EXHIBIT 4.5
CREDIT AND GUARANTY AGREEMENT
DATED AS OF SEPTEMBER 20, 2000
AMONG
VICAR OPERATING, INC.,
VETERINARY CENTERS OF AMERICA, INC.,
CERTAIN SUBSIDIARIES OF COMPANY,
AS GUARANTORS,
VARIOUS LENDERS,
▇▇▇▇▇▇▇ ▇▇▇▇▇ CREDIT PARTNERS L.P.,
AS SOLE LEAD ARRANGER AND SOLE SYNDICATION AGENT,
AND
▇▇▇▇▇ FARGO BANK, N.A.,
AS ADMINISTRATIVE AGENT
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$300,000,000 SENIOR SECURED CREDIT FACILITIES
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TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS AND INTERPRETATION....................................8
1.1. DEFINITIONS.......................................................8
1.2. ACCOUNTING TERMS..................................................40
1.3. INTERPRETATION, ETC...............................................40
SECTION 2. LOANS.............................................................41
2.1. TERM LOANS........................................................41
2.2. REVOLVING LOANS...................................................42
2.3. SWING LINE LOANS..................................................43
2.4. PRO RATA SHARES; AVAILABILITY OF FUNDS............................46
2.5. USE OF PROCEEDS...................................................46
2.6. EVIDENCE OF DEBT; REGISTER; LENDERS' BOOKS AND RECORDS; NOTES.....47
2.7. INTEREST ON LOANS.................................................47
2.8. CONVERSION/CONTINUATION...........................................49
2.9. DEFAULT INTEREST..................................................49
2.10. FEES..............................................................50
2.11. SCHEDULED PAYMENTS................................................50
2.12. VOLUNTARY PREPAYMENTS/COMMITMENT REDUCTIONS.......................52
2.13. MANDATORY PREPAYMENTS/COMMITMENT REDUCTIONS.......................53
2.14. APPLICATION OF PREPAYMENTS/REDUCTIONS.............................55
2.15. GENERAL PROVISIONS REGARDING PAYMENTS.............................57
2.16. RATABLE SHARING...................................................58
2.17. MAKING OR MAINTAINING EURODOLLAR RATE LOANS.......................58
2.18. INCREASED COSTS; CAPITAL ADEQUACY.................................60
2.19. TAXES; WITHHOLDING, ETC...........................................61
2.20. OBLIGATION TO MITIGATE............................................63
2.21. DEFAULTING LENDERS................................................64
2.22. REMOVAL OR REPLACEMENT OF A LENDER................................65
SECTION 3. CONDITIONS PRECEDENT..............................................66
3.1. CLOSING DATE......................................................66
3.2. CONDITIONS TO EACH CREDIT EXTENSION...............................71
SECTION 4. REPRESENTATIONS AND WARRANTIES....................................72
4.1. ORGANIZATION; REQUISITE POWER AND AUTHORITY; QUALIFICATION........72
4.2. CAPITAL STOCK AND OWNERSHIP.......................................73
4.3. DUE AUTHORIZATION.................................................73
4.4. NO CONFLICT.......................................................73
4.5. GOVERNMENTAL CONSENTS.............................................74
4.6. BINDING OBLIGATION................................................74
4.7. HISTORICAL FINANCIAL STATEMENTS...................................74
4.8. PROJECTIONS.......................................................74
4.9. NO MATERIAL ADVERSE CHANGE........................................74
4.10. NO RESTRICTED JUNIOR PAYMENTS.....................................75
4.11. ADVERSE PROCEEDINGS, ETC..........................................75
4.12. PAYMENT OF TAXES..................................................75
4.13. PROPERTIES........................................................75
4.14. ENVIRONMENTAL MATTERS.............................................76
4.15. NO DEFAULTS.......................................................76
4.16. GOVERNMENTAL REGULATION...........................................76
4.17. MARGIN STOCK......................................................77
4.18. EMPLOYEE MATTERS..................................................77
4.19. EMPLOYEE BENEFIT PLANS............................................77
4.20. CERTAIN FEES......................................................78
4.21. SOLVENCY..........................................................78
4.22. RELATED AGREEMENTS................................................78
4.23. SUBORDINATION OF PERMITTED SELLER NOTES AND SENIOR
SUBORDINATED NOTE DOCUMENTS.....................................79
4.24. COMPLIANCE WITH STATUTES, ETC.....................................79
4.25. DISCLOSURE........................................................79
SECTION 5. AFFIRMATIVE COVENANTS.............................................80
5.1. FINANCIAL STATEMENTS AND OTHER REPORTS............................80
5.2. EXISTENCE.........................................................83
5.3. PAYMENT OF TAXES AND CLAIMS.......................................84
5.4. MAINTENANCE OF PROPERTIES.........................................84
5.5. INSURANCE.........................................................84
5.6. INSPECTIONS.......................................................85
5.7. LENDERS MEETINGS..................................................85
5.8. COMPLIANCE WITH LAWS..............................................85
5.9. ENVIRONMENTAL.....................................................85
5.10. SUBSIDIARIES......................................................86
5.11. ADDITIONAL MATERIAL REAL ESTATE ASSETS............................87
5.12. INTEREST RATE PROTECTION..........................................87
5.13. FURTHER ASSURANCES................................................88
SECTION 6. NEGATIVE COVENANTS................................................88
6.1. INDEBTEDNESS......................................................88
6.2. LIENS.............................................................91
6.3. EQUITABLE LIEN....................................................92
6.4. NO FURTHER NEGATIVE PLEDGES.......................................92
6.5. RESTRICTED JUNIOR PAYMENTS........................................93
6.6. RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS..........................95
6.7. INVESTMENTS.......................................................96
6.8. FINANCIAL COVENANTS...............................................97
6.9. FUNDAMENTAL CHANGES; DISPOSITION OF ASSETS; ACQUISITIONS..........101
6.10. DISPOSAL OF SUBSIDIARY INTERESTS..................................102
6.11. SALES AND LEASE-BACKS.............................................102
6.12. TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.....................102
6.13. CONDUCT OF BUSINESS...............................................103
6.14. PERMITTED ACTIVITIES OF HOLDINGS..................................103
6.15. AMENDMENTS OR WAIVERS OF CERTAIN RELATED AGREEMENTS...............104
6.16. AMENDMENTS OR WAIVERS WITH RESPECT TO SUBORDINATED INDEBTEDNESS...104
6.17. DESIGNATION OF "SENIOR INDEBTEDNESS"..............................104
6.18. FISCAL YEAR.......................................................104
SECTION 7. GUARANTY..........................................................104
7.1. GUARANTY OF THE OBLIGATIONS.......................................104
7.2. CONTRIBUTION BY GUARANTORS........................................105
7.3. PAYMENT BY GUARANTORS.............................................105
7.4. LIABILITY OF GUARANTORS ABSOLUTE..................................106
7.5. WAIVERS BY GUARANTORS.............................................108
7.6. GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC..............108
7.7. SUBORDINATION OF OTHER OBLIGATIONS................................109
7.8. CONTINUING GUARANTY...............................................109
7.9. AUTHORITY OF GUARANTORS OR COMPANY................................109
7.10. FINANCIAL CONDITION OF COMPANY....................................110
7.11. BANKRUPTCY, ETC...................................................110
7.12. DISCHARGE OF GUARANTY UPON SALE OF GUARANTOR......................111
SECTION 8. EVENTS OF DEFAULT.................................................111
8.1. EVENTS OF DEFAULT.................................................111
SECTION 9. AGENTS............................................................114
9.1. APPOINTMENT OF AGENTS.............................................114
9.2. POWERS AND DUTIES.................................................114
9.3. GENERAL IMMUNITY..................................................115
9.4. AGENTS ENTITLED TO ACT AS LENDER..................................115
9.5. LENDERS' REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENT...........116
9.6. RIGHT TO INDEMNITY................................................116
9.7. SUCCESSOR ADMINISTRATIVE AGENT AND SWING LINE LENDER..............117
9.8. COLLATERAL DOCUMENTS AND GUARANTY.................................117
SECTION 10. MISCELLANEOUS....................................................118
10.1. NOTICES...........................................................118
10.2. EXPENSES..........................................................118
10.3. INDEMNITY.........................................................119
10.4. SET-OFF...........................................................119
10.5. AMENDMENTS AND WAIVERS............................................120
10.6. SUCCESSORS AND ASSIGNS; PARTICIPATIONS............................122
10.7. INDEPENDENCE OF COVENANTS.........................................124
10.8. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS............124
10.9. NO WAIVER; REMEDIES CUMULATIVE....................................125
10.10. MARSHALLING; PAYMENTS SET ASIDE...................................125
10.11. SEVERABILITY......................................................125
10.12. OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS........125
10.13. ENTIRE AGREEMENT..................................................126
10.14. HEADINGS..........................................................126
10.15. APPLICABLE LAW....................................................126
10.16. CONSENT TO JURISDICTION...........................................126
10.17. WAIVER OF JURY TRIAL..............................................127
10.18. CONFIDENTIALITY...................................................127
10.19. USURY SAVINGS CLAUSE..............................................128
10.20. COUNTERPARTS......................................................128
10.21. EFFECTIVENESS.....................................................128
APPENDICES: A-1 Tranche A Term Loan Commitments
A-2 Tranche B Term Loan Commitments
A-3 Revolving Commitments
B Notice Addresses
SCHEDULES: 1.1 Certain Calculations
1.2 Existing Permitted Partially-Owned Subsidiaries
3.1(i) Closing Date Mortgaged Properties
4.1 Jurisdictions of Organization and Qualification
4.2 Capital Stock and Ownership
4.10 Restricted Junior Payments
4.13 Real Estate Assets
6.1 Certain Indebtedness
6.2 Certain Liens
6.7 Certain Investments
EXHIBITS: A-1 Funding Notice
A-2 Conversion/Continuation Notice
B-1 Tranche A Term Loan Note
B-2 Tranche B Term Loan Note
B-3 Revolving Loan Note
B-4 Swing Line Note
C Compliance Certificate
D Opinions of Counsel
E Assignment Agreement
F Certificate Re Non-bank Status
G-1 Closing Date Certificate
G-2 Solvency Certificate
H Counterpart Agreement
I Pledge and Security Agreement
J Mortgage
K Form of Permitted Seller Note
CREDIT AND GUARANTY AGREEMENT
This CREDIT AND GUARANTY AGREEMENT, dated as of September 20, 2000, is
entered into by and among VICAR OPERATING, INC., a Delaware corporation
("COMPANY"), VETERINARY CENTERS OF AMERICA, INC., a Delaware corporation
("HOLDINGS"), CERTAIN SUBSIDIARIES OF COMPANY, as Guarantors, the Lenders party
hereto from time to time, ▇▇▇▇▇▇▇ ▇▇▇▇▇ CREDIT PARTNERS L.P. ("GSCP"), as Sole
Lead Arranger (in such capacity, "LEAD ARRANGER"), and as Sole Syndication Agent
(in such capacity, "SYNDICATION AGENT"), and ▇▇▇▇▇ FARGO BANK, N.A. ("▇▇▇▇▇
FARGO"), as Administrative Agent (together with its permitted successors in such
capacity, "ADMINISTRATIVE AGENT") and as Collateral Agent (together with its
permitted successor in such capacity, "COLLATERAL AGENT").
