any amount in respect of any
of the foregoing that any Lender Party, in its sole discretion, may
elect to pay or advance on behalf of such Loan Party.
"OTHER TAXES" has the meaning specified in Section 2.12(b).
"PARENT BORROWER" has the meaning specified in the recital of
parties to this Agreement.
"PARENT BORROWER CHARTER" has the meaning specified in the
Preliminary Statements.
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"PARENT BORROWER CHARTER AMENDMENT" has the meaning specified
in the Preliminary Statements.
"PARENT BORROWER CHARTER AMENDMENT DOCUMENTS" means the
Certificate of Amendment to the Parent Borrower Charter, dated June __,
1999, pursuant to which the Parent Borrower Charter Amendment was
effectuated and became effective on and as of such date and all proxy
statements, proxy cards, written consents, agreements, instruments,
certificates or other documents in connection with the Parent Borrower
Charter Amendment.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"PERMITTED ENCUMBRANCES" has the meaning specified in the
Mortgage.
"PERMITTED LIENS" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b); (b) Liens imposed by law (whether statutory or
common law), such as landlords', materialmen's, mechanics', carriers',
workmen's and repairmen's Liens and other similar Liens arising in the
ordinary course of business securing obligations that are not overdue
for a period of more than 30 days; (c) pledges or deposits to secure
obligations under workers' compensation laws or similar legislation or
to secure public or statutory obligations; and (d) easements, rights of
way and other encumbrances on title to real property that do not render
title to the property encumbered thereby unmarketable or materially
adversely affect the use of such property for its current present
purposes.
"PERSON" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock
company, trust, unincorporated association, joint venture or other
entity, or a government or any political subdivision or agency thereof.
"PLAN" means a Single Employer Plan or a Multiple Employer
Plan.
"PLEDGED DEBT" has the meaning specified in the Security
Agreement.
"PREFERRED STOCK" means, with respect to any corporation,
capital stock issued by such corporation that is entitled to a
preference or priority over any other capital stock issued by such
corporation upon any distribution of such corporation's assets, whether
by dividend or upon liquidation.
"PRIOR LENDER" means each lender under the Existing Credit
Agreement as in effect immediately prior to the effectiveness of this
Agreement.
"PRIOR TRANSACTIONs" means, collectively, the Merger, the
Equity Investment, the issuance of the Senior Notes and the Share
Exchange.
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"PRO RATA SHARE" of any amount means, with respect to any
Working Capital Lender at any time, the product of such amount TIMES a
fraction the numerator of which is the amount of such Lender's Working
Capital Commitment at such time (or, if the Commitments shall have been
terminated pursuant to Section 2.05 or 6.01, such Lender's Working
Capital Commitment as in effect immediately prior to such termination)
and the denominator of which is the Working Capital Facility at such
time (or, if the Commitments shall have been terminated pursuant to
Section 2.05 or 6.01, the Working Capital Facility as in effect
immediately prior to such termination).
"RECEIVABLES" means all Receivables referred to in Section
1(c) of the Security Agreement.
"REDEEMABLE" means, with respect to any capital stock or other
ownership or profit interest, Debt or other right or Obligation, any
such right or Obligation that (a) the issuer has undertaken to redeem
at a fixed or determinable date or dates, whether by operation of a
sinking fund or otherwise, or upon the occurrence of a condition not
solely within the control of the issuer or (b) is redeemable at the
option of the holder.
"REDUCTION AMOUNT" has the meaning specified in Section
2.06(b)(v).
"REGISTER" has the meaning specified in Section 8.07(d).
"REGULATION U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"RELATED DOCUMENTS" means the Merger Agreement, the Senior
Notes, the Senior Notes Indenture, the Share Exchange and Termination
Agreement, the Stock Option Plan, the Investors Agreement, the Labor
Pool Agreements, the Corporate Opportunity Agreement, the Saturn
Acquisition Agreement, the Marshalls Debt Documents, the Reorganization
Documents, the Corporate Reorganization Documents, the Parent Borrower
Charter Amendment Documents and such other documents entered into by
any of the Loan Parties in connection with the initial public offering
of IXnet Holdings' common stock contemplated by clause (iii)(C) of
Section 5.02(g) as the Administrative Agent may reasonably designate to
the Borrowers as "Related Documents."
"REORGANIZATION" has the meaning specified in the Preliminary
Statements.
"REORGANIZATION DOCUMENTS" means the Agreement and Plan of
Merger among the Parent Borrower, Holdings and IPC Holdings Merger Sub,
dated as of May 20, 1999, and the Certificate of Merger of IPC Holdings
Merger Sub into the Parent Borrower, dated as of May 21, 1999, pursuant
to which the Reorganization was consummated on and as of May 21, 1999
and all written consents, agreements, instruments, certificates or
other documents in connection with the Reorganization.
-31-
"REQUIRED LENDERS" means, at any time, Lenders owed or holding
at least a majority in interest of the sum of (a) the aggregate
principal amount of the Advances outstanding at such time and (b) the
aggregate Available Amount of all Letters of Credit outstanding at such
time, or, if no such principal amount and no Letters of Credit are
outstanding at such time, Lenders holding at least a majority in
interest of the aggregate of the Term Loan Commitments and Working
Capital Commitments; PROVIDED, HOWEVER, that if any Lender shall be a
Defaulting Lender at such time, there shall be excluded from the
determination of Required Lenders at such time (A) the aggregate
principal amount of the Advances owing to such Lender (in its capacity
as a Lender) and outstanding at such time, (B) such Lender's Pro Rata
Share of the aggregate Available Amount of all Letters of Credit
outstanding at such time and (C) the aggregate Term Loan Commitments
and Unused Working Capital Commitments of such Lender at such time. For
purposes of this definition, the aggregate principal amount of Letter
of Credit Advances owing to the Issuing Bank and the Available Amount
of each Letter of Credit shall be considered to be owed to the Working
Capital Lenders ratably in accordance with their respective Working
Capital Commitments.
"RESPONSIBLE OFFICER" means any executive officer of any Loan
Party or any of its Subsidiaries.
"SATURN" means Saturn Global Network Services Holdings
Limited, a corporation organized under the laws of England and Wales.
"SATURN ACQUISITION AGREEMENT" means the acquisition agreement
dated as of August 6, 1998 among the Parent Borrower, IXnet, Marshalls
106 Limited and Marshalls Finance Limited, as amended, supplemented or
otherwise modified, in each such case in form and substance reasonably
acceptable to the Administrative Agent and in accordance with its
terms, to the extent permitted in accordance with the Loan Documents.
"SEC" means the United States Securities and Exchange
Commission.
"SECURED HEDGE AGREEMENT" means any Hedge Agreement required
or permitted under Article V that is entered into by and between the
Parent Borrower and any Hedge Bank.
"SECURED OBLIGATIONS" has the meaning specified in Section 2
of the Security Agreement.
"SECURED PARTIES" means (a) for purposes of this Agreement and
the Notes and any amendment, supplement or modification hereof or
thereof and for all other purposes other than for purposes of the
Foreign Guaranty, the Specified Intercompany Notes, the Administrative
Agency Agreement, the Security Agreement (solely with respect to the
Foreign Subsidiaries party thereto and their Obligations thereunder)
and the Foreign Security Documents and any amendment, supplement or
modification thereof, (i) the Agents, (ii) the
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Lender Parties and (iii) the Hedge Banks and (b) for purposes of the
Foreign Guaranty, the Specified Intercompany Notes, the Administrative
Agency Agreement, the Security Agreement (solely with respect to the
Foreign Subsidiaries party thereto and their Obligations thereunder)
and the Foreign Security Documents, and any amendment, supplement or
modification thereof, the Administrative Agent; PROVIDED, HOWEVER, that
solely for purposes of the granting of Liens by the Foreign Guarantors
to the Administrative Agent for the benefit of the Sub Borrower as
required by Section 5.02(b)(ii)(A) and the administrative agency
appointment by the Sub Borrower pursuant to the Administrative Agency
Agreement, the term "Secured Parties" shall include the Sub Borrower;
PROVIDED FURTHER, HOWEVER, that notwithstanding the immediately
preceding proviso, the Sub Borrower shall have no voting or other
rights or remedies as a Secured Party under the Loan Documents.
"SECURITY AGREEMENT" has the meaning specified in Section
3.01(m)(x).
"SENIOR NOTES" has the meaning specified in the Preliminary
Statements.
"SENIOR NOTES INDENTURE" means the Indenture dated as of April
30, 1998, between the Parent Borrower, as issuer, and United States
Trust Company of New York, as trustee, pursuant to which the Senior
Notes were issued, as supplemented by the First Supplemental Indenture,
dated as of September 30, 1998, and as such Indenture may be further
amended, supplemented or otherwise modified from time to time in
accordance with its terms, to the extent permitted in accordance with
the Loan Documents.
"SHARE EXCHANGE" has the meaning specified in the Preliminary
Statements.
"SHARE EXCHANGE AND TERMINATION AGREEMENT" means the Share
Exchange and Termination Agreement dated as of December 18, 1997 among
the Parent Borrower, IXnet and certain other parties thereto, as such
Agreement may be amended, supplemented or otherwise modified from time
to time in accordance with its terms, to the extent permitted in
accordance with the Loan Documents.
"SINGLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and no Person other
than the Loan Parties and the ERISA Affiliates or (b) was so maintained
and in respect of which any Loan Party or any ERISA Affiliate could
have liability under Section 4069 of ERISA in the event such plan has
been or were to be terminated.
"SOLVENT" and "SOLVENCY" mean, with respect to any Person on a
particular date, that on such date (a) the fair value of the property
of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person,
(b) the present fair salable value of the assets of such Person is not
less than the amount that will be
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required to pay the probable liability of such Person on its debts as
they become absolute and matured, (c) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond
such Person's ability to pay such debts and liabilities as they mature
and (d) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such
Person's property would constitute an unreasonably small capital. The
amount of contingent liabilities at any time shall be computed as the
amount that, in the light of all the facts and circumstances existing
at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.
"SPECIFIED INTERCOMPANY NOTE" means a promissory note of a
Specified Subsidiary payable to the order of the Sub Borrower, in
substantially the form of Exhibit I-1 hereto, evidencing the aggregate
intercompany indebtedness of such Specified Subsidiary to the Sub
Borrower, as amended, supplemented or otherwise modified from time to
time.
"SPECIFIED SUBSIDIARIES" means each of the Foreign
Subsidiaries listed on Schedule V hereto.
"STANDBY LETTER OF CREDIT" means any Letter of Credit issued
under the Letter of Credit Facility, other than a Trade Letter of
Credit.
"STOCK OPTION PLAN" means the Holdings Stock Option Plan, a
copy of which has been furnished to the Lender Parties prior to the
Effective Date, as amended, supplemented or otherwise modified from
time to time in accordance with its terms, to the extent permitted
in accordance with the Loan Documents.
"SUB BORROWER" has the meaning specified in the recital of
parties to this Agreement.
"SUBORDINATED DEBT" means any Debt of either Borrower that is
subordinated to the Obligations of such Borrower under the Loan
Documents on, and that otherwise contains, terms and conditions
satisfactory to the Required Lenders.
"SUBSIDIARY" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or
in which) more than 50% of (a) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall
or might have voting power upon the occurrence of any contingency), (b)
the interest in the capital or profits of such partnership, joint
venture or limited liability company or (c) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"SUPERMAJORITY LENDERS" means, at any time, Lenders owed or
holding at least 70% of the sum of (a) the aggregate principal amount
of the Advances outstanding at such time
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and (b) the aggregate Available Amount of all Letters of Credit
outstanding at such time, or, if no such principal amount and no
Letters of Credit are outstanding at such time, Lenders holding at
least 70% of the aggregate of the Term Loan Commitments and Working
Capital Commitments; PROVIDED, HOWEVER, that if any Lender shall be a
Defaulting Lender at such time, there shall be excluded from the
determination of Supermajority Lenders at such time (A) the aggregate
principal amount of the Advances owing to such Lender (in its capacity
as a Lender) and outstanding at such time, (B) such Lender's Pro Rata
Share of the aggregate Available Amount of all Letters of Credit
outstanding at such time and (C) the aggregate Term Loan Commitments
and Unused Working Capital Commitments of such Lender at such time. For
purposes of this definition, the aggregate principal amount of Letter
of Credit Advances owing to the Issuing Bank and the Available Amount
of each Letter of Credit shall be considered to be owed to the Working
Capital Lenders ratably in accordance with their respective Working
Capital Commitments.
"SYNDICATION AGENT" has the meaning specified in the recital
of parties to this Agreement.
"TAX CERTIFICATE" has the meaning specified in Section
5.03(o).
"TAXES" has the meaning specified in Section 2.12(a).
"TERM LOAN ADVANCE" has the meaning specified in Section
2.01(c).
"TERM LOAN COMMITMENT" means, with respect to any Term Loan
Lender at any time, the amount set forth opposite such Lender's name on
Schedule I hereto under the caption "Term Loan Commitment" or, if such
Lender has entered into one or more Assignments and Acceptances, set
forth for such Lender in the Register maintained by the Administrative
Agent pursuant to Section 8.07(d) as such Lender's "Term Loan
Commitment," as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"TERM LOAN FACILITY" means, at any time, the aggregate amount
of the Term Loan Lenders' Term Loan Commitments at such time.
"TERM LOAN LENDER" means any Lender that has a Term Loan
Commitment or has made a Term Loan Advance.
"TERM LOAN NOTE" means a promissory note of the Parent
Borrower payable to the order of any Term Loan Lender, in substantially
the form of Exhibit A-1 hereto, evidencing the aggregate indebtedness
of the Parent Borrower to such Term Loan Lender resulting from the Term
Loan Advances made by such Term Loan Lender, as amended, supplemented
or otherwise modified from time to time.
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"TERMINATION DATE" means the earlier of April 30, 2003 and the
date of termination in whole of the Letter of Credit Commitment and the
Working Capital Commitments pursuant to Section 2.05 or 6.01.
"TIME OF ASSIGNMENT" has the meaning specified in Section
2.16(a).
"TRADE LETTER OF CREDIT" means any Letter of Credit that is
issued under the Letter of Credit Facility for the benefit of a
supplier of Inventory to the Parent Borrower or any of its Subsidiaries
to effect payment for such Inventory, the conditions to drawing under
which include the presentation to the Issuing Bank of negotiable bills
of lading, invoices and related documents sufficient, in the judgment
of the Issuing Bank, to create a valid and perfected lien on or
security interest in such Inventory, bills of lading, invoices and
related documents in favor of the Issuing Bank.
"TYPE" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the
Eurodollar Rate.
"UNUSED WORKING CAPITAL COMMITMENT" means, with respect to any
Working Capital Lender at any time, (a) such Lender's Working Capital
Commitment at such time MINUS (b) the sum of (i) the aggregate
principal amount of all Working Capital Advances and Letter of Credit
Advances made by such Lender (in its capacity as a Working Capital
Lender) and outstanding at such time PLUS (ii) such Lender's Pro Rata
Share of (A) the aggregate Available Amount of all Letters of Credit
outstanding at such time and (B) the aggregate principal amount of all
Letter of Credit Advances made by the Issuing Bank or any L/C Issuer
pursuant to Section 2.03(c) and outstanding at such time.
"VOTING STOCK" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the
happening of such a contingency.
"WELFARE PLAN" means a welfare plan, as defined in Section
3(1) of ERISA, that is maintained for employees of any Loan Party or in
respect of which any Loan Party could have liability.
"WHOLLY-OWNED SUBSIDIARY" or "WHOLLY-OWNED SUBSIDIARY"of any
Person means any corporation, partnership, joint venture, limited
liability company, trust or estate of which (or in which) 100% of (a)
the issued and outstanding capital stock of such corporation, (b) the
interest in the capital or profits of such partnership, joint venture
or limited liability company or (c) the beneficial interest in such
trust or estate, is at the time directly or indirectly owned by such
Person, by such Person and one or more of its other Wholly-Owned
Subsidiaries or by one or more of such Person's other Wholly-Owned
Subsidiaries. Notwithstanding the
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foregoing, IXnet Holdings (and all Wholly-Owned Subsidiaries of IXnet
Holdings) shall be deemed to be Wholly-Owned Subsidiaries of Holdings
and the Parent Borrower so long as the Parent Borrower owns at least
80% (or 68% after giving effect to the exercise of all options issued
to officers, directors, consultants and employees of IXnet Holdings
pursuant to its stock option plan; PROVIDED, THAT, all of the
provisions of clause (iii)(D) of Section 5.02(g) are satisfied) of the
outstanding Voting Stock of IXnet Holdings.
"WITHDRAWAL LIABILITY" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"WORKING CAPITAL ADVANCE" has the meaning specified in Section
2.01(a).
"WORKING CAPITAL COMMITMENT" means, with respect to any
Working Capital Lender at any time, the amount set forth opposite such
Lender's name on Schedule I hereto under the caption "Working Capital
Commitment" or, if such Lender has entered into one or more Assignments
and Acceptances, set forth for such Lender in the Register maintained
by the Administrative Agent pursuant to Section 8.07(d) as such
Lender's "Working Capital Commitment", as such amount may be reduced at
or prior to such time pursuant to Section 2.05.
"WORKING CAPITAL FACILITY" means, at any time, the aggregate
amount of the Working Capital Lenders' Working Capital Commitments at
such time.
"WORKING CAPITAL LENDER" means any Lender that has a Working
Capital Commitment.
"WORKING CAPITAL NOTE" means a promissory note of either
Borrower payable to the order of any Working Capital Lender, in
substantially the form of Exhibit A-2 hereto, or an amended and
restated promissory note of either Borrower payable to the order of any
Working Capital Lender which was also a Prior Lender, in substantially
the form of Exhibit A-3 hereto, evidencing the aggregate indebtedness
of such Borrower to such Working Capital Lender resulting from the
Working Capital Advances made by such Working Capital Lender, as
amended, supplemented or otherwise modified from time to time.
"YEAR 2000 COMPLIANT" means the ability of the software and
other processing capabilities of Holdings, the Parent Borrower and its
Subsidiaries correctly to interpret and manipulate all data, in
whatever form, including printed form, screen displays, financial
records, calculations and loan-related data, so as to avoid errors in
processing that may otherwise occur because of the inability of the
software or other processing capabilities to recognize accurately the
year 2000 or subsequent dates.
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SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement
in the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each mean "to but excluding".
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(f) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01. THE ADVANCES AND LETTERS OF CREDIT. (a) THE
WORKING CAPITAL ADVANCES. Each Working Capital Lender severally agrees, on the
terms and conditions hereinafter set forth, to make advances (each a "WORKING
CAPITAL ADVANCE") to either Borrower from time to time on any Business Day
during the period from the Effective Date until the Termination Date in an
amount for each such Advance not to exceed (i) in the case of the Parent
Borrower, the lesser of (x) such Lender's Unused Working Capital Commitment at
such time and (y) such Lender's Pro Rata Share of the Loan Value of the
applicable Eligible Collateral at such time, and (ii) in the case of the Sub
Borrower, the lesser of (x) such Lender's Unused Working Capital Commitment at
such time and (y) such Lender's Pro Rata Share of the Loan Value of the
applicable Eligible Collateral at such time. Each Borrowing shall be in an
aggregate amount of $500,000 or an integral multiple of $100,000 in excess
thereof and shall consist of Working Capital Advances made simultaneously by the
Lenders ratably according to their Working Capital Commitments. Within the
limits of each Lender's Unused Working Capital Commitment in effect from time to
time, the Borrowers may borrow under this Section 2.01(a), prepay pursuant to
Section 2.06(a)(i) and reborrow under this Section 2.01(a). Notwithstanding the
foregoing, no Working Capital Lender shall be obligated to make a Working
Capital Advance and no Working Capital Advance shall be made if the sum of all
Working Capital Advances to be made by all Lenders as part of such Borrowing
PLUS the aggregate principal amount of the Advances outstanding at such time
PLUS the aggregate Available Amount of all Letters of Credit outstanding at such
time would exceed the maximum amount of Indebtedness (as such term is defined in
the Senior Notes Indenture) permitted to be incurred under clause (i) of the
second paragraph of Section 4.03(a) of the Senior Notes Indenture.
(b) LETTERS OF CREDIT. The Issuing Bank agrees, on the terms
and conditions hereinafter set forth, to issue letters of credit for Parent
Borrower's account, or to cause the issuance of letters of credit for Parent
Borrower's account by a bank or other legally authorized Person selected by or
acceptable to the Issuing Bank in its discretion and reasonably acceptable to
the Administrative Agent (each, an "L/C Issuer"), such letters of credit to be
guaranteed by the Issuing Bank; PROVIDED, HOWEVER, that, if the L/C Issuer is a
Lender, then the Issuing Bank shall not guarantee letters of credit issued by
such an L/C Issuer, but rather each Lender shall purchase (or be
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deemed to have purchased) risk participations in all such letters of credit
issued by such an L/C Issuer with the written consent of the Issuing Bank (such
letters of credit, whether issued by the Issuing Bank or issued by an L/C Issuer
and guaranteed by the Issuing Bank, or issued by an L/C Issuer which is a Lender
and in which each Lender shall have purchased or be deemed to have purchased
risk participations, the "LETTERS OF CREDIT") from time to time on any Business
Day during the period from the Effective Date until 60 days before the
Termination Date (i) in an aggregate Available Amount for all Letters of Credit
not to exceed at any time the Issuing Bank's Letter of Credit Commitment at such
time and (ii) in an Available Amount for each such Letter of Credit not to
exceed the lesser of (x) the Unused Working Capital Commitments of the Lenders
at such time and (y) the Loan Value of the applicable Eligible Collateral at
such time; PROVIDED, FURTHER, that upon request of the Parent Borrower, the
Issuing Bank may, in its and the Administrative Agent's sole discretion, issue
or cause to be issued, Letters of Credit for Parent Borrower's account
denominated in currencies other than United States dollars and otherwise on the
terms and conditions set forth herein. No Letter of Credit shall have an
expiration date (including all rights of the Parent Borrower or the beneficiary
to require renewal) later than the earlier of 60 days before the Termination
Date and (A) in the case of Standby Letters of Credit, one year after the date
of issuance thereof and (B) in the case of a Trade Letter of Credit, 60 days
after the date of issuance thereof. Within the limits of the Letter of Credit
Facility, and subject to the limits referred to above, the Parent Borrower may
request the issuance of Letters of Credit under this Section 2.01(b), repay any
Letter of Credit Advances resulting from drawings thereunder pursuant to Section
2.03(c) and request the issuance of additional Letters of Credit under this
Section 2.01(b). Notwithstanding the foregoing, no Letter of Credit shall be
issued if the sum of the Available Amount of the Letter of Credit to be issued
plus the aggregate principal amount of the Advances outstanding at such time
plus the aggregate Available Amount of all Letters of Credit outstanding at such
time would exceed the maximum amount of Indebtedness (as such term is defined in
the Senior Notes Indenture) permitted to be incurred under clause (i) of the
second paragraph of Section 4.03 of the Senior Notes Indenture.
(c) THE TERM LOAN ADVANCES. Each Term Loan Lender severally
agrees, on the terms and conditions hereinafter set forth, to make a single
advance (a "TERM LOAN Advance") to the Parent Borrower on the Effective Date in
an aggregate amount not to exceed such Lender's Term Loan Commitment at such
time. The Borrowing under the Term Loan Facility shall consist of Term Loan
Advances made simultaneously by the Term Loan Lenders ratably according to their
Term Loan Commitments. Amounts borrowed under this Section 2.01(c) and repaid or
prepaid may not be reborrowed.
Notwithstanding any other provision of this Agreement or any
other Loan Document to the contrary, on the Effective Date the proceeds of the
Term Loan Advances shall be used by the Parent Borrower to repay the then
outstanding Working Capital Advances of the Working Capital Lenders in an amount
equal to 100% of such proceeds (without any corresponding reduction in the
amount of the Working Capital Facility).
SECTION 2.02. MAKING THE ADVANCES. (a) Except as otherwise
provided in Section 2.03, each Borrowing shall be made on notice, given not
later than 11:00 A.M. (New York
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City time) on the third Business Day prior to the date of the proposed Borrowing
in the case of a Borrowing consisting of Eurodollar Rate Advances, or the first
Business Day prior to the date of the proposed Borrowing in the case of a
Borrowing consisting of Base Rate Advances, by the applicable Borrower to the
Administrative Agent, which shall give to each Lender prompt notice thereof by
telex or telecopier. Each such notice of a Borrowing (a "NOTICE OF BORROWING")
shall be by telephone, confirmed immediately in writing, or telex or telecopier,
in substantially the form of Exhibit B hereto, specifying therein the requested
(i) date of such Borrowing, (ii) Facility under which such Borrowing is to be
made, (iii) Type of Advances comprising such Borrowing, (iv) aggregate amount of
such Borrowing and (v) in the case of a Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Advance. Each Lender shall,
before 11:00 A.M. (New York City time) on the date of such Borrowing, make
available for the account of its Applicable Lending Office to the Administrative
Agent at the Administrative Agent's Account, in same day funds, such Lender's
ratable portion of such Borrowing in accordance with the respective Commitments
under the applicable Facility of such Lender and the other Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent shall
make such funds available to such Borrower; PROVIDED, HOWEVER, that the
Administrative Agent shall first make a portion of such funds equal to the
aggregate principal amount of any Letter of Credit Advances made by the Issuing
Bank and by any other Lender and outstanding on the date of such Borrowing, plus
interest accrued and unpaid thereon to and as of such date, available to the
Issuing Bank and such other Lenders for repayment of such Letter of Credit
Advances.
(b) Anything in subsection (a) of this Section 2.02 to the
contrary notwithstanding, (i) neither Borrower may select Eurodollar Rate
Advances for any Borrowing if the aggregate amount of such Borrowing is less
than $1,000,000 or if the obligation of the Lenders to make Eurodollar Rate
Advances shall then be suspended pursuant to Section 2.09 or 2.10, (ii) the
Working Capital Advances may not be outstanding as part of more than 5 separate
Borrowings and (iii) the Term Loan Advances may not be outstanding as part of
more than 4 separate Borrowings.
(c) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower giving such Notice of Borrowing. In the case of any Borrowing
that the related Notice of Borrowing specifies is to be comprised of Eurodollar
Rate Advances, the applicable Borrower shall indemnify each Lender against any
loss, cost or expense incurred by such Lender as a result of any failure to
fulfill on or before the date specified in such Notice of Borrowing for such
Borrowing the applicable conditions set forth in Article III, including, without
limitation, any loss (including loss of anticipated profits), cost or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund the Advance to be made by such Lender as part of
such Borrowing when such Advance, as a result of such failure, is not made on
such date.
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such
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Borrowing in accordance with subsection (a) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available to
the applicable Borrower on such date a corresponding amount. If and to the
extent that such Lender shall not have so made such ratable portion available to
the Administrative Agent, such Lender and such Borrower severally agree to repay
or pay to the Administrative Agent forthwith on demand such corresponding amount
and to pay interest thereon, for each day from the date such amount is made
available to such Borrower until the date such amount is repaid or paid to the
Administrative Agent, at (i) in the case of such Borrower, the interest rate
applicable at such time under Section 2.07 to Advances comprising such Borrowing
and (ii) in the case of such Lender, the Federal Funds Rate. If such Lender
shall pay to the Administrative Agent such corresponding amount, such amount so
paid shall constitute such Lender's Advance as part of such Borrowing for all
purposes.
(e) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. ISSUANCE OF AND DRAWINGS AND REIMBURSEMENT UNDER
LETTERS OF CREDIT. (a) REQUEST FOR ISSUANCE. Each Letter of Credit shall be
issued (other than Letters of Credit denominated in currencies other than United
States dollars, which may be issued or caused to be issued in the sole
discretion of the Issuing Bank and the Administrative Agent and which the
Issuing Bank or the Administrative Agent may refuse to issue or cause to be
issued for any reason whatsoever) upon notice, given not later than 11:00 A.M.
(New York City time) on the fifth Business Day prior to the date of the proposed
issuance of such Letter of Credit, by the Parent Borrower to the Issuing Bank,
which shall give to the Administrative Agent and each Working Capital Lender
prompt notice thereof by telex or telecopier. Each such notice of issuance of a
Letter of Credit (a "NOTICE OF ISSUANCE") shall be by telephone, confirmed
immediately in writing, or telex or telecopier, specifying therein the requested
(A) date of such issuance (which shall be a Business Day), (B) Available Amount
of such Letter of Credit and, in the case of a Letter of Credit to be
denominated in a currency other than United States dollars, the amount of such
Letter of Credit in such other currency, (C) expiration date of such Letter of
Credit, (D) name and address of the beneficiary of such Letter of Credit and (E)
form of such Letter of Credit, and shall be accompanied by such application and
agreement for letter of credit as the Issuing Bank or the L/C Issuer, as the
case may be, may specify to the Parent Borrower for use in connection with such
requested Letter of Credit (a "LETTER OF CREDIT AGREEMENT"). If (x) the
requested form of such Letter of Credit is acceptable to the Issuing Bank or the
L/C Issuer, as the case may be, in its sole discretion and (y) the Issuing Bank
has not received notice from the Administrative Agent or the Required Lenders
that the conditions to issuing such Letter of Credit have not been satisfied or
duly waived, the Issuing Bank or the L/C Issuer, as the case may be, shall, upon
fulfillment of the applicable conditions set forth in Article III, make such
Letter of Credit available to the Parent Borrower at its office referred to in
Section 8.02 or as otherwise agreed with the Parent Borrower in connection with
such issuance. In the event and to the extent that the provisions of any Letter
of Credit Agreement shall conflict with this Agreement, the provisions of this
Agreement shall govern. At the Parent Borrower's
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request, the Issuing Bank or the L/C Issuer, as the case may be, shall provide
the Parent Borrower with a copy of the form of Letter of Credit to be issued for
the Parent Borrower's review and approval prior to issuance.