RECITALS:
WHEREAS, capitalized terms used in these Recitals shall have the
respective meanings set forth for such terms in Section 1.1 hereof;
WHEREAS, Holdings, Company and Merger Corp. have entered into the Merger
Agreement pursuant to which a series of acquisition transactions will occur and
whereby, (i) Sponsor and its Co-Investors will acquire all of the outstanding
Capital Stock of Holdings (other than the Rollover Equity, the Warrants and the
Preferred Stock) and (ii) Holdings will be the holder of all of the outstanding
Capital Stock of Company;
WHEREAS, the Lenders have agreed to extend certain credit facilities to
Company, in an aggregate principal amount not to exceed $300,000,000, consisting
of $250,000,000 aggregate principal amount of Term Loans and up to $50,000,000
aggregate principal amount of Revolving Commitments. The proceeds of the Term
Loans will be used by Company to fund, a portion of the Acquisition Financing
Requirements, to repay the Existing Indebtedness of Holdings and its
Subsidiaries and to pay related fees and expenses. The proceeds of the Revolving
Loans made after the Closing Date shall be applied by Company for working
capital and general corporate purposes of Company and its Subsidiaries;
WHEREAS, Company has agreed to secure all of its Obligations by granting
to Collateral Agent, for the benefit of Secured Parties, a First Priority Lien
on certain of its assets, including a pledge of all of the Capital Stock of each
of its Domestic Subsidiaries and 65% of all the Capital Stock of each of its
Foreign Subsidiaries; and
WHEREAS, Guarantors have agreed to guarantee the obligations of Company
hereunder and to secure their respective Obligations by granting to Collateral
Agent, for the benefit of Secured Parties, a First Priority Lien on certain of
their respective assets, including a pledge of all of the Capital Stock of each
of their respective Domestic Subsidiaries (including Company) and 65% of all the
Capital Stock of each of their respective Foreign Subsidiaries.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained the parties hereto agree as follows:
Page 7
SECTION 1. DEFINITIONS AND INTERPRETATION
1.1. DEFINITIONS. The following terms used herein, including in the preamble,
recitals, exhibits and schedules hereto, shall have the following meanings:
"ACQUISITION" means the Merger and the other transactions
contemplated by the Merger Agreement.
"ACQUISITION FINANCING REQUIREMENTS" means the aggregate of all
amounts necessary (i) to pay the cash consideration for the Acquisition, (ii) to
refinance all Existing Indebtedness (other than certain existing Indebtedness of
Holdings and its Subsidiaries permitted under Section 6.1(j)) and (iii) to pay
the Transaction Costs.
"ADJUSTED EURODOLLAR RATE" means, for any Interest Rate
Determination Date with respect to an Interest Period for a Eurodollar Rate
Loan, the rate per annum obtained by dividing (and rounding upward to the next
whole multiple of 1/16 of 1%)(i)(a) the rate per annum (rounded to the nearest
1/100 of 1%) equal to the rate determined by Administrative Agent to be the
offered rate which appears on the page of the Telerate Screen which displays an
average British Bankers Association Interest Settlement Rate (such page
currently being page number 3740 or 3750, as applicable) for deposits (for
delivery on the first day of such period) with a term equivalent to such period
in Dollars, determined as of approximately 11:00 a.m. (London, England time) on
such Interest Rate Determination Date, or (b) in the event the rate referenced
in the preceding clause (a) does not appear on such page or service or if such
page or service shall cease to be available, the rate per annum (rounded to the
nearest 1/100 of 1%) equal to the rate determined by Administrative Agent to be
the offered rate on such other page or other service which displays an average
British Bankers Association Interest Settlement Rate for deposits (for delivery
on the first day of such period) with a term equivalent to such period in
Dollars, determined as of approximately 11:00 a.m. (London, England time) on
such Interest Rate Determination Date, or (c) in the event the rates referenced
in the preceding clauses (a) and (b) are not available, the rate per annum
(rounded to the nearest 1/100 of 1%) equal to the offered quotation rate to
first class banks in the London interbank market by ▇▇▇▇▇ Fargo for deposits
(for delivery on the first day of the relevant period) in Dollars of amounts in
same day funds comparable to the principal amount of the applicable Loan of
Administrative Agent, in its capacity as a Lender, for which the Adjusted
Eurodollar Rate is then being determined with maturities comparable to such
period as of approximately 11:00 a.m. (London, England time) on such Interest
Rate Determination Date, by (ii) an amount equal to (a) one MINUS (b) the
Applicable Reserve Requirement.
"ADMINISTRATIVE AGENT" as defined in the preamble hereto.
"ADVERSE PROCEEDING" means any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration (whether or not purportedly on behalf of Holdings or any of its
Subsidiaries) at law or in equity, or before or by any Governmental Authority,
domestic or foreign (including any Environmental Claims), whether pending or, to
the knowledge of Holdings or any of its Subsidiaries, threatened against or
affecting Holdings or any of its Subsidiaries or any property of Holdings or any
of its Subsidiaries.
Page 8
"AFFECTED LENDER" as defined in Section 2.17(b).
"AFFECTED LOANS" as defined in Section 2.17(b).
"AFFILIATE" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power (i) to vote 10% or more of the Securities having
ordinary voting power for the election of directors of such Person or (ii) to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting securities or by contract or otherwise.
"AGENT" means each of Lead Arranger, Syndication Agent,
Administrative Agent and Collateral Agent.
"AGGREGATE AMOUNTS DUE" as defined in Section 2.16.
"AGGREGATE PAYMENTS" as defined in Section 7.2.
"AGREEMENT" means this Credit and Guaranty Agreement, dated as of
September 20, 2000, as it may be amended, supplemented or otherwise modified
from time to time.
"APPLICABLE MARGIN" means (i) with respect to Tranche A Term Loans
and Revolving Loans that are Eurodollar Rate Loans (a) from the Closing Date
until the date of delivery of the Compliance Certificate and the financial
statements for the period ending twelve months after the Closing Date, 3.25%,
per annum; and (b) thereafter, a percentage, per annum, determined by reference
to the Leverage Ratio in effect from time to time as set forth below:
LEVERAGE APPLICABLE MARGIN
RATIO FOR EURODOLLAR LOAN
---------------- -------------------
> 3.75:1.00 3.25%
-
< 3.75:1.00 3.00%
> 3.25:1.00
-
< 3.25:1.00 2.75%
> 2.75:1.00
-
< 2.75:1.00 2.50%
> 2.25:1.00
-
< 2.25:1.00 2.00%
, (ii) with respect to Tranche A Term Loans and Revolving Loans that are Base
Rate Loans, the Applicable Margin for Eurodollar Rate Loans as set forth in
clause (i)(a) or (i)(b) above, as applicable, minus (b) 1.00% per annum and
(iii) with respect to Swing Line Loans, (a) the Applicable Margin for Eurodollar
Rate Loans as set forth in clause (i)(a) or (i)(b) above, as
Page 9
applicable, minus (b) the sum of 1.00% per annum plus the then Applicable
Revolving Commitment Fee Percentage. No change in the Applicable Margin shall be
effective until three Business Days after the date on which Administrative Agent
shall have received the applicable financial statements and a Compliance
Certificate pursuant to Section 5. 1 (d) calculating the Leverage Ratio. At any
time Company has not submitted to Administrative Agent the applicable
information as and when required under Section 5.1(d), the Applicable Margin
shall be determined as if the Leverage Ratio were in excess of 3.75:1.00. Within
one Business Day of receipt of the applicable information as and when required
under Section 5. 1 (d), Administrative Agent shall give each Lender
telefacsimile or telephonic notice (confirmed in writing) of the Applicable
Margin in effect from such date.
"APPLICABLE RESERVE REQUIREMENT" means, at any time, for any
Eurodollar Rate Loan, the maximum rate, expressed as a decimal, at which
reserves (including, without limitation, any basic marginal, special,
supplemental, emergency or other reserves) are required to be maintained with
respect thereto against "Eurocurrency liabilities" (as such term is defined in
Regulation D) under regulations issued from time to time by the Board of
Governors of the Federal Reserve System or other applicable banking regulator.
Without limiting the effect of the foregoing, the Applicable Reserve Requirement
shall reflect any other reserves required to be maintained by such member banks
with respect to (i) any category of liabilities which includes deposits by
reference to which the applicable Adjusted Eurodollar Rate or any other interest
rate of a Loan is to be determined, or (ii) any category of extensions of credit
or other assets which include Eurodollar Rate Loans. A Eurodollar Rate Loan
shall be deemed to constitute Eurocurrency liabilities and as such shall be
deemed subject to reserve requirements without benefits of credit for proration,
exceptions or offsets that may be available from time to time to the applicable
Lender. The rate of interest on Eurodollar Rate Loans shall be adjusted
automatically on and as of the effective date of any change in the Applicable
Reserve Requirement.
"APPLICABLE REVOLVING COMMITMENT FEE PERCENTAGE" means a percentage,
per annum, equal to (i) 0.75% with respect to any period during which the Total
Utilization of Revolving Commitments is less than 50% and (ii) 0.50% at all
other times.
"ASSET SALE" means a sale, lease or sub-lease (as lessor or
sublessor), sale and leaseback, assignment, conveyance, transfer or other
disposition to, or any exchange of property with, any Person (other than Company
or a Guarantor Subsidiary), in one transaction or a series of transactions, of
all or any part of Holdings' or any of its Subsidiaries' businesses, assets or
properties of any kind, whether real, personal, or mixed and whether tangible or
intangible, whether now owned or hereafter acquired, including, without
limitation, the Capital Stock of any of Holdings' Subsidiaries (PROVIDED,
HOWEVER, that solely for purposes of Section 2.13(a), such sale of Capital Stock
shall not be considered an Asset Sale), other than (i) inventory (or other
assets) sold or leased in the ordinary course of business, and (ii) sales of
other assets for aggregate consideration of less than $750,000 with respect to
any transaction or series of related transactions.
"ASSIGNMENT AGREEMENT" means an Assignment Agreement substantially
in the form of Exhibit E, with such amendments or modifications as may be
approved by Administrative Agent.
Page 10
"AUTHORIZED OFFICER" means, as applied to any Person, any individual
holding the position of chairman of the board (if an officer), chief executive
officer, president or one of its vice presidents (or the equivalent thereof),
and such Person's chief financial officer or treasurer.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy," as now and hereafter in effect, or any successor statute.
"BASE RATE" means, for any day, a rate per annum equal to the
greater of (i) the Prime Rate in effect on such day and (ii) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the Base Rate
due to a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective on the effective day of such change in the Prime Rate or the Federal
Funds Effective Rate, respectively.
"BASE RATE LOAN" means a Loan bearing interest at a rate determined
by reference to the Base Rate.
"BENEFICIARY" means each Agent, Lender and Lender Counterparty.
"BUSINESS DAY" means (i) any day excluding Saturday, Sunday and any
day which is a legal holiday under the laws of the State of New York and/or
California or is a day on which banking institutions located in such state are
authorized or required by law or other governmental action to close and (ii)
with respect to all notices, determinations, fundings and payments in connection
with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans, the term
"BUSINESS DAY" shall mean any day which is a Business Day described in clause
(i) and which is also a day for trading by and between banks in Dollar deposits
in the London interbank market.
"CAPITAL LEASE" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"CAPITAL STOCK" means any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation),
including, without limitation, partnership interests and membership interests,
and any and all warrants, rights or options to purchase or other arrangements or
rights to acquire any of the foregoing.
"CASH" means money, currency or a credit balance in any demand or
Deposit Account.
"CASH EQUIVALENTS" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the
Page 11
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
▇▇▇▇▇'▇; (iii) commercial paper maturing no more than one year from the date of
creation thereof and having, at the time of the acquisition thereof, a rating of
at least A-1 from S&P or at least P-1 from ▇▇▇▇▇'▇; (iv) certificates of deposit
or bankers' acceptances maturing within one year after such date and issued or
accepted by any Lender or by any commercial bank organized under the laws of the
United States of America or any state thereof or the District of Columbia that
(a) is at least "adequately capitalized" (as defined in the regulations of its
primary Federal banking regulator) and (b) has Tier 1 capital (as defined in
such regulations) of not less than $100,000,000; and (v) shares of any money
market mutual fund that (a) has substantially all of its assets invested
continuously in the types of investments referred to in clauses (i) through (iv)
above, (b) has net assets of not less than $500,000,000, and (c) has the highest
rating obtainable from either S&P or ▇▇▇▇▇'▇.
"CERTIFICATE RE NON-BANK STATUS" means a certificate substantially
in the form of Exhibit F.
"CHANGE OF CONTROL" means, at any time, (i) Sponsor, Co-Investors
and Management Investors shall collectively cease to beneficially own and
control at least 51% on a fully diluted basis of the voting interests in the
Capital Stock of Holdings; (ii) any Person or "group" (within the meaning of
Rules 13d-3 and 13d-5 under the Exchange Act) other than Sponsor (a) shall have
acquired beneficial ownership of 35% or more on a fully diluted basis of the
voting interests in the Capital Stock of Holdings or (b) shall have obtained the
power (whether or not exercised) to elect a majority of the members of the board
of directors (or similar governing body) of Holdings; (iii) Sponsor and
Co-Investors shall collectively cease to beneficially own and control on a fully
diluted basis a percentage of the voting interests in the Capital Stock of
Holdings greater than any other Person or group (within the meaning of Rules
13d-3 and 13d-5 of the Exchange Act); (iv) Holdings shall cease to beneficially
own and control 100% on a fully diluted basis of the Capital Stock of Company;
or (v) the majority of the seats (other than vacant seats) on the board of
directors (or similar governing body) of Company cease to be occupied by Persons
who either (a) were members of the board of directors of Company on the Closing
Date or (b) were nominated for election by the board of directors of Company, a
majority of whom were directors on the Closing Date or whose election or
nomination for election was previously approved by a majority of such directors;
or (vi) any "change of control" or similar event under the Holdings Senior Note
Documents or the Senior Subordinated Note Documents shall occur.
"CLASS" means (i) with respect to Lenders, each of the following
classes of Lenders: (a) Lenders having Tranche A Term Loan Exposure, (b) Lenders
having Tranche B Term Loan Exposure, and (c) Lenders having Revolving Exposure
(including Swing Line Lender), and (ii) with respect to Loans, each of the
following classes of Loans: (a) Tranche A Term Loans, (b) Tranche B Term Loans,
and (c) Revolving Loans (including Swing Line Loans).
"CLOSING DATE" means the date on or before September 20, 2000 on
which the initial borrowing of Term Loans and Revolving Loans are made.
Page 12
"CLOSING DATE CERTIFICATE" means a Closing Date Certificate
substantially in the form of Exhibit G-1.
"CLOSING DATE MORTGAGED PROPERTY" as defined in Section 3.1(i).
"CO-INVESTORS" means certain entities affiliated with (i) Trust
Company of the West and ▇▇▇▇▇▇▇▇ ▇▇▇▇ Advisors and (ii) the following limited
partners in Sponsor: (a) CalPERS, (b) Caisse De Depot, (c) Procific and (d) PPM
America.
"COLLATERAL" means, collectively, all of the real, personal and
mixed property (including Capital Stock) in which Liens are purported to be
granted pursuant to the Collateral Documents as security for the Obligations.
"COLLATERAL AGENT" means the institution serving as such under the
Collateral Documents.
"COLLATERAL DOCUMENTS" means the Pledge and Security Agreement, the
Mortgages and all other instruments, documents and agreements delivered by any
Credit Party pursuant to this Agreement or any of the other Credit Documents in
order to grant to Collateral Agent, for the benefit of Secured Parties, a Lien
on any real, personal or mixed property of that Credit Party as security for the
Obligations.
"COMMITMENT" means any Revolving Commitment or Term Loan
Commitment.
"COMPANY" as defined in the preamble hereto.
"COMPANY PURCHASE AGREEMENT" means that certain Purchase Agreement
dated as of September 20, 2000 by and among Company, GS Mezzanine Partners II,
L.P. and Permitted Investors, pursuant to which the Senior Subordinated Notes
are sold, as in effect on the Closing Date and as such agreement may thereafter
be amended, restated, supplemented or otherwise modified from time to time to
the extent permitted by Section 6.16.
"COMPLIANCE CERTIFICATE" means a Compliance Certificate
substantially in the form of Exhibit C.
"CONSOLIDATED ADJUSTED EBITDA" means, for any period, an amount
determined for Company and its Subsidiaries on a consolidated basis equal to (i)
the sum, without duplication, of the amounts for such period of (a) Consolidated
Net Income, (b) Consolidated Interest Expense, (c) provisions for taxes based on
income, (d) total depreciation expense, (e) total amortization expense, (f)
other non-Cash items reducing Consolidated Net Income (excluding any such
non-Cash item to the extent that it represents an accrual or reserve for
potential Cash items in any future period or amortization of a prepaid Cash item
that was paid in a prior period but, notwithstanding anything to the contrary
herein, including without limitation, reserves for lease expense and other
charges and expenses related to the closure of hospitals to the extent not paid
in cash), (g) to the extent deducted in calculating Consolidated Net Income,
Transaction Costs and (h) payments made under the Management Services Agreement
in accordance with the provisions of Section 6.5(l), MINUS (ii) other non-Cash
items increasing Consolidated Net Income for such period (excluding any such
non-Cash item to the
Page 13
extent it represents the reversal of an accrual or reserve for potential Cash
item in any prior period); PROVIDED that the foregoing shall be subject to the
adjustments described in Schedule 1.1.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
aggregate of all expenditures of Company and its Subsidiaries during such period
determined on a consolidated basis that, in accordance with GAAP, are or should
be included in "purchase of property and equipment" or similar items reflected
in the consolidated statement of cash flows of Company and its Subsidiaries
excluding, (i) any acquisition of assets that constitutes a Permitted
Acquisition and (ii) any expenditures made by Company pursuant to Sections
2.13(a) and 2.13(b) hereof.
"CONSOLIDATED CASH INTEREST EXPENSE" means, for any period,
Consolidated Interest Expense for such period, PLUS, interest payable by
Holdings, pursuant to the Holdings Senior Notes, excluding, in each case, any
amount not payable in Cash.
"CONSOLIDATED CURRENT ASSETS" means, as at any date of
determination, the total assets of Company and its Subsidiaries on a
consolidated basis that may properly be classified as current assets in
conformity with GAAP, excluding Cash and Cash Equivalents.
"CONSOLIDATED CURRENT LIABILITIES" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries on a
consolidated basis that may properly be classified as current liabilities in
conformity with GAAP, excluding the current portion of long term debt.
"CONSOLIDATED EXCESS CASH FLOW" means, for any period, an amount (if
positive) equal to: (i) the sum, without duplication, of the amounts for such
period of (a) Consolidated Adjusted EBITDA, and (b) the Consolidated Working
Capital Adjustment, MINUS (ii) the sum, without duplication, of the amounts for
such period of (a) voluntary and scheduled repayments of Consolidated Total Debt
(excluding repayments of Revolving Loans or Swing Line Loans except to the
extent the Revolving Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Capital Expenditures (net of any proceeds of any
related financings with respect to such expenditures), (c) Consolidated Cash
Interest Expense, (d) the provision for current taxes based on income of
Holdings and its Subsidiaries and payable in cash with respect to such period,
(e) to the extent not otherwise deducted in determining Consolidated Excess Cash
Flow, cash payments made in connection with Permitted Acquisitions (net of any
proceeds of related financing), (f) all amounts which were paid in cash (or
which would have been payable but for the existence and continuance of an Event
of Default) to Holdings or ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Partners, L.P. in conformity with the
provisions of Section 6.5 and Section 6.7(i) hereof, (g) all amounts that were
made as Investments (or which would have been made as Investments but for the
existence and continuance of an Event of Default) in Persons, other than
Holdings, Company or a Guarantor Subsidiary in conformity with the provisions of
Section 6.7 hereof, (h) Transaction Costs to the extent included in determining
Consolidated Adjusted EBITDA and to the extent paid in cash during such period
(net of any proceeds of any related financing with respect thereto) and, without
duplication, whether or not included in determining Consolidated Adjusted EBITDA
Transaction Costs (A) made to purchase the restricted Capital Stock of Holdings
in an amount not to exceed $2,000,000 and (B)
Page 14
made pursuant to certain noncompetition agreements with members of senior
management of Holdings in an aggregate amount not to exceed $10,000,000 and (i)
all amounts that were distributed pro rata to the holders of Capital Stock of
Subsidiaries of Company (other than Company and Subsidiaries of Company) or that
were paid in cash to repurchase the Capital Stock of any Subsidiary of Company
from a Person who is not an Affiliate of Company in conformity with the
provisions of Sections 6.5 and 6.7, and MINUS (or plus) (iii) the amount by
which outstanding loans permitted pursuant to Section 6.7(g) hereof increased or
decreased during such period when compared to the immediately preceding Fiscal
Year.