(b) LETTER OF CREDIT REPORTS. The Issuing Bank shall furnish
(A) to the Administrative Agent on the first Business Day of each week a written
report summarizing issuance and expiration dates of Letters of Credit issued
during the previous week and drawings during such week under all Letters of
Credit, (B) to each Working Capital Lender on the first Business Day of each
month a written report summarizing issuance and expiration dates of Letters of
Credit issued during the preceding month and drawings during such month under
all Letters of Credit and (C) to the Administrative Agent and each Working
Capital Lender on the first Business Day of each calendar quarter a written
report setting forth the average daily aggregate Available Amount during the
preceding calendar quarter of all Letters of Credit.
(c) DRAWING AND REIMBURSEMENT. The payment by the Issuing Bank
of a draft drawn under any Letter of Credit issued by the Issuing Bank, or the
payment by the Issuing Bank of any amount to an L/C Issuer in respect of any
guaranty made by the Issuing Bank of a Letter of Credit issued by such L/C
Issuer, or the payment by an L/C Issuer, which is also a Lender, of a draft
drawn under any Letter of Credit issued by such L/C Issuer, shall each
constitute for all purposes of this Agreement the making by the Issuing Bank or
such L/C Issuer, as the case may be, of a Letter of Credit Advance, which shall
be a Base Rate Advance, in the amount of such payment. Upon written demand by
the Issuing Bank, or L/C Issuer (in the case of an L/C Issuer which is also a
Lender), with a copy of such demand to the Administrative Agent, each Working
Capital Lender shall purchase from the Issuing Bank or such L/C Issuer, as the
case may be, and the Issuing Bank or such L/C Issuer, as the case may be, shall
sell and assign to each such Working Capital Lender, such Working Capital
Lender's Pro Rata Share of such outstanding Letter of Credit Advance as of the
date of such purchase, by making available for the account of its Applicable
Lending Office to the Administrative Agent for the account of the Issuing Bank
or such L/C Issuer, as the case may be, by deposit to the Administrative Agent's
Account, in same day funds, an amount equal to the portion of the outstanding
principal amount of such Letter of Credit Advance to be purchased by such
Working Capital Lender. Promptly after receipt thereof, the Administrative Agent
shall transfer such funds to the Issuing Bank, or L/C Issuer (in the case of an
L/C Issuer which is also a Lender), as the case may be. The Parent Borrower
hereby agrees to each such sale and assignment. Each Working Capital Lender
agrees to purchase its Pro Rata Share of an outstanding Letter of Credit Advance
on (i) the Business Day on which demand therefor is made by the Issuing Bank, or
L/C Issuer (in the case of an L/C Issuer which is also a Lender), as the case
may be; PROVIDED, that notice of such demand is given not later than 11:00 A.M.
(New York City time) on such Business Day, or (ii) the first Business Day next
succeeding such demand if notice of such demand is given after such time. Upon
any such assignment by the Issuing Bank, or L/C Issuer (in the case of an L/C
Issuer which is also a Lender), as the case may be, to any Working Capital
Lender of a portion of a Letter of Credit Advance, the Issuing Bank, or such L/C
Issuer, as the case may be, represents and warrants to such Lender that the
Issuing Bank, or such L/C Issuer, as the case may be, is the legal and
beneficial owner of such interest being assigned by it, free and clear of any
Liens, but makes no other
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representation or warranty and assumes no responsibility with respect to such
Letter of Credit Advance, the Loan Documents or any Loan Party. If and to the
extent that any Working Capital Lender shall not have so made the amount of such
Letter of Credit Advance available to the Administrative Agent, such Lender
agrees to pay to the Administrative Agent forthwith on demand such amount
together with interest thereon, for each day from the date of demand by the
Issuing Bank, or L/C Issuer (in the case of an L/C Issuer which is also a
Lender), as the case may be, until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate for its account or the account
of the Issuing Bank, or such L/C Issuer, as applicable. If such Working Capital
Lender shall pay to the Administrative Agent such amount for the account of the
Issuing Bank, or L/C Issuer (in the case of an L/C Issuer which is also a
Lender), as the case may be, on any Business Day, such amount so paid in respect
of principal shall constitute a Letter of Credit Advance made by such Lender on
such Business Day for purposes of this Agreement, and the outstanding principal
amount of the Letter of Credit Advance made by the Issuing Bank, or such L/C
Issuer, as the case may be, shall be reduced by such amount on such Business
Day.
(d) FAILURE TO MAKE LETTER OF CREDIT ADVANCES. The failure of
any Working Capital Lender to make the Letter of Credit Advance to be made by it
on the date specified in Section 2.03(c) shall not relieve any other Working
Capital Lender of its obligation hereunder to make its Letter of Credit Advance
on such date, but no Working Capital Lender shall be responsible for the failure
of any other Working Capital Lender to make the Letter of Credit Advance to be
made by such other Working Capital Lender on such date.
SECTION 2.04. REPAYMENT OF ADVANCES. (a) WORKING CAPITAL
ADVANCES. Each Borrower shall repay to the Administrative Agent for the ratable
account of the Working Capital Lenders on the Termination Date the aggregate
outstanding principal amount of the Working Capital Advances then outstanding
and owing by such Borrower.
(b) LETTER OF CREDIT ADVANCES. (i) The Parent Borrower shall
repay to the Administrative Agent for the account of the Issuing Bank and each
other Working Capital Lender that has made a Letter of Credit Advance on the
earlier of demand and the Termination Date the outstanding principal amount of
each Letter of Credit Advance made by each of them.
(ii) The Obligations of the Parent Borrower under this
Agreement, any Letter of Credit Agreement and any other agreement or instrument
relating to any Letter of Credit shall be unconditional and irrevocable, and
shall be paid strictly in accordance with the terms of this Agreement, such
Letter of Credit Agreement and such other agreement or instrument under all
circumstances, including, without limitation, the following circumstances (it
being understood that any such payment by the Parent Borrower is without
prejudice to, and does not constitute a waiver of, any rights that the Parent
Borrower might have or might acquire as a result of the payment by the Issuing
Bank or L/C Issuer of any draft or the reimbursement by the Parent Borrower
thereof):
(A) any lack of validity or enforceability of any Loan
Document, any Letter of Credit Agreement, any Letter of Credit, any
guaranty by the Issuing Bank with respect to any
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Letter of Credit issued by an L/C Issuer or any other agreement or
instrument relating thereto (all of the foregoing being, collectively,
the "L/C RELATED DOCUMENTS");
(B) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations of the Parent
Borrower in respect of any L/C Related Document or any other amendment
or waiver of or any consent to departure from all or any of the L/C
Related Documents;
(C) the existence of any claim, setoff, defense or other right
that the Parent Borrower may have at any time against any beneficiary
or any transferee of a Letter of Credit (or any Persons for whom any
such beneficiary or any such transferee may be acting), the Issuing
Bank, the L/C Issuer or any other Person, whether in connection with
the transactions contemplated by the L/C Related Documents or any
unrelated transaction;
(D) any statement or any other document presented under a
Letter of Credit or guaranty thereof proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(E) payment by the Issuing Bank or any L/C Issuer under a
Letter of Credit or guaranty thereof against presentation of a draft or
certificate that does not strictly comply with the terms of such Letter
of Credit or guaranty thereof;
(F) any exchange, release or non-perfection of any Collateral
or other collateral, or any release or amendment or waiver of or
consent to departure from the Domestic Guaranty or any other guarantee,
for all or any of the Obligations of the Parent Borrower in respect of
the L/C Related Documents; or
(G) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including, without limitation, any
other circumstance that might otherwise constitute a defense available
to, or a discharge of, the Parent Borrower or a Domestic Guarantor or
any other guarantor.
(c) TERM LOAN ADVANCES. (i) The Parent Borrower shall repay to
the Administrative Agent for the ratable account of the Term Loan Lenders the
aggregate outstanding principal amount of the Term Loan Advances to the Parent
Borrower on the following dates in the amounts indicated (which amounts shall be
reduced as a result of the application of prepayments in accordance with the
order of priority set forth in Section 2.06):
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Date Amount
---- ------
September 30, 1999 $1,300,000
December 31, 1999 $1,300,000
March 31, 2000 $1,300,000
June 30, 2000 $1,300,000
September 30, 2000 $1,300,000
December 31, 2000 $1,300,000
March 31, 2001 $1,300,000
June 30, 2001 $1,300,000
September 30, 2001 $1,300,000
December 31, 2001 $1,300,000
March 31, 2002 $1,300,000
June 30, 2002 $1,300,000
September 30, 2002 $1,300,000
December 31, 2002 $1,300,000
March 31, 2003 $1,300,000
April 30, 2003 $ 500,000
PROVIDED, HOWEVER, that the final principal installment shall be in an amount
equal to the aggregate principal amount of the Term Loan Advances outstanding on
such date.
SECTION 2.05. TERMINATION OR REDUCTION OF THE COMMITMENTS. (a)
OPTIONAL. On and after the date that all Term Loan Advances shall have been
repaid in full, the Parent Borrower may, upon at least five Business Days'
notice to the Administrative Agent, terminate in whole or reduce in part the
unused portions of the Letter of Credit Facility and the Unused Working Capital
Commitments; PROVIDED, HOWEVER, that each partial reduction of a Facility or a
Commitment (i) shall be in an aggregate amount of $1,000,000 or an integral
multiple of $100,000 in excess thereof and (ii) shall be made ratably among the
Working Capital Lenders in accordance with their Commitments with respect to
such Facility or such Commitments; and PROVIDED, FURTHER, THAT, in no event
shall the Working Capital Facility be reduced below $30,000,000 without the
prior consent of the Administrative Agent and the Required Lenders, unless it is
repaid and terminated in full.
(b) MANDATORY. (i) On and after the date that all Term Loan
Advances shall have been repaid in full, the Working Capital Facility shall be
automatically and permanently reduced on a pro rata basis on each date on which
prepayment thereof is required to be made pursuant to Section 2.06(b)(i) in an
amount equal to the applicable Reduction Amount; PROVIDED that each such
reduction of the Working Capital Facility shall be made ratably among the
Working Capital Lenders in accordance with their Working Capital Commitments;
PROVIDED FURTHER, HOWEVER, that, notwithstanding the foregoing and Section
2.06(b)(v), in no event shall the Working Capital Facility be reduced, pursuant
to this Section 2.05(b)(i), to less than $30,000,000.
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(ii) The Letter of Credit Facility shall be permanently
reduced from time to time on the date of each reduction in the Working Capital
Facility by the amount, if any, by which the amount of the Letter of Credit
Facility exceeds the Working Capital Facility after giving effect to
such reduction of the Working Capital Facility.
(iii) The Term Loan Commitments of the Term Loan Lenders shall
automatically and permanently terminate and shall be of no further force and
effect on the Effective Date after the Borrowing under the Term Loan Facility
has been made by the Term Loan Lenders.
SECTION 2.06. PREPAYMENTS. (a) OPTIONAL. (i) Either Borrower
may, upon at least five (5) Business Days' notice to the Administrative Agent
stating the proposed date and aggregate principal amount of the prepayment, and
if such notice is given such Borrower shall, prepay the then outstanding
aggregate principal amount of the Letter of Credit Advances or prepay the then
outstanding aggregate principal amount of the Working Capital Advances (but not
permanently reduce the Working Capital Facility) comprising part of the same
Borrowing and owing by such Borrower in whole or ratably in part, together with
accrued interest to the date of such prepayment on the aggregate principal
amount prepaid; PROVIDED, HOWEVER, that (x) each partial prepayment shall be in
an aggregate principal amount of $500,000 or an integral multiple of $100,000 in
excess thereof and (y) no such prepayment of a Eurodollar Rate Advance shall be
made other than on the last day of an Interest Period therefor.
(ii) Either Borrower may, upon at least five (5) Business
Days' notice to the Administrative Agent stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given such Borrower
shall, permanently prepay the outstanding aggregate principal amount of the
Advances owing by such Borrower, in whole or ratably in part, together with
accrued interest to the date of such prepayment on the aggregate principal
amount prepaid; PROVIDED, HOWEVER, that (x) each partial prepayment shall be in
an aggregate principal amount of $500,000 or an integral multiple of $100,000 in
excess thereof and (y) no such prepayment of a Eurodollar Rate Advance shall be
made other than on the last day of an Interest Period therefor. Each permanent
prepayment made by a Borrower pursuant to this Section 2.06(a)(ii) shall be
applied to the Facilities made available to such Borrower in the following
manner: FIRST, to the Term Loan Advances then owing by such Borrower under the
Term Loan Facility, for application to the then unpaid installments of principal
on such Term Loan Advances in inverse order of maturity, SECOND, in the case of
the Parent Borrower, but not of the Sub Borrower, to prepay Letter of Credit
Advances then outstanding until such Advances are paid in full, THIRD, to the
Working Capital Advances then owing by such Borrower under the Working Capital
Facility until such Working Capital Advances are repaid in full (and
contemporaneously therewith the Working Capital Facility shall be automatically
permanently reduced by the amount of such permanent prepayment), and FOURTH, in
the case of the Parent Borrower, but not of the Sub Borrower, deposited in the
L/C Cash Collateral Account to cash collateralize 100% of the Available Amount
of Letters of Credit then outstanding.
(b) MANDATORY. (i) The Parent Borrower shall, on the date of
receipt (or such later date as may be specified in Section 5.02(e) or (g)) of
the Net Cash Proceeds by any Loan Party or
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any of their respective Subsidiaries from (A) the sale, lease, transfer or other
disposition of any assets of any Loan Party or any of their respective
Subsidiaries (other than any sale, lease, transfer or other disposition of
assets pursuant to clause (i), (ii) or (v) of Section 5.02(e) or, to the extent
no prepayment is required under such clause, clause (iv) of Section 5.02(e)),
(B) the incurrence or issuance by any Loan Party or any of their respective
Subsidiaries of any Debt (other than Debt incurred or issued pursuant to Section
5.02(b)), and (C) the sale or issuance by any Loan Party or any of their
respective Subsidiaries of any capital stock or other ownership or profit
interest, any securities convertible into or exchangeable for capital stock or
other ownership or profit interest or any warrants, rights or options to acquire
capital stock or other ownership or profit interest (other than any such sale or
issuance permitted under Section 5.02(g) (other than pursuant to subclause
(iii)(C) thereof, except to the extent no prepayment is required under such
subclause)), prepay an aggregate principal amount of the then outstanding
Advances in an amount equal to the amount of such Net Cash Proceeds. Each such
prepayment shall be applied to the Facilities as set forth in clause (v)(A) of
this Section 2.06(b).
(ii) (A) The Sub Borrower shall, on each Business Day, prepay
an aggregate principal amount of the Working Capital Advances owing by the Sub
Borrower and comprising part of the same Borrowings in an amount equal to the
amount by which (x) the sum of the aggregate principal amount of the Working
Capital Advances owing by the Sub Borrower then outstanding exceeds (y) the
lesser of the Working Capital Facility and the Loan Value of the applicable
Eligible Collateral on such Business Day.
(B) The Parent Borrower shall, on each Business Day,
prepay an aggregate principal amount of the Working Capital Advances owing by
the Parent Borrower and comprising part of the same Borrowings and the Letter of
Credit Advances and deposit in the L/C Cash Collateral Account an amount equal
to the amount, in the aggregate, by which (x) the sum of the aggregate principal
amount of (I) the Working Capital Advances owing by the Parent Borrower and (II)
the Letter of Credit Advances then outstanding PLUS the aggregate Available
Amount of all Letters of Credit then outstanding exceeds (y) the lesser of the
Working Capital Facility and the Loan Value of the applicable Eligible
Collateral on such Business Day.
(iii) The Parent Borrower shall, on each Business Day, pay to
the Administrative Agent for deposit in the L/C Cash Collateral Account an
amount sufficient to cause the aggregate amount on deposit in such Account to
equal the amount by which the aggregate Available Amount of all Letters of
Credit then outstanding exceeds the Letter of Credit Facility on such Business
Day.
(iv) The Borrowers, jointly and severally, shall, on each
Business Day, prepay an aggregate principal amount of the Working Capital
Advances owing by the Borrowers and comprising part of the same Borrowings in an
amount equal to the amount by which (x) the sum of (I) the aggregate principal
amount of all Advances outstanding at such time PLUS (II) the aggregate
Available Amount of all Letters of Credit outstanding at such time exceeds (y)
the maximum amount of Indebtedness (as such term is defined in the Senior Notes
Indenture) permitted to be incurred at such time under clause (i) of the second
paragraph of Section 4.03(a) of the Senior Notes Indenture.
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(v) (A) Prepayments made pursuant to clause (i) of this
Section 2.06(b) shall be FIRST applied to prepay the Term Loan Advances in
inverse order of maturity until such Advances are paid in full, SECOND applied
to prepay Letter of Credit Advances then outstanding until such Advances are
paid in full, THIRD applied to prepay Working Capital Advances then outstanding
comprising part of the same Borrowings until such Advances are paid in full and
FOURTH deposited in the L/C Cash Collateral Account to cash collateralize 100%
of the Available Amount of the Letters of Credit then outstanding; and, in the
case of prepayments of the Working Capital Facility, the amount remaining (if
any) after the prepayment in full of the Working Capital Advances then
outstanding and the 100% cash collateralization of the aggregate Available
Amount of Letters of Credit then outstanding (the sum of such prepayment
amounts, cash collateralization amounts and remaining amount being referred to
herein as the "REDUCTION AMOUNT") may be retained by the Parent Borrower and the
Working Capital Facility shall be permanently reduced as set forth in Section
2.05(b)(i). Upon the drawing of any Letter of Credit, or the payment by the
Issuing Bank of any amount in respect of any guaranty made by the Issuing Bank
of a Letter of Credit issued by an L/C Issuer, in each instance for which funds
are on deposit in the L/C Cash Collateral Account, such funds shall be applied
to reimburse the Issuing Bank, the L/C Issuer (in the case of an L/C Issuer
which is also a Lender) or the Lenders, as applicable.
(B) Prepayments made pursuant to clauses (ii)(A) and
(B) of this Section 2.06(b) shall be FIRST applied to prepay Letter of Credit
Advances then outstanding until such Advances are paid in full, SECOND applied
to prepay Working Capital Advances then outstanding comprising part of the same
Borrowings until such Advances are paid in full and THIRD deposited in the L/C
Cash Collateral Account to cash collateralize 100% of the Available Amount of
the Letters of Credit then outstanding; and, in the case of prepayments of the
Working Capital Facility, the amount remaining (if any) after the prepayment in
full of the Working Capital Advances then outstanding and the 100% cash
collateralization of the aggregate Available Amount of Letters of Credit then
outstanding may be retained by the Parent Borrower. Upon the drawing of any
Letter of Credit, or the payment by the Issuing Bank of any amount in respect of
any guaranty made by the Issuing Bank of a Letter of Credit issued by an L/C
Issuer, in each instance for which funds are on deposit in the L/C Cash
Collateral Account, such funds shall be applied to reimburse the Issuing Bank,
the L/C Issuer (in the case of an L/C Issuer which is also a Lender) or the
Lenders, as applicable.
(v) All prepayments under this subsection (b) shall be made
together with accrued interest to the date of such prepayment on the principal
amount prepaid.
SECTION 2.07. INTEREST. (a) SCHEDULED INTEREST. Each Borrower
shall pay interest on the unpaid principal amount of each Advance owing by such
Borrower to each applicable Lender from the date of such Advance until such
principal amount shall be paid in full, at the following rates per annum:
(i) BASE RATE ADVANCES. During such periods as such Advance is
a Base Rate Advance, a rate per annum equal at all times to the sum of
(A) the Base Rate in effect from
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time to time PLUS (B) the Applicable Margin in effect from time to
time, payable in arrears quarterly on the last day of each March, June,
September and December during such periods and on the date such Base
Rate Advance shall be Converted or paid in full.
(ii) EURODOLLAR RATE ADVANCES. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at all
times during each Interest Period for such Advance to the sum of (A)
the Eurodollar Rate for such Interest Period for such Advance PLUS (B)
the Applicable Margin in effect on the first day of such Interest
Period, payable in arrears on the last day of such Interest Period and,
if such Interest Period has a duration of more than three months, on
each day that occurs during such Interest Period every three months
from the first day of such Interest Period and on the date such
Eurodollar Rate Advance shall be Converted or paid in full.
(b) DEFAULT INTEREST. Upon the occurrence and during the
continuance of an Event of Default, each Borrower shall pay interest on (i) the
unpaid principal amount of each Advance owing by such Borrower to each Lender,
payable in arrears on the dates referred to in clause (a)(i) or (a)(ii) of this
Section 2.07 and on demand, at a rate per annum equal at all times to 2% per
annum above the rate per annum required to be paid on such Advance pursuant to
clause (a)(i) or (a)(ii) of this Section 2.07 and (ii) to the fullest extent
permitted by law, the amount of any interest, fee or other amount payable
hereunder that is not paid when due, from the date such amount shall be due
until such amount shall be paid in full, payable in arrears on the date such
amount shall be paid in full and on demand, at a rate per annum equal at all
times to 2% per annum above the rate per annum required to be paid, in the case
of interest, on the Type of Advance on which such interest has accrued pursuant
to clause (a)(i) or (a)(ii) of this Section 2.07, and, in all other cases, on
Base Rate Advances pursuant to clause (a)(i) of this Section 2.07.
(c) NOTICE OF INTEREST RATE. Promptly after receipt of a
Notice of Borrowing pursuant to Section 2.02(a), the Administrative Agent shall
give notice to the Borrower giving such Notice of Borrowing and each Term Loan
Lender or Working Capital Lender, as applicable, of the applicable interest rate
determined by the Administrative Agent for purposes of Section 2.07(a)(i) or
2.07(a)(ii).
SECTION 2.08. FEES. (a) COMMITMENT FEE. The Parent Borrower
shall pay to the Administrative Agent for the account of the Working Capital
Lenders a commitment fee, from the date hereof in the case of each Working
Capital Lender on the date hereof and from the effective date specified in the
Assignment and Acceptance pursuant to which it became a Working Capital Lender
in the case of each other Working Capital Lender, until the Termination Date,
payable in arrears quarterly on the last Business Day of each March, June,
September and December, commencing June 30, 1999, and on the Termination Date,
at the rate of 0.50% per annum on the daily aggregate Unused Working Capital
Commitment of such Lender; PROVIDED, HOWEVER, that any commitment fee accrued
with respect to any of the Commitments of a Defaulting Lender during the period
prior to the time such Lender became a Defaulting Lender and unpaid at such time
shall not be payable by the Parent Borrower so long as such Lender shall be a
Defaulting Lender except to the extent that
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such commitment fee shall otherwise have been due and payable by the Parent
Borrower prior to such time; and PROVIDED FURTHER that no commitment fee shall
accrue on any of the Commitments of a Defaulting Lender so long as such Lender
shall be a Defaulting Lender.
(b) LETTER OF CREDIT FEES, ETC. (i) The Parent Borrower shall
pay to the Administrative Agent for the account of each Working Capital Lender a
commission, payable in arrears quarterly on the last Business Day of each March,
June, September and December, commencing June 30, 1999, and on the earliest to
occur of the full drawing, expiration, termination or cancellation of any Letter
of Credit and on the Termination Date, on such Lender's Pro Rata Share of the
average daily aggregate Available Amount during such quarter of all Letters of
Credit outstanding from time to time at the Letter of Credit Fee Rate in effect
from time to time.
(ii) The Parent Borrower shall pay to the Issuing Bank, for
its own account, (A) a fronting fee for each Letter of Credit in an amount equal
to 0.25% per annum of the Available Amount of such Letter of Credit on the date
of issuance of such Letter of Credit, payable on such date and (B) such
commissions, issuance fees, transfer fees and other fees and charges in
connection with the issuance or administration of each Letter of Credit as the
Parent Borrower and the Issuing Bank (after consultation with the L/C Issuer, in
the event that the L/C Issuer is the issuer of the Letter of Credit) shall
agree.
(c) AGENTS' FEES. The Parent Borrower shall pay to GE Capital,
as Administrative Agent and Collateral Agent, for its own account the fees
described in the Administrative and Collateral Agent's Fee Letter.
SECTION 2.09. CONVERSION OF ADVANCES. (a) OPTIONAL. Either
Borrower may on any Business Day, upon notice given to the Administrative Agent
not later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Conversion and subject to the provisions of Sections
2.07 and 2.10, Convert all or any portion of the Advances of one Type comprising
the same Borrowing and owing by such Borrower into Advances of the other Type;
PROVIDED, HOWEVER, that any Conversion of Eurodollar Rate Advances into Base
Rate Advances shall be made only on the last day of an Interest Period for such
Eurodollar Rate Advances, any Conversion of Base Rate Advances into Eurodollar
Rate Advances shall be in an amount not less than the minimum amount specified
in Section 2.02(b), no Conversion of any Advances shall result in more separate
Borrowings than permitted under Section 2.02(b) and each Conversion of Advances
comprising part of the same Borrowing shall be made ratably among the Term Loan
Lenders or Working Capital Lenders, as the case may be, in accordance with their
then outstanding Term Loan Advances or Working Capital Commitments, as the case
may be. Each such notice of Conversion shall, within the restrictions specified
above, specify (i) the date of such Conversion, (ii) the Advances to be
Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the
duration of the initial Interest Period for such Advances. Each notice of
Conversion shall be irrevocable and binding on the Borrower giving such notice
of Conversion.
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(b) MANDATORY. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $1,000,000 such
Advances shall automatically Convert into Base Rate Advances.
(ii) If the applicable Borrower shall fail to select the
duration of any Interest Period for any Eurodollar Rate Advances in accordance
with the provisions contained in the definition of "Interest Period" in Section
1.01, the Administrative Agent shall forthwith so notify such Borrower and the
applicable Lenders, whereupon each such Eurodollar Rate Advance will
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance.
(iii) Upon the occurrence and during the continuance of any
Event of Default, (x) each Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (y) the obligation of the Lenders to make, or to Convert Advances
into, Eurodollar Rate Advances shall be suspended.
SECTION 2.10. INCREASED COSTS, ETC. (a) If, due to either (i)
the introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender Party of agreeing to make
or of making, funding or maintaining Eurodollar Rate Advances or of agreeing to
issue or of issuing or maintaining or of guaranteeing or of purchasing a risk
participation in Letters of Credit or of agreeing to make or of making or
maintaining Letter of Credit Advances (excluding, for purposes of this Section
2.10, any such increased costs resulting from (x) Taxes or Other Taxes (as to
which Section 2.12 shall govern) and (y) changes in the basis of taxation of
overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender Party is
organized or has its Applicable Lending Office or any political subdivision
thereof), then each Borrower hereby jointly and severally agrees from time to
time, upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), to pay to the Administrative Agent for the account of
such Lender Party additional amounts sufficient to compensate such Lender Party
for such increased cost. A certificate as to the amount of such increased cost,
submitted to the Borrowers by such Lender Party, shall be conclusive and binding
for all purposes, absent manifest error.
(b) If any Lender Party determines that compliance with any
law or regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by such
Lender Party or any corporation controlling such Lender Party and that the
amount of such capital is increased by or based upon the existence of such
Lender Party's commitment to lend or to issue or guaranty or purchase a risk
participation in Letters of Credit hereunder and other commitments of such type
or the issuance or maintenance or guaranty of or purchase of risk participations
in the Letters of Credit, (or similar contingent obligations), then each
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Borrower hereby jointly and severally agrees, upon demand by such Lender Party
(with a copy of such demand to the Administrative Agent), to pay to the
Administrative Agent for the account of such Lender Party, from time to time as
specified by such Lender Party, additional amounts sufficient to compensate such
Lender Party in the light of such circumstances, to the extent that such Lender
Party reasonably determines such increase in capital to be allocable to the
existence of such Lender Party's commitment to lend or to issue or guaranty or
purchase a risk participation in Letters of Credit hereunder or to the issuance
or maintenance or guaranty of or purchase or risk participations in any Letters
of Credit. A certificate as to such amounts submitted to the Borrowers by such
Lender Party shall be conclusive and binding for all purposes, absent manifest
error. Each Lender Party shall use its reasonable efforts to notify the
Borrowers as to the existence of any change of circumstance described in this
Section 2.10(b) as promptly as practicable after gaining knowledge thereof, but
the failure to give notice required hereby shall not affect the right of any
Lender Party to any payment to which it would otherwise be entitled hereunder.
(c) If, with respect to any Eurodollar Rate Advances, the
Required Lenders notify the Administrative Agent that the Eurodollar Rate for
any Interest Period for such Advances will not adequately reflect the cost to
such Lenders of making, funding or maintaining their Eurodollar Rate Advances
for such Interest Period, the Administrative Agent shall forthwith so notify the
Borrowers and the Lenders, whereupon (i) each such Eurodollar Rate Advance shall
automatically, on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance and (ii) the obligation of the Lenders to make,
or to Convert Advances into, Eurodollar Rate Advances shall be suspended until
the Administrative Agent shall notify the Borrowers that such Lenders have
determined that the circumstances causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to each Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance shall
automatically, upon such demand, Convert into a Base Rate Advance and (ii) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrowers that such Lender has determined that the circumstances causing such
suspension no longer exist.
(e) Any Lender Party claiming any additional amounts payable
pursuant to clause (a), (b) or (c) of this Section 2.10 agrees to use its
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the making
of such a designation would avoid the need for, or reduce the amount of, such
increased costs or additional amounts that may thereafter accrue and would not,
in the sole judgment of such Lender Party, be otherwise disadvantageous to such
Lender Party.
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SECTION 2.11. PAYMENTS AND COMPUTATIONS. (a) Each Borrower
shall make each payment hereunder and under the Notes issued by such Borrower,
irrespective of any right of counterclaim or setoff (except as otherwise
provided in Section 2.15), not later than 11:00 A.M. (New York City time) on the
day when due in U.S. dollars to the Administrative Agent at the Administrative
Agent's Account in same day funds. The Administrative Agent shall promptly
thereafter cause like funds to be distributed (i) if such payment by either
Borrower is in respect of principal, interest, commitment fees or any other
Obligation then payable hereunder and under the Notes issued by such Borrower to
more than one Lender Party, to such Lender Parties for the account of their
respective Applicable Lending Offices ratably in accordance with the amounts of
such respective Obligations then payable to the applicable Lender Parties and
(ii) if such payment by either Borrower is in respect of any Obligation then
payable hereunder to one Lender Party, to such Lender Party for the account of
its Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement. Upon its acceptance of an Assignment and Acceptance and
recording of the information contained therein in the Register pursuant to
Section 8.07(d), from and after the effective date of such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender Party
assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such payments for periods prior to such
effective date directly between themselves.
(b) Each Borrower hereby authorizes each Lender Party, if and
to the extent payment owed to such Lender Party is not made when due hereunder
or, in the case of a Lender, under the Note issued by such Borrower and held by
such Lender, to charge from time to time against any or all of such Borrower's
accounts with such Lender Party any amount so due.
(c) The computation of interest on Base Rate Advances using an
interest rate determined pursuant to clause (a) of the definition of "Base Rate"
and the computation of the fees payable pursuant to Section 2.08(a) shall each
be made by the Administrative Agent on the basis of a year of 365 days or 366
days, as the case may be, in each case for the actual number of days (including
the first but excluding the last day) occurring in the period for which such
interest or commissions are payable. All other computations of interest, fees
and commissions shall be made by the Administrative Agent on the basis of a year
of 360 days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest,
fees or commissions are payable. Each determination by the Administrative Agent
of an interest rate, fee or commission hereunder shall be conclusive and binding
for all purposes, absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or commitment fee, as
the case may be; PROVIDED, HOWEVER, that, if such extension would cause payment
of interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the next preceding
Business Day.
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(e) Unless the Administrative Agent shall have received notice
from the applicable Borrower prior to the date on which any payment is due to
any Lender Party hereunder that such Borrower will not make such payment in
full, the Administrative Agent may assume that such Borrower has made such
payment in full to the Administrative Agent on such date and the Administrative
Agent may, in reliance upon such assumption, cause to be distributed to each
such Lender Party on such due date an amount equal to the amount then due such
Lender Party. If and to the extent such Borrower shall not have so made such
payment in full to the Administrative Agent, each such Lender Party shall repay
to the Administrative Agent forthwith on demand such amount distributed to such
Lender Party together with interest thereon, for each day from the date such
amount is distributed to such Lender Party until the date such Lender Party
repays such amount to the Administrative Agent, at the Federal Funds Rate.
SECTION 2.12. TAXES. (a) Any and all payments by either
Borrower hereunder or under the Notes issued by such Borrower shall be made, in
accordance with Section 2.11, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, EXCLUDING, in the case
of each Lender Party and each Agent, taxes that are imposed on its net income by
the United States and taxes that are imposed on its net income (and franchise
taxes imposed in lieu thereof) by the state or foreign jurisdiction under the
laws of which such Lender Party or such Agent (as the case may be) is organized
or any political subdivision thereof and, in the case of each Lender Party,
taxes that are imposed on its overall net income (and franchise taxes imposed in
lieu thereof) by the state or foreign jurisdiction of such Lender Party's
Applicable Lending Office or any political subdivision thereof (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "TAXES"). If either Borrower shall be required by law
to deduct any Taxes from or in respect of any sum payable hereunder or under any
Note issued by such Borrower to any Lender Party or any Agent, (i) the sum
payable by such Borrower shall be increased as may be necessary so that after
such Borrower and the Administrative Agent have made all required deductions
(including deductions applicable to additional sums payable under this Section
2.12) such Lender Party or such Agent (as the case may be) receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
such Borrower shall make all such deductions and (iii) such Borrower shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law.
(b) In addition, each Borrower shall pay any present or future
stamp, documentary, excise, property or similar taxes, charges or levies that
arise from any payment made hereunder or under the Notes issued by such Borrower
or from the execution, delivery or registration of, performance under, or
otherwise with respect to, this Agreement or the Notes issued by such Borrower
(hereinafter referred to as "OTHER TAXES").
(c) The Borrowers shall jointly and severally indemnify each
Lender Party and each Agent for and hold them harmless against the full amount
of Taxes and Other Taxes, and for the full amount of taxes of any kind imposed
by any jurisdiction on amounts payable under this
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Section 2.12, imposed on or paid by such Lender Party or such Agent (as the case
may be) and any liability (including penalties, additions to tax, interest and
expenses) arising therefrom or with respect thereto. This indemnification shall
be made within 30 days from the date such Lender Party or such Agent (as the
case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the
applicable Borrower shall furnish to the Administrative Agent, at its address
referred to in Section 8.02, the original or a certified copy of a receipt
evidencing such payment.
(e) Each Lender Party organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date of its
execution and delivery of this Agreement in the case of each Initial Lender or
Initial Issuing Bank, as the case may be, and on the date of the Assignment and
Acceptance pursuant to which it becomes a Lender Party in the case of each other
Lender Party, and from time to time thereafter as requested in writing by either
Borrower (but only so long thereafter as such Lender Party remains lawfully able
to do so), provide each of the Administrative Agent and such Borrower with two
original Internal Revenue Service forms 1001 or 4224 or (in the case of a Lender
that has certified in writing to the Administrative Agent and such Borrower that
it is not a "bank" as defined in Section 881(c)(3)(A) of the Internal Revenue
Code) form W-8 (and, if such Lender delivers a form W-8, a certificate
representing that such Lender is not a "bank" for purposes of Section 881(c) of
the Internal Revenue Code, is not a 10-percent shareholder (within the meaning
of Section 871(h)(3)(B) of the Internal Revenue Code) of such Borrower and is
not a controlled foreign corporation related to such Borrower (within the
meaning of Section 864(d)(4) of the Internal Revenue Code)), as appropriate, or
any successor or other form prescribed by the Internal Revenue Service,
certifying that such Lender Party is exempt from or entitled to a reduced rate
of United States withholding tax on payments pursuant to this Agreement or the
Notes issued by such Borrower or, in the case of a Lender providing a form W-8,
certifying that such Lender is a foreign corporation, partnership, estate or
trust. If the forms provided by a Lender Party at the time such Lender Party
first becomes a party to this Agreement indicate a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender Party provides the
appropriate forms certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such forms; PROVIDED, HOWEVER, that, if, at the date of the
Assignment and Acceptance pursuant to which a Lender Party becomes a party to
this Agreement, the Lender Party assignor was entitled to payments under
subsection (a) of this Section 2.12 in respect of United States withholding tax
with respect to interest paid at such date, then, to such extent, the term Taxes
shall include (in addition to withholding taxes that may be imposed in the
future or other amounts otherwise includable in Taxes) United States withholding
tax, if any, applicable with respect to the Lender Party assignee on such date.
For purposes of this subsection (e) and subsection (f) of this Section 2.12, the
terms "UNITED STATES" and "UNITED STATES PERSON" shall have the meanings
specified in Section 7701 of the Internal Revenue Code.
(f) For any period with respect to which a Lender Party has
failed to provide the applicable Borrower with the appropriate form described in
subsection (e) above (OTHER THAN if such
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failure is due to a change in law enacted or promulgated after the date on which
a form originally was required to be provided or if such form otherwise is not
required under subsection (e) of this Section 2.12), such Lender Party shall not
be entitled to indemnification under subsection (a) or (c) of this Section 2.12
with respect to Taxes imposed by the United States by reason of such failure;
PROVIDED, HOWEVER, that should a Lender Party become subject to Taxes because of
its failure to deliver a form required hereunder, such Borrower shall take such
steps as such Lender Party shall reasonably request to assist such Lender Party
to recover such Taxes.
(g) In the event that a Lender Party determines in its
reasonable discretion, that it has actually and finally realized a refund of or
credit for taxes withheld or paid pursuant to this Section 2.12, which credit or
refund is identifiable by such Lender Party as being a result of taxes withheld
in connection with sums payable hereunder or under any other Loan Document, such
Lender Party shall promptly notify the Administrative Agent and the Parent
Borrower and shall remit to the Parent Borrower or the Sub Borrower, as
applicable, the amount of such refund or credit allocable to payments made
hereunder or under the other Loan Documents; PROVIDED, HOWEVER, that in the
event of any subsequent disallowance of any such refund or credit on account of
which such Lender Party has made a payment pursuant to this subsection (g), the
amount so disallowed shall be deemed to be a Tax (notwithstanding any exclusions
in the definition of "Taxes") for which such Lender Party shall be entitled to
indemnification under subsection (c) of this Section 2.12, but only to the
extent of any payment by such Lender Party pursuant to this subsection (g).
SECTION 2.13. SHARING OF PAYMENTS, ETC. If any Lender Party
shall obtain at any time any payment (whether voluntary, involuntary, through
the exercise of any right of setoff, or otherwise) (a) on account of Obligations
due and payable to such Lender Party hereunder and under the Notes at such time
in excess of its ratable share (according to the proportion of (i) the amount of
such Obligations due and payable to such Lender Party at such time to (ii) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time obtained by all the Lender Parties at such time or (b) on account
of Obligations owing (but not due and payable) to such Lender Party hereunder
and under the Notes at such time in excess of its ratable share (according to
the proportion of (i) the amount of such Obligations owing to such Lender Party
at such time to (ii) the aggregate amount of the Obligations owing (but not due
and payable) to all Lender Parties hereunder and under the Notes at such time)
of payments on account of the Obligations owing (but not due and payable) to all
Lender Parties hereunder and under the Notes at such time obtained by all of the
Lender Parties at such time, such Lender Party shall forthwith purchase from the
other Lender Parties such participations in the Obligations due and payable or
owing to them, as the case may be, as shall be necessary to cause such
purchasing Lender Party to share the excess payment ratably with each of them;
PROVIDED, HOWEVER, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender Party, such purchase from each
other Lender Party shall be rescinded and such other Lender Party shall repay to
the purchasing Lender Party the purchase price to the extent of such Lender
Party's ratable share (according to the proportion of (i) the purchase price
paid to such Lender Party to (ii) the aggregate purchase price paid to all
Lender Parties) of such recovery together with
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an amount equal to such Lender Party's ratable share (according to the
proportion of (i) the amount of such other Lender Party's required repayment to
(ii) the total amount so recovered from the purchasing Lender Party) of any
interest or other amount paid or payable by the purchasing Lender Party in
respect of the total amount so recovered. Each Borrower agrees that any Lender
Party so purchasing a participation from another Lender Party pursuant to this
Section 2.13 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of setoff) with respect to such
participation as fully as if such Lender Party were the direct creditor of such
Borrower in the amount of such participation.
SECTION 2.14. USE OF PROCEEDS. The proceeds of the Advances
and issuances of Letters of Credit to the Parent Borrower shall be available
(and the Parent Borrower agrees that it shall use such proceeds and Letters of
Credit) solely to finance ongoing working capital requirements and for other
general corporate purposes, including, without limitation, Non-hostile
Acquisitions, of the Parent Borrower and its Subsidiaries. The proceeds of the
Advances to the Sub Borrower shall be available (and the Sub Borrower agrees
that it shall use such proceeds) solely to be lent to the Specified Subsidiaries
and to be used by the Specified Subsidiaries solely to finance ongoing working
capital requirements and for other general corporate purposes of the Specified
Subsidiaries, including, without limitation, Non-hostile Acquisitions.
SECTION 2.15. DEFAULTING LENDERS. (a) In the event that, at
any one time, (i) any Lender Party shall be a Defaulting Lender, (ii) such
Defaulting Lender shall owe a Defaulted Advance to either Borrower and (iii)
such Borrower shall be required to make any payment hereunder or under any other
Loan Document to or for the account of such Defaulting Lender, then such
Borrower may, so long as no Default shall occur or be continuing at such time
and to the fullest extent permitted by applicable law, set off and otherwise
apply the Obligation of such Borrower to make such payment to or for the account
of such Defaulting Lender against the obligation of such Defaulting Lender to
make such Defaulted Advance. In the event that, on any date, such Borrower shall
so set off and otherwise apply its Obligation to make any such payment against
the obligation of such Defaulting Lender to make any such Defaulted Advance on
or prior to such date, the amount so set off and otherwise applied by such
Borrower shall constitute for all purposes of this Agreement and the other Loan
Documents an Advance by such Defaulting Lender made on the date and under the
Facility pursuant to which such Defaulted Advance was originally required to
have been made pursuant to Section 2.01. Such Advance shall be a Base Rate
Advance and shall be considered, for all purposes of this Agreement, to comprise
part of the Borrowing in connection with which such Defaulted Advance was
originally required to have been made pursuant to Section 2.01, even if the
other Advances comprising such Borrowing shall be Eurodollar Rate Advances on
the date such Advance is deemed to be made pursuant to this subsection (a). Each
Borrower shall notify the Administrative Agent at any time such Borrower
exercises its right of setoff pursuant to this subsection (a) and shall set
forth in such notice (A) the name of the Defaulting Lender and the Defaulted
Advance required to be made by such Defaulting Lender and (B) the amount set off
and otherwise applied in respect of such Defaulted Advance pursuant to this
subsection (a). Any portion of such payment otherwise required to be made by
such Borrower to or for the account of such Defaulting Lender that is paid by
such Borrower, after giving effect to the amount set off and
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otherwise applied by such Borrower pursuant to this subsection (a), shall be
applied by the Administrative Agent as specified in subsection (b) or (c) of
this Section 2.15.
(b) In the event that, at any one time, (i) any Lender Party
shall be a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted
Amount to any Agent or any of the other Lender Parties and (iii) either Borrower
shall make any payment hereunder or under any other Loan Document to the
Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of the Collateral Agent or
such other Lender Parties and to the fullest extent permitted by applicable law,
apply at such time the amount so paid by such Borrower to or for the account of
such Defaulting Lender to the payment of each such Defaulted Amount to the
extent required to pay such Defaulted Amount. In the event that the
Administrative Agent shall so apply any such amount to the payment of any such
Defaulted Amount on any date, the amount so applied by the Administrative Agent
shall constitute for all purposes of this Agreement and the other Loan Documents
payment, to such extent, of such Defaulted Amount on such date. Any such amount
so applied by the Administrative Agent shall be retained by the Administrative
Agent or distributed by the Administrative Agent to the Collateral Agent or such
other Lender Parties, ratably in accordance with the respective portions of such
Defaulted Amounts payable at such time to the Administrative Agent, the
Collateral Agent and such other Lender Parties and, if the amount of such
payment made by such Borrower shall at such time be insufficient to pay all
Defaulted Amounts owing at such time to the Administrative Agent, the Collateral
Agent and the other Lender Parties, in the following order of priority:
(i) FIRST, to the Administrative Agent for any Defaulted
Amount then owing to the Administrative Agent;
(ii) SECOND, to the Collateral Agent for any Defaulted Amounts
then owing to the Collateral Agent; and
(iii) THIRD, to any other Lender Parties for any Defaulted
Amounts then owing to such other Lender Parties, ratably in accordance
with such respective Defaulted Amounts then owing to such other Lender
Parties.
Any portion of such amount paid by such Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.15.
(c) In the event that, at any one time, (i) any Lender Party
shall be a Defaulting Lender, (ii) such Defaulting Lender shall not owe a
Defaulted Advance or a Defaulted Amount and (iii) either Borrower, either Agent
or any other Lender Party shall be required to pay or distribute any amount
hereunder or under any other Loan Document to or for the account of such
Defaulting Lender, then such Borrower, such Agent or such other Lender Party
shall pay such amount to the Administrative Agent to be held by the
Administrative Agent, to the fullest extent permitted by
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applicable law, in escrow or the Administrative Agent shall, to the fullest
extent permitted by applicable law, hold in escrow such amount otherwise held by
it. Any funds held by the Administrative Agent in escrow under this subsection
(c) shall be deposited by the Administrative Agent in an account with Bankers
Trust Company, in the name and under the control of the Administrative Agent,
but subject to the provisions of this subsection (c). The terms applicable to
such account, including the rate of interest payable with respect to the credit
balance of such account from time to time, shall be Bankers Trust Company's
standard terms applicable to escrow accounts maintained with it. Any interest
credited to such account from time to time shall be held by the Administrative
Agent in escrow under, and applied by the Administrative Agent from time to time
in accordance with the provisions of, this subsection (c). The Administrative
Agent shall, to the fullest extent permitted by applicable law, apply all funds
so held in escrow from time to time to the extent necessary to make any Advances
required to be made by such Defaulting Lender and to pay any amount payable by
such Defaulting Lender hereunder and under the other Loan Documents to the
Administrative Agent, the Collateral Agent or any other Lender Party, as and
when such Advances or amounts are required to be made or paid and, if the amount
so held in escrow shall at any time be insufficient to make and pay all such
Advances and amounts required to be made or paid at such time, in the following
order of priority:
(i) FIRST, to the Administrative Agent for any amount then due
and payable by such Defaulting Lender to the Administrative Agent
hereunder;
(ii) SECOND, to the Collateral Agent for any amount then due
and payable by such Defaulting Lender to the Collateral Agent
hereunder;
(iii) THIRD, to any other Lender Parties for any amount then
due and payable by such Defaulting Lender to such other Lender Parties
hereunder, ratably in accordance with such respective amounts then due
and payable to such other Lender Parties; and
(iv) FOURTH, to the applicable Borrower for any Advance then
required to be made to such Borrower by such Defaulting Lender pursuant
to a Commitment of such Defaulting Lender.
In the event that any Lender Party that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Administrative
Agent in escrow at such time with respect to such Lender Party shall be
distributed by the Administrative Agent to such Lender Party and applied by such
Lender Party to the Obligations owing to such Lender Party at such time under
this Agreement and the other Loan Documents in such manner as the Administrative
Agent shall reasonably direct.
(d) The rights and remedies against a Defaulting Lender under
this Section 2.15 are in addition to other rights and remedies that the
Borrowers may have against such Defaulting Lender with respect to any Defaulted
Advance and that the Administrative Agent, the Collateral
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Agent or any Lender Party may have against such Defaulting Lender with respect
to any Defaulted Amount.
SECTION 2.16. ASSIGNMENT AND ASSUMPTION OF OBLIGATIONS UNDER
EXISTING CREDIT AGREEMENT. (a) Each Prior Lender and each Working Capital Lender
hereby agrees (subject, in the case of each Prior Lender, to receipt of any and
all payments required under Section 2.16 (g)) that prior to (and subject to the
condition subsequent of) the occurrence of the Effective Date (such prior
moment, the "TIME OF ASSIGNMENT"), each Prior Lender hereby sells and assigns,
without recourse except as to the representation and warranty made by such Prior
Lender in Section 2.16(d)(i) below, to each Working Capital Lender, and each
Working Capital Lender hereby purchases and assumes from each Prior Lender, an
interest in and to all of such Prior Lender's rights and obligations under the
Existing Credit Agreement at the Time of Assignment, pro rata for each Working
Capital Lender in accordance with the percentage of the Working Capital Facility
hereunder represented by such Lender's Working Capital Commitment. Upon the
occurrence of the Effective Date, (i) the principal amount of the Working
Capital Advances assumed by each Working Capital Lender shall continue to
constitute Working Capital Advances made by such Working Capital Lender
hereunder and (ii) the Working Capital Commitment assumed by each Working
Capital Lender shall be reconstituted as, and restated to be, the Working
Capital Commitment of such Working Capital Lender hereunder.
(b) As consideration for the assignment and sale contemplated
by Section 2.16(a), each Working Capital Lender shall pay to the Administrative
Agent, for the account of the Prior Lenders, an amount equal to the Working
Capital Advances assigned to and assumed by such Working Capital Lender (net of
the amount, if any, to be received hereunder by such Working Capital Lender in
its capacity as a Prior Lender) in immediately available funds by no later than
11:00 a.m. (New York time) on the Effective Date. Upon receipt of such funds
from the Working Capital Lenders, the Administrative Agent shall promptly pay
the amount that each Prior Lender is entitled to receive from the Working
Capital Lenders to such Prior Lender in immediately available funds. It is
understood and agreed that commitment fees and all other fees and interest
accrued under the Existing Credit Agreement to the Effective Date are for the
account of the Prior Lenders and such fees and interest accruing under this
Agreement from and including the Effective Date are for the account of the
Working Capital Lenders. Each Prior Lender and each Working Capital Lender
hereby agrees that if it receives any amount under the Existing Credit Agreement
or hereunder which is for the account of another party, it shall receive the
same for the account of such other party to the extent of such other party's
interest therein and shall promptly return the same to the Administrative Agent
for distribution to such other party.
(c) The Administrative Agent hereby waives the processing fees
referred to in Section 8.07(a) of the Existing Credit Agreement that would
otherwise be payable in connection with
the assignments made pursuant to this Section 2.16.
(d) Each Prior Lender (i) hereby represents and warrants that
it is the legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any Lien or adverse claim;
(ii) makes no representation or warranty and assumes no responsibility
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with respect to any statements, warranties or representations made in or in
connection with the Existing Credit Agreement, this Agreement or any other Loan
Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of, or the perfection or priority of any Lien or security
interest created or purported to be created under or in connection with, the
Existing Credit Agreement, this Agreement or any other Loan Document or any
other agreement, instrument or document furnished pursuant hereto or thereto;
and (iii) makes no representation or warranty and assumes no responsibility with
respect to the financial condition of either Borrower or any other Loan Party or
the performance or observance by either Borrower or any other Loan Party of any
of its obligations under or in respect of the Existing Credit Agreement, this
Agreement or any other Loan Document or any other agreement, instrument or
document furnished pursuant hereto or thereto.
(e) Each Working Capital Lender that is not a Prior Lender
confirms (solely for the benefit of the Prior Lenders and the Agents) that it
has received a copy of the Existing Credit Agreement, together with such other
Loan Documents, other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into this Agreement.
(f) From and after the Time of Assignment, each Prior Lender
shall relinquish its rights and be released from its obligations under the
Existing Credit Agreement (as distinct from those rights and obligations that it
acquires by virtue of being a Working Capital Lender under this Agreement).
Notwithstanding the foregoing, the obligations of the Borrowers to each Prior
Lender contained in Sections 2.10, 2.12 and 8.04 of the Existing Credit
Agreement and Section 2.16(g) hereunder shall survive the occurrence of the Time
of Assignment, but only as they relate to the period when such Prior Lender was,
or to such Prior Lender's status as, a Lender under the Existing Credit
Agreement.
(g) By its execution hereof, each Borrower agrees that on the
Effective Date it shall pay to each Prior Lender all interest, commitment fees
and other fees and any expenses that are accrued but unpaid to the Effective
Date and payable to such Prior Lender by such Borrower at any time under the
terms of the Existing Credit Agreement. In addition to the foregoing, each
Borrower agrees that, to the extent (i) any Prior Lender's Eurodollar Rate
Advances under the Existing Credit Agreement exceed the Working Capital Advances
assumed by such Prior Lender as a Working Capital Lender hereunder and (ii) the
Effective Date is not the last day of the Interest Period applicable to such
Eurodollar Rate Advances, such Borrower shall, upon demand by such Prior Lender
(with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Prior Lender any amounts required
to compensate such Prior Lender for any losses, costs or expenses that it may
incur as a result of the assignments made pursuant to this Section 2.16,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Prior Lender to fund or maintain any
and all such Eurodollar Rate Advances under the Existing Credit Agreement.
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(h) From and after the Effective Date, the Administrative
Agent shall make all payments under this Agreement in respect of the interests
assigned pursuant to this Section 2.16 (including, without limitation, all
payments of principal, interest, commitment fees and other fees with respect
thereto) to each Working Capital Lender, as appropriate.
SECTION 2.17. AMENDMENT AND RESTATEMENT. This Agreement amends
and restates in its entirety the Existing Credit Agreement and upon the
effectiveness of this Agreement, the terms and provisions of the Existing Credit
Agreement shall, subject to this Section 2.17, be superseded hereby. All
references to the "Credit Agreement" contained in the Loan Documents delivered
in connection with the Existing Credit Agreement or this Agreement shall, and
shall be deemed to, refer to this Agreement. Notwithstanding the amendment and
restatement of the Existing Credit Agreement by this Agreement, the Obligations
of the Borrowers and the other Loan Parties outstanding under the Existing
Credit Agreement and the other Loan Documents as of the Effective Date shall
remain outstanding and shall constitute continuing Obligations as set forth in
Section 2.16(a) and shall continue as such to be secured by the Collateral. Such
Obligations shall in all respects be continuing and this Agreement shall not be
deemed to evidence or result in a novation or repayment and reborrowing of such
Obligations. The Liens securing payment of the Obligations under the Existing
Credit Agreement, as amended and restated in the form of this Agreement, shall
in all respects be continuing, securing the payment of all Obligations.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVE DATE.
Notwithstanding the execution and delivery of this Agreement by all parties
hereto, the Existing Credit Agreement shall remain in full force and effect and
shall not be amended and restated hereby unless and until the Effective Date
occurs. The effectiveness of the amendment and restatement of the Existing
Credit Agreement to be effected by this Agreement, and the obligation of each
Term Loan Lender to make the Term Loan Advances, and of the Working Capital
Lenders to make any Working Capital Advances, on the Effective Date, shall occur
on the Effective Date and shall be subject to the conditions precedent (each to
be satisfied in form and substance satisfactory to the Administrative Agent)
that:
(a) The Reorganization, including all of the terms and
conditions thereof, shall have been duly approved by the board of
directors of the Parent Borrower and duly approved (if required by
applicable law) by the Board of Directors and the shareholders of all
other parties thereto or affected thereby, and all Reorganization
Documents shall have been duly executed and delivered by the Parent
Borrower and the other parties thereto and shall be in full force and
effect. The representations and warranties set forth in the
Reorganization Documents shall be true and correct in all material
respects as if made on and as of the Effective Date, except to the
extent that such representations and warranties are stated to
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relate to a specific earlier date, in which case such representations
and warranties shall be true and correct in all material respects as of
such earlier date.
(b) The Reorganization shall have been consummated on and as
of May 21, 1999 strictly in accordance with the terms of the
Reorganization Documents and all applicable laws, rules and
regulations. On and as of the Effective Date, the Reorganization shall
remain consummated and in full force and effect and shall not be the
subject of any attack, other complaint or question by the stockholders
of Holdings, the Parent Borrower or any other Loan Party, the SEC (or
any similar state or foreign governmental agency or body) or any other
Person (whether domestic or foreign).
(c) The Parent Borrower Charter Amendment shall have been duly
approved by the board of directors and stockholders of both Holdings
and the Parent Borrower and all Parent Borrower Charter Amendment
Documents shall have been duly adopted or executed and delivered, as
applicable, by all relevant Persons and shall be in full force and
effect. The representations and warranties set forth in the Parent
Borrower Charter Amendment Documents shall be true and correct in all
material respects as if made on and as of the Effective Date, except to
the extent that such representations and warranties are stated to
relate to a specific earlier date, in which case such representations
and warranties shall be true and correct in all material respects as of
such earlier date.
(d) The Parent Borrower Charter Amendment shall have been
effectuated and all necessary filings and other actions in connection
therewith under the DGCL and all other applicable laws, rules and
regulations shall have been made or taken, as the case may be. On and
as of the Effective Date, the Parent Borrower Charter shall include the
Parent Borrower Charter Amendment and otherwise shall be in form and
substance identical to Exhibit F hereto. None of the foregoing shall be
the subject of any attack, other complaint or question by the
stockholders of Holdings, the Parent Borrower or any other Loan Party,
the SEC or any other Person (whether domestic or foreign).