"CONSOLIDATED FIXED CHARGES" means, for any period, the sum, without
duplication, of the amounts determined for Company and its Subsidiaries on a
consolidated basis equal to (i) Consolidated Cash Interest Expense, (ii)
scheduled payments of principal on Consolidated Total Debt, (iii) Consolidated
Capital Expenditures, (iv) annual management or similar fees paid to Sponsor or
any of its Affiliates and (v) provisions for current cash taxes based on income
with respect to such period; provide that Consolidated Fixed Charges for any
period prior to the Closing Date shall be determined in accordance with Schedule
1.1.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Company and its Subsidiaries
on a consolidated basis with respect to all outstanding Indebtedness of Company
and its Subsidiaries, including all commissions, discounts and other fees and
charges owed with respect to letters of credit and net costs under Interest Rate
Agreements, but excluding, however, any amounts referred to in Section 2.10(c)
payable on or before the Closing Date and any fees paid under or in connection
with the Senior Subordinated Note Documents; PROVIDED that Consolidated Interest
Expense for any period prior to the Closing Date shall be determined in
accordance with Schedule 1.1.
"CONSOLIDATED NET INCOME" means, for any period, (i) the net income
(or loss) of Company and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with GAAP,
MINUS (ii) (a) the income of any Person (other than a Subsidiary of Company) in
which any other Person (other than Company or any of its Subsidiaries) has a
joint interest, except to the extent of the amount of dividends or other
distributions actually paid to Company or any of its Subsidiaries by such Person
during such period, (b) the income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary of Company or is merged into or consolidated with
Company or any of its Subsidiaries or that Person's assets are acquired by
Company or any of its Subsidiaries, (c) the income of any Subsidiary of Company
to the extent that the declaration or payment of dividends or similar
distributions by that Subsidiary of that income is not at the time permitted by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary, (d) any after-tax gains or losses attributable to Asset Sales or
returned surplus assets of any Pension Plan, and (e) (to the extent not included
in clauses (a) through (d) above) any net extraordinary gains or net
extraordinary losses.
"CONSOLIDATED TOTAL DEBT" means, as at any date of determination,
the aggregate stated balance sheet amount of all Indebtedness of Company and its
Subsidiaries determined on a consolidated basis in accordance with GAAP.
Page 15
"CONSOLIDATED TOTAL SENIOR DEBT" means as of any date of
determination, the total amount of Indebtedness incurred by Company and its
Subsidiaries pursuant to this Agreement, determined as of the last day of any
Fiscal Quarter, MINUS the outstanding principal amount of Senior Subordinated
Notes.
"CONSOLIDATED WORKING CAPITAL" means, as at any date of
determination, the excess of Consolidated Current Assets over Consolidated
Current Liabilities.
"CONSOLIDATED WORKING CAPITAL ADJUSTMENT" means, for any period on a
consolidated basis, the amount (which may be a negative number) by which
Consolidated Working Capital as of the beginning of such period exceeds (or is
less than) Consolidated Working Capital as of the end of such period.
"CONTRACTUAL OBLIGATION" means, as applied to any Person, any
provision of any Security issued by that Person or of any indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"CONVERSION/CONTINUATION DATE" means the effective date of a
continuation conversion, as the case may be, as set forth in the applicable
Conversion/Continuation Notice.
"CONVERSION/CONTINUATION NOTICE" means a Conversion/Continuation
Notice substantially in the form of Exhibit A-2.
"COUNTERPART AGREEMENT" means a Counterpart Agreement substantially
in the form of Exhibit H delivered by a Credit Party pursuant to Section 5.10.
"CONTRIBUTING GUARANTORS" as defined in Section 7.2.
"CREDIT DATE" means the date of a Credit Extension.
"CREDIT DOCUMENT" means any of this Agreement, the Notes, if any,
the Collateral Documents and all other documents, instruments or agreements
executed and delivered by a Credit Party for the benefit of any Agent or any
Lender in connection herewith, including, without limitation, any Hedge
Agreement entered into in connection herewith.
"CREDIT EXTENSION" means the making of a Loan.
"CREDIT PARTY" means each Person (other than any Agent or any Lender
or any other representative thereof) from time to time party to a Credit
Document.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency
swap agreement, futures contract, option contract, synthetic cap or other
similar agreement or arrangement, each of which is for the purpose of hedging
the foreign currency risk associated with Holdings' and its Subsidiaries'
operations and not for speculative purposes.
"DEFAULT" means a condition or event that, after notice or lapse of
time or both, would constitute an Event of Default.
Page 16
"DEFAULT EXCESS" means, with respect to any Defaulting Lender, the
excess, if any, of such Defaulting Lender's Pro Rata Share of the aggregate
outstanding principal amount of Loans of all Lenders (calculated as if all
Defaulting Lenders (other than such Defaulting Lender) had funded all of their
respective Defaulted Loans) over the aggregate outstanding principal amount of
all Loans of such Defaulting Lender.
"DEFAULT PERIOD" means, with respect to any Defaulting Lender, the
period commencing on the date of the applicable Funding Default and ending on
the earliest of the following dates: (i) the date on which all Commitments are
cancelled or terminated and/or the Obligations are declared or become
immediately due and payable, (ii) the date on which (a) the Default Excess with
respect to such Defaulting Lender shall have been reduced to zero (whether by
the funding by such Defaulting Lender of any Defaulted Loans of such Defaulting
Lender or by the non-pro rata application of any voluntary or mandatory
prepayments of the Loans in accordance with the terms of Section 2.13 or Section
2.14 or by a combination thereof) and (b) such Defaulting Lender shall have
delivered to Company and Administrative Agent a written reaffirmation of its
intention to honor its obligations hereunder with respect to its Commitments,
and (iii) the date on which Company, Administrative Agent and Requisite Lenders
waive all Funding Defaults of such Defaulting Lender in writing.
"DEFAULTING LENDER" as defined in Section 2.21.
"DEFAULTED LOAN" as defined in Section 2.21.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"DOLLARS" and the sign "$" mean the lawful money of the United
States of America.
"DOMESTIC SUBSIDIARY" means any Subsidiary organized under the laws
of the United States of America, any State thereof or the District of Columbia.
"EARN-OUT OBLIGATIONS" means any unsecured contingent liability of
Holdings or any of its Subsidiaries owed to any seller in connection with a
Permitted Acquisition that (a) constitutes a portion of the purchase price for
such Permitted Acquisition but is not an amount certain on the date of
incurrence thereof and is not subject to any right of acceleration by such
seller and (b) is only payable upon the achievement of performance standards by
the Person or other property acquired in such Permitted Acquisition and in an
amount based upon such achievement provided that the maximum aggregate amount of
such liability shall be fixed at a specified amount on the date of such
Permitted Acquisition.
"ELIGIBLE ASSIGNEE" means (i) any Lender, any Affiliate of any
Lender and any Related Fund (any two or more Related Funds being treated as a
single Eligible Assignee for all purposes hereof), and (ii) any commercial bank,
insurance company, investment or mutual fund or other entity that is an
"accredited investor" (as defined in Regulation D under the Securities Act) and
which extends credit or buys loans as one of its businesses; PROVIDED, no
Affiliate of Holdings shall be an Eligible Assignee.
Page 17
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as defined
in Section 3(3) of ERISA which is or was sponsored, maintained or contributed to
by, or required to be contributed by, Holdings or any of its Subsidiaries or, to
the extent that Holdings or any of its Subsidiaries would be liable under ERISA
in respect thereof, any of their respective ERISA Affiliates.
"EMPLOYMENT AGREEMENT" means any of the following: (i) the
Employment Agreement dated as of the date hereof by and between Holdings and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, (ii) the Employment Agreement dated as of the date hereof by
and between Holdings and ▇▇▇▇▇▇ ▇▇▇▇▇, (iii) the Employment Agreement dated as
of the date hereof by and between Holdings and ▇▇▇▇ ▇▇▇▇▇▇, and (iv) the
Employment Agreement dated as of the date hereof by and between Holdings and
▇▇▇▇▇ ▇▇▇▇▇▇, and as such agreements may be amended, restated or otherwise
modified from time to time in accordance with Section 6.15.
"ENVIRONMENTAL CLAIM" means any investigation, notice, notice of
violation, claim, action, suit, proceeding, demand, abatement order or other
order or directive (conditional or otherwise), by any governmental authority or
any other Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law; (ii) in connection with any
Hazardous Material or any actual or alleged Hazardous Materials Activity; or
(iii) in connection with any actual or alleged damage, injury, threat or harm to
health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future foreign or
domestic, federal or state (or any subdivision of either of them), statutes,
ordinances, orders, rules, regulations, guidance documents, judgments,
Governmental Authorizations, or any other requirements of Governmental
Authorities relating to (i) environmental matters, including those relating to
any Hazardous Materials Activity; (ii) the generation, use, storage,
transportation or disposal of Hazardous Materials; or (iii) occupational safety
and health, industrial hygiene, land use or the protection of human, plant or
animal health or welfare, in any manner applicable to Holdings or any of its
Subsidiaries or any Facility.
"EQUITY CONTRIBUTION" means, collectively, (i) the Rollover Equity
by the Management Investors and (ii) Sponsor's and its Co-Investor's (a) payment
(at the rate of $15 per share) of cash to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ in exchange for
certain shares of the Capital Stock of Holdings, (b) contribution of cash and
certain shares of Capital Stock of Holdings to Merger Corp. in exchange for all
of the outstanding Capital Stock of Merger Corp. and (c) contribution of cash to
Holdings in exchange for all of the outstanding Capital Stock of Holdings (other
than the Preferred Stock, the Warrants, the Rollover Equity and the Capital
Stock of Holdings issued in the Merger for the outstanding Capital Stock of
Merger Corp.); PROVIDED, that the aggregate amount of the cash payments and
contributions described in clauses (a), (b) and (c) above, shall not be less
than $155,000,000.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and any successor thereto.
"ERISA AFFILIATE" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations within the
meaning of Section 414(b) of the
Page 18
Internal Revenue Code of which that Person is a member; (ii) any trade or
business (whether or not incorporated) which is a member of a group of trades or
businesses under common control within the meaning of Section 414(c) of the
Internal Revenue Code of which that Person is a member; and (iii) any member of
an affiliated service group within the meaning of Section 414(m) or (o) of the
Internal Revenue Code of which that Person, any corporation described in clause
(i) above or any trade or business described in clause (ii) above is a member.
Any former ERISA Affiliate of Holdings or any of its Subsidiaries shall continue
to be considered an ERISA Affiliate of Holdings or any such Subsidiary within
the meaning of this definition with respect to the period such entity was an
ERISA Affiliate of Holdings or such Subsidiary and with respect to liabilities
arising after such period for which Holdings or such Subsidiary could be liable
under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations issued thereunder with respect to any
Pension Plan (excluding those for which the provision for 30-day notice to the
PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates of
fines, penalties, taxes or related charges under Chapter 43 of the Internal
Revenue Code or under Section 409, Section 502(c), (i) or (1), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (ix) receipt from the Internal
Revenue Service of notice of the failure of any Pension Plan (or any other
Employee Benefit Plan intended to be qualified under Section 401(a) of the
Internal Revenue Code) to qualify under Section 401(a) of the Internal Revenue
Code; or (x) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n)
of the Internal Revenue Code or pursuant to ERISA with respect to any Pension
Plan.
Page 19
"EURODOLLAR RATE LOAN" means a Loan bearing interest at a rate
determined by reference to the Adjusted Eurodollar Rate.
"EVENT OF DEFAULT" means each of the conditions or events set forth
in Section 8.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute.
"EXISTING INDEBTEDNESS" means all Indebtedness of Holdings and its
Subsidiaries outstanding immediately prior to the Closing Date.
"FACILITY" means any real property (including all buildings,
fixtures or other improvements located thereon) now, hereafter or heretofore
owned, leased, operated or used by Holdings or any of its Subsidiaries or any of
their respective predecessors or Affiliates.
"FAIR SHARE CONTRIBUTION AMOUNT" as defined in Section 7.2.
"FAIR SHARE" as defined in Section 7.2.
"FAIR SHARE SHORTFALL" as defined in Section 7.2.
"FEDERAL FUNDS EFFECTIVE RATE" means for any day, the rate per annum
(expressed, as a decimal, rounded upwards, if necessary, to the next higher
1/100 of 1%) equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank of
New York on the Business Day next succeeding such day; PROVIDED, (i) if such day
is not a Business Day, the Federal Funds Effective Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Effective Rate
for such day shall be the average rate charged to Administrative Agent, in its
capacity as a Lender, on such day on such transactions as determined by
Administrative Agent.
"FINANCIAL OFFICER CERTIFICATION" means, with respect to the
financial statements for which such certification is required, the certification
of the chief financial officer of Holdings that such financial statements fairly
present, in all material respects, the financial condition of Holdings and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments.
"FINANCIAL PLAN" as defined in Section 5.1(i).
"FIRST PRIORITY" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that such Lien is
the only Lien to which such Collateral is subject, other than Permitted Liens.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
Page 20
"FISCAL YEAR" means the fiscal year of Holdings and its Subsidiaries
ending on December 31 of each calendar year.
"FIXED CHARGE COVERAGE RATIO" means the ratio as of the last day of
any Fiscal Quarter of (i) Consolidated Adjusted EBITDA for the four-Fiscal
Quarter period then ending, to (ii) Consolidated Fixed Charges for such
four-Fiscal Quarter period.
"FLOOD HAZARD PROPERTY" means any Real Estate Asset subject to a
Mortgage and located in an area designated by the Federal Emergency Management
Agency as having special flood or mud slide hazards.
"FOREIGN SUBSIDIARY" means any Subsidiary that is not a Domestic
Subsidiary.
"FUNDING DEFAULT" as defined in Section 2.21.
"FUNDING GUARANTORS" as defined in Section 7.2.
"FUNDING NOTICE" means a notice substantially in the form of Exhibit
A-1.
"GAAP" means, subject to the limitations on the application thereof
set forth in ▇▇▇▇▇▇▇ ▇.▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ generally accepted accounting principles
in effect as of the date of determination thereof.
"GOVERNMENTAL ACTS" means any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or
Governmental Authority.
"GOVERNMENTAL AUTHORITY" means any federal, state, municipal,
national or other government, governmental department, commission, board,
bureau, court, agency or instrumentality or political subdivision thereof or any
entity or officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with a state of the United States, the United
States, or a foreign entity or government.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
authorization, plan, directive, consent order or consent decree of or from any
Governmental Authority.
"GRANTOR" as defined in the Pledge and Security Agreement.
"GUARANTEED OBLIGATIONS" as defined in Section 7.1.
"GUARANTOR" means each of Holdings and each Domestic Subsidiary of
Holdings (other than Company and certain Permitted Partially-Owned Subsidiaries
that do not provide a Guaranty).
"GUARANTOR SUBSIDIARY" means each Guarantor other than Holdings.
"GUARANTY" means the guaranty of each Guarantor set forth in Section
7.
Page 21
"HAZARDOUS MATERIALS" means any chemical, material or substance,
exposure to which is prohibited, limited or regulated by any Governmental
Authority or which may or could pose a hazard to the health and safety of the
owners, occupants or any Persons in the vicinity of any Facility or to the
indoor or outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a Currency
Agreement entered into with a Lender Counterparty in order to satisfy the
requirements of this Agreement.
"HIGHEST LAWFUL RATE" means the maximum lawful interest rate, if
any, that at any time or from time to time may be contracted for, charged, or
received under the laws applicable to any Lender which are presently in effect
or, to the extent allowed by law, under such applicable laws which may hereafter
be in effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.
"HISTORICAL FINANCIAL STATEMENTS" means as of the Closing Date, (i)
the audited financial statements of Holdings and its Subsidiaries, for the
immediately preceding three Fiscal Years, consisting of balance sheets and the
related consolidated statements of income, stockholders' equity and cash flows
for such Fiscal Years, and (ii) the unaudited financial statements of Holdings
and its Subsidiaries as at the most recently ended Fiscal Quarter, consisting of
a balance sheet and the related consolidated statements of income, stockholders'
equity and cash flows for the three-, six- or nine-month period, as applicable,
ending on such date, and, in the case of clauses (i) and (ii), certified by the
chief financial officer of Company that they fairly present, in all material
respects, the financial condition of Holdings and its Subsidiaries as at the
dates indicated and the results of their operations and their cash flows for the
periods indicated, subject to changes resulting from audit and normal year-end
adjustments.
"HOLDINGS" as defined in the preamble hereto.
"HOLDINGS PURCHASE AGREEMENT" means that certain Purchase Agreement
dated as of September 20, 2000 by and among Holdings, GS Mezzanine Partners II,
L.P. and Permitted Investors, pursuant to which the Holdings Senior Notes, the
Preferred Stock, and the Warrants are sold, as in effect on the Closing Date and
as such agreement may thereafter be amended, restated, supplemented or otherwise
modified from time to time to the extent permitted under Section 6.16.
"HOLDINGS REGISTRATION RIGHTS AGREEMENT" means the Exchange and
Registration Rights Agreement dated as of September 20, 2000 among Holdings, GS
Mezzanine Partners II, L.P. and Permitted Investors, as in effect on the Closing
Date and as such agreement
Page 22
may thereafter be amended, restated, supplemented or otherwise modified from
time to time to the extent permitted under Section 6.16.
"HOLDINGS SENIOR NOTE DOCUMENTS" means the Holdings Senior Notes,
the Holdings Senior Note Indenture, the Holdings Purchase Agreement, the
Holdings Registration Rights Agreement, the Warrant Agreement, the Warrants and
each other document executed in connection with the Holdings Senior Notes, as
such document may be amended, restated, supplemented or otherwise modified from
time to time to the extent permitted under Section 6.16.
"HOLDINGS SENIOR NOTE INDENTURE" means that certain Indenture dated
as of September 20, 2000 between Holdings and Chase Manhattan Bank and Trust
Company, National Association, as trustee, pursuant to which the Holdings Senior
Notes are issued, as in effect on the Closing Date and as such indenture may
hereafter be amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under Section 6.16.
"HOLDINGS SENIOR NOTES" means the $ 100,000,000 in aggregate
principal amount of 15.5% senior notes due 2010, and any PIK Notes issued by
Holdings pursuant to the Holdings Senior Note Indenture (including any Holdings
Senior Notes or PIK Notes issued by Holdings pursuant to the Holdings Senior
Note Indenture, the Holdings Purchase Agreement or the Holdings Registration
Rights Agreement (the "HOLDINGS REPLACEMENT NOTES") in exchange for, and on
substantially identical terms as, the original Holdings Senior Notes and PIK
Notes; PROVIDED, that, the Holdings Replacement Notes may have changes to the
relative ranking as among such Holdings Replacement Notes, the interest rate or
yield so long as the principal amount and cash interest and premium expense to
Holdings shall not exceed such principal amount and cash interest and premium
expense of the original Holdings Senior Notes or PIK Notes prior to such
exchange and so long as the aggregate amounts paid, and the dates of payment
thereof, with respect to the Holdings Replacement Notes shall not be different
from the aggregate amounts paid and the dates of payment of the original
Holdings Senior Notes or PIK Notes prior to such exchange), as such notes may
hereafter be amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under Section 6.16.
"INCREASED AMOUNT DATE" as defined in Section 2.1(c).
"INCREASED-COST LENDERS" as defined in Section 2.22.
"INDEBTEDNESS", as applied to any Person, means, without
duplication, (i) all indebtedness for borrowed money; (ii) that portion of
obligations with respect to Capital Leases that is properly classified as a
liability on a balance sheet in conformity with GAAP; (iii) notes payable and
drafts accepted representing extensions of credit whether or not representing
obligations for borrowed money; (iv) any obligation owed for all or any part of
the deferred purchase price of property or services (excluding any such
obligations incurred under ERISA and ordinary course trade payables), which
purchase price is (a) due more than six months from the date of incurrence of
the obligation in respect thereof or (b) evidenced by a note or similar written
instrument; (v) all indebtedness secured by any Lien on any property or asset
owned or held by that Person regardless of whether the indebtedness secured
thereby shall have been assumed by that Person or is nonrecourse to the credit
of that Person; (vi) the face amount of any
Page 23
letter of credit issued for the account of that Person or as to which that
Person is otherwise liable for reimbursement of drawings; (vii) the direct or
indirect guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of the obligation of another; (viii) any obligation of
such Person the primary purpose or intent of which is to provide assurance to an
obligee that the obligation of the obligor thereof will be paid or discharged,
or any agreement relating thereto will be complied with, or the holders thereof
will be protected (in whole or in part) against loss in respect thereof, and
(ix) any liability of such Person for the obligation of another through any
agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise
acquire such obligation or any security therefor, or to provide funds for the
payment or discharge of such obligation (whether in the form of loans, advances,
stock purchases, capital contributions or otherwise) or (b) to maintain the
solvency or any balance sheet item, level of income or financial condition of
another if, in the case of any agreement described under subclauses (a) or (b)
of this clause (ix), the primary purpose or intent thereof is as described in
clause (viii) above; and (x) obligations of such Person in respect of any
exchange traded or over the counter derivative transaction, including, without
limitation, any Interest Rate Agreement and Currency Agreement, whether entered
into for hedging or speculative purposes; PROVIDED, in no event shall
obligations under any Interest Rate Agreement and any Currency Agreements be
deemed "Indebtedness" for any purpose under Section 6.8.