(e) Holdings and the Parent Borrower shall have effectuated
their worldwide corporate reorganization on the terms previously
described to the Agents and Lenders (the "CORPORATE REORGANIZATION")
and the corporate structure of Holdings, the Parent Borrower and its
Subsidiaries shall be precisely as set forth in Exhibit K hereto. The
Corporate Reorganization shall have been effectuated pursuant to
agreements, instruments and other documentation in form and substance
satisfactory to the Administrative Agent (the "CORPORATE REORGANIZATION
DOCUMENTS") and in compliance with all applicable domestic and foreign
laws, rules and regulations and other legal requirements. The Corporate
Reorganization shall not be the subject of any attack, other complaint
or question by the stockholders of Holdings, the Parent Borrower or any
other Loan Party, the SEC (or any similar state or foreign governmental
agency or body) or any other Person (whether domestic or foreign).
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(f) The Administrative Agent, the Collateral Agent and the
Lender Parties shall be satisfied with the corporate and legal
structure, ownership and capitalization of each Loan Party and each of
its Subsidiaries, including the terms and conditions of the charter
(including, without limitation, the Parent Borrower Charter, as amended
by the Parent Borrower Charter Amendment), bylaws and other governing
documents, and each class of capital stock, of each Loan Party and each
such Subsidiary and of each agreement, instrument or other document
relating to such structure, ownership or capitalization.
(g) There shall have occurred no Material Adverse Change since
September 30, 1998.
(h) There shall exist no action, suit, investigation,
litigation or proceeding affecting any Loan Party or any of its
Subsidiaries pending or, to the best of Holdings' or either Borrower's
knowledge, threatened before any court, governmental agency or
arbitrator that (i) could be reasonably likely to have a Material
Adverse Effect or (ii) purports to affect the legality, validity or
enforceability of the Reorganization, the Parent Borrower Charter
Amendment, the Corporate Reorganization, the Effective Date
Transactions, any Loan Document or any Related Document.
(i) Nothing shall have come to the attention of the
Administrative Agent, the Collateral Agent or the Lender Parties to
lead them to believe (i) that the information relating to the Loan
Parties furnished to the Administrative Agent, the Collateral Agent or
the Lender Parties prior to the Effective Date was or has become
misleading, incorrect or incomplete in any material respect, (ii) that
any Loan Party or any of its Subsidiaries would not have good and
marketable title to all material assets of such Loan Party and its
Subsidiaries reflected in the information relating to the Loan Parties
furnished to the Administrative Agent, the Collateral Agent or the
Lender Parties prior to the Effective Date or (iii) that the
Reorganization, the Parent Borrower Charter Amendment, the Corporate
Reorganization or the Effective Date Transactions, will, individually
or in the aggregate, have a Material Adverse Effect; without limiting
the generality of the foregoing, the Administrative Agent, the
Collateral Agent and the Lender Parties shall have been given such
access to the management, records, books of account, contracts and
properties of each Loan Party and its Subsidiaries as they shall have
requested.
(j) All accrued costs, fees and expenses of the Agents and the
Lender Parties to the extent due shall have been paid (including the
accrued costs, fees and expenses of counsel (including local and
foreign counsel) to the Agents).
(k) The Administrative Agent, the Collateral Agent and the
Lender Parties shall be satisfied that (i) all requisite governmental
and other third party licenses, permits, approvals and consents
necessary in connection with and for the consummation of the
Reorganization, the Parent Borrower Charter Amendment, the Corporate
Reorganization and the Effective Date Transactions, shall have been
obtained (without the imposition of any
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conditions that are not acceptable to the Administrative Agent, the
Collateral Agent and the Lender Parties) and remain in effect, and all
applicable appeal periods and all applicable waiting periods, if any,
in connection with any of the Reorganization, the Parent Borrower
Charter Amendment, the Corporate Reorganization or the Effective Date
Transactions shall have expired without any action being taken by any
competent authority, and no law or regulation shall be applicable in
the judgment of the Administrative Agent, the Collateral Agent or the
Lender Parties, in each case, that restrains, prevents or imposes
adverse conditions upon the consummation of any of the Reorganization,
the Parent Borrower Charter Amendment, the Corporate Reorganization and
the Effective Date Transactions or the rights of the Loan Parties or
their Subsidiaries freely to the transfer or otherwise dispose of, or
to create any Lien on, any properties now owned or hereafter acquired
by any of them and (ii) the Effective Date Transactions shall be in
full compliance with all legal and regulatory requirements, including,
without limitation, Regulations T, U and X of the Board of Governors of
the Federal Reserve System.
(l) Lenders, other than GE Capital, shall have committed to
provide, on terms acceptable to GE Capital, Commitments equal to at
least $40,000,000, comprised of Term Loan Commitments equal to at least
$12,307,693 and Working Capital Commitments equal
to at least $27,692,307.
(m) The Administrative Agent shall have received on or before
the Effective Date the following, each dated such day (unless otherwise
specified), in form and substance satisfactory to the Administrative
Agent, the Collateral Agent and the Lender Parties, unless otherwise
specified, and (except for the Notes) in sufficient copies for each
Lender Party:
(i) The Notes payable to the order of the Lenders.
(ii) Certified copies of (A) the resolutions of the
Board of Directors (or persons performing similar functions)
of each Loan Party that is a party thereto approving the
Reorganization, the Corporate Reorganization, the Parent
Borrower Charter Amendment, the Effective Date Transactions,
each Loan Document and, to the extent that a certified copy of
such resolutions has not been previously delivered, each
Related Document to which it is or is to be a party, (B) the
resolutions and other corporate actions of the stockholders of
Holdings and the Parent Borrower approving the Parent Borrower
Charter Amendment, as applicable and (C) all documents
evidencing other necessary or desirable corporate action and
governmental and other third party approvals and consents with
respect to the Reorganization, the Corporate Reorganization,
the Parent Borrower Charter Amendment and the Effective Date
Transactions, each Loan Document and each Related Document to
which it is or is to be a party.
(iii) A copy of a certificate of the Secretary of
State or other appropriate domestic or foreign governmental
official of the jurisdiction of incorporation of each
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Loan Party other than the Hong Kong Subsidiaries, dated
reasonably near the Effective Date, certifying, where
applicable, (A) as to a true and correct copy of the charter
or other constitutive document of such Loan Party and each
amendment thereto on file in that office and (B) that (1) such
amendments are the only amendments to such Loan Party's
charter or other constitutive document on file in that office,
(2) such Loan Party has paid all franchise taxes to the date
of such certificate and (3) such Loan Party is duly
incorporated and in good standing or presently subsisting
under the laws of the jurisdiction of its incorporation.
(iv) A copy of a certificate of the Hong Kong
Registrar of Companies dated reasonably near the Effective
Date, certifying that each of the Hong Kong Subsidiaries is
presently on the Register.
(v) A copy of a certificate of the Secretary of State
or other appropriate domestic or foreign governmental official
in all jurisdictions in which any Loan Party is qualified to
do business as a foreign corporation, in each case, dated
reasonably near the Effective Date, stating that such Loan
Party is duly qualified and in good standing as a foreign
corporation in such State or other jurisdiction and has filed
all annual reports required to be filed to the date of such
certificate.
(vi) Certified copies of a certificate of merger or
other confirmation from the Secretary of State of the State of
Delaware satisfactory to the Administrative Agent, the
Collateral Agent and the Lender Parties of the consummation
and effectiveness of the Reorganization and that the
Reorganization remains consummated and effective on and as of
the Effective Date.
(vii) Certified copies of a certificate of amendment
or other confirmation from the Secretary of State of the State
of Delaware satisfactory to the Administrative Agent, the
Collateral Agent and the Lender Parties of the ratification
and effectiveness of the Parent Borrower Charter Amendment and
that the Parent Borrower Charter Amendment remains effective
on and as of the Effective Date.
(viii) A certificate of each Loan Party, signed on
behalf of such Loan Party by its Chief Financial Officer or
any Vice President or, in the case of any Foreign Subsidiary,
a Director and its Secretary or any Assistant Secretary, dated
the Effective Date (the statements made in which certificate
shall be true on and as of the Effective Date), certifying as
to (A) the absence of any amendments to the charter or other
constituent and governing documents of such Loan Party since
the date of the Secretary of State's certificate referred to
in Section 3.01(m)(iii), (B) a true and correct copy of the
bylaws of such Loan Party as in effect on the date on which
the resolutions referred to in 3.01(m)(ii) were adopted and on
the Effective Date, (C) the due incorporation and good
standing or valid existence of such Loan Party as a
corporation organized under the laws of the jurisdiction of
its incorporation, and the
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absence of any proceeding for the dissolution or liquidation
of such Loan Party, (D) the truth of the representations and
warranties contained in the Loan Documents, Reorganization
Documents, Corporate Reorganization Documents and Parent
Borrower Charter Amendment Documents as though made on and as
of the Effective Date and (E) the absence of any event
occurring and continuing, or resulting from the
Reorganization, the Parent Borrower Charter Amendment, the
Corporate Reorganization or the Effective Date Transactions,
that constitutes a Default.
(ix) A certificate of the Secretary or an Assistant
Secretary of each Loan Party certifying the names and true
signatures of the officers of such Loan Party authorized to
sign each Loan Document and each Related Document (dated on or
after May 1, 1999) to which it is or is to be a party and the
other documents to be delivered hereunder and thereunder.
(x) An amended and restated security agreement in
substantially the form of Exhibit D hereto (together with each
other security agreement and security agreement supplement
delivered pursuant to Section 5.01(o), in each case as amended
(including, without limitation, amended and restated),
supplemented or otherwise modified from time to time in
accordance with its terms, the "SECURITY AGREEMENT"), duly
executed by Holdings, each Borrower, each Domestic Guarantor
and IPC Canada, together with:
(A) to the extent not already held by the
Administrative Agent, certificates representing the
Pledged Shares referred to therein accompanied by
undated stock powers executed in blank and
instruments, including, without limitation, the
Intercompany Notes, evidencing the Pledged Debt
referred to therein indorsed in blank,
(B) executed copies of Uniform Commercial
Code financing statements, to be filed under the
Uniform Commercial Code of all additional
jurisdictions that the Administrative Agent may deem
necessary or desirable in order to perfect and
protect, and continue to perfect and protect, the
first priority liens and security interests created
under the Security Agreement, covering the Collateral
described in the Security Agreement,
(C) completed requests for information,
dated on or before the Effective Date, listing all
effective financing statements filed in the
jurisdictions referred to in clause (B) above that
name any Loan Party as debtor, together with copies
of such other financing statements,
(D) to the extent not previously delivered
to the Administrative Agent, duly executed copies of
the Collateral Assignments referred to in the
Security Agreement and evidence of the completion of
all recordings and
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filings of or with respect to the Intellectual
Property Collateral referred to in the Security
Agreement that the Administrative Agent may deem
necessary or desirable in order to perfect and
protect, and continue to perfect and protect, the
Liens on such Intellectual Property Collateral
created thereunder,
(E) evidence of the completion of all other
recordings and filings of or with respect to the
Security Agreement that the Administrative Agent may
deem necessary or desirable in order to perfect and
protect, and continue to perfect and protect, the
Liens created thereby,
(F) evidence of the insurance required by
the terms of the Security Agreement,
(G) to the extent not previously delivered
to the Administrative Agent, copies of the Assigned
Agreements referred to in, and set forth on Schedule
II to, the Security Agreement, together with a
consent to such assignment, in substantially the form
of Exhibit B to the Security Agreement, duly executed
by each party to such Assigned Agreements other than
the Loan Parties, and
(H) evidence that all other action that the
Administrative Agent may deem necessary or desirable
in order to perfect and protect, and continue to
perfect and protect, the first priority liens and
security interests created under the Security
Agreement has been taken (including, without
limitation, delivering duly executed Local Pledges to
the Administrative Agent).
(xi) Such debentures, security agreements, pledges,
mortgages, assignments, charges, other agreements and
documents and any amendments and restatements of or amendments
or variations to any of the foregoing (together with all other
debentures, security agreements, security agreement
supplements, pledges, mortgages, assignments, charges and
other agreements and documents delivered by any Foreign
Subsidiary pursuant to Section 5.01(o), in each case, as the
same may be amended (including, without limitation, amended
and restated), supplemented or otherwise modified in
accordance with its terms, the "FOREIGN SECURITY DOCUMENTS"),
in each case in form and substance satisfactory to the
Administrative Agent, as the Administrative Agent may request
to secure payment of all Obligations of the Specified
Subsidiaries and the other Foreign Guarantors under the Loan
Documents, duly executed by the applicable Foreign Guarantor,
together with:
(A) an amended and restated administrative
agency agreement in substantially the form of Exhibit
J hereto (as amended (including, without limitation,
amended and restated), supplemented or otherwise
modified from time to time in accordance with its
terms, the "ADMINISTRATIVE AGENCY
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AGREEMENT"), duly executed by the Sub Borrower and
the Administrative Agent, and
(B) evidence that all actions that may be
necessary or, in the reasonable discretion of the
Administrative Agent, desirable in order to perfect
and protect, and continue to perfect and protect, the
first priority liens, security interests, pledges and
charges created by the Foreign Security Documents
under the laws of the jurisdiction of the applicable
Foreign Guarantors have been taken.
(xii) An amended and restated guaranty in
substantially the form of Exhibit E-1 hereto (together with
each other guaranty and guaranty supplement delivered by a
Domestic Guarantor pursuant to Section 5.01(o), in each case
as amended (including, without limitation, amended and
restated), supplemented or otherwise modified from time to
time in accordance with its terms, the "DOMESTIC GUARANTY"),
duly executed by each Domestic Guarantor, and an amended and
restated guaranty in substantially the form of Exhibit E-2
hereto (together with each other guaranty and guaranty
supplement delivered by a Foreign Guarantor pursuant to
Section 5.01(o), in each case as amended (including, without
limitation, amended and restated), supplemented or otherwise
modified from time to time in accordance with its terms, the
"FOREIGN GUARANTY"), duly executed by each Foreign Guarantor.
(xiii) Certified copies of the Reorganization
Documents Corporate Reorganization Documents, Parent Borrower
Charter Amendment Documents and the No-Action Letter.
(xiv) An amendment to the Mortgage, in form and
substance satisfactory to the Administrative Agent, along with
such agreements, instruments or other documents and evidence
of the taking of all other actions that are necessary or
desirable in order to maintain the Liens on the property
described in the Mortgage securing all of the Obligations.
(xv) Such financial, business and other information
regarding each Loan Party and each of its Subsidiaries as the
Administrative Agent, the Collateral Agent, or the Lender
Parties (through the Administrative Agent) shall have
requested.
(xvi) Certificates, in substantially the form of
Exhibit G hereto, attesting to the Solvency of each Loan Party
(other than those Loan Parties set forth on Schedule
3.01(m)(xvi) (as to which no such certificates shall be
delivered)) on the Effective Date, both before and after
giving effect to the Effective Date Transactions, from its
chief financial officer or other authorized officer familiar
with the financial condition of such Loan Party.
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(xvii) Evidence of insurance naming the
Administrative Agent as additional insured and loss payee with
such responsible and reputable insurance companies or
associations, and in such amounts and covering such risks, as
is reasonably satisfactory to the Administrative Agent.
(xviii) To the extent not previously delivered to the
Administrative Agent, certified copies of each employment
agreement and other compensation arrangement with each
executive officer of each Loan Party and each of its
Subsidiaries as the Administrative Agent may request.
(xix) To the extent not previously delivered to the
Administrative Agent, certified copies of all Material
Contracts of each Loan Party and each of its Subsidiaries as
the Administrative Agent may request.
(xx) A Borrowing Base Certificate dated as of a
recent date which is acceptable to the Collateral Agent.
(xxi) A favorable opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇
LLP, counsel for Holdings, the Borrowers and the other
Domestic Guarantors, in form and substance reasonably
satisfactory to the Administrative Agent and as to such
matters as the Administrative Agent may reasonably request.
(xxii) A favorable opinion of Thacher, ▇▇▇▇▇▇▇▇ &
Wood, counsel for Holdings and the Parent Borrower, in form
and substance reasonably satisfactory to the Administrative
Agent, as to the Parent Borrower Charter Amendment and such
other matters as the Administrative Agent may reasonably
request.
(xxiii) A favorable opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ &
Finger, special Delaware counsel for Holdings and the Parent
Borrower, in form and substance reasonably satisfactory to the
Administrative Agent, as to the Parent Borrower Charter
Amendment and such other matters as the Administrative Agent
may reasonably
request.
(xxiv) A favorable opinion of such local, foreign and
special counsel for the Loan Parties as the Administrative may
request, all in form and substance reasonably satisfactory to
the Administrative Agent and as to such matters as the
Administrative Agent may reasonably request.
(n) The Administrative Agent shall have received such other
certificates, approvals, opinions, agreements, instruments or other
documents as the Administrative Agent, the Collateral Agent or any
Lender Party (through the Administrative Agent) shall have requested,
and all legal matters incident to such Borrowing shall be reasonably
satisfactory to the Administrative Agent and its counsel.
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SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING AND
ISSUANCE. The obligation of each Lender to make an Advance (other than a Letter
of Credit Advance made by the Issuing Bank, an L/C Issuer (in the case of an L/C
Issuer which is also a Lender) or a Lender pursuant to Section 2.03(c)) on the
occasion of each Borrowing (including the Borrowings made on the Effective
Date), and the obligation of the Issuing Bank or an L/C Issuer to issue a Letter
of Credit, and the obligation of the Issuing Bank to guarantee a Letter of
Credit issued by an L/C Issuer, shall be subject to the further conditions
precedent that on the date of such Borrowing or issuance or guarantee:
(a) The following statements shall be true and each of the
giving of the applicable Notice of Borrowing or Notice of Issuance and
the acceptance by the applicable Borrower of the proceeds of such
Borrowing or of such Letter of Credit shall constitute a representation
and warranty by such Borrower that both on the date of such notice and
on the date of such Borrowing or issuance or guarantee such statements
are true:
(i) the representations and warranties contained in
each Loan Document are true and correct on and as of such
date, before and after giving effect to such Borrowing or
issuance or guarantee and to the application of the proceeds
therefrom, as though made on and as of such date, other than
any such representations or warranties that, by their terms,
refer to a specific date other than the date of such Borrowing
or issuance or guarantee, in which case as of such specific
date;
(ii) no event has occurred and is continuing, or
would result from such Borrowing or issuance or guarantee or
from the application of the proceeds therefrom, that
constitutes a Default;
(iii) (A) in the case of any Working Capital Advance
to be made to the Parent Borrower or any issuance or any
guarantee of a Letter of Credit for the account of the Parent
Borrower, the sum of the Loan Values of the applicable
Eligible Collateral exceeds the aggregate principal amount of
the Working Capital Advances owing by the Parent Borrower PLUS
Letter of Credit Advances to be outstanding PLUS the aggregate
Available Amount of all Letters of Credit to be outstanding,
in each case after giving effect to such Advance or issuance
or guarantee, respectively, and (B) in the case of any Working
Capital Advance to be made to the Sub Borrower, the sum of the
Loan Values of the applicable Eligible Collateral exceeds the
aggregate principal amount of the Working Capital Advances
owing by the Sub Borrower after giving effect to such Advance;
and
(iv) after giving effect to such Borrowing, issuance
or guarantee, the Obligations hereunder will not exceed the
maximum amount of Indebtedness (as such term is defined in the
Senior Notes Indenture) permitted to be incurred under clause
(i) of the second paragraph of Section 4.03(a) of the Senior
Notes Indenture.
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(b) If, after giving effect to such Borrowing, issuance or guarantee,
the sum of (i) the aggregate principal amount of all Advances
outstanding at such time PLUS (ii) the aggregate Available Amount of
all Letters of Credit outstanding at such time would exceed
$55,000,000, the Parent Borrower shall have delivered to the
Administrative Agent and Lenders an officer's certificate, signed by
its chief financial officer and in form and substance satisfactory to
the Administrative Agent, certifying that after giving effect to such
Borrowing, issuance or guarantee, the Obligations hereunder will not
exceed the maximum amount of Indebtedness (as such term is defined in
the Senior Notes Indenture) permitted to be incurred under clause (i)
of the second paragraph of Section 4.03(a) of the Senior Notes
Indenture, and such certificate shall include, in detail and with
specificity, the determination in accordance with such clause of the
Senior Notes Indenture of the net book value of accounts receivable and
inventory which determination shall evidence to the Administrative
Agent and Lenders the then maximum amount of Indebtedness (as such term
is defined in the Senior Notes Indenture) permitted to be incurred
under such clause (i) of the second paragraph of Section 4.03(a) of the
Senior Notes Indenture.
(c) The Administrative Agent shall have received such other
certificates, approvals, opinions, agreements, instruments or documents
as the Administrative Agent or any Lender Party (through the
Administrative Agent) shall have reasonably requested.
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01 and
Section 3.02 on the Effective Date, each Lender Party shall be deemed to have
consented to, approved or accepted or to be satisfied with each action, document
or other matter required under such Sections to be consented to or approved by
or acceptable or satisfactory to the Lender Parties unless an officer of the
Administrative Agent responsible for the transactions contemplated by the Loan
Documents shall have received notice from such Lender Party prior to the
Effective Date specifying its objection thereto and, if any Borrowing is made on
the Effective Date, such Lender Party shall not have made available to the
Administrative Agent such Lender Party's ratable portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF HOLDINGS AND
THE BORROWERS. Holdings and each Borrower represents and warrants as follows:
(a) Each Loan Party (other than IPC UK) and each of its
Subsidiaries (i) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its
incorporation and (ii) is duly qualified and in good standing as a
foreign corporation in each other jurisdiction in which it owns or
leases property or in which the conduct of its business requires it to
so qualify or be licensed except where the failure to so
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qualify or be licensed could not have a Material Adverse Effect. IPC UK
is an unlimited liability company, duly organized, validly existing and
in good standing under the laws of the jurisdiction of its
organization. Each Loan Party and each of its Subsidiaries has all
requisite corporate power and authority (including, without limitation,
all governmental licenses, permits and other approvals) to own or lease
and operate its properties and to carry on its business as now
conducted and as proposed to be conducted. All of the outstanding
capital stock of each Loan Party has been validly issued, is fully paid
and non-assessable and is owned by those Persons listed on Schedule
4.01(a) hereto in the amounts specified thereon free and clear of all
Liens, except those created under the Collateral Documents. Each of
Holdings and IPC Holdings Merger Sub were created solely for purposes
of the Reorganization and, prior to the Reorganization, neither
Holdings nor IPC Holdings Merger Sub engaged in any business, had any
assets or incurred any Debt or had any other liabilities, other than by
virtue of its incorporation and by being party to the Reorganization
and the Related Documents with respect thereto.
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of Holdings and each other Loan
Party, showing as of the date of this Agreement (as to each such
Subsidiary), the jurisdiction of its incorporation, the number of
shares of each class of capital stock authorized and the number
outstanding, the percentage of the outstanding shares of each such
class owned (directly or indirectly) by such Loan Party and the number
of shares covered by all outstanding options, warrants, rights of
conversion or purchase and similar rights. All of the outstanding
capital stock of all of such Subsidiaries has been validly issued, is
fully paid and non-assessable and, except as otherwise expressly
permitted hereunder in respect of IXnet Holdings, is owned by such Loan
Party or one or more of its Subsidiaries free and clear of all Liens,
except those created under the Loan Documents.
(c) The execution, delivery and performance by each Loan Party
of each Loan Document and each Related Document to which it is or is to
be a party, and the consummation of the Reorganization, the Corporate
Reorganization, the Parent Borrower Charter Amendment and the Effective
Date Transactions are within such Loan Party's corporate powers, have
been duly authorized by all necessary corporate action, and do not (i)
contravene such Loan Party's charter or bylaws or other equivalent
organizational documents, (ii) violate any law (including, without
limitation, the DGCL, the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, and the Racketeer
Influenced and Corrupt Organizations Chapter of the Organized Crime
Control Act of 1970), rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System or
any rule or regulation promulgated by the SEC), order, writ, judgment,
injunction, decree, determination or award, (iii) conflict with or
result in the breach of, or constitute a default under, any loan
agreement, indenture, mortgage, deed of trust or other instrument or
material contract or material lease binding on or affecting any Loan
Party, any of its Subsidiaries or any of their respective properties or
(iv) except for the Liens created under the Loan Documents, result in
or require the creation or imposition of
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any Lien upon or with respect to any of the properties of any Loan
Party or any of its Subsidiaries. No Loan Party nor any of its
Subsidiaries is in violation of any such law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award or in breach
of any such contract, loan agreement, indenture, mortgage, deed of
trust, lease or other instrument, the violation or breach of which
could have a Material Adverse Effect. Each of the Reorganization, the
Corporate Reorganization and the Parent Borrower Charter Amendment does
not conflict with, result in the breach of, constitute a default under,
constitute a "change of control" under or permit the indenture trustee
or any noteholder to take any action under, the Senior Notes Indenture.
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of any
Loan Document or any Related Document to which it is or is to be a
party, or for the consummation of the Reorganization, the Corporate
Reorganization, the Parent Borrower Charter Amendment and the Effective
Date Transactions, (ii) the grant by any Loan Party of the Liens
granted by it pursuant to the Collateral Documents, (iii) the
perfection or maintenance of the Liens created by the Collateral
Documents (including the first priority nature thereof) or (iv) the
exercise by any of the Agents or any of the Lender Parties of its
rights under the Loan Documents or the remedies in respect of the
Collateral pursuant to the Collateral Documents, except for the
authorizations, approvals, actions, notices and filings listed on
Schedule 4.01(d) hereto, all of which have been duly obtained, taken,
given or made and are in full force and effect. All applicable waiting
periods in connection with the Reorganization, the Corporate
Reorganization, the Parent Borrower Charter Amendment and the Effective
Date Transactions have expired without any action having been taken by
any competent authority restraining, preventing or imposing materially
adverse conditions upon any of the Reorganization, the Corporate
Reorganization, the Parent Borrower Charter Amendment or the Effective
Date Transactions or the rights of the Loan Parties or their
Subsidiaries freely to transfer or otherwise dispose of, or to create
any Lien on, any properties now owned or hereafter acquired by any of
them.
(e) This Agreement, each of the Notes, each other Loan
Document and each Related Document has been duly executed and delivered
by each Loan Party party thereto. This Agreement, each of the Notes,
each other Loan Document and each Related Document is the legal, valid
and binding obligation of each Loan Party party thereto, enforceable
against such Loan Party in accordance with its terms, subject to the
effect of any applicable bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar law affecting creditors' rights generally.
(f) The Consolidated balance sheet of the Parent Borrower and
its Subsidiaries as at September 30, 1998, and the related Consolidated
statement of income and Consolidated statement of cash flows of the
Parent Borrower and its Subsidiaries for the fiscal year then ended,
accompanied by an unqualified opinion of PriceWaterhouseCoopers
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L.L.P., independent public accountants, and the consolidating balance
sheet of the Parent Borrower and its Subsidiaries as at September 30,
1998, and the related consolidating statement of income of the Parent
Borrower and its Subsidiaries for the fiscal year then ended, duly
certified by the chief financial officer of the Parent Borrower, and
the Consolidated and consolidating balance sheets of the Parent
Borrower and its Subsidiaries as at December 31, 1998 and March 31,
1999, and the related Consolidated and consolidating statements of
income and Consolidated statement of cash flows of the Parent Borrower
and its Subsidiaries for the three months and six months, respectively,
then ended, duly certified by the chief financial officer of the Parent
Borrower, copies of which have been furnished to each Lender Party,
fairly present, subject, in the case of said balance sheets as at
December 31, 1998 and March 31, 1999, and said statements of income and
cash flows for the three months and six months, respectively, then
ended, to year-end audit adjustments, the Consolidated and
consolidating financial condition of the Parent Borrower and its
Subsidiaries as at such dates and the Consolidated and consolidating
results of the operations of the Parent Borrower and its Subsidiaries
for the periods ended on such dates, all in accordance with generally
accepted accounting principles applied on a consistent basis. Since
September 30, 1998, there has been no Material Adverse Change.
(g) The Consolidated forecasted balance sheets, income
statements and cash flows statements of the Parent Borrower and its
Subsidiaries delivered to the Lender Parties pursuant to Section 5.03
were prepared in good faith on the basis of the assumptions stated
therein, which assumptions were fair in the light of conditions
existing at the time of delivery of such forecasts, and represented, at
the time of delivery, the Parent Borrower's best estimate of its future
financial performance.
(h) None of the information, schedules, exhibits or reports
furnished by or on behalf of any Loan Party to any Agent or any Lender
Party in connection with the negotiation of this Agreement and the
other Loan Documents or pursuant to the terms of this Agreement or any
of the other Loan Documents contained any untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements made therein not misleading.
(i) There is no action, suit, investigation, litigation or
proceeding affecting Holdings, either Borrower, any other Loan Party or
any of their respective Subsidiaries, including any Environmental
Action, pending or, to the best of Holdings' or either Borrower's
knowledge, threatened before any court, governmental agency or
arbitrator that (i) could be reasonably likely to have a Material
Adverse Effect or (ii) purports to affect the legality, validity,
enforceability, or effectiveness of the Reorganization, the Corporate
Reorganization, the Parent Borrower Charter Amendment, the Effective
Date Transactions, any of the Prior Transactions, this Agreement, any
Note, any other Loan Document or any Related Document or the
consummation of the Reorganization, the Corporate Reorganization, the
Parent Borrower Charter Amendment, the Effective Date Transactions and
any of the Prior Transactions.
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(j) No proceeds of any Advance or drawings under any Letter of
Credit will be used to acquire any equity security of a class that is
registered pursuant to Section 12 of the Securities Exchange Act of
1934 (other than, to the extent applicable, in connection with a
Non-hostile Acquisition).
(k) Neither Borrower is engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, no
proceeds of any Advance made to either Borrower will be used to
purchase or carry any Margin Stock or to extend credit to others for
the purpose of purchasing or carrying any Margin Stock, and following
application of the proceeds of each Advance or drawing under each
Letter of Credit, not more than 25 percent of the value of the assets
(either of the Parent Borrower only or of the Parent Borrower and its
Subsidiaries on a Consolidated basis) subject to the provisions of
Section 5.02(a) or 5.02(e) or subject to any restriction contained in
any agreement or instrument between the Parent Borrower and any Lender
Party or any Affiliate of any Lender Party relating to Debt within the
scope of Section 6.01(e) will be Margin Stock.
(l) With respect to each scheme or arrangement mandated by a
government other than the United States (a "FOREIGN GOVERNMENT SCHEME
OR ARRANGEMENT") and with respect to each employee benefit plan
maintained or contributed to by any Loan Party or any Subsidiary of any
Loan Party that is not subject to United States law (a "FOREIGN PLAN"),
except as could not be reasonably likely in the aggregate to have a
Material Adverse Effect:
(i) Any employer and employee contribution required
by law or by the terms of any Foreign Government Scheme or
Arrangement or any Foreign Plan have been made, or, if
applicable, accrued, in accordance with normal accounting
practices.
(ii) The fair market value of the assets of each
funded Foreign Plan, the liability of each insurer for any
Foreign Plan funded through insurance or the book reserve
established for any Foreign Plan, together with any accrued
contributions, is sufficient to procure or provide for the
accrued benefit obligations, as of the date hereof, with
respect to all current and former participants in such Foreign
Plan according to the actuarial assumptions and valuations
most recently used to account for such obligations in
accordance with applicable generally accepted accounting
principles.
(iii) Each Foreign Plan required to be registered has
been registered and has been maintained in good standing with
applicable regulatory authorities.
(m) No ERISA Event has occurred or is reasonably expected to
occur with respect to any Plan that has had or could be reasonably
likely to have a Material Adverse Effect.
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(n) Schedule B (Actuarial Information) to the most recent
annual report (Form 5500 Series) for each Plan, copies of which have
been filed with the Internal Revenue Service and, with respect to any
Plan of the Loan Parties, furnished to the Agents and the Lender
Parties, is complete and accurate and fairly presents the funding
status of such Plan, and since the date of such Schedule B there has
been no material adverse change in such funding status.
(o) Neither any Loan Party nor any ERISA Affiliate has
incurred or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan that has had or could be reasonably likely to
have a Material Adverse Effect.
(p) Neither any Loan Party nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or has been terminated, within the meaning of
Title IV of ERISA, where such reorganization or termination has had or
could be reasonably likely to have a Material Adverse Effect, and no
such Multiemployer Plan is reasonably expected to be in reorganization
or to be terminated, within the meaning of Title IV of ERISA, where
such reorganization or termination could be reasonably likely to have a
Material Adverse Effect.
(q) Except as set forth in the financial statements referred
to in this Section 4.01 and in Section 5.03, the Loan Parties and their
respective Subsidiaries have no liability with respect to "expected
post retirement benefit obligations" within the meaning of Statement of
Financial Accounting Standards No. 106 that has had or could be
reasonably likely to have a Material Adverse Effect.
(r) Neither the business nor the properties of any Loan Party
or any of its Subsidiaries are affected by any fire, explosion,
accident, strike, lockout or other labor dispute, drought, storm, hail,
earthquake, embargo, act of God or of the public enemy or other
casualty (whether or not covered by insurance) that could be reasonably
likely to have a Material Adverse Effect.
(s) The operations and properties of each Loan Party and each
of its Subsidiaries comply in all material respects with all applicable
Environmental Laws and Environmental Permits, except for any
noncompliance that is not reasonably likely to have a Material Adverse
Effect, all past noncompliance with such Environmental Laws and
Environmental Permits has been resolved without material ongoing
obligations or costs, and no circumstances exist that would be
reasonably likely to (i) form the basis of an Environmental Action
against any Loan Party or any of its Subsidiaries or any of their
properties that could be reasonably likely to have a Material Adverse
Effect or (ii) cause any such property to be subject to any material
restrictions on ownership, occupancy, use or transferability under any
Environmental Law.
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(t) None of the properties currently or formerly owned or
operated by any Loan Party or any of its Subsidiaries is listed or, to
the knowledge of any Loan Party, proposed for listing on the NPL or on
the CERCLIS or any analogous foreign, state or local list; there are no
and never have been any underground or aboveground storage tanks or any
surface impoundments, septic tanks, pits, sumps or lagoons in which
Hazardous Materials are being or have been treated, stored or disposed
on any property currently owned or operated by any Loan Party or any of
its Subsidiaries or, to the best of its knowledge, on any property
formerly owned or operated by any Loan Party or any of its Subsidiaries
which could be reasonably likely to have a Material Adverse Effect;
there is no asbestos or asbestos- containing material on any property
currently owned or operated by any Loan Party or any of its
Subsidiaries which could be reasonably likely to have a Material
Adverse Effect; and Hazardous Materials have not been released,
discharged or disposed of on any property currently or formerly owned
or operated by any Loan Party or any of its Subsidiaries in a manner
that could be reasonably likely to result in a Material Adverse Effect.
(u) Neither any Loan Party nor any of its Subsidiaries is
undertaking or has completed, either individually or together with
other potentially responsible parties, any investigation or assessment
or remedial or response action relating to any actual or threatened
release, discharge or disposal of Hazardous Materials at any site,
location or operation, either voluntarily or pursuant to the order of
any governmental or regulatory authority or the requirements of any
Environmental Law which could be reasonably likely to have a Material
Adverse Effect; and all Hazardous Materials generated, used, treated,
handled or stored at, or transported to or from, any property currently
or formerly owned or operated by any Loan Party or any of its
Subsidiaries have been disposed of in a manner not reasonably expected
to result in a Material Adverse Effect.
(v) Neither any Loan Party nor any of its Subsidiaries is a
party to any indenture, loan or credit agreement or any lease or other
agreement or instrument or subject to any charter, bylaw or other
corporate restriction that could be reasonably likely to have a
Material Adverse Effect.
(w) The Collateral Documents create a valid security interest
in the Collateral, securing the payment of the Secured Obligations; all
filings and other actions necessary or desirable to perfect and
protect, and to continue to perfect and protect, such security interest
have been duly taken and the Administrative Agent, for the benefit of
the Secured Parties, has a perfected first priority security interest
in the Collateral. The Loan Parties are the legal and beneficial owners
of the Collateral free and clear of any Lien, except for the Liens and
security interests created or permitted under the Loan Documents.
(x) Each Loan Party and each of its Subsidiaries has filed,
has caused to be filed or has been included in all tax returns
(federal, state, local and foreign) required to be filed and has paid
all taxes shown thereon to be due, together with applicable interest
and penalties (except for extensions that have been duly filed).
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(y) There are no pending audits, examinations, investigations
or other proceedings in respect of federal, state, local or foreign
taxes relating to any Loan Party or any of its Subsidiaries which, if
determined adversely to such Loan Party or such Subsidiary, could
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
(z) There are no deficiencies or claims in respect of federal,
state, local or foreign taxes relating to any Loan Party or any of its
Subsidiaries which, if such deficiencies or claims were resolved
against such Loan Party or such Subsidiary, could reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect.
(aa) The Reorganization was not, and will not be, taxable to
Holdings, the Parent Borrower, any of their respective Subsidiaries or
any of their respective stockholders. The Corporate Reorganization was
not, and will not be, taxable to Holdings, the Parent Borrower, any of
their respective Subsidiaries or any of their respective stockholders
except to the extent as could not reasonably be expected, individually
or in the aggregate, to have a Material Adverse Effect.
(bb) Neither any Loan Party nor any of its Subsidiaries is an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended. Neither the
making of any Advances, nor the issuance of any Letters of Credit, nor
the application of the proceeds or repayment thereof by either
Borrower, nor the consummation of the other transactions contemplated
hereby, will violate any provision of such Act or any rule, regulation
or order of the Securities and Exchange Commission thereunder.
(cc) Each Loan Party (other than those Loan Parties set forth
on Schedule 3.01(m)(xvi) (as to which no representation as to Solvency
is made)) is, individually and together with its Subsidiaries, Solvent.
(dd) Set forth on Schedule 4.01(dd) hereto is a complete and
accurate list of all real property owned by any Loan Party or any of
its Subsidiaries, showing as of the date hereof the street address,
county or other relevant jurisdiction, State, country (if not the
United States of America), record owner and book and fair value
thereof. Such Loan Party or such Subsidiary, as applicable, has good,
marketable and insurable fee simple title to such real property, free
and clear of all Liens, other than Liens created or permitted by the
Loan Documents.
(ee) Set forth on Schedule 4.01(ee) hereto is a complete and
accurate list of all Material Contracts of each Loan Party and each of
its Subsidiaries, showing as of the date hereof the parties, subject
matter and term thereof and a complete and accurate list of all
employment agreements with each executive officer of each Loan Party
and each of its Subsidiaries. Each such Material Contract has been duly
authorized, executed and delivered
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by all parties thereto, has not been amended or otherwise modified, is
in full force and effect and is binding upon and enforceable against
all parties thereto in accordance with its terms, and there exists no
default under any Material Contract by any party thereto.
(ff) Set forth on Schedule 4.01(ff) hereto is a complete and
accurate list of all Investments (other than equity Investments in
Subsidiaries) held by any Loan Party or any of its Subsidiaries,
showing as of the date hereof the amount, obligor or issuer and
maturity, if any, thereof.
(gg) Set forth on Schedule 4.01(gg) hereto is a complete and
accurate list of all trade names and all registered patents,
trademarks, service marks and copyrights, if any, and all applications
therefor and licenses thereof of each Loan Party and each of its
Subsidiaries, showing as of the date of this Agreement the jurisdiction
in which registered, the registration number, the date of registration
and the expiration date.
(hh) No Excluded Subsidiary holds assets or has annual
revenues or net income in the aggregate in excess of $150,000 and the
aggregate amount of assets, revenues or net income of all Excluded
Subsidiaries does not exceed $1,000,000, in each case, determined based
on the most recent financial statements required to be delivered to the
Lender Parties pursuant to Section 5.03(b) or (c), as the case may be.
No Excluded Subsidiary is engaged in any business of any kind, other
than the holding of licenses and/or acting as agent for a Loan Party.
ARTICLE V
COVENANTS OF THE LOAN PARTIES
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or any Lender
Party shall have any Commitment hereunder, Holdings and each Borrower shall:
(a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA, federal, state, local and
foreign tax laws, rules, regulations and orders, the Securities Act of
1933, as amended, the Securities Exchange Act of 1934, as amended, and
the Racketeer Influenced and Corrupt Organizations Chapter of the
Organized Crime Control Act of 1970.
(b) PAYMENT OF TAXES, ETC. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims
in excess of $1,000,000 in the aggregate that, if unpaid, might by law
become a Lien upon
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its property; PROVIDED, HOWEVER, that no Loan Party nor any of its
Subsidiaries shall be required to pay or discharge any such tax,
assessment, charge or claim that is being contested in good faith and
by proper proceedings and as to which appropriate reserves are being
maintained, unless and until any Lien resulting therefrom attaches to
its property and becomes enforceable against its other creditors.
(c) COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply, and cause each
of its Subsidiaries and all lessees and other Persons operating or
occupying its properties to comply, in all material respects, with all
applicable Environmental Laws and Environmental Permits; obtain and
renew, and cause each of its Subsidiaries to obtain and renew, all
Environmental Permits necessary for its operations and properties; and
conduct, and cause each of its Subsidiaries to conduct, any
investigation, study, sampling and testing, and undertake any cleanup,
removal, remedial or other action necessary to remove and clean up all
Hazardous Materials from any of its properties, to the extent required
by Environmental Laws; PROVIDED, HOWEVER, that no Loan Party nor any of
its Subsidiaries shall be required to undertake any such cleanup,
removal, remedial or other action to the extent that its obligation to
do so is being contested in good faith and by proper proceedings and
appropriate reserves are being maintained with respect to such
circumstances.
(d) MAINTENANCE OF INSURANCE. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which such
Loan Party or such Subsidiary operates.
(e) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain,
its existence, legal structure, legal name, rights (charter and
statutory), permits, licenses, approvals, privileges and franchises;
PROVIDED, HOWEVER, that the Parent Borrower and its Subsidiaries may
consummate any merger or consolidation permitted under Section 5.02(d)
and the Parent Borrower and its Subsidiaries may sell or otherwise
dispose of assets to the extent permitted under Section 5.02(e); and
PROVIDED, FURTHER that neither the Parent Borrower nor any of its
Subsidiaries shall be required to preserve any right, permit, license,
approval, privilege or franchise if the Board of Directors of the
Parent Borrower or such Subsidiary shall determine that the
preservation thereof is no longer desirable in the conduct of the
business of the Parent Borrower or such Subsidiary, as the case may be,
and that the loss thereof is not disadvantageous in any material
respect to Holdings, the Parent Borrower, any of its Subsidiaries or
the Lender Parties.
(f) VISITATION RIGHTS. Upon reasonable notice and during
regular business hours, from time to time, permit any of the Agents or
any of the Lender Parties or any agents or representatives thereof, to
examine and make copies of and abstracts from the records and books of
account of, and visit the properties of, the respective Loan Parties
and any of their
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respective Subsidiaries, and to discuss the affairs, finances and
accounts of the Loan Parties and any of their respective Subsidiaries
with any of their officers or directors and with their independent
certified public accountants; without limitation of the foregoing, the
Collateral Agent may conduct audits of the Collateral up to two times
in each Fiscal Year (unless an Event of Default shall have occurred and
be continuing, in which case the right of the Collateral Agent to
perform audits of the Collateral shall not be so limited), including,
without limitation, inspection, reviews, evaluation and performance of
counts of the Receivables, Inventory and other Collateral, PROVIDED
that so long as no Event of Default shall have occurred and be
continuing, the Collateral Agent shall coordinate its audits to
coincide with the Parent Borrower's regularly scheduled internal cycle
counts, PROVIDED, FURTHER, that in connection with any audit by the
Collateral Agent, the Parent Borrower shall reimburse each auditor of
the Collateral Agent at a rate of $650 per day plus actual
out-of-pocket expenses (including, without limitation, travel
expenses), PROVIDED, STILL, FURTHER, that the Parent Borrower shall, at
the request of the Collateral Agent, arrange for PriceWaterhouseCoopers
L.L.P. or, if an Event of Default shall have occurred and be
continuing, permit the Collateral Agent to perform test verifications
of the Collateral at such times as the Collateral Agent may request but
in any event, so long as no Event of Default shall have occurred and be
continuing, not more than two times in any Fiscal Year.
(g) PREPARATION OF ENVIRONMENTAL REPORTS. At the request of
the Administrative Agent or Required Lenders from time to time (i) upon
the occurrence and during the continuance of a Default, (ii) in the
case of the Parent Borrower's or any of its Subsidiaries' acquisition
of real property that could be reasonably likely to result in a
Material Adverse Effect, and (iii) at any time when the Administrative
Agent or any Lender believes after reasonable inquiry that a condition
or event exists or has occurred on any real property owned or operated
by the Parent Borrower or any of its Subsidiaries that could be
reasonably likely to result in a Material Adverse Effect, provide, or
cause such Subsidiary to provide, to the Agents and the Lender Parties
within 60 days after such request, at the expense of the Parent
Borrower or such Subsidiary, an environmental site assessment report
for any of its or its Subsidiaries' properties described in such
request, prepared by an environmental consulting firm acceptable to the
Administrative Agent, indicating the presence or absence of Hazardous
Materials and the estimated cost of any compliance, removal or remedial
action in connection with any Hazardous Materials on such properties;
without limiting the generality of the foregoing, if the Administrative
Agent or Required Lenders determine at any time that a material risk
exists that any such report will not be provided within the time
referred to above and the Administrative Agent or Required Lenders will
be materially prejudiced by any such delay, the Administrative Agent or
Required Lenders, as the case may be, may retain an environmental
consulting firm to prepare such report at the expense of the Parent
Borrower, and the Parent Borrower hereby grants and agrees to cause any
Subsidiary that owns any property described in such request to grant to
the Agents, the Lender Parties, such firm and any agents or
representatives thereof, subject to the rights of tenants, access to
enter onto their respective properties to undertake such an assessment;
PROVIDED, HOWEVER, that no such Persons shall unreasonably interfere
with the operations conducted at such
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property and the Parent Borrower shall be given at least 2 Business
Days' notice prior to such undertaking.
(h) KEEPING OF BOOKS. Keep, and cause each of its Subsidiaries
to keep, proper books of record and account, in which full and correct
entries shall be made of all financial transactions and the assets and
business of each Loan Party and each Subsidiary in accordance with
generally accepted accounting principles in effect from time to time.
(i) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its
properties that are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted.
(j) COMPLIANCE WITH TERMS OF LEASEHOLDS. Make all payments and
otherwise perform all obligations in respect of all leases of real
property to which any Loan Party or any of its Subsidiaries is a party,
keep such leases in full force and effect and not allow such leases to
lapse or be terminated or any rights to renew such leases to be
forfeited or canceled, notify the Administrative Agent of any default
by any party with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and
cause each of its Subsidiaries to do so, except, in any case, where the
failure to do so, either individually or in the aggregate, could not be
reasonably expected to have a Material Adverse Effect.
(k) PERFORMANCE OF RELATED DOCUMENTS. Perform and observe all
of the terms and provisions of each Related Document to be performed or
observed by it, maintain each such Related Document in full force and
effect, enforce such Related Document in accordance with its terms,
take all such action to such end as may be from time to time requested
by the Administrative Agent and, upon request of the Administrative
Agent, make to each other party to each such Related Document such
demands and requests for information and reports or for action as any
Loan Party is entitled to make under such Related Document, except, in
any case, where the failure to do so, either individually or in the
aggregate, could not be reasonably expected to have a Material Adverse
Effect.
(l) PERFORMANCE OF MATERIAL CONTRACTS. Perform and observe all
of the terms and provisions of each Material Contract to be performed
or observed by it, maintain each such Material Contract in full force
and effect, enforce each such Material Contract in accordance with its
terms, take all such action to such end as may be from time to time
requested by the Administrative Agent and, upon request of the
Administrative Agent, make to each other party to each such Material
Contract such demands and requests for information and reports or for
action as any Loan Party is entitled to make under such Material
Contract, and cause each of its Subsidiaries to do so, except, in any
case, where the failure to do so, either individually or in the
aggregate, could not be reasonably expected to have a Material Adverse
Effect.
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(m) TRANSACTIONS WITH AFFILIATES. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under
this Agreement and the other Loan Documents with any of their
Affiliates (other than immaterial transactions entered into in the
ordinary course of business in accordance with past practices with
Affiliates that are Loan Parties) on terms that are fair and reasonable
and no less favorable to the applicable Loan Party or Subsidiary than
it would otherwise obtain in a comparable arm's-length transaction with
a Person not an Affiliate.
(n) CASH CONCENTRATION ACCOUNTS. Maintain, and cause each of
its Domestic Subsidiaries and the Specified Subsidiaries to maintain
(to the extent such Domestic Subsidiaries and Specified Subsidiaries
maintain any deposit accounts), cash concentration accounts and Pledged
Accounts (as defined in the Security Agreement) into which all proceeds
of Collateral are paid with one or more banks acceptable to the
Administrative Agent that shall have accepted the assignment of such
accounts to the Administrative Agent pursuant to the Security
Agreement.
(o) COVENANT TO GUARANTEE OBLIGATIONS AND GIVE SECURITY. Upon
(v) notice from the Parent Borrower to the Administrative Agent that it
intends to cause an Excluded Subsidiary to become a Loan Party, (w) the
request of the Administrative Agent or the Required Lenders following
the occurrence and during the continuance of a Default, (x) the
formation or acquisition of any new direct or indirect Subsidiary
(other than an Excluded Subsidiary) by any Loan Party, (y) the
acquisition of any personal property by any Loan Party, and such
property, in the reasonable opinion of the Administrative Agent, shall
not be subject to a perfected first priority security interest in favor
of the Administrative Agent for the benefit of the Secured Parties, or
(z) the request of the Administrative Agent or the Required Lenders at
any time with respect to any or all of the real property listed on
Schedule 4.01(dd) hereto or any other real or personal property owned
or leased by any Loan Party or any of its Subsidiaries from time to
time, then each Loan Party shall, in each case at such Loan Party's
expense:
(i) in connection with an Excluded Subsidiary
becoming a Loan Party or the formation or acquisition of a
Subsidiary, within 10 days after such notice, request,
formation or acquisition, cause each such Subsidiary, and
cause each direct and indirect parent of such Subsidiary (if
it has not already done so), to duly execute and deliver to
the Administrative Agent, if such Subsidiary is a Domestic
Subsidiary, a Domestic Guaranty or guaranty supplement
guaranteeing the Obligations of the Borrowers and the other
Loan Parties under the Loan Documents and, if such Subsidiary
is Foreign Subsidiary, a Foreign Guaranty or guaranty
supplement guaranteeing the Obligations of the Specified
Subsidiaries and the other Foreign Subsidiaries under the Loan
Documents, in each case, in substantially the form of Exhibit
E-1 or Exhibit E-2 hereto, as applicable, or otherwise in form
and substance satisfactory to the Administrative Agent (except
to the extent that any such Guaranty
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by a Subsidiary of any Loan Party would result in material
adverse tax consequences to such Loan Party or any of its
Subsidiaries),
(ii) within 10 days after such notice, request,
formation or acquisition, furnish to the Administrative Agent
a description of the real and personal properties of such Loan
Party and its Subsidiaries in detail satisfactory to the
Administrative Agent,
(iii) within 15 days after such notice, request,
formation or acquisition, duly execute and deliver, and cause
each such Subsidiary and each direct and indirect parent of
such Subsidiary (if it has not already done so) to duly
execute and deliver, to the Administrative Agent security
agreement supplements, mortgages, pledges, assignments,
charges, debentures and other security agreements, as
specified by and in form and substance satisfactory to the
Administrative Agent, securing payment of all the obligations
of the applicable Loan Party, such Subsidiary or such parent,
as the case may be, under the Loan Documents and constituting
Liens on all such properties (except to the extent that any
pledge of the stock of a non-U.S. Subsidiary of a Loan Party
would result in material adverse tax consequences to such Loan
Party or any of its Subsidiaries),
(iv) within 30 days after such notice, request,
formation or acquisition, take, and cause such Subsidiary or
such parent to take, whatever actions (including, without
limitation, the recording of mortgages, the filing of Uniform
Commercial Code financing statements, the giving of notices
and the endorsement of notices on title documents) that may be
necessary or advisable in the opinion of the Administrative
Agent to vest in the Administrative Agent (or in any
representative of the Administrative Agent designated by it)
valid and perfected Liens on the properties purported to be
subject to the mortgages, pledges, assignments, charges,
debentures and security agreements delivered pursuant to this
Section 5.01(o)(iv), enforceable against all third parties in
accordance with their terms,
(v) within 60 days after such notice, request,
formation or acquisition, deliver to the Administrative Agent,
upon the request of the Administrative Agent in its sole
discretion, a signed copy of a favorable opinion, addressed to
the Agents and the other Secured Parties, of counsel for the
Loan Parties acceptable to the Administrative Agent as to the
matters contained in clauses (i), (ii) and (iii) above, as to
such guaranties, mortgages, pledges, assignments, charges,
debentures and security agreements being legal, valid and
binding obligations of each Loan Party party thereto
enforceable in accordance with their terms, as to the matters
contained in clause (iv) above, as to such recordings,
filings, notices, endorsements and other actions being
sufficient to create valid and perfected first priority Liens
on such properties and as to such other matters as the
Administrative Agent may reasonably request,
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(vi) as promptly as practicable after such notice,
request, formation or acquisition, deliver, upon the request
of the Administrative Agent in its sole discretion, to the
Administrative Agent with respect to each parcel of real
property owned or held by the entity that is the subject of
such request, formation or acquisition surveys and
engineering, soils and other reports, and environmental
assessment reports, title reports, each in scope, form and
substance satisfactory to the Administrative Agent; PROVIDED,
HOWEVER, that, in furtherance and not in limitation of the
foregoing, to the extent that any Loan Party or any of its
Subsidiaries shall have otherwise received any of the
foregoing items with respect to such real property, such items
shall promptly after the receipt thereof be delivered to the
Administrative Agent,
(vii) upon the occurrence and during the continuance
of a Default, promptly cause to be deposited any and all cash
dividends paid or payable to it or any of its Subsidiaries
from any of its Subsidiaries from time to time into the L/C
Cash Collateral Account, and with respect to all other
dividends paid or payable to it or any of its Subsidiaries
from time to time, promptly execute and deliver, or cause such
Subsidiary to promptly execute and deliver, as the case may
be, any and all further instruments and take or cause such
Subsidiary to take, as the case may be, all such other actions
as the Administrative Agent may deem necessary or desirable in
order to obtain and maintain from and after the time such
dividend is paid or payable a perfected, first priority lien
on and security interest in such dividends,
(viii) at any time following the occurrence of a
Default, upon the request of the Administrative Agent,
promptly cause each of the Foreign Subsidiaries which is
capable of doing so without material adverse federal income
tax consequences and is then legally permitted to do so under
applicable foreign law (A) to execute and deliver, to the
Administrative Agent, a guaranty (or supplement to the
Domestic Guaranty) guaranteeing all Obligations of the
Borrowers, Holdings and all other Loan Parties, including,
without limitation, the Domestic Subsidiaries, under the Loan
Documents, (B) to execute and deliver, to the Administrative
Agent, security agreements, security agreement supplements,
mortgages, pledges, assignments, charges, debentures,
debenture supplements and other security agreements, as
specified by and in form and substance satisfactory to the
Administrative Agent, securing payment of all Obligations of
the Borrowers, Holdings and all other Loan Parties, including,
without limitation, the Domestic Subsidiaries, under the Loan
Documents and constituting Liens on all properties of such
Foreign Subsidiary and (C) to take, whatever actions
(including, without limitation, the recording of security
agreements, mortgages, pledges, assignments, charges,
debentures and other security agreements or supplements
thereto, the giving of notices and the endorsement of notices
on title documents) that may be necessary or advisable in the
opinion of the Administrative Agent to vest in the
Administrative Agent (or in any representative of the
Administrative Agent designated by it) valid and perfected
Liens on the
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properties purported to be subject to the security agreements,
mortgages, pledges, assignments, charges, debentures and other
security agreements and supplements thereto delivered pursuant
to this Section 5.01(o)(viii), enforceable against all third
parties in accordance with their terms, and
(ix) at any time and from time to time, promptly
execute and deliver any and all further certificates,
agreements, instruments and other documents and take all such
other actions as the Administrative Agent may deem necessary
or desirable in obtaining the full benefits of, or in
perfecting and preserving the Liens of, such guaranties,
mortgages, pledges, assignments, charges, debentures and
security agreements.
(p) FURTHER ASSURANCES. (i) Promptly upon request by the
Administrative Agent or any Lender Party through the Administrative
Agent, correct any material defect or error that may be discovered in
any Loan Document or in the execution, acknowledgment, filing or
recordation thereof, and
(ii) Promptly upon request by the Administrative Agent or any
Lender Party through the Administrative Agent, do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register any and all such further acts, deeds, conveyances, pledge
agreements, mortgages, deeds of trust, trust deeds, assignments,
charges, debentures, financing statements and continuations thereof,
termination statements, notices of assignment, transfers, certificates,
assurances and other instruments and documents as the Administrative
Agent or any Lender Party through the Administrative Agent, may
reasonably require from time to time in order to (A) carry out more
effectively the purposes of this Agreement, the Notes or any other Loan
Document, (B) to the fullest extent permitted by applicable law,
subject any Loan Party's or any of its Subsidiaries' properties,
assets, rights or interests to the Liens now or hereafter intended to
be covered by any of the Collateral Documents, (C) perfect and maintain
the validity, effectiveness and priority of any of the Collateral
Documents and any of the Liens intended to be created thereunder and
(D) assure, convey, grant, assign, transfer, preserve, protect and
confirm more effectively unto the Agents and the Lender Parties the
rights granted or now or hereafter intended to be granted to the Agents
and the Lender Parties under any Loan Document or under any other
agreement, instrument or document executed in connection with any Loan
Document to which any Loan Party or any of its Subsidiaries is or is to
be a party; without limitation of the foregoing, Holdings and the
Parent Borrower shall, promptly upon the request of the Administrative
Agent or the Collateral Agent, (x) cause any unlimited liability
company to be converted to a limited liability company or, if such
conversion is not then permitted under applicable law, take such action
as any Agent shall reasonably request in order to obtain the benefits
that would otherwise be afforded by such conversion; PROVIDED, HOWEVER,
that, so long as no Event of Default shall have occurred and be
continuing, such conversion or other action will not be required if
such conversion or other action would result in a material adverse tax
effect to the Parent Borrower or any of its Subsidiaries and (y)
deliver, or cause
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to be delivered, to the Administrative Agent stock certificates of the
Excluded Subsidiaries to the extent that the stock of such Subsidiaries
shall have been pledged to the Administrative Agent pursuant to the
Loan Documents.