"INDEMNIFIED LIABILITIES" means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties and claims (including Environmental Claims), and any and all
reasonable and documented costs (including the costs of any investigation,
study, sampling, testing, abatement, cleanup, removal, remediation or other
response action necessary to remove, remediate, clean up or ▇▇▇▇▇ any Hazardous
Materials Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable and documented fees and disbursements of counsel for
Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto, and any
fees or expenses incurred by Indemnitees in enforcing this indemnity), whether
direct, indirect or consequential and whether based on any federal, state or
foreign laws, statutes, rules or regulations (including securities and
commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner relating
to or arising out of (i) this Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby (including Lenders' agreement to
make Credit Extensions or the use or intended use of the proceeds thereof, or
any enforcement of any of the Credit Documents (including any sale of,
collection from, or other realization upon any of the Collateral or the
enforcement of the Guaranty)); (ii) the statements contained in the commitment
letter delivered by any Lender to Company or Sponsor with respect to the
transactions contemplated by this Agreement; or (iii) any Environmental Claim or
any Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, or practice
of Holdings or any of its Subsidiaries.
"INDEMNITEE" as defined in Section 10.3.
"INSTALLMENT" as defined in Section 2.11(a).
Page 24
"INSTALLMENT DATE" as defined in Section 2.11(a).
"INTEREST COVERAGE RATIO" means the ratio as of the last day of any
Fiscal Quarter of (i) Consolidated Adjusted EBITDA for the four-Fiscal Quarter
period then ended, to (ii) Consolidated Cash Interest Expense for such
four-Fiscal Quarter period.
"INTEREST PAYMENT DATE" means with respect to (i) any Base Rate
Loan, the last Business Day of each March, June, September and December of each
year, commencing on the first such date to occur after the Closing Date and the
final maturity date of such Loan; and (ii) any Eurodollar Rate Loan, the last
day of each Interest Period applicable to such Loan; PROVIDED, in the case of
each Interest Period of longer than three months "Interest Payment Date" shall
also include each date that is three months, or an integral multiple thereof,
after the commencement of such Interest Period.
"INTEREST PERIOD" means, in connection with a Eurodollar Rate Loan,
an interest period of one-, two-, three- or six-months, as selected by Company
in the applicable Funding Notice or Conversion/Continuation Notice, (i)
initially, commencing on the Credit Date or Conversion/Continuation Date
thereof, as the case may be; and (ii) thereafter, commencing on the day on which
the immediately preceding Interest Period expires; PROVIDED, (a) if an Interest
Period would otherwise expire on a day that is not a Business Day, such Interest
Period shall expire on the next succeeding Business Day unless no further
Business Day occurs in such month, in which case such Interest Period shall
expire on the immediately preceding Business Day; (b) any Interest Period that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clauses (c) through (d), of this definition,
end on the last Business Day of a calendar month; (c) no Interest Period with
respect to any portion of any Class of Term Loans shall extend beyond such
Class's Term Loan Maturity Date; and (d) no Interest Period with respect to any
portion of the Revolving Loans shall extend beyond the Revolving Commitment
Termination Date.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement, interest rate
hedging agreement or other similar agreement or arrangement, each of which is
for the purpose of hedging the interest rate exposure associated with Holdings'
and its Subsidiaries' operations and not for speculative purposes.
"INTEREST RATE DETERMINATION DATE" means, with respect to any
Interest Period, the date that is two Business Days prior to the first day of
such Interest Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter, and any successor
statute.
"INVESTMENT" means (i) any direct or indirect purchase or other
acquisition by Holdings or any of its Subsidiaries of, or of a beneficial
interest in, any of the Securities of any other Person (other than Company or a
Guarantor Subsidiary); (ii) any direct or indirect redemption, retirement,
purchase or other acquisition for value, by any Subsidiary of Holdings from any
Person (other than Holdings, Company or any Guarantor Subsidiary), of any
Capital Stock of such Person; and (iii) any direct or indirect loan, advance
(other than advances to
Page 25
employees for moving, entertainment and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business) or capital contribution
by Holdings or any of its Subsidiaries to any other Person (other than Holdings,
Company or any Guarantor Subsidiary), including all indebtedness and accounts
receivable from that other Person that are not current assets or did not arise
from sales to that other Person in the ordinary course of business. The amount
of any Investment shall be the original cost of such Investment plus the cost of
all additions thereto, without any adjustments for increases or decreases in
value, or write-ups, write-downs or write-offs with respect to such Investment.
"INVESTMENT RELATED PROPERTY" as defined in the Pledge and
Security Agreement.
"JOINT VENTURE" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; PROVIDED, in
no event shall any corporate Subsidiary of any Person be considered to be a
Joint Venture to which such Person is a party.
"JUNIOR PREFERRED STOCK" means the shares of junior preferred stock,
par value $.01 per share of Holdings issued to GS Mezzanine Partners II, L.P.
and Permitted Investors pursuant to the terms of the Holdings Purchase
Agreement.
"LANDLORD CONSENT AND ESTOPPEL" means, with respect to any Leasehold
Property, a letter, certificate or other instrument in writing from the lessor
under the related lease, pursuant to which, among other things, the landlord
consents to the granting of a Mortgage on such Leasehold Property by the Credit
Party tenant, such Landlord Consent and Estoppel to be in form and substance
acceptable to the Collateral Agent in its reasonable discretion, but in any
event sufficient for the Collateral Agent to obtain a Title Policy with respect
to such Mortgage.
"LEAD ARRANGER" as defined in the preamble hereto.
"LEASEHOLD PROPERTY" means any leasehold interest of any Credit
Party as lessee under any lease of real property, other than any such leasehold
interest designated from time to time by Collateral Agent in its sole discretion
as not being required to be included in the Collateral.
"LENDER" means each financial institution listed on the signature
pages hereto as a Lender and any other Person that becomes a party hereto
pursuant to an Assignment Agreement.
"LENDER COUNTERPARTY" means each Lender or any Affiliate of a Lender
counterparty to a Hedge Agreement, including, without limitation, each such
Affiliate that enters into a joinder agreement with the Collateral Agent.
"LEVERAGE RATIO" means the ratio as of the last day of any Fiscal
Quarter of (i) Consolidated Total Debt as of such day to (ii) Consolidated
Adjusted EBITDA for the four-Fiscal Quarter period ending on such date (as
determined in accordance with Section 6.8(f)).
"LIEN" means (i) any lien, claim, mortgage, pledge, assignment,
security interest, charge or encumbrance of any kind (including any agreement to
give any of the foregoing, any
Page 26
conditional sale or other title retention agreement, and any lease in the nature
thereof) and any option, trust or other preferential arrangement having the
practical effect of any of the foregoing and (ii) in the case of Securities, any
purchase option, call or similar right of a third party with respect to such
Securities.
"LOAN" means a Tranche A Term Loan, a Tranche B Term Loan, a
Revolving Loan or a Swing Line Loan.
"MANAGEMENT INVESTORS" means certain management, officers and
employees of Holdings and its Subsidiaries disclosed to Syndication Agent and
Administrative Agent pursuant to the Merger Agreement.
"MANAGEMENT SERVICES AGREEMENT" means that certain Management
Services Agreement, dated as of the Closing Date, by and between ▇▇▇▇▇▇▇ ▇▇▇▇▇ &
Partners, L.P., on the one hand and Holdings and Company, on the other.
"MARGIN STOCK" as defined in Regulation U of the Board of Governors
of the Federal Reserve System as in effect from time to time.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
business, operations, properties, assets, condition (financial or otherwise) or
prospects of Holdings and its Subsidiaries, taken as a whole; (ii) the ability
of any Credit Party to fully and timely perform the Obligations; (iii) the
legality, validity, binding effect or enforceability against a Credit Party of a
Credit Document to which it is a party; (iv) the rights, remedies and benefits
available to, or conferred upon, any Agent and any Lender or any Secured Party
under any Credit Document or (v) the Collateral or the Collateral Agent's Liens,
on behalf of Secured Parties on the Collateral or the priority of such Liens.
"MATERIAL CONTRACT" means any contract or other arrangement to which
Holdings or any of its Subsidiaries is a party (other than the Credit Documents)
for which breach, nonperformance, cancellation or failure to renew could
reasonably be expected to have a Material Adverse Effect.
"MATERIAL REAL ESTATE ASSET" means (i)(a) any fee-owned Real Estate
Asset having a fair market value in excess of $50,000 as of the date of the
acquisition thereof and (b) all Leasehold Properties other than those with
respect to which the aggregate payments under the term of the lease are less
than $150,000 per annum or (ii) any Real Estate Asset that the Requisite Lenders
have determined is material to the business, operations, properties, assets,
condition (financial or otherwise) or prospects of Holdings or any Subsidiary
thereof, including Company.
"MERGER AGREEMENT" means that certain Amended and Restated Agreement
and Plan of Merger dated as of August 11, 2000 by and among Holdings, Company
and Merger Corp., and as such agreement may be amended, restated or otherwise
modified from time to time pursuant to Section 6.15.
"MERGER" means the merger of Merger Corp. with and into Holdings
as contemplated by the Merger Agreement.
Page 27
"MERGER CORP." means Vicar Recap, Inc., a Delaware corporation
formed by Sponsor, for the purpose of engaging with Holdings and Company the
Acquisition.
"MOODY'S" means ▇▇▇▇▇'▇ Investor Services, Inc.
"MORTGAGE" means a Mortgage substantially in the form of Exhibit J,
as it may be amended, supplemented or otherwise modified from time to time.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan which is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"NAIC" means The National Association of Insurance Commissioners,
and any successor thereto.
"NARRATIVE REPORT" means, with respect to the financial statements
for which such narrative report is required, a narrative report describing the
operations of Holdings and its Subsidiaries in the form and to the extent
prepared for presentation to senior management thereof for the applicable month,
Fiscal Quarter or Fiscal Year and for the period from the beginning of the then
current Fiscal Year to the end of such period to which such financial statements
relate.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset Sale, an
amount equal to: (i) Cash payments (including any Cash received by way of
deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) received by Holdings or any of its
Subsidiaries from such Asset Sale, MINUS (ii) any bona fide direct costs
incurred in connection with such Asset Sale, including (a) income or gains taxes
payable by the seller as a result of any gain recognized in connection with such
Asset Sale, (b) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on any Indebtedness (other than the Loans) that is
secured by a Lien on the stock or assets in question and that is required to be
repaid under the terms thereof as a result of such Asset Sale and (c) a
reasonable reserve for any indemnification payments (fixed or contingent)
attributable to seller's indemnities and representations and warranties to
purchaser in respect of such Asset Sale undertaken by Holdings or any of its
Subsidiaries in connection with such Asset Sale.