(q) YEAR 2000 COMPLIANCE. Be, and cause each of its
Subsidiaries to be, Year 2000 Compliant on or before August 31, 1999
and at all times thereafter.
(r) INVENTORY CYCLE COUNTS. Perform, and cause its
Subsidiaries to perform, monthly Inventory cycle counts with respect to
Inventory located at Parent Borrower's manufacturing facility located
in Westbrook, Connecticut and annual physical Inventory counts with
respect to Inventory located at all locations (in which, in each such
case, the Collateral Agent may participate upon request).
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance shall
remain unpaid, any Letter of Credit shall be outstanding or any Lender Party
shall have any Commitment hereunder, neither Holdings nor either Borrower shall,
at any time:
(a) LIENS, ETC. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Lien on or with respect to any of its properties of any
character (including, without limitation, accounts and inventory)
whether now owned or hereafter acquired, or sign or file or suffer to
exist, or permit any of its Subsidiaries to sign or file or suffer to
exist, under the Uniform Commercial Code of any jurisdiction, a
financing statement that names any Loan Party or any of its
Subsidiaries as debtor, or sign or suffer to exist, or permit any of
its Subsidiaries to sign or suffer to exist, any security agreement
authorizing any secured party thereunder to file such financing
statement, or assign, or permit any of its Subsidiaries to assign, any
accounts or other right to receive income; EXCLUDING, HOWEVER, from the
operation of the foregoing restrictions the following:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) purchase money Liens upon equipment acquired or
held by the Parent Borrower or any of its Subsidiaries (other
than the Sub Borrower) in the ordinary course of business to
secure the purchase price of such equipment or to secure Debt
incurred solely for the purpose of financing the acquisition
of any such equipment to be subject to such Liens, or Liens
existing on any such equipment at the time of acquisition
(other than any such Liens created in contemplation of such
acquisition that do not secure the purchase price), or
extensions, renewals or replacements of any of the foregoing
for the same or a lesser amount; PROVIDED, HOWEVER, that no
such Lien shall extend to or cover any property other than the
equipment being acquired, and no such extension, renewal or
replacement shall extend to or cover any property
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not theretofore subject to the Lien being extended, renewed or
replaced; and PROVIDED FURTHER that the aggregate principal
amount of the Debt secured by Liens permitted by this clause
(iii) shall not exceed the amount permitted under Section
5.02(b)(iii)(C) at any time outstanding and that any such Debt
shall not otherwise be prohibited by the terms of the Loan
Documents;
(iv) Liens arising in connection with Capitalized
Leases permitted under Section 5.02(b)(iii)(D); PROVIDED that
no such Lien shall extend to or cover any Collateral or assets
other than the assets subject to such Capitalized Leases;
(v) Liens existing on the date hereof and described
on Schedule 5.02(a) hereto; and
(vi) the replacement, extension or renewal of any
Lien permitted by clause (v) above upon or in the same
property theretofore subject thereto or the replacement,
extension or renewal (without increase in the amount or change
in any direct or contingent obligor) of the Debt secured
thereby.
(b) DEBT. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist,
any Debt other than:
(i) in the case of the Parent Borrower,
(A) Debt in respect of Hedge Agreements with
one or more Secured Parties designed to hedge against
fluctuations in interest rates or foreign exchange
rates incurred in the ordinary course of business and
consistent with prudent business practice with the
aggregate Agreement Value thereof not to exceed
$1,000,000 at any time outstanding,
(B) Debt owed to a wholly owned Subsidiary
of the Parent Borrower (other than the Sub Borrower),
so long as no Default shall have occurred and be
continuing at the time of issuance or incurrence of
such Debt or would result therefrom and which Debt
(x) shall, in the case of Debt owed to a Loan Party,
constitute Pledged Debt, (y) shall be on terms
acceptable to the Administrative Agent and (z) shall
be evidenced by promissory notes in form and
substance satisfactory to the Administrative Agent
and such promissory notes, in the case of Debt owed
to a Loan Party, shall be pledged as security for the
Obligations of the holder thereof under the Loan
Documents and delivered to the Administrative Agent
pursuant to the terms of the Security Agreement,
(C) Debt under the Senior Notes Indenture in
an aggregate principal amount not to exceed
$180,010,714 in original issue amount, and
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(D) unsecured Debt incurred in the ordinary
course of business and aggregating not more than
$5,000,000 at any one time outstanding,
(ii) in the case of the Parent Borrower's
Subsidiaries,
(A) in the case of the Specified
Subsidiaries, Debt owed to the Sub Borrower; PROVIDED
that, in each case, such Debt (w) shall constitute
Pledged Debt, (x) shall be on terms acceptable to the
Administrative Agent, (y) shall be evidenced by
promissory notes in substantially the form of Exhibit
I-1 hereto, such promissory notes shall be secured by
the personal property, and such other property as the
Administrative Agent shall require from time to time,
of the makers thereof and such promissory notes shall
be pledged as security for the Obligations of the Sub
Borrower under the Loan Documents and delivered to
the Administrative Agent pursuant to the terms of the
Security Agreement and (z) the Obligations of the
Specified Subsidiaries under such promissory notes
shall be guaranteed by the Foreign Guarantors
pursuant to the Foreign Guaranty, PROVIDED FURTHER,
HOWEVER, that no such Debt may be incurred by any
such Specified Subsidiary unless and until the
requirements of clauses (w) through (z) above, in
each case relating to such Specified Subsidiary,
shall, in the judgment of the Administrative Agent,
have been satisfied, and
(B) in the case of any of the Subsidiaries
of the Parent Borrower (other than the Sub Borrower
and any Excluded Subsidiary), Debt owed to the Parent
Borrower; PROVIDED that, in each case, such Debt (x)
shall constitute Pledged Debt, (y) shall be on terms
acceptable to the Administrative Agent and (z) shall
be evidenced by promissory notes in substantially the
form of Exhibit I-2 hereto or otherwise in form and
substance satisfactory to the Administrative Agent
and such promissory notes shall be pledged as
security for the Obligations of the holder thereof
under the Loan Documents and delivered to the
Administrative Agent pursuant to the terms of the
Security Agreement,
(iii) in the case of the Parent Borrower and its
Subsidiaries (other than the Sub Borrower and the Excluded
Subsidiaries),
(A) Debt under the Loan Documents,
(B) Subordinated Debt in an aggregate amount
not to exceed $20,000,000 at any time outstanding
issued or incurred to finance, in whole or in part,
any acquisition under Section 5.02(f)(vii) which Debt
has been issued to the seller of the company or
business being acquired at the time of such
acquisition; PROVIDED, HOWEVER, that such Debt shall
be subordinated to
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the Obligations of the Loan Parties under the Loan
Documents on terms and conditions satisfactory to the
Administrative Agent,
(C) Debt secured by Liens permitted by
Section 5.02(a)(iii) not to exceed in the aggregate
$5,000,000 at any time outstanding,
(D) Debt consisting of Capitalized Leases
not to exceed in the aggregate $40,000,000 at any
time outstanding,
(E) [Intentionally Omitted],
(F) indorsement of negotiable instruments
for deposit or collection or similar transactions in
the ordinary course of business, and
(G) unsecured Debt in an aggregate amount
not to exceed $15,000,000 issued to members of the
Marshalls Group in connection with the acquisition of
Saturn pursuant to the terms of the Saturn
Acquisition Agreement; PROVIDED, THAT, such Debt
shall be unsecured and shall otherwise be on terms
and conditions acceptable to the Administrative
Agent; and PROVIDED, FURTHER, THAT, the Parent
Borrower or its Subsidiaries may grant to the members
of the Marshalls Group a right of offset (such right
of offset to be on terms and in form and substance
acceptable to the Administrative Agent) of amounts
due by members of the Marshalls Group to the Parent
Borrower or any of its Subsidiaries against amounts
which (x) are owed by Parent Borrower or its
Subsidiaries to members of the Marshalls Group and
(y) are overdue in respect of such Debt incurred
pursuant to this Section 5.02(b)(iii)(G), and
(iv) in the case of the Sub Borrower,
(A) Debt under the Loan Documents, and
(B) indorsement of negotiable instruments
for deposit or collection or similar transactions in
the ordinary course of business.
(c) LEASE OBLIGATIONS. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur, assume or
suffer to exist, any obligations as lessee (i) for the rental or hire
of real or personal property in connection with any sale and leaseback
transaction, or (ii) for the rental or hire of other real or personal
property of any kind under leases or agreements to lease, excluding
Capitalized Leases, having an original term of one year or more other
than, in the case of the Parent Borrower and its Subsidiaries (other
than the Sub Borrower), such obligations as would not cause the direct
and contingent liabilities
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of the Parent Borrower and its Subsidiaries, on a Consolidated basis,
in respect of all such obligations to exceed $12,000,000 payable in any
period of 12 consecutive months.
(d) MERGERS, ETC. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its Subsidiaries
to do so, except that (x) any Subsidiary of the Parent Borrower (other
than the Sub Borrower and IXnet Holdings) may merge into or consolidate
with any other Subsidiary of the Parent Borrower (other than the Sub
Borrower and IXnet Holdings) and (y) any Subsidiary of the Parent
Borrower (other than the Sub Borrower and IXnet Holdings) may merge
with another un-Affiliated Person to effectuate an Investment that is
otherwise expressly permitted hereunder; PROVIDED, that, in the case of
any such merger or consolidation, the Person formed by such merger or
consolidation (i) shall be a wholly-owned Subsidiary of the Parent
Borrower and (ii) shall, if any Subsidiary party to such merger or
consolidation is a Guarantor, be a Guarantor; and PROVIDED, FURTHER,
that in each case, immediately after giving effect thereto, no event
shall occur and be continuing that constitutes a Default.
(e) SALES, ETC., OF ASSETS. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer
or otherwise dispose of, any of its assets, or grant any option or
other right to purchase, lease or otherwise acquire any Collateral
other than Inventory to be sold in the ordinary course of its business,
EXCEPT, with respect to the Parent Borrower and its Subsidiaries (other
than the Sub Borrower):
(i) sales of Inventory in the ordinary course of its
business;
(ii) in a transaction authorized by subsection (d) of
this Section 5.02;
(iii) sales of assets for cash and for fair value in
an aggregate amount not to exceed $10,000,000 in any Fiscal
Year; PROVIDED, HOWEVER, that the Net Cash Proceeds of such
sales shall be applied on the date of receipt thereof to
prepay the Advances pursuant to Section 2.06(b)(i);
(iv) sales of assets for cash and for fair value in
an aggregate amount not to exceed $10,000,000 in any Fiscal
Year; PROVIDED, HOWEVER, that, except to the extent that the
Net Cash Proceeds of such sale shall be reinvested in like
assets within 180 days after such sale, any Net Cash Proceeds
of such sales not so reinvested shall be applied on the 180th
day after receipt thereof to prepay the Advances pursuant to
Section 2.06(b)(i); and
(v) any Excluded Subsidiary may be dissolved.
(f) INVESTMENTS IN OTHER PERSONS. Make or hold, or permit any
of its Subsidiaries to make or hold, any Investment in any Person other
than:
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(i) Investments by the Parent Borrower and its
Subsidiaries (other than the Sub Borrower) in their respective
Subsidiaries outstanding on the date hereof and additional
Investments in their respective wholly-owned Subsidiaries
(other than the Excluded Subsidiaries) in an aggregate amount
invested from the date hereof not to exceed $2,000,000;
(ii) (A) loans and advances to employees of the
Parent Borrower and its Subsidiaries (other than the Sub
Borrower) in the ordinary course of business as presently
conducted in an aggregate principal amount not to exceed
$2,000,000 at any time outstanding and (B) loans to officers,
directors, employees and consultants in connection with the
exercise of options granted to such officers, directors,
employees and consultants under either the Stock Option Plan
or the stock option plan approved by IXnet Holdings on May 20,
1999 (as such approved stock option plan is amended,
supplemented or otherwise modified from time to time in
accordance with its terms, to the extent permitted in
accordance with the Loan Documents) in an aggregate principal
amount not to exceed $2,000,000 at any time outstanding;
PROVIDED, THAT, such loans are secured by the stock purchased
upon such exercise;
(iii) Investments by the Parent Borrower and its
Subsidiaries (other than the Sub Borrower) in Cash
Equivalents;
(iv) Investments consisting of intercompany Debt
permitted under Section 5.02(b)(i)(B) or (ii);
(v) Investments existing on the date hereof and
described on Schedule 4.01(ee) hereto;
(vi) Investments by the Parent Borrower in Hedge
Agreements permitted under Section 5.02(b)(i)(A);
(vii) other Investments by the Parent Borrower and
its Subsidiaries (other than the Sub Borrower) in an aggregate
amount invested not to exceed $25,000,000; PROVIDED, that with
respect to Investments made under this clause (vii), (1) any
newly acquired or created Subsidiary of the Parent Borrower or
any of its Subsidiaries shall be a wholly owned Subsidiary
thereof; (2) immediately before and after giving effect
thereto, no Default shall have occurred and be continuing or
would result therefrom; (3) any company or business acquired
or invested in pursuant to this clause (vii) shall be in the
same line of business as the business of the Parent Borrower
or any of its Subsidiaries; and (4) immediately before and
after giving effect to the acquisition of a company or
business pursuant to this clause (vii), the Parent Borrower
shall be in pro forma compliance with the covenants contained
in Section 5.04, calculated based on the financial statements
most recently delivered to the Lender Parties pursuant to
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Section 5.03, as though such acquisition had occurred at the
beginning of the four quarter period covered thereby, as
evidenced by a certificate of the chief financial officer of
the Parent Borrower furnished to the Lender Parties
demonstrating such compliance;
(viii) Investments by the Parent Borrower and its
Subsidiaries (other than the Sub Borrower) in Saturn pursuant
to the Saturn Acquisition Agreement in an aggregate amount
invested not to exceed the sum of (A) (pound)30,000,000, (B)
any adjustment to the purchase price provided for in the
Saturn Acquisition Agreement, and (C) capitalized expenses
incurred in connection with such acquisition; PROVIDED that
(1) Saturn shall be a wholly owned Subsidiary of the Parent
Borrower; (2) immediately before and after giving effect
thereto, no Default shall have occurred and be continuing or
would result therefrom; and (3) immediately before and after
giving effect to the acquisition of Saturn, the Parent
Borrower shall be in pro forma compliance with the covenants
contained in Section 5.04, calculated based on the financial
statements most recently delivered to the Lender Parties
pursuant to Section 5.03, as though such acquisition had
occurred at the beginning of the four quarter period covered
thereby, as evidenced by a certificate of the chief financial
officer of the Parent Borrower furnished to the Lender Parties
demonstrating such compliance;
(ix) Investments by IXnet and its Subsidiaries in an
aggregate amount not to exceed an amount equal to (x) the Net
Cash Proceeds of the initial public offering of IXnet
Holdings' common stock which is contemplated by clause
(iii)(C) of Section 5.02(g) (the "IPO NET CASH PROCEEDS"),
MINUS (y) the aggregate amount of Debt comprised of
Obligations of IXnet and its Subsidiaries under Capitalized
Leases which is permanently prepaid pursuant to the last
sentence of Section 5.02(k), MINUS (z) the aggregate amount of
Capital Expenditures made pursuant to clause (ii) of Section
5.02 (r); PROVIDED, that with respect to Investments made
under this clause (ix), (1) such Investments shall be funded
solely from the IPO Net Cash Proceeds; (2) any newly acquired
or created Subsidiary of IXnet or any of its Subsidiaries
shall be a wholly owned Subsidiary thereof; (3) immediately
before and after giving effect thereto, no Default shall have
occurred and be continuing or would result therefrom; (4) any
company or business acquired or invested in pursuant to this
clause (ix) shall be in the same line of business as the
business of IXnet or any of its Subsidiaries; and (5)
immediately before and after giving effect to the acquisition
of a company or business pursuant to this clause (ix), the
Parent Borrower shall be in pro forma compliance with the
covenants contained in Section 5.04, calculated based on the
financial statements most recently delivered to the Lender
Parties pursuant to Section 5.03, as though such acquisition
had occurred at the beginning of the four quarter period
covered thereby, as evidenced by a certificate of the chief
financial officer of the Parent Borrower furnished to the
Lender Parties demonstrating such compliance;
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(x) an Investment on March 31, 1999 by the Parent
Borrower in IXnet consisting of a contribution to the equity
capital of IXnet in the amount of $73,000,000 through the
conversion of an equal amount of intercompany Debt owing as of
March 31, 1999 from IXnet to the Parent Borrower into equity
capital of IXnet; and
(xi) an Investment by the Parent Borrower consisting
of the contribution of all (100%) of the issued and
outstanding shares of common stock of MXNet to IXnet, which
shall result in MXNet being a directly and wholly-owned
Subsidiary of IXnet and an indirectly owned Subsidiary of
Parent Borrower.
(g) DIVIDENDS, ETC. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its
capital stock or any warrants, rights or options to acquire such
capital stock, now or hereafter outstanding, return any capital to its
stockholders as such, make any distribution of assets, capital stock,
warrants, rights, options, obligations or securities to its
stockholders as such or issue or sell any capital stock or any
warrants, rights or options to acquire such capital stock, or permit
any of its Subsidiaries to do any of the foregoing or permit any of its
Subsidiaries to purchase, redeem, retire, defease or otherwise acquire
for value any capital stock of Holdings or either Borrower or any
warrants, rights or options to acquire such capital stock or to issue
or sell any capital stock or any warrants, rights or options to acquire
such capital stock; EXCEPT that, so long as no Default shall have
occurred and be continuing at the time of any action described in
clauses (i), (ii) and (iii) below or would result therefrom, (i)
Holdings may (A) declare and pay dividends and distributions payable
only in common stock of Holdings and (B) issue and sell shares of its
common stock to management, employees, directors and consultants of
Holdings, the Parent Borrower and its Subsidiaries pursuant to and in
accordance with the terms of the Stock Option Plan, (ii) to the extent
permitted to do so under the Senior Notes Indenture, the Parent
Borrower may (A) declare and pay dividends to Holdings in an aggregate
amount not to exceed $1,000,000 in any Fiscal Year to enable Holdings
to pay its ordinary course expenses (E.G. legal and accounting expenses
and directors' and officers' insurance premiums) and (B) declare and
pay dividends and distributions to Holdings in an amount equal to the
Parent Borrower's proportionate share of Holdings' then due and payable
consolidated, combined or unitary income tax liabilities and (iii) in
the case of the Parent Borrower's Subsidiaries (other than the Sub
Borrower), (A) any Subsidiary of the Parent Borrower may declare and
pay cash dividends to its parent or the Parent Borrower (but not to
Holdings), (B) any Excluded Subsidiary may be liquidated, (C) IXnet
Holdings may issue and sell up to and including 20% of its common stock
to the public in a firm commitment underwritten initial public
offering; PROVIDED, THAT, the Net Cash Proceeds of such initial public
offering are at least $100,000,000; PROVIDED, FURTHER, THAT, the terms
and conditions of such initial public offering are otherwise reasonably
satisfactory to the Administrative Agent; and PROVIDED, FURTHER, THAT,
except to the extent that the Net Cash Proceeds of such issuance and
sale are reinvested (or committed to be reinvested) within twelve (12)
months after such sale in accordance with clause (B) of Section 4.11 of
the Senior Notes Indenture
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or permitted to be retained pursuant to the 10% of Adjusted
Consolidated Net Tangible Assets (as such term is defined in the Senior
Notes Indenture) basket set forth in accordance with clauses (A) and
(B) of Section 4.11 of the Senior Notes Indenture, all Net Cash
Proceeds of such issuance and sale not so reinvested (or so committed
to be reinvested) or so permitted to be retained shall be applied to
prepay the Advances pursuant to Section 2.06(b)(i) of this Agreement no
later than the time for repayment of unsubordinated Indebtedness (as
such term is defined in the Senior Notes Indenture) provided for in
clause (A) of Section 4.11 of the Senior Notes Indenture, and (D) IXnet
Holdings may issue and sell shares of its common stock up to an amount
equal to twelve percent (12%) of its common stock on a fully diluted
basis to its officers, directors, consultants and employees pursuant to
a stock option plan; provided that no stock option issued pursuant to
such plan shall be exercisable until thirty (30) months after the
effective date of such stock option plan and such stock option plan
shall otherwise have terms and conditions reasonably acceptable to the
Administrative Agent.
(h) CHANGE IN NATURE OF BUSINESS. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
as carried on at the date hereof. In the case of the Sub Borrower,
engage in any business other than the making of loans to the Specified
Subsidiaries from time to time to the extent permitted by Section
5.02(b)(ii)(A).
(i) CHARTER AMENDMENTS. Amend, or permit any of its
Subsidiaries to amend, its certificate of incorporation or bylaws in
any manner that would in any material respect impair the ability of any
Loan Party to perform its obligations under the Loan Documents or that
would impair in any material respect the rights or interests of any of
the Agents or any of the Lender Parties. Without limiting the
generality of the foregoing, neither Holdings nor the Parent Borrower
shall, or shall permit to exist, any amendment of the Parent Borrower
Charter, as amended as of the date of this Agreement by the Parent
Borrower Charter Amendment, without the prior consent of the
Administrative Agent.
(j) ACCOUNTING CHANGES. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (i) its accounting
policies or reporting practices, except as required by generally
accepted accounting principles or (ii) its Fiscal Year.
(k) PREPAYMENTS, ETC., OF DEBT. Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in
any manner, or make any payment in violation of any subordination terms
of, any Debt, other than the prepayment of the Advances in accordance
with the terms of this Agreement, or amend, modify or change in any
manner any term or condition of any Debt or Subordinated Debt, or make
any payment of principal, interest or any other amount in respect of
any Debt issued by Parent Borrower or any of its Subsidiaries pursuant
to clause (G) of Section 5.02(b)(iii) if a Default or Event of Default
shall have occurred and be continuing at the time of such payment or
would occur after giving effect thereto, or permit any of its
Subsidiaries to do any of the foregoing other than to prepay any Debt
payable to either Borrower. Notwithstanding anything to the contrary
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otherwise set forth in this Section 5.02(k), IXnet and its Subsidiaries
may permanently prepay Debt comprised of Obligations of such Persons as
lessee under Capitalized Leases in an aggregate amount not to exceed
the amount equal to (x) the IPO Net Cash Proceeds, MINUS (y) the
aggregate amount of Investments made pursuant to clause (ix) of Section
5.02(f) MINUS (z) the aggregate amount of Capital Expenditures made
pursuant to clause (ii) of Section 5.02(r); PROVIDED, THAT, (a) such
prepayments of Capitalized Leases are funded solely from the IPO Net
Cash Proceeds, (b) both before and after giving effect thereto no
Default shall have occurred and be continuing and (c) such prepayments
of Capitalized Leases are permitted as permanent repayments of
unsubordinated Indebtedness (as such term is defined in the Senior
Notes Indenture) under clause (A) of Section 4.11 of the Senior Notes
Indenture.
(l) AMENDMENT, ETC., OF RELATED DOCUMENTS. Cancel or terminate
any Related Document or consent to or accept any cancellation or
termination thereof, amend, modify or change in any manner any term or
condition of any Related Document or give any consent, waiver or
approval thereunder, waive any default under or any breach of any term
or condition of any Related Document, agree in any manner to any other
amendment, modification or change of any term or condition of any
Related Document or take any other action in connection with any
Related Document if any of the foregoing (x) would impair in any
material respect the value of the interests or rights of Holdings, the
Parent Borrower or any other Loan Party thereunder, (y) would impair in
any material respect the ability of Holdings, the Parent Borrower or
any other Loan Party to perform its obligations under the Loan
Documents or (z) would impair in any material respect the rights or
interests any of the Agents or any of the Lender Parties, or permit any
of its Subsidiaries to do any of the foregoing.
(m) AMENDMENT, ETC., OF MATERIAL CONTRACTS. Without the
consent of the Administrative Agent and the Required Lenders, cancel or
terminate any Material Contract or consent to or accept any
cancellation or termination thereof, amend or otherwise modify any
Material Contract or give any consent, waiver or approval thereunder,
waive any default under or breach of any Material Contract, agree in
any manner to any other amendment, modification or change of any term
or condition of any Material Contract or take any other action in
connection with any Material Contract if any of the foregoing (x) would
impair in any material respect the value of the interests or rights of
Holdings, the Parent Borrower or any other Loan Party thereunder, (y)
would impair in any material respect the ability of Holdings, the
Parent Borrower or any other Loan Party to perform its obligations
under the Loan Documents or (z) would impair in any material respect
the interests or rights of any of the Agents or any of the Lender
Parties, or permit any of its Subsidiaries to do any of the foregoing.
(n) OWNERSHIP CHANGE. Take, or permit any of its Subsidiaries
to take, any action that would result in an "ownership change" (as
defined in Section 382 of the Internal Revenue Code) with respect to
Holdings, the Parent Borrower or any of its Subsidiaries or
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the application of the "separate return limitation year" or
"consolidated return change of ownership" limitations under the federal
income tax consolidated return regulations with respect to Holdings,
the Parent Borrower or any of its Subsidiaries.
(o) NEGATIVE PLEDGE. Enter into or suffer to exist, or permit
any of its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon
any of its property or assets other than in favor of the Secured
Parties.
(p) PARTNERSHIPS, ETC. Become a general partner in any general
or limited partnership or joint venture, or permit any of its
Subsidiaries to do so.
(q) SPECULATIVE TRANSACTIONS. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options
or futures contracts or any similar speculative transactions other than
Hedge Agreements permitted under Section 5.02(b).
(r) CAPITAL EXPENDITURES. Make, or permit any of its
Subsidiaries to make, any Capital Expenditures other than, in the case
of the Parent Borrower and its Subsidiaries (other than the Sub
Borrower), such Capital Expenditures as would not cause the aggregate
of all such Capital Expenditures made by the Parent Borrower and its
Subsidiaries in any Fiscal Year to exceed (i) $35,000,000 (it being
understood that such Capital Expenditures do not include expenditures
which constitute Investments in other Persons permitted under Section
5.02(f)) plus (ii) in the case of IXnet and its Subsidiaries, Capital
Expenditures which in the aggregate do not exceed the amount equal to
(x) the IPO Net Cash Proceeds MINUS (y) the aggregate amount of
Investments made pursuant to clause (ix) of Section 5.02(f) MINUS (z)
the aggregate amount of Debt comprised of Obligations of IXnet and its
Subsidiaries under Capitalized Leases which is permanently prepaid
pursuant to the last sentence of Section 5.02(k); PROVIDED, THAT, (a)
such Capital Expenditures are funded solely from the IPO Net Cash
Proceeds and (b) both before and after giving effect thereto no Default
shall have occurred or be continuing.
(s) EXCLUDED SUBSIDIARIES. Permit any Excluded Subsidiary to
(i) individually hold assets or have annual revenues or net income in
the aggregate in excess of $150,000, (ii) collectively with all other
Excluded Subsidiaries, hold assets or have annual revenues or net
income in excess of $1,000,000, in each case, determined based on the
most recent financial statements required to be delivered to the Lender
Parties pursuant to Section 5.03(b) or (c), as the case may be, or
(iii) engage in any business of any kind, other than the holding of
licenses and/or acting as agent for a Loan Party.
(t) HOLDINGS AND IXNET HOLDINGS. Holdings shall not engage in
any trade or business, or own any assets, or incur or guaranty any Debt
or other liabilities, except that Holdings may own 100% of the common
stock of the Parent Borrower, engage in activities reasonably
incidental to its ownership as a holding company of 100% of such common
stock
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and guarantee the Obligations of the Loan Parties under the Loan
Documents (and provide security therefor). IXnet Holdings shall not
engage in any trade or business, or own any assets, or incur or
guaranty any Debt or other liabilities, except that IXnet Holdings may
own 100% of the common stock of IXnet, engage in activities reasonably
incidental to its ownership as a holding company of 100% of such common
stock and guarantee the Obligations of the Loan Parties under the Loan
Documents (and provide security therefor).
SECTION 5.03. REPORTING REQUIREMENTS. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or any Lender
Party shall have any Commitment hereunder, the Parent Borrower shall furnish to
the Lender Parties and the Agents:
(a) DEFAULT NOTICE. As soon as possible and in any event
within two Business Days after any Responsible Officer knows or should
know of any Default or any event, development or occurrence reasonably
likely to have a Material Adverse Effect continuing on the date of such
statement, a statement of a Responsible Officer of the Parent Borrower
setting forth the details of such Default and the action that the
Parent Borrower has taken and proposes to take with respect thereto.
(b) QUARTERLY FINANCIALS. As soon as available and in any
event within 45 days after the end of each of the first three quarters
of each Fiscal Year, Consolidated and consolidating balance sheets of
Holdings, the Parent Borrower and its Subsidiaries as of the end of
such quarter, Consolidated and consolidating statements of income of
Holdings, the Parent Borrower and its Subsidiaries for the period
commencing at the end of the previous fiscal quarter and ending with
the end of such fiscal quarter, Consolidated and consolidating
statements of income of Holdings, the Parent Borrower and its
Subsidiaries for the period commencing at the end of the previous
Fiscal Year and ending with the end of such quarter, Consolidated
statements of cash flows of Holdings and the Parent Borrower for the
period commencing at the end of the previous fiscal quarter and ending
with the end of such fiscal quarter and Consolidated statements of cash
flows of Holdings and the Parent Borrower for the period commencing at
the end of the previous Fiscal Year and ending with the end of such
quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding period of the preceding
Fiscal Year, all in reasonable detail and duly certified (subject to
year-end audit adjustments) by the chief financial officer of Holdings
and the Parent Borrower as having been prepared in accordance with
GAAP, together with (i) a certificate of said officer stating that no
Default has occurred and is continuing or, if a Default has occurred
and is continuing, a statement as to the nature thereof and the action
that the Parent Borrower has taken and proposes to take with respect
thereto and (ii) a schedule in form satisfactory to the Administrative
Agent of the computations used by the Parent Borrower in determining
compliance with the covenants contained in Section 5.04; PROVIDED that
in the event of any change in GAAP used in the preparation of such
financial statements, the Parent Borrower shall also provide, if
necessary for the determination of compliance with Section 5.04, a
statement of reconciliation conforming such financial statements to
GAAP.
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(c) ANNUAL FINANCIALS. As soon as available and in any event
within 90 days after the end of each Fiscal Year, a copy of the
Consolidated annual statements for such year of (x) Holdings, the
Parent Borrower and its Subsidiaries and (y) the Parent Borrower and
its Subsidiaries, each in the form provided to the Administrative Agent
and the Lender Parties pursuant to Section 4.01(f) or in a form
otherwise acceptable to the Administrative Agent, including the report
of PriceWaterhouseCoopers L.L.P. or other independent public
accountants of recognized standing acceptable to the Administrative
Agent and the Required Lenders, and consolidating balance sheets of
Holdings, the Parent Borrower and its Subsidiaries as of the end of
such Fiscal Year and consolidating statements of income of Holdings,
the Parent Borrower and its Subsidiaries for such Fiscal Year, prepared
by management of Holdings and the Parent Borrower together with (i) a
report of such accounting firm to the Agents and the Lender Parties
stating that in the course of the regular audit of the Consolidated
financial statements of (x) Holdings, the Parent Borrower and its
Subsidiaries and (y) the Parent Borrower and its Subsidiaries, which
audit was conducted by such accounting firm in accordance with
generally accepted auditing standards, nothing has come to the
attention of such accounting firm that caused it to believe that the
Parent Borrower failed to comply with the terms of Section 5.04, in so
far as they relate to accounting matters; (ii) a schedule prepared by
the Parent Borrower in form satisfactory to the Administrative Agent of
the computations used by the Parent Borrower in determining, as of the
end of such Fiscal Year, compliance with the covenants contained in
Section 5.04; PROVIDED that in the event of any change in GAAP used in
the preparation of such financial statements, the Parent Borrower shall
also provide, if necessary for the determination of compliance with
Section 5.04, a statement of reconciliation conforming such financial
statements to GAAP and (iii) a certificate of the chief financial
officer of the Parent Borrower stating that no Default has occurred and
is continuing or, if a Default has occurred and is continuing, a
statement as to the nature thereof and the action that the Parent
Borrower has taken and proposes to take with respect thereto.
(d) ANNUAL FORECASTS. As soon as available and in any event no
later than 15 days before the end of each Fiscal Year, forecasts
prepared by management of the Parent Borrower, in form satisfactory to
the Agents and the Lender Parties, of balance sheets, income statements
and cash flow statements on a monthly basis for the Fiscal Year
following such Fiscal Year and on an annual basis for each Fiscal Year
thereafter until the Termination Date.
(e) ERISA EVENTS AND ERISA REPORTS. (i) Promptly and in any
event within 10 days after any Loan Party or any ERISA Affiliate knows
or has reason to know that any ERISA Event that could be reasonably
likely to have a Material Adverse Effect has occurred, a statement of
the chief financial officer of the Parent Borrower describing such
ERISA Event and the action, if any, that such Loan Party or such ERISA
Affiliate has taken and proposes to take with respect thereto and (ii)
on the date any records, documents or other information must be
furnished to the PBGC with respect to any Plan pursuant to Section 4010
of ERISA, a copy of such records, documents and information.
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(f) PLAN TERMINATIONS. Promptly and in any event within two
Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate, copies of each notice from the PBGC stating its intention to
terminate any Plan or to have a trustee appointed to administer any
Plan, PROVIDED, HOWEVER, that there shall be no obligation to furnish
copies of any such notice received by an ERISA Affiliate that is not
received by a Loan Party unless such termination or appointment could
be reasonably likely to have a Material Adverse Effect.
(g) ACTUARIAL REPORTS. Promptly upon receipt thereof by any
Loan Party or any ERISA Affiliate, a copy of the annual actuarial
valuation report for each Plan of any Loan Party the funded current
liability percentage (as defined in Section 302(d)(8) of ERISA) of
which is less than 90% and the unfunded current liability of which
exceeds $5,000,000.
(h) PLAN ANNUAL REPORTS. Upon the request of any Lender Party,
copies of each Schedule B (Actuarial Information) to the annual report
(Form 5500 Series) with respect to each Plan.
(i) MULTIEMPLOYER PLAN NOTICES. Promptly and in any event
within five Business Days after receipt thereof by any Loan Party or
any ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
each notice concerning (i) the imposition of Withdrawal Liability by
any such Multiemployer Plan, (ii) the reorganization or termination,
within the meaning of Title IV of ERISA, of any such Multiemployer Plan
or (iii) the amount of liability incurred, or that may be incurred, by
such Loan Party or any ERISA Affiliate in connection with any event
described in clause (i) or (ii) of this Section 5.03(i), where such
Withdrawal Liability, reorganization or termination could be reasonably
likely to have a Material Adverse Effect.
(j) LITIGATION. Promptly after the commencement thereof,
notice of all actions, suits, investigations, litigation and
proceedings before any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign,
affecting Holdings, the Parent Borrower, any other Loan Party or any of
their respective Subsidiaries of the type described in Section 4.01(i).
(k) SECURITIES REPORTS. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and
reports that Holdings, any other Loan Party or any of their respective
Subsidiaries sends to its stockholders, and copies of all regular,
periodic and special reports, and all registration statements, that
Holdings, any other Loan Party or any of their respective Subsidiaries
files with the Securities and Exchange Commission or any governmental
authority that may be substituted therefor, or with any national
securities exchange.
(l) CREDITOR REPORTS. Promptly after the furnishing thereof,
copies of any statement or report furnished generally to other holders
of the securities of Holdings, the Parent Borrower, any other Loan
Party or any of their respective Subsidiaries pursuant to the
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terms of any indenture (including, without limitation, the Senior Notes
Indenture), loan or credit or similar agreement and not otherwise
required to be furnished to the Lender Parties pursuant to any other
subsection of this Section 5.03.
(m) AGREEMENT NOTICES, ETC. Promptly upon receipt thereof,
copies of all notices, requests and other documents received by any
Loan Party or any of its Subsidiaries under or pursuant to any Related
Document or Material Contract or indenture (including, without
limitation, the Senior Notes Indenture), loan or credit or similar
agreement regarding or related to any breach or default by any party
thereto or any other event that could impair in any material respect
the value of the interests or the rights of any Loan Party or that
otherwise could be reasonably likely to have a Material Adverse Effect
and copies of any amendment, modification or waiver of any provision of
any Related Document or Material Contract or any indenture, loan or
credit or similar agreement and of any amendment to the certificate of
incorporation or bylaws or other constitutive documents of any Loan
Party and, from time to time upon request by the Administrative Agent,
such information and reports regarding the Related Documents and the
Material Contracts as the Administrative Agent may reasonably request.
(n) REVENUE AGENT REPORTS. Within 10 days after receipt,
copies of all Revenue Agent Reports (Internal Revenue Service Form
886), or other written proposals of the Internal Revenue Service, that
propose, determine or otherwise set forth positive adjustments to the
federal income tax liability of the affiliated group (within the
meaning of Section 1504(a)(1) of the Internal Revenue Code) of which
Holdings or the Parent Borrower is a member aggregating $500,000 or
more.
(o) TAX CERTIFICATES. Promptly, and in any event within five
Business Days after the due date (with extensions) for filing the final
federal income tax return in respect of each taxable year, a
certificate (a "TAX CERTIFICATE"), signed by the President or the chief
financial officer of Holdings and the Parent Borrower, stating that
Holdings and the Parent Borrower have each paid to the Internal Revenue
Service or other taxing authority, or, in the case of the Parent
Borrower, to Holdings, the full amount that such affiliated group is
required to pay in respect of federal income tax for such year.
(p) ENVIRONMENTAL CONDITIONS. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of
any noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit that could (i) reasonably be
expected to have a Material Adverse Effect or (ii) cause any real
property owned or leased by any Loan Party or any of its Subsidiaries
to be subject to any material restrictions on ownership, occupancy, use
or transferability under any Environmental Law.
(q) REAL PROPERTY. As soon as available and in any event
within 30 days after the end of each Fiscal Year, a report
supplementing Schedule 4.01(dd) hereto, including an identification of
all real and leased property disposed of by the Parent Borrower or any
of its
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Subsidiaries during such Fiscal Year, a list and description (including
the street address, county or other relevant jurisdiction, State,
country if other than the United States of America, record owner, book
value thereof, and in the case of leases of property, lessor, lessee,
expiration date and annual rental cost thereof) of all real property
acquired or leased during such Fiscal Year and a description of such
other changes in the information included in such Schedule as may be
necessary for such Schedule to be accurate and complete.
(r) INSURANCE. As soon as available and in any event within 30
days after the end of each Fiscal Year, a report summarizing the
insurance coverage (specifying type, amount and carrier) in effect for
each Loan Party and each of its Subsidiaries and containing such
additional information as any Lender Party, through the Administrative
Agent, may reasonably specify.
(s) BORROWING BASE CERTIFICATE. As soon as available and in
any event, in the case of the Collateral Agent (and the Collateral
Agent shall promptly deliver a copy thereof to the Administrative Agent
after the Collateral Agent shall have approved such Borrowing Base
Certificate), within 20 days after the end of each month, and in all
other cases, promptly following the Collateral Agent's approval of such
Borrowing Base Certificate, a Borrowing Base Certificate, as at the end
of the previous month, accompanied by, in the case of the Borrowing
Base Certificate being delivered to the Collateral Agent, the related
accounts receivable aging (setting forth domestic and foreign
Receivables), the related monthly trial balance showing Receivables
outstanding aged from invoice due date from 1 to 30 days, 31 to 60
days, 61 to 90 days, and 91 days or more, and the related perpetual
Inventory report, in each case in form and scope satisfactory to the
Collateral Agent, certified by the chief financial officer, the chief
accounting officer, the controller or the treasurer of the Parent
Borrower and the Specified Subsidiaries.
(t) COLLATERAL REPORTS. Promptly after the preparation
thereof, copies (to the Collateral Agent only) of the results of each
physical verification, if any, which the Parent Borrower or any of its
Subsidiaries may in their discretion have made, or caused any other
Person to have made on their behalf, of all or any portion of their
Inventory (and if an Event of Default shall have occurred and be
continuing, the Parent Borrower shall, upon the request of the
Collateral Agent, conduct, and then deliver the results of, such
physical verifications as the Collateral Agent may require), and
promptly after the request therefor, such other information (to the
Collateral Agent only) respecting the borrowing base and the Collateral
as the Collateral Agent may from time to time reasonably request.
(u) OTHER INFORMATION. Such other information respecting the
business, condition (financial or otherwise), operations, performance,
assets, nature of assets, liabilities (including, without limitation,
tax, ERISA and environmental liabilities) or prospects of Holdings, the
Parent Borrower, any other Loan Party or any of their respective
Subsidiaries as any Lender Party, through the Administrative Agent, may
from time to time reasonably request.
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SECTION 5.04. FINANCIAL COVENANTS. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or any Lender
Party shall have any Commitment hereunder, the Parent Borrower shall:
(a) MINIMUM EBITDA. Maintain at the end of each fiscal quarter
of the Parent Borrower, EBITDA of not less than the amount set forth
below for each four consecutive fiscal quarter period set forth below:
FOUR FISCAL QUARTERS ENDING AMOUNT
--------------------------- ------
September 30, 1998 $24,000,000
December 31, 1998 $26,000,000
March 31, 1999 $28,600,000
June 30, 1999 $31,000,000
September 30, 1999 $36,000,000
December 31, 1999 $39,600,000
March 31, 2000 $44,000,000
June 30, 2000 $49,000,000
September 30, 2000 $54,000,000
December 31, 2000 $60,000,000
March 31, 2001 $63,000,000
June 30, 2001 $67,000,000
September 30, 2001 $71,000,000
December 31, 2001 $75,000,000
March 31, 2002 $81,000,000
June 30, 2002 $87,000,000
September 30, 2002 $93,000,000
December 31, 2002 $100,000,000
March 31, 2003
and thereafter $107,000,000
(b) INTEREST COVERAGE RATIO. Maintain at the end of each
fiscal quarter of the Parent Borrower a ratio of Consolidated EBITDA to
cash interest payable on all Debt of the Parent Borrower and its
Subsidiaries, in each case for the four quarter period then ending, of
not less than 4.00:1.00, except for the four quarter period ending
September 30, 2001, in which case such ratio shall be not less than
3.5:1.0.
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(c) LEVERAGE RATIO. Maintain at the end of each fiscal quarter
of the Parent Borrower a Leverage Ratio of the Parent Borrower and its
Subsidiaries, in each case for the four quarter period ending on the
date set forth below, of not more than the ratio set forth below:
FOUR FISCAL QUARTERS ENDING RATIO
--------------------------- -----
June 30, 1999 5.90:1.00
September 30, 1999 6.60:1.00
December 31, 1999 6.40:1.00
March 31, 2000 6.20:1.00
June 30, 2000 5.90:1.00
September 30, 2000 5.70:1.00
December 31, 2000 5.40:1.00
March 31, 2001 4.90:1.00
June 30, 2001 4.50:1.00
September 30, 2001 4.00:1.00
December 31, 2001 3.50:1.00
March 31, 2002 3.30:1.00
June 30, 2002 3.00:1.00
September 30, 2002 2.80:1.00
December 31, 2002 2.60:1.00
March 31, 2003 2.40:1.00
June 30, 2003 2.20:1.00
September 30, 2003 2.10:1.00
December 31, 2003 2.00:1.00
(d) FIXED CHARGE COVERAGE RATIO. Maintain at the end of each
fiscal quarter of the Parent Borrower a ratio of (i) EBITDA for the
most recently completed four fiscal quarters of the Parent Borrower and
its Subsidiaries, LESS Capital Expenditures made by the Parent Borrower
and its Subsidiaries during such period, other than (x) Capital
Expenditures to the extent financed by Capitalized Leases (but only to
the extent so financed and not paid in cash), (y) Capital Expenditures
to the extent financed by purchase money indebtedness (but only to the
extent so financed and not paid in cash) and (z) Capital Expenditures
made by IXnet and its Subsidiaries out of the IPO Net Cash Proceeds
(but only to the extent so made out of the IPO Net Cash Proceeds) (in
the case of (x), (y) and (z) only to the extent that such transactions
otherwise are permitted by, and in compliance with, the terms and
conditions of this Agreement), LESS the aggregate amount of federal,
state, local and foreign income taxes paid by the Parent Borrower and
its Subsidiaries in cash during such period,
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other than (x) various foreign income taxes paid by Foreign
Subsidiaries to the extent that such foreign income taxes do not in the
aggregate exceed $1,000,000 during such period, (y) the payment by IPC
UK in June 1999 of certain foreign income taxes in the aggregate amount
of approximately (pound)4,200,000 and (z) the payment by IPC UK in July
1999 of the ACT (Advance Corporation Tax) in the aggregate amount of
approximately (pound)5,625,000, LESS cash dividends paid by the Parent
Borrower to the holder of its common stock (I.E. Holdings) during such
period to the extent that the Parent Borrower is expressly permitted to
pay such dividends under this Agreement, to the (ii) sum of (x) cash
interest payable by the Parent Borrower and its Subsidiaries on all
Debt during such period PLUS (y) principal amounts of all Debt payable
by the Parent Borrower and its Subsidiaries during such period, of not
less than the ratio set forth below for such period:
FOUR FISCAL QUARTERS ENDING RATIO
--------------------------- -----
June 30, 1999 1.06:1.00
September 30, 1999 1.28:1.00
December 31, 1999 1.30:1.00
March 31, 2000 1.50:1.00
June 30, 2000 1.70:1.00
September 30, 2000 2.00:1.00
December 31, 2000 2.20:1.00
March 31, 2001 2.40:1.00
June 30, 2001 2.60:1.00
September 30, 2001 2.80:1.00
December 31, 2001 2.30:1.00
March 31, 2002 1.80:1.00
June 30, 2002 1.30:1.00
September 30, 2002 1.00:1.00
December 31, 2002 1.00:1.00
March 31, 2003 1.00:1.00
and thereafter
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following
events ("EVENTS OF DEFAULT") shall occur and be continuing:
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(a) (i) either Borrower shall fail to pay any principal of any
Advance when the same shall become due and payable or (ii) either
Borrower shall fail to pay any interest on any Advance, or any Loan
Party shall fail to make any other payment under this Agreement or any
other Loan Document, in each case under this clause (ii) within 5
Business Days after the same becomes due and payable; or
(b) any representation or warranty made by Holdings, the
Parent Borrower or any other Loan Party (or any of its officers) under
or in connection with this Agreement or any other Loan Document shall
prove to have been incorrect in any material respect when made; or
(c) either Borrower shall fail to perform or observe any term,
covenant or agreement contained in ▇▇▇▇▇▇▇ ▇.▇▇, ▇.▇▇(▇), (▇), (▇), or
(o), 5.02, 5.03 or 5.04; or
(d) Holdings, the Parent Borrower or any other Loan Party
shall fail to perform or observe any other term, covenant or agreement
contained in this Agreement or any other Loan Document on its part to
be performed or observed if such failure shall remain unremedied for 15
days after the earlier of the date on which (A) a Responsible Officer
becomes aware of such failure or (B) written notice thereof shall have
been given to the Parent Borrower by either of the Agents or any of the
Lender Parties; or
(e) any Loan Party or any of its Subsidiaries shall fail to
pay any principal of, premium or interest on or any other amount
payable in respect of any Debt that is outstanding in a principal or
notional amount of at least $5,000,000 either individually or in the
aggregate (but excluding Debt outstanding hereunder) of such Loan Party
or such Subsidiary (as the case may be), when the same becomes due and
payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event shall occur or
condition shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt or otherwise to cause, or to permit the holder
thereof to cause, such Debt to mature; or any such Debt shall be
declared to be due and payable or required to be prepaid (other than by
a regularly scheduled required prepayment) or redeemed, purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated maturity
thereof; or
(f) any Loan Party or any of its Subsidiaries shall generally
not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against any Loan Party or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement,
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adjustment, protection, relief, or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief
of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding
shall remain undismissed or unstayed for a period of 30 days or any of
the actions sought in such proceeding (including, without limitation,
the entry of an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for, it or any
substantial part of its property) shall occur; or any Loan Party or any
of its Subsidiaries shall take any corporate action to authorize any of
the actions set forth above in this subsection (f); or
(g) any judgment or order for the payment of money in excess
of $5,000,000 shall be rendered against any Loan Party or any of its
Subsidiaries and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there
shall be any period of 15 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(h) any non-monetary judgment or order shall be rendered
against any Loan Party or any of its Subsidiaries that could be
reasonably expected to have a Material Adverse Effect, and there shall
be any period of 15 consecutive days during which a stay of enforcement
of such judgment or order, by reason of a pending appeal or otherwise,
shall not be in effect; or
(i) any provision of any Loan Document after delivery thereof
pursuant to Section 3.01 or 5.01(o) shall for any reason cease to be
valid and binding on or enforceable against any Loan Party party to it,
or any such Loan Party shall so state in writing; or
(j) any Collateral Document after delivery thereof pursuant to
Section 3.01 or 5.01(o) shall for any reason (other than pursuant to
the terms thereof) cease to create a valid and perfected first priority
Lien on and security interest in the Collateral purported to be covered
thereby; or
(k) (i) the Equity Investors, collectively, shall cease to
beneficially own and control at least 50% of the Voting Stock of
Holdings; (ii) any Person or two or more Persons acting in concert
other than the Equity Investors shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934),
directly or indirectly, of Voting Stock of Holdings (or other
securities convertible into such Voting Stock) representing 40% or more
of the combined voting power of all Voting Stock of Holdings; (iii)
individuals who, on the date on which the Reorganization is
consummated, constitute the board of directors of Holdings (together
with any new directors whose election by the board of directors or
whose
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nomination by the board of directors for election by Holdings'
stockholders was approved by a vote of at least two-thirds of the
members of the board of directors then in office who either were
members of the board of directors on the date on which the
Reorganization is consummated or whose election or nomination for
election was previously so approved) cease for any reason to constitute
a majority of the members of the board of directors of Holdings then in
office; (iv) any Person or two or more Persons acting in concert other
than the Equity Investors shall have acquired by contract or otherwise,
or shall have entered into a contract or arrangement that, upon
consummation, will result in its or their acquisition of control over
Voting Stock of Holdings (or other securities convertible into such
securities) representing 40% or more of the combined voting power of
all Voting Stock of Holdings; (v) Holdings shall cease to own 100% of
the outstanding capital stock and 100% of the Voting Stock of the
Parent Borrower; or (vi) the Parent Borrower shall cease to own at
least 80% (or 68% after giving effect to the exercise of all options
issued to officers, directors, consultants and employees of IXnet
Holdings pursuant to its stock option plan; PROVIDED, THAT, all of the
provisions of clause (iii)(D) of Section 5.02(g) are satisfied) of the
outstanding capital stock and at least 80% (or 68% after giving effect
to the exercise of all options issued to officers, directors,
consultants and employees of IXnet Holdings pursuant to its stock
option plan; PROVIDED, THAT, all of the provisions of clause (iii)(D)
of Section 5.02(g) are satisfied) of the outstanding Voting Stock of
IXnet Holdings.
(l) any ERISA Event shall have occurred with respect to a Plan
that, when aggregated with any liability under Sections 6.01(m) and
(n), has had or could be reasonably likely to have a Material Adverse
Effect; or
(m) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan and such liability,
when aggregated with all other amounts required to be paid to
Multiemployer Plans by the Loan Parties and the ERISA Affiliates as
Withdrawal Liability (determined as of the date of such notification)
and with any liability under Sections 6.01(l) and (n), has had or could
be reasonably likely to have a Material Adverse Effect; or
(n) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of
Title IV of ERISA, and such reorganization or termination, when
aggregated with any liability under Sections 6.01(l) and (m), has had
or could be reasonably likely to have a Material Adverse Effect; or
(o) there shall occur in the judgment of the Required Lenders
any Material Adverse Change;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrowers,
declare the obligation of each Lender to make Advances (other than Letter of
Credit Advances made by the Issuing Bank, an L/C Issuer
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(in the case of an L/C Issuer which is also a Lender) or a Lender pursuant to
Section 2.03(c)) and of the Issuing Bank or an L/C Issuer to issue or the
Issuing Bank to guarantee, as the case may be, Letters of Credit to be
terminated, whereupon the same shall forthwith terminate, and (ii) shall at the
request, or may with the consent, of the Required Lenders, by notice to the
Borrowers, declare the Notes, all interest thereon and all other amounts payable
under this Agreement and the other Loan Documents to be forthwith due and
payable, whereupon the Notes, all such interest and all such amounts shall
become and be forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by each
Borrower; PROVIDED, HOWEVER, that in the event of an actual or deemed entry of
an order for relief with respect to any Loan Party or any of its Subsidiaries
under the Federal Bankruptcy Code, (x) the obligation of each Lender to make
Advances (other than Letter of Credit Advances made by the Issuing Bank, an L/C
Issuer (in the case of an L/C Issuer which is also a Lender) or a Lender
pursuant to Section 2.03(c)) and of the Issuing Bank or an L/C Issuer to issue
or the Issuing Bank to guarantee, as the case may be, Letters of Credit shall
automatically be terminated and (y) the Notes, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by each Borrower.
SECTION 6.02. ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON
DEFAULT. If any Event of Default shall have occurred and be continuing, the
Administrative Agent may, or shall at the request of the Required Lenders,
irrespective of whether it is taking any of the actions described in Section
6.01 or otherwise, make demand upon the Parent Borrower to, and forthwith upon
such demand the Parent Borrower shall, pay to the Administrative Agent on behalf
of the Lender Parties in same day funds at the Administrative Agent's office
designated in such demand, for deposit in the L/C Cash Collateral Account, an
amount equal to the aggregate Available Amount of all Letters of Credit then
outstanding. If at any time the Administrative Agent determines that any funds
held in the L/C Cash Collateral Account are subject to any right or claim of any
Person other than the Administrative Agent, the Collateral Agent and the Lender
Parties or that the total amount of such funds is less than the aggregate
Available Amount of all Letters of Credit, the Parent Borrower shall, forthwith
upon demand by the Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in the L/C Cash Collateral Account, an
amount equal to the excess of (a) such aggregate Available Amount over (b) the
total amount of funds, if any, then held in the L/C Cash Collateral Account that
the Administrative Agent determines to be free and clear of any such right and
claim.
ARTICLE VII
THE AGENTS
SECTION 7.01. AUTHORIZATION AND ACTION. Each Lender Party (in
its capacities as a Lender, the Issuing Bank (if applicable) and a potential
Hedge Bank) hereby appoints and authorizes each Agent to take such action as
agents on its behalf and to exercise such powers and discretion under this
Agreement and the other Loan Documents as are delegated to such Agent by
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the terms hereof and thereof, together with such powers and discretion as are
reasonably incidental thereto. As to any matters not expressly provided for by
this Agreement or another Loan Document (including, without limitation,
enforcement or collection of the Notes), no Agent shall be required to exercise
any discretion or take any action, but shall be required to act or to refrain
from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Lenders, and such instructions
shall be binding upon all Lender Parties and all holders of Notes; PROVIDED,
HOWEVER, that no Agent shall be required to take any action that exposes such
Agent to personal liability or that is contrary to this Agreement, any other
Loan Document or applicable law. The Administrative Agent agrees to give to each
Lender Party prompt notice of each notice given to it by either Borrower
pursuant to the terms of this Agreement.
SECTION 7.02. AGENTS' RELIANCE, ETC. Neither Agent nor any of
their respective directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by it or them under or in connection
with this Agreement or any other Loan Document, except for its or their own
gross negligence or willful misconduct. Without limiting the generality of the
foregoing, each Agent: (a) may treat the payee of any Note as the holder thereof
until, in the case of the Administrative Agent, the Administrative Agent
receives and accepts an Assignment and Acceptance entered into by the Lender
that is the payee of such Note, as assignor, and an Eligible Assignee, as
assignee, as provided in Section 8.07; (b) may consult with legal counsel
(including counsel for any Loan Party), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (c) makes no warranty or representation to any Lender
Party and shall not be responsible to any Lender Party for any statements,
warranties or representations (whether written or oral) made in or in connection
with the Loan Documents; (d) shall not have any duty to ascertain or to inquire
as to the performance or observance of any of the terms, covenants or conditions
of any Loan Document on the part of any Loan Party or to inspect the property
(including the books and records) of any Loan Party; (e) shall not be
responsible to any Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of, or continued perfection or priority of, any Lien or security
interest created or purported to be created under or in connection with, any
Loan Document or any other agreement, instrument or document furnished pursuant
thereto; and (f) shall incur no liability under or in respect of any Loan
Document by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telegram, telecopy or telex) believed by it to be
genuine and signed or sent by the proper party or parties.
SECTION 7.03. GE CAPITAL, MSSF AND AFFILIATES. With respect to
its Commitments, the Advances made by it and the Notes issued to it, GE Capital
and MSSF shall have the same rights and powers under the Loan Documents as any
other Lender Party and may exercise the same as though it were not the
Collateral Agent, the Administrative Agent or the Syndication Agent, as the case
may be; and the term "Lender Party" or "Lender Parties" shall, unless otherwise
expressly indicated, include GE Capital and MSSF in their respective individual
capacities. GE Capital and MSSF and their respective Affiliates may accept
deposits from, lend money to, act as trustee under indentures of, accept
investment banking engagements from and generally engage in any kind of
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business with, Holdings, the Parent Borrower, any other Loan Party or any of
their respective Subsidiaries and any Person who may do business with or own
securities of Holdings, the Parent Borrower, any other Loan Party or any such
Subsidiary, all as if GE Capital and MSSF were not the Collateral Agent, the
Administrative Agent or the Syndication Agent, as the case may be, and
without any duty to account therefor to the Lender Parties.
SECTION 7.04. LENDER PARTY CREDIT DECISION. Each Lender Party
acknowledges that it has, independently and without reliance upon either of the
Agents or any of the other Lender Parties and based on the financial statements
referred to in Section 4.01 and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon either of the Agents or any of the other Lender Parties
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.