"NET INSURANCE/CONDEMNATION PROCEEDS" means an amount equal to: (i)
any Cash payments or proceeds received by Holdings or any of its Subsidiaries
(a) under any casualty insurance policy in respect of a covered loss thereunder
or (b) as a result of the taking of any assets of Holdings or any of its
Subsidiaries by any Person pursuant to the power of eminent domain, condemnation
or otherwise, or pursuant to a sale of any such assets to a purchaser with such
power under threat of such a taking, MINUS (ii) (a) any actual and reasonable
costs incurred by Holdings or any of its Subsidiaries in connection with the
adjustment or settlement of any claims of Holdings or such Subsidiary in respect
thereof, and (b) any bona fide direct costs incurred in connection with any sale
of such assets as referred to in clause (i)(b) of this definition, including
income taxes payable as a result of any gain recognized in connection therewith.
"NEW TRANCHE B TERM LOAN COMMITMENTS" as defined in Section
2.1(c).
"NEW TRANCHE B TERM LOANS" as defined in Section 2.1(c).
Page 28
"NEW TRANCHE B TERM LOAN LENDER" as defined in Section 2. 1 (c).
"NON-US LENDER" as defined in Section 2.19(c).
"NOTE" means a Tranche A Term Note, a Tranche B Term Note, a
Revolving Loan Note or a Swing Line Note.
"NOTICE" means a Funding Notice or a Conversion/Continuation Notice.
"OBLIGATIONS" means all obligations of every nature of each Credit
Party from time to time owed to the Agents (including former Agents), the
Lenders or any of them or their respective Affiliates and Lender Counterparties,
under any Credit Document or Hedge Agreement (including, without limitation,
with respect to a Hedge Agreement, obligations owed thereunder to any person who
was a Lender or an Affiliate of a Lender at the time such Hedge Agreement was
entered into), whether for principal, interest (including interest which, but
for the filing of a petition in bankruptcy with respect to such Credit Party,
would have accrued on any Obligation, whether or not a claim is allowed against
such Credit Party for such interest in the related bankruptcy proceeding),
payments for early termination of Hedge Agreements, fees, expenses,
indemnification or otherwise.
"OBLIGEE GUARANTOR" as defined in Section 7.7.
"OPTION EXCHANGE AGREEMENTS" means any of the Option Exchange
Agreements, dated as of or prior to the Closing Date, entered into by and
between Holdings and certain employees of Holdings and its Subsidiaries in
connection with the Acquisition.
"ORGANIZATIONAL DOCUMENTS" means (i) with respect to any
corporation, its certificate or articles of incorporation, as amended, and its
by-laws, as amended, (ii) with respect to any limited partnership, its
certificate of limited partnership, as amended, and its partnership agreement,
as amended, (iii) with respect to any general partnership, its partnership
agreement, as amended, and (iv) with respect to any limited liability company,
its articles of organization, as amended, and its operating agreement, as
amended. In the event any term or condition of this Agreement or any other
Credit Document requires any Organizational Document to be certified by a
secretary of state or similar governmental official, the reference to any such
"Organizational Document" shall only be to a document of a type customarily
certified by such governmental official.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, that is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"PERMITTED ACQUISITION" means any acquisition by Company or any of
its Subsidiaries, whether by purchase, merger or otherwise, of all or
substantially all of the assets of, 70% or more of the Capital Stock of, or a
business line or unit or a division of, any Person; PROVIDED,
Page 29
(i) immediately prior to, and after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing or would
result therefrom;
(ii) all transactions in connection therewith shall be consummated,
in all material respects, in accordance with all applicable laws and in
conformity with all applicable Governmental Authorizations;
(iii) in the case of the acquisition of Capital Stock, (i) at least
70% of the Capital Stock (except for any such Securities in the nature of
directors' qualifying shares required pursuant to applicable law) acquired or
otherwise issued by such Person or any newly formed Subsidiary of Company in
connection with such acquisition shall be owned by Company or a Guarantor
Subsidiary thereof, (ii) in the case of acquisitions where Company owns more
than 70% but less than 100% of such Subsidiary, Company shall designate such
Subsidiary as a Permitted Partially-Owned Subsidiary, and (iii) except in the
case of a Permitted Partially-Owned Subsidiary, Company shall have taken, or
caused to be taken, as of the date such Person becomes a Subsidiary of Company,
each of the actions set forth in Sections 5. 10 and/or 5. 11, as applicable;
(iv) Any Person or assets so acquired shall be located exclusively
in the United States;
(v) Holdings and its Subsidiaries shall be in compliance with the
financial covenants set forth in Section 6.8 on a pro forma basis after giving
effect to such acquisition as of the last day of the Fiscal Quarter most
recently ended (as determined in accordance with Section 6.8(f));
(vi) Company shall have delivered to Administrative Agent (A) at
least five Business Days prior to such proposed acquisition, a Compliance
Certificate evidencing compliance with Section 6.8 as required under clause (v)
above, together with all relevant financial information with respect to such
acquired assets, including, without limitation, the aggregate consideration for
such acquisition and any other information required to demonstrate compliance
with Section 6.8; PROVIDED, HOWEVER, that Company shall not be required to
comply with the provisions of this clause (vi) with respect to acquisitions
unless the consideration of such acquisition is greater than $3,000,000; and
(vii) any Person or assets or division as acquired in accordance
herewith shall be in a business or lines of business the same as, related,
complementary or ancillary to, the business or lines of business in which
Company and/or its Subsidiaries are engaged as of the Closing Date.
"PERMITTED INVESTORS" means any affiliated investment funds of GS
Mezzanine Partners II, L.P., TCW Leveraged Income Trust, L.P., TCW Leveraged
Income Trust II, L.P., TCW Leveraged Income Trust IV, L.P., TCW/Crescent
Mezzanine Partners II, L.P., TCW/Crescent Mezzanine Trust II and The
Northwestern Mutual Life Insurance Company.
"PERMITTED LIENS" means each of the Liens permitted pursuant to
Section 6.2.
Page 30
"PERMITTED PARTIALLY-OWNED SUBSIDIARY" means (a) those Subsidiaries
of Company listed on Schedule 1.2 existing on the Closing Date and (b) those
Subsidiaries of Company acquired or created after the Closing Date and
designated by Company as a Permitted Partially-Owned Subsidiary by written
notice to the Administrative Agent, PROVIDED, that, with respect to Permitted
Partially-Owned Subsidiaries acquired or created after the Closing Date, (i)
Company owns at least 70% of the outstanding Capital Stock of such Subsidiary,
(ii) the remaining Capital Stock of such Subsidiary is owned directly or
indirectly, by one or more licensed veterinarians who are actively involved in
the business of such Subsidiary, (iii) Company shall use its commercially
reasonable efforts to cause such Subsidiary to become a Guarantor Subsidiary,
(iv) if Company fails to obtain a Guaranty from such Subsidiary, then such
Subsidiary shall not own any Material Real Estate Assets, and (v) Company shall
use commercially reasonable efforts to cause such veterinarian to pledge his or
her Capital Stock in such Permitted Partially-Owned Subsidiary in favor of the
Collateral Agent for the benefit of the Secured Parties; PROVIDED, FURTHER, that
(i) at no time shall the total portion of Consolidated Adjusted EBITDA
contributed by all Subsidiaries constituting Permitted Partially-Owned
Subsidiaries exceed 10% of Consolidated Adjusted EBITDA and (ii) at no time
shall the portion of Consolidated Adjusted EBITDA contributed by all Permitted
Partially Owned Subsidiaries acquired or created after the Closing Date which
are not Guarantor Subsidiaries exceed 3% of Consolidated Adjusted EBITDA.
"PERMITTED SELLER NOTES" means promissory notes containing
subordination provisions in substantially the form of, or no less favorable to
Lenders (in the reasonable judgment of Administrative Agent) than the
subordination provisions contained in, Exhibit K annexed hereto, representing
any Indebtedness of Holdings incurred in connection with any Permitted
Acquisition payable to the seller in connection therewith, as such note may be
amended, supplemented or otherwise modified from time to time to the extent
permitted under subsection 6.16; PROVIDED that, no Permitted Seller Note shall
(i) be guarantied by any Subsidiary of Holdings or secured by any property of
Holdings, Company or any of its Subsidiaries, (ii) bear cash interest at a rate
greater than 8.5% per annum; or, (iii) except in accordance with subsection 6.5,
provide for any prepayment or repayment of all or any portion of the principal
thereof prior to the date of the final scheduled installment of principal of the
Loans; PROVIDED FURTHER, that in no event shall the aggregate scheduled cash
payments of principal and interest on all outstanding Permitted Seller Notes
exceed $4,000,000 in any Fiscal Year.
"PERSON" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and Governmental Authorities.
"PIK NOTES" as defined in the Holdings Senior Note Indenture.
"PLEDGE AND SECURITY AGREEMENT" means the Pledge and Security
Agreement to be executed by Company and each Guarantor, substantially in the
form of Exhibit I, as it may be amended, supplemented or otherwise modified from
time to time.
Page 31
"PREFERRED STOCK" means the Junior Preferred Stock and the Senior
Preferred Stock.
"PRIME RATE" means the rate of interest per annum that ▇▇▇▇▇ Fargo
announces from time to time as its prime lending rate, as in effect from time to
time. The Prime Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer. ▇▇▇▇▇ Fargo or any other
Lender may make commercial loans or other loans at rates of interest at, above
or below the Prime Rate.
"PRINCIPAL OFFICE" means, for each of Administrative Agent and Swing
Line Lender, such Person's "Principal Office" as set forth on Appendix B, or
such other office as such Person may from time to time designate in writing to
Company, Administrative Agent and each Lender.
"PROJECTIONS" as defined in Section 4.8.
"PRO RATA SHARE" means (i) with respect to all payments,
computations and other matters relating to the Tranche A Term Loan of any
Lender, the percentage obtained by dividing (a) the Tranche A Term Loan Exposure
of that Lender by (b) the aggregate Tranche A Term Loan Exposure of all Lenders;
(ii) with respect to all payments, computations and other matters relating to
the Tranche B Term Loan of any Lender, the percentage obtained by dividing (a)
the Tranche B Term Loan Exposure of that Lender by (b) the aggregate Tranche B
Term Loan Exposure of all Lenders; and (iii) with respect to all payments,
computations and other matters relating to the Revolving Commitment or Revolving
Loans of any Lender or participations purchased therein by any Lender or any
participations in any Swing Line Loans purchased by any Lender, the percentage
obtained by dividing (a) the Revolving Exposure of that Lender by (b) the
aggregate Revolving Exposure of all Lenders. For all other purposes with respect
to each Lender, "Pro Rata Share" means the percentage obtained by dividing (A)
an amount equal to the sum of the Tranche A Term Loan Exposure, the Tranche B
Term Loan Exposure and the Revolving Exposure of that Lender, by (B) an amount
equal to the sum of the aggregate Tranche A Term Loan Exposure, the aggregate
Tranche B Term Loan Exposure and the aggregate Revolving Exposure of all
Lenders.