SECTION 7.05. INDEMNIFICATION. (a) Each Lender Party severally
agrees to indemnify each Agent (to the extent not promptly reimbursed by the
Borrowers) from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by, or asserted
against such Agent in any way relating to or arising out of this Agreement or
any other Loan Document or any action taken or omitted by such Agent under this
Agreement or any other Loan Document; PROVIDED, HOWEVER, that no Lender Party
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from such Agent's gross negligence or willful misconduct. Without
limiting the foregoing, each Lender Party agrees to reimburse each Agent
promptly upon demand for its ratable share of any costs and expenses (including,
without limitation, fees and expenses of counsel) payable by either Borrower
under Section 8.04, to the extent that such Agent is not promptly reimbursed for
such costs and expenses by such Borrower. For purposes of this subsection (a),
the Lender Parties' respective ratable shares of any amount shall be determined,
at any time, according to the sum of (x) the aggregate principal amount of the
Advances outstanding at such time and owing to the respective Lender Parties,
(y) their respective Pro Rata Shares of the aggregate Available Amount of all
Letters of Credit outstanding at such time and (z) their respective Unused
Working Capital Commitments at such time; PROVIDED that the aggregate principal
amount of Letter of Credit Advances owing to the Issuing Bank shall be
considered to be owed to the Working Capital Lenders ratably in accordance with
their respective Working Capital Commitments. In the event that any Defaulted
Advance shall be owing by any Defaulting Lender at any time, such Lender Party's
Commitment with respect to the Facility under which such Defaulted Advance was
required to have been made shall be considered to be unused for purposes of this
subsection (a) to the extent of the amount of such Defaulted Advance. The
failure of any Lender Party to reimburse an Agent promptly upon demand for its
ratable share of any amount required to be paid by the Lender Party to such
Agent as provided herein shall not relieve any other Lender Party of its
obligation hereunder to reimburse such Agent for its
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ratable share of such amount, but no Lender Party shall be responsible for the
failure of any other Lender Party to reimburse such Agent for such other Lender
Party's ratable share of such amount.
(b) Each Lender Party severally agrees to indemnify the
Issuing Bank (to the extent not promptly reimbursed by the Borrowers) from and
against such Lender Party's ratable share (determined as provided below) of any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by, or asserted against the Issuing
Bank in any way relating to or arising out of this Agreement or any other Loan
Document or any action taken or omitted by the Issuing Bank under this Agreement
or any other Loan Document; PROVIDED, HOWEVER, that no Lender Party shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Issuing Bank's gross negligence or willful misconduct. Without limiting
the foregoing, each Lender Party agrees to reimburse the Issuing Bank promptly
upon demand for its ratable share of any costs and expenses (including, without
limitation, fees and expenses of counsel) payable by either Borrower under
Section 8.04, to the extent that the Issuing Bank is not promptly reimbursed for
such costs and expenses by such Borrower. For purposes of this subsection (b),
the Lender Parties' respective ratable shares of any amount shall be determined,
at any time, according to the sum of (a) the aggregate principal amount of the
Advances outstanding at such time and owing to the respective Lender Parties,
(b) their respective Pro Rata Shares of the aggregate Available Amount of all
Letters of Credit outstanding at such time and (c) their respective Unused
Working Capital Commitments at such time; PROVIDED that the aggregate principal
amount of Letter of Credit Advances owing to the Issuing Bank shall be
considered to be owed to the Working Capital Lenders ratably in accordance with
their respective Working Capital Commitments. In the event that any Defaulted
Advance shall be owing by any Defaulting Lender at any time, such Lender Party's
Commitment with respect to the Facility under which such Defaulted Advance was
required to have been made shall be considered to be unused for purposes of this
subsection (b) to the extent of the amount of such Defaulted Advance. The
failure of any Lender Party to reimburse the Issuing Bank promptly upon demand
for its ratable share of any amount required to be paid by the Lender Parties to
the Issuing Bank as provided herein shall not relieve any other Lender Party of
its obligation hereunder to reimburse the Issuing Bank for its ratable share of
such amount, but no Lender Party shall be responsible for the failure of any
other Lender Party to reimburse the Issuing Bank for such other Lender Party's
ratable share of such amount.
(c) Without prejudice to the survival of any other agreement
of any Lender Party hereunder, the agreement and obligations of each Lender
Party contained in this Section 7.05 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the other
Loan Documents.
SECTION 7.06. SUCCESSOR AGENTS. Either Agent may resign at any
time and, if at any time either Agent shall cease to be a Lender, such Agent
shall promptly thereafter resign by giving written notice thereof to the Lender
Parties and the Borrowers and may be removed at any time with or without cause
by the Required Lenders. Upon any such resignation or removal, the
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Required Lenders shall have the right to appoint a successor Administrative
Agent or Collateral Agent (as the case may be), subject, so long as no Default
shall have occurred and be continuing, to the consent of the Parent Borrower,
such consent not to be unreasonably withheld or delayed. If no such successor
Agent shall have been so appointed by the Required Lenders, and shall have
accepted such appointment, within 30 days after the retiring Agent's giving of
notice of resignation or the Required Lenders' removal of the retiring Agent,
then the retiring Agent may, on behalf of the Lender Parties, appoint a
successor Agent, which shall be a Lender. Upon the acceptance of any appointment
as an Agent hereunder by a successor Agent and upon the execution and filing or
recording of such financing statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such successor Agent shall
succeed to and become vested with all the rights, powers, discretion, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations under this Agreement or any other Loan Document.
After any retiring Agent's resignation or removal hereunder as an Agent, the
provisions of this Article VII shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was an Agent.
SECTION 7.07. SYNDICATION AGENT. MSSF shall have neither any
rights nor any responsibilities in its capacity as Syndication Agent. The
Syndication Agent may resign at any time and, if at any time the Syndication
Agent shall cease to be a Lender, the Syndication Agent shall promptly
thereafter resign by giving written notice thereof to the Lender Parties and the
Borrowers and may be removed at any time with or without cause by the Required
Lenders. Upon any such resignation or removal, the Administrative Agent shall
have the right to appoint a successor Syndication Agent or to leave the position
of Syndication Agent vacant.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement or the Notes or any other Loan Document, nor consent
to any departure by any Loan Party herefrom or therefrom, shall in any event be
effective unless the same shall be in writing and signed (or, in the case of the
Collateral Documents, consented to) by the Required Lenders, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; PROVIDED, HOWEVER, that no amendment, waiver
or consent shall, unless in writing and signed by all of the Lenders (other than
any Lender Party that is, at such time, a Defaulting Lender), do any of the
following at any time: (i) waive any of the conditions specified in Section 3.01
or, in the case of any Borrowings made on the Effective Date, Section 3.02, (ii)
change the number of Lenders or the percentage of (x) the Commitments, (y) the
aggregate unpaid principal amount of the Advances or (z) the aggregate Available
Amount of outstanding Letters of Credit that, in each case, shall be required
for the Lenders or any of them to take any action hereunder, (iii) to the extent
that a Guarantor has not been fully released from the Guaranty issued by such
Guarantor
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pursuant to Section 14 of such Guaranty, reduce or limit the obligations of such
Guarantor under Section 1 of the Guaranty issued by it or otherwise limit the
liability of such Guarantor with respect to the Obligations owing to the Agents
and the Lender Parties, (iv) release any material portion of the Collateral in
any transaction or series of related transactions or permit the creation,
incurrence, assumption or existence of any Lien on any material portion of the
Collateral in any transaction or series of related transactions to secure any
Obligations other than Obligations owing to the Secured Parties under the Loan
Documents, (v) amend this Section 8.01, (vi) increase the Commitments of the
Lenders or subject the Lenders to any additional obligations, (vii) reduce the
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, (viii) postpone any date fixed for any payment of principal of, or
interest on, the Notes or any fees or other amounts payable hereunder, or (ix)
limit the liability of any Loan Party under any of the Loan Documents; PROVIDED
FURTHER that no amendment, waiver or consent shall, unless in writing and signed
by the Supermajority Lenders, waive or amend Section 5.04(a); PROVIDED STILL
FURTHER that no amendment, waiver or consent shall, unless in writing and signed
by the Issuing Bank in addition to the Lenders required above to take such
action, affect the rights or obligations of the Issuing Bank under this
Agreement; and PROVIDED FURTHER that no amendment, waiver or consent shall,
unless in writing and signed by each of the Agents in addition to the Lenders
required above to take such action, affect the rights or duties of the Agents
under this Agreement.
SECTION 8.02. NOTICES, ETC. All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telecopy or telex communication) and mailed, telegraphed,
telecopied, telexed or delivered, if to either Borrower, at its address at ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, facsimile
number: ▇▇▇-▇▇▇-▇▇▇▇, Attention: Chief Financial Officer with a copy to General
Counsel; if to any Lender which is a Lender on the Effective Date or the Issuing
Bank, at its Domestic Lending Office specified opposite its name on Schedule I
hereto; if to any other Lender Party, at its Domestic Lending Office specified
in the Assignment and Acceptance pursuant to which it became a Lender Party; if
to the Administrative Agent or the Collateral Agent, at its address at ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Account Manager - IPC, with
copies to General Electric Capital Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Counsel Commercial Finance, and ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; or, as
to either Borrower or either Agent, at such other address as shall be designated
by such party in a written notice to the other parties and, as to each other
party, at such other address as shall be designated by such party in a written
notice to the Borrowers and the Administrative Agent. All such notices and
communications shall, when mailed, telegraphed, telecopied or telexed, be
effective when deposited in the mails, delivered to the telegraph company,
transmitted by telecopier or confirmed by telex answerback, respectively, except
that notices and communications to either Agent pursuant to Article II, III or
VII shall not be effective until received by such Agent. Delivery by telecopier
of an executed counterpart of any amendment or waiver of any provision of this
Agreement, the Notes or any other Loan Document shall be as effective as
delivery of a manually executed counterpart thereof.
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SECTION 8.03. NO WAIVER; REMEDIES. No failure on the part of
any Lender Party or either Agent to exercise, and no delay in exercising, any
right hereunder or under any Note or any other Loan Document shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
SECTION 8.04. COSTS AND EXPENSES. (a) Each Borrower agrees,
jointly and severally, to pay on demand (i) all reasonable out-of-pocket costs
and expenses of the Agents in connection with the preparation, execution,
delivery, administration, modification and amendment of the Loan Documents
(including, without limitation, (A) all due diligence, collateral review,
syndication, transportation, computer, duplication, appraisal, audit, insurance,
consultant, search, filing and recording fees and expenses and (B) the
reasonable fees and expenses of counsel for the Agents with respect thereto,
with respect to advising the Agents as to their respective rights and
responsibilities, or the perfection, protection or preservation of rights or
interests, under the Loan Documents, with respect to negotiations with any Loan
Party or with other creditors of any Loan Party or any of its Subsidiaries
arising out of any Default or any events or circumstances that may give rise to
a Default and with respect to presenting claims in or otherwise participating in
or monitoring any bankruptcy, insolvency or other similar proceeding involving
creditors' rights generally and any proceeding ancillary thereto) and (ii) all
costs and expenses of the Agents and the Lender Parties in connection with the
enforcement of the Loan Documents, whether in any action, suit or litigation,
any bankruptcy, insolvency or other similar proceeding affecting creditors'
rights generally (including, without limitation, the reasonable fees and
expenses of counsel for the Agents and each Lender Party with respect thereto).
(b) Each Borrower agrees, jointly and severally, to indemnify
and hold harmless each Agent, each Lender Party and each of their respective
Affiliates and their respective officers, directors, employees, agents and
advisors (each, an "INDEMNIFIED PARTY") from and against any and all claims,
damages, losses, liabilities and expenses (including, without limitation,
reasonable fees and expenses of counsel) that may be incurred by or asserted or
awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in connection
with any investigation, litigation or proceeding or preparation of a defense in
connection therewith) (i) the Facilities, the actual or proposed use of the
proceeds of the Advances or the Letters of Credit, the Loan Documents or any of
the transactions contemplated thereby, including, without limitation, any
acquisition or proposed acquisition or any other transaction or action or
proposed transaction or action (including, without limitation, the Prior
Transactions, the Reorganization, the Corporate Reorganization, the Parent
Borrower Charter Amendment and the Effective Date Transactions) or (ii) the
actual or alleged presence of Hazardous Materials on any property of any Loan
Party or any of its Subsidiaries or any Environmental Action relating in any way
to any Loan Party or any of its Subsidiaries, except to the extent such claim,
damage, loss, liability or expense is found in a final, non-appealable judgment
by a court of competent jurisdiction to have resulted directly and primarily
from such Indemnified Party's bad faith, gross negligence or willful misconduct.
In the case of an investigation, litigation or other proceeding to which the
indemnity in this subsection (b) applies, such indemnity shall be effective
whether or not such
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investigation, litigation or proceeding is brought by any Loan Party, its
directors, shareholders or creditors or an Indemnified Party or any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. Each Borrower also agrees not to assert any
claim against any Agent, any Lender Party or any of their Affiliates, or any of
their respective officers, directors, employees, attorneys or agents, on any
theory of liability, for special, indirect, consequential or punitive damages
arising out of or otherwise relating to the Facilities, the actual or proposed
use of the proceeds of the Advances or the Letters of Credit, the Loan Documents
or any of the transactions contemplated thereby, including, without limitation,
any acquisition or proposed acquisition or any other transaction or action or
proposed transaction or action (including, without limitation, the Prior
Transactions, the Reorganization, the Corporate Reorganization, the Parent
Borrower Charter Amendment and the Effective Date Transactions).
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by either Borrower to or for the account of a
Lender Party other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.09(b)(i) or
2.10(d), acceleration of the maturity of the Notes pursuant to Section 6.01 or
for any other reason, or by an Eligible Assignee to a Lender Party other than on
the last day of the Interest Period for such Advance upon an assignment of
rights and obligations under this Agreement pursuant to Section 8.07 as a result
of a demand by the Parent Borrower pursuant to Section 8.07(a), such Borrower
shall, upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender Party any amounts required to compensate such Lender Party for any
additional losses, costs or expenses that it may reasonably incur as a result of
such payment, including, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender Party to fund or
maintain such Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under this Agreement or any other Loan
Document, including, without limitation, fees and expenses of counsel and
indemnities, such amount may be paid on behalf of such Loan Party by the
Administrative Agent or any Lender Party, in its sole discretion.
(e) Without prejudice to the survival of any other agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrowers contained in Sections 2.10 and 2.12 and this
Section 8.04 shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under any of the other Loan
Documents.
SECTION 8.05. RIGHT OF SETOFF. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, the Administrative Agent, the Collateral Agent, each
Lender Party and each of their respective Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and otherwise apply any and all deposits (general or special,
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time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Agent, such Lender Party or such Affiliate to or for the
credit or the account of either Borrower against any and all of the Obligations
of such Borrower now or hereafter existing under this Agreement or any other
Loan Document, irrespective of whether such Agent or such Lender Party shall
have made any demand under this Agreement or such other Loan Document and
although such Obligations may be unmatured. The Administrative Agent, the
Collateral Agent and each Lender Party agrees promptly to notify the applicable
Borrower after any such setoff and application by it; PROVIDED, HOWEVER, that
the failure to give such notice shall not affect the validity of such setoff and
application. The rights of the Administrative Agent, the Collateral Agent, each
Lender Party and their respective Affiliates under this Section 8.05 are in
addition to other rights and remedies (including, without limitation, other
rights of setoff) that the Administrative Agent, the Collateral Agent, each
Lender Party and their respective Affiliates may have.
SECTION 8.06. BINDING EFFECT. This Agreement shall become
effective when it shall have been executed by each Borrower, the Administrative
Agent, the Collateral Agent and each Prior Lender, and when the Administrative
Agent shall have been notified by each Lender and the Issuing Bank that such
Lender and the Issuing Bank has executed it and thereafter shall be binding upon
and inure to the benefit of each Borrower, each Agent and each Lender Party and
their respective successors and assigns, except that neither Borrower shall have
the right to assign its rights hereunder or any interest herein without the
prior written consent of the Administrative Agent and the Lender Parties.
SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Lender
may, and, so long as no Default shall have occurred and be continuing, if
demanded by the Parent Borrower (following a demand by such Lender pursuant to
Section 2.10) upon at least five Business Days' notice to such Lender and the
Administrative Agent, will, assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment or Commitments, the Advances
owing to it and the Note or Notes held by it); PROVIDED, HOWEVER, that (i) each
such assignment shall be of a uniform, and not a varying, percentage of all
rights and obligations under and in respect of one or more of the Facilities,
(ii) except in the case of an assignment of all of a Lender's rights and
obligations under this Agreement, the amount of the Commitment of the assigning
Lender being assigned pursuant to each such assignment (determined as of the
date of the Assignment and Acceptance with respect to such assignment) shall in
no event be less than $5,000,000 and the amount of the Commitment of the
assigning Lender being retained shall in no event be less than $5,000,000, (iii)
each such assignment shall be to an Eligible Assignee, (iv) each such assignment
made as a result of a demand by the Parent Borrower pursuant to this Section
8.07(a) shall be arranged by the Parent Borrower after consultation with the
Administrative Agent and shall be either an assignment of all of the rights and
obligations of the assigning Lender under this Agreement or an assignment of a
portion of such rights and obligations made concurrently with another such
assignment or other such assignments that together cover all of the rights and
obligations of the assigning Lender under this Agreement, (v) no Lender shall be
obligated to make any such assignment as a result of a demand by the Parent
Borrower pursuant to this Section 8.07(a) unless and until such Lender shall
have received one or more payments from
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either the Parent Borrower or one or more Eligible Assignees in an aggregate
amount at least equal to the aggregate outstanding principal amount of the
Advances owing to such Lender, together with accrued interest thereon to the
date of payment of such principal amount and all other amounts payable to such
Lender under this Agreement, (vi) no such assignment shall be permitted without
the consent of the Administrative Agent until the Administrative Agent shall
have notified the Lender Parties that syndication of the Commitments hereunder
has been completed, and (vii) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with any Note or Notes subject
to such assignment and a processing and recordation fee of (A) $1,500 if such
assignment is to an Affiliate of the assigning Lender Party and (B) $3,000 in
all other cases.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Acceptance,
(x) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or
Issuing Bank, as the case may be, hereunder and (y) the Lender or Issuing Bank
assignor thereunder shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's or Issuing Bank's rights and obligations under this
Agreement, such Lender or Issuing Bank shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
the Lender Party assignor thereunder and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender Party 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 any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of, or continued perfection or priority of, any Lien or security
interest created or purported to be created under or in connection with, this
Agreement or any other Loan Document or any other agreement, instrument or
document furnished pursuant hereto or thereto; (ii) such assigning Lender Party
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of either Borrower or any other Loan Party or the
performance or observance by any Loan Party of any of its obligations under any
Loan Document or any other agreement, instrument or document furnished pursuant
thereto; (iii) such assignee confirms that it has received a copy of this
Agreement, together with copies of the financial statements referred to in
Section 4.01 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 Acceptance; (iv) such assignee will, independently and without
reliance upon the Agents, such assigning Lender Party or any other Lender Party
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 each Agent to take such
action as agents on its
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behalf and to exercise such powers and discretion under this Agreement and the
other Loan Documents as are delegated to such Agent by the terms hereof and
thereof, together with such powers and discretion 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 or Issuing Bank, as the case may be.
(d) The Administrative Agent, acting for this purpose (but
only for this purpose) as the agent of the Borrowers, shall maintain at its
address referred to in Section 8.02 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lender Parties and the Commitment under each Facility of,
and principal amount of the Advances under each Facility owing to, each Lender
Party from time to time (the "REGISTER"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrowers, the Agents and the Lender Parties shall treat each Person whose name
is recorded in the Register as a Lender Party hereunder for all purposes of this
Agreement. The Register shall be available for inspection by either Borrower or
any Lender Party at any reasonable time and from time to time upon reasonable
prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender Party and an assignee, together with any Note or Notes
subject to such assignment, the Administrative Agent shall, if such Assignment
and Acceptance has been completed and is in substantially the form of Exhibit C
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrowers and the Collateral Agent. In the case of any assignment by a Lender,
within five Business Days after its receipt of such notice, each Borrower, at
its own expense, shall execute and deliver to the Administrative Agent in
exchange for the surrendered Note or Notes a new Note to the order of such
Eligible Assignee in an amount equal to the Commitment assumed by it pursuant to
such Assignment and Acceptance and, if the assigning Lender has retained a
Commitment hereunder, a new Note 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 Acceptance and shall otherwise be in substantially the form
of Exhibit ▇-▇, ▇-▇ or A-3 hereto, as applicable.
(f) The Issuing Bank may assign to an Eligible Assignee all
of its rights and obligations under its Letter of Credit Commitment at any time;
PROVIDED, HOWEVER, that (i) each such assignment shall be to an Eligible
Assignee and (ii) the parties to each such assignment shall execute and deliver
to the Administrative Agent, for its acceptance and recording in the Register,
an Assignment and Acceptance, together with a processing and recordation fee of
(A) $1,500 if such assignment is to an Affiliate of the assigning Lender Party
and (B) $3,000 in all other cases.
(g) Each Lender Party may sell participations to one or more
Persons (other than any Loan Party or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments, the Advances owing
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to it and the Note or Notes (if any) held by it); PROVIDED, HOWEVER, that (i)
such Lender Party's obligations under this Agreement (including, without
limitation, its Commitments) shall remain unchanged, (ii) such Lender Party
shall remain solely responsible to the other parties hereto for the performance
of such obligations, (iii) such Lender Party shall remain the holder of any such
Note for all purposes of this Agreement, (iv) the Borrowers, the Agents and the
other Lender Parties shall continue to deal solely and directly with such Lender
Party in connection with such Lender Party's rights and obligations under this
Agreement and (v) no participant under any such participation shall have any
right to approve any amendment or waiver of any provision of this Agreement or
any other Loan Document, or any consent to any departure by any Loan Party
herefrom or therefrom, except to the extent that such amendment, waiver or
consent would reduce the principal of, or interest on, the Notes or any fees or
other amounts payable hereunder, in each case to the extent subject to such
participation, postpone any date fixed for any payment of principal of, or
interest on, the Notes or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation, or release all or
substantially all of the Collateral.
(h) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to either Borrower furnished to such
Lender Party by or on behalf of such Borrower; PROVIDED, HOWEVER, that, prior to
any such disclosure, the assignee or participant or proposed assignee or
participant shall agree to preserve in accordance with Section 8.10 the
confidentiality of any confidential information relating to any Loan Party
received by it from such Lender Party.
(i) Notwithstanding any other provision set forth in this
Agreement, any Lender Party may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and the Note or Notes held by it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System.
SECTION 8.08. EXECUTION IN 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 all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be as effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.09. NO LIABILITY OF THE ISSUING BANK. The Parent
Borrower assumes all risks of the acts or omissions of any beneficiary or
transferee of any Letter of Credit with respect to its use of such Letter of
Credit. Neither the Issuing Bank nor any of its directors, officers or other
employees shall be liable or responsible for: (a) the use that may be made of
any Letter of Credit or any acts or omissions of any beneficiary or transferee
in connection therewith; (b) the validity, sufficiency or genuineness of
documents, or of any endorsement thereon, even if such documents should prove to
be in any or all respects invalid, insufficient, fraudulent or forged; (c)
payment by the Issuing Bank or an L/C Issuer against presentation of documents
that do not comply with the
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terms of a Letter of Credit or any guaranty thereof, including failure of any
documents to bear any reference or adequate reference to the Letter of Credit or
any guaranty thereof; or (d) any other circumstances whatsoever in making or
failing to make payment under any Letter of Credit or any guaranty thereof;
EXCEPT that the Parent Borrower shall have a claim against the Issuing Bank, and
the Issuing Bank shall be liable to the Parent Borrower, to the extent of any
direct, but not consequential, damages suffered by the Parent Borrower that the
Parent Borrower proves were caused by (i) the Issuing Bank's willful misconduct
or gross negligence in determining whether documents presented under any Letter
of Credit issued by it comply with the terms of the Letter of Credit or (ii) the
Issuing Bank's willful failure to make lawful payment under a Letter of Credit
issued by it after the presentation to it of a draft and certificates strictly
complying with the terms and conditions of the Letter of Credit. In furtherance
and not in limitation of the foregoing, the Issuing Bank may accept documents
that appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary. Nothing
contained herein shall be deemed to limit or to expand any waivers, covenants or
indemnities made by the Parent Borrower in favor of any L/C Issuer in any letter
of credit application, reimbursement agreement or similar document, instrument
or agreement between the Borrower and such L/C Issuer.
SECTION 8.10. CONFIDENTIALITY. Each of the Lender Parties and
each of the Agents understands that some of the information furnished to it
pursuant to this Agreement may be received by it prior to the time that such
information shall have been made public, and each of the Lender Parties and each
of the Agents hereby agrees that it will keep, and will direct its officers and
employees to keep, all the information provided to it pursuant to this Agreement
confidential prior to its becoming public (through publication other than as a
result of action by one of the Lender Parties or the Agents in violation of this
Section 8.10), subject, however, to (a) disclosure to officers, directors,
employees, representatives, agents, auditors, consultants, advisors, lawyers and
Affiliates of such Lender Party or such Agent, as the case may be, in the
ordinary course of business, (b) disclosure to such officers, directors,
employees, representatives, agents and lawyers of a prospective assignee or
participant on a need-to-know basis in connection with the evaluation of a
possible assignment of, or participation in, the Advances hereunder (who will be
informed of the confidential nature of the material); (c) the obligations of the
Lender Parties or the Agents or a participant under applicable law, or pursuant
to subpoenas or other legal process, to make information available to
governmental agencies and examiners or to others and the right of the Lender
Parties and the Agents and participants to use such information in proceedings
to enforce their rights and remedies hereunder or under any other Loan Document
or in any proceeding against any Lender Party or any Agent or any participant in
connection with this Agreement or under any other Loan Document or the
transactions contemplated thereby; (d) disclosure to the extent such information
(i) becomes publicly available other than as a result of a breach of this
Agreement or (ii) becomes available to a Lender Party, an Agent or a participant
on a non-confidential basis, not, to the knowledge of such Lender Party, Agent
or participant, in breach of any agreement or other obligation to either
Borrower, from a source other than such Borrower; (e) disclosure to the extent
the applicable Borrower shall have consented to such disclosure in writing; or
(f) each Lender Party's or Agent's or participant's right to make information
available (i) to any corporation controlled by such Lender Party, Agent or
participant or under common control with such Lender Party, Agent or
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participant in connection with an assignment or the sale of a participation by
such Lender Party or participant, or the assignment by such Agent of its rights
and obligations as an Agent, to such other corporation, PROVIDED that such
transferee agrees to be bound by this confidentiality provision or (ii) in
accordance with Section 8.07(h).
SECTION 8.11. RELEASE OF COLLATERAL. Upon the sale, lease,
transfer or other disposition of any item of Collateral of any Loan Party in
accordance with the terms of this Agreement and the other Loan Documents, the
Administrative Agent shall, at the Parent Borrower's expense, execute and
deliver to such Loan Party such documents as such Loan Party may reasonably
request to evidence the release of such item of Collateral from the assignment
and security interest granted under the Collateral Documents in accordance with
the terms of the Loan Documents.
SECTION 8.12. JURISDICTION, ETC. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, New York
County, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or any of the other Loan Documents
to which it is a party, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that
all claims in respect of any such action or proceeding may be heard and
determined in any such New York State court or, to the extent permitted by law,
in such federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement or
any of the other Loan Documents in the courts of any other jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Loan Documents to which it is a party in any New York State or federal
court located in New York City, New York County. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
SECTION 8.13. GOVERNING LAW. This Agreement, the Notes and the
other Loan Documents shall be governed by, and construed in accordance with, the
laws of the State of New York.
SECTION 8.14. WAIVER OF JURY TRIAL. Each of the Borrowers, the
Agents and the Lender Parties irrevocably waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to this Agreement, any of the other Loan
Documents, the Advances or the actions of either Agent or any Lender Party in
the negotiation, administration, performance or enforcement hereof or thereof.
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[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
IPC INFORMATION SYSTEMS, INC.
By______________________________________
Name: __________________________________
Title: _________________________________
IPC FUNDING CORP.
By______________________________________
Name: __________________________________
Title: _________________________________
IPC COMMUNICATIONS, INC.,
as a Loan Party1
By______________________________________
Name: __________________________________
Title: _________________________________
--------
1/ Not as a Borrower, but for purposes of the other provisions of this
Agreement.
GENERAL ELECTRIC CAPITAL CORPORATION,
as Administrative Agent, Collateral Agent and Issuing
Bank
By______________________________________
Name: __________________________________
Title: _________________________________
GENERAL ELECTRIC CAPITAL CORPORATION,
as a Prior Lender and as a Lender
By______________________________________
Name: __________________________________
Title: _________________________________
BNY FINANCIAL CORPORATION,
as a Prior Lender and as a Lender
By______________________________________
Name: __________________________________
Title: _________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.,
as a Prior Lender
By_____________________________________
Name: _________________________________
Title: ________________________________
FREMONT INVESTMENT AND LOAN,
as a Prior Lender
By_____________________________________
Name: _________________________________
Title: ________________________________
FIRST UNION BANK
as a Prior Lender and as a Lender
By_____________________________________
Name: _________________________________
Title: ________________________________