"REAL ESTATE ASSET" means, at any time of any interest (fee,
leasehold or otherwise) then owned by any Credit Party in any real property.
"RECORD DOCUMENT" means, with respect to any Leasehold Property, (i)
the lease evidencing such Leasehold Property or a memorandum thereof, executed
and acknowledged by the owner of the affected real property, as lessor, or (ii)
if such Leasehold Property was acquired or subleased from the holder of a
Recorded Leasehold Interest, the applicable assignment or sublease document,
executed and acknowledged by such holder, in each case in form sufficient to
give such constructive notice upon recordation and otherwise in form reasonably
satisfactory to Collateral Agent.
"RECORDED LEASEHOLD INTEREST" means a Leasehold Property with
respect to which a Record Document has been recorded in all places necessary or
desirable, in
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Administrative Agent's reasonable judgment, to give constructive notice of such
Leasehold Property to third-party purchasers and encumbrancers of the affected
real property.
"REFUNDED SWING LINE LOANS" as defined in Section 2.3(b)(iv).
"REGISTER" as defined in Section 2.6(b).
"REGULATION D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"RELATED AGREEMENTS" means, collectively, the Merger Agreement, the
Holdings Senior Note Documents, the Senior Subordinated Note Documents, the
Management Services Agreement, the Stockholders Agreement, the Employment
Agreements, the Stock Purchase Agreement, the Securities Purchase Agreements,
the Option Exchange Agreements, certain noncompetition agreements executed with
certain members of senior management and disclosed to Syndication Agent and
Collateral Agent, certain agreements to repurchase restricted Capital Stock of
Holdings held by employees of Holdings and its Subsidiaries and disclosed to
Syndication Agent and Collateral Agent, certain agreements to provide stay
bonuses to certain employees of Holdings and its Subsidiaries and disclosed to
Syndication Agent and Collateral Agent and certain agreements to make payments
in connection with the termination of employment contracts and disclosed to
Syndication Agent and Collateral Agent.
"RELATED FUND" means, with respect to any Lender that is an
investment fund, any other investment fund that invests in commercial loans and
that is managed or advised by the same investment advisor as such Lender or by
an Affiliate of such investment advisor.
"RELEASE" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of any Hazardous Material into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Material), including the
movement of any Hazardous Material through the air, soil, surface water or
groundwater.
"REPLACEMENT LENDER" as defined in Section 2.22.
"REQUIRED PREPAYMENT DATE" as defined in Section 2.14(c).
"REQUISITE CLASS LENDERS" means, at any time of determination, (i)
for the Class of Lenders having Tranche A Term Loan Exposure, Lenders holding
more than 50% of the aggregate Tranche A Term Loan Exposure of all Lenders; (ii)
for the Class of Lenders having Tranche B Term Loan Exposure, Lenders holding
more than 50% of the aggregate Tranche B Term Loan Exposure of all Lenders; and
(iii) for the Class of Lenders having Revolving Exposure, Lenders having or
holding more than 50% of the aggregate Revolving Exposure of all Lenders.
"REQUISITE LENDERS" means one or more Lenders having or holding
Tranche A Term Loan Exposure, Tranche B Term Loan Exposure and/or Revolving
Exposure and representing more than 50% of the sum of (i) the aggregate Tranche
A Term Loan Exposure of
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all Lenders, (ii) the aggregate Tranche B Term Loan Exposure of all Lenders and
(iii) the aggregate Revolving Exposure of all Lenders.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of stock
of Holdings or Company or any of its Subsidiaries now or hereafter outstanding,
except a dividend payable solely in shares of that class of stock to the holders
of that class; (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of stock of Holdings or Company or any of its Subsidiaries now or
hereafter outstanding; (iii) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of stock of Holdings or Company or any of its Subsidiaries
now or hereafter outstanding; (iv) management or similar fees payable to Sponsor
or any of its Affiliates; and (v) any payment or prepayment of principal of,
premium, if any, or interest on, or redemption, purchase, retirement, defeasance
(including in-substance or legal defeasance), sinking fund or similar payment
with respect to, any Subordinated Indebtedness.
"REVOLVING COMMITMENT" means the commitment of a Lender to make or
otherwise fund any Revolving Loan and to acquire participations in Swing Line
Loans hereunder and "Revolving Commitments" means such commitments of all
Lenders in the aggregate. The amount of each Lender's Revolving Commitment, if
any, is set forth on Appendix A-3 or in the applicable Assignment Agreement,
subject to any adjustment or reduction pursuant to the terms and conditions
hereof. The aggregate amount of the Revolving Loan Commitments as of the Closing
Date is $50,000,000.
"REVOLVING COMMITMENT PERIOD" means the period from the Closing Date
to but excluding the Revolving Commitment Termination Date.
"REVOLVING COMMITMENT TERMINATION DATE" means the earliest to occur
of (i) September 30, 2000, if the Term Loans are not made on or before that
date; (ii) the sixth (6th) anniversary of the Closing Date, (iii) the date the
Revolving Commitments are permanently reduced to zero pursuant to Section
2.12(b) or 2.13, and (iv) the date of the termination of the Revolving
Commitments pursuant to Section 8.1.
"REVOLVING EXPOSURE" means, with respect to any Lender as of any
date of determination, (i) prior to the termination of the Revolving
Commitments, that Lender's Revolving Commitment; and (ii) after the termination
of the Revolving Commitments, the sum of (a) the aggregate outstanding principal
amount of the Revolving Loans of that Lender, (b) in the case of Swing Line
Lender, the aggregate outstanding principal amount of all Swing Line Loans (net
of any participations therein by other Lenders), and (e) the aggregate amount of
all participations therein by that Lender in any outstanding Swing Line Loans.
"REVOLVING LOAN" means a Loan made by a Lender to Company pursuant
to Section 2.2(a).
"REVOLVING LOAN NOTE" means a promissory note in the form of Exhibit
B-3, as it may be amended, supplemented or otherwise modified from time to time.
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"ROLLOVER EQUITY" means (i) the retention of Capital Stock of
Holdings by Management Investors, (ii) the exchange of the spread value (excess
of $15.00 per share over the exercise price) of options to acquire Capital Stock
of Holdings by Management Investors for Capital Stock of Holdings at $15.00 per
share, and (iii) the issuance to Management Investors of Capital Stock of
Holdings at $15.00 per share in cash, notes or property of equivalent value in
an aggregate amount with respect to (i), (ii) and (iii) above, of not less than
$4,000,000.
"S&P" means Standard & Poor's Ratings Group, a division of The
McGraw Hill Corporation.
"SECURED PARTIES" has the meaning assigned to that term in the
Pledge and Security Agreement.
"SECURITIES" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time, and any successor statute.
"SECURITIES PURCHASE AGREEMENTS" means any of the Securities
Purchase Agreements, dated as of or prior to the Closing Date, entered into by
and between Holdings and its Management Investors.
"SENIOR LEVERAGE RATIO" means the ratio as of the last day of any
Fiscal Quarter of (i) Consolidated Total Senior Debt as of such day to (ii)
Consolidated Adjusted EBITDA for the four-Fiscal Quarter ending on such date (as
determined in accordance with Section 6.8(f)).
"SENIOR PREFERRED STOCK" means the shares of senior preferred stock,
par value $.01 per share of Holdings issued to GS Mezzanine Partners II, L.P.
and Permitted Investors pursuant to the terms of the Holdings Purchase
Agreement.
"SENIOR SUBORDINATED NOTE DOCUMENTS" means the Senior Subordinated
Notes, the Senior Subordinated Note Indenture, the Company Purchase Agreement,
the Senior Subordinated Note Registration Rights Agreement, and each other
document executed in connection with the Senior Subordinated Notes, as such
document may be amended, restated, supplemented or otherwise modified from time
to time to the extent permitted under Section 6.16.
"SENIOR SUBORDINATED NOTE INDENTURE" means that certain Indenture
dated as of September 20, 2000 by and among Company, the Subsidiaries of Company
party thereto, and Chase Manhattan Bank and Trust Company, National Association,
as trustee, pursuant to which the Senior Subordinated Notes are issued, as in
effect on the Closing Date and as such indenture
Page 35
may hereafter be amended, restated, supplemented or otherwise modified from time
to time to the extent permitted under Section 6.16.
"SENIOR SUBORDINATED NOTE REGISTRATION RIGHTS AGREEMENT" means the
Exchange and Registration Rights Agreement dated as of September 20, 2000 among
Company, GS Mezzanine Partners II, L.P. and Permitted Investors, as in effect on
the Closing Date and as such agreement may thereafter be amended, restated,
supplemented or otherwise modified from time to time to the extent permitted
under Section 6.16.
"SENIOR SUBORDINATED NOTES" means the $20,000,000 in aggregate
principal amount of 13.5% subordinated notes due 2010 issued by Company pursuant
to the Senior Subordinated Note Indenture (including any Senior Subordinated
Notes issued by Company pursuant to the Senior Subordinated Note Indenture, the
Company Purchase Agreement or the Senior Subordinated Note Registration Rights
Agreement (the "SENIOR SUBORDINATED REPLACEMENT NOTES") in exchange for, and on
substantially identical terms as, the Senior Subordinated Notes; PROVIDED, that,
the Senior Subordinated Replacement Notes may have changes to the relative
ranking as among such Senior Replacement Notes, the interest rate or yield so
long as the principal amount and cash interest and premium expense to Company
shall not exceed such principal amount and cash interest and premium expense of
the original Senior Subordinated Notes prior to such exchange and so long as the
aggregate amounts paid, and the dates of payment thereof, with respect to the
Senior Subordinated Replacement Notes shall not be different from the aggregate
amounts paid and the dates of payment of the original Senior Subordinated Notes
prior to such exchange), as such notes may be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under Section 6.16.
"SOLVENCY CERTIFICATE" means a Solvency Certificate of the chief
financial officer of Holdings substantially in the form of Exhibit G-2.
"SOLVENT" means, with respect to any Person, that as of the date of
determination both (i) (a) the sum of such Person's debt (including contingent
liabilities) does not exceed all of its property, at a fair valuation; (b) the
present fair saleable value of the property of such Person is not less than the
amount that will be required to pay the probable liabilities on such Person's
then existing debts as they become absolute and matured; (c) such Person's
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (d) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (ii) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability (irrespective of whether such contingent liabilities
meet the criteria for accrual under Statement of Financial Accounting Standard
No.5).
"SPONSOR" means Green Equity Investors III, L.P., a Delaware
limited partnership.
Page 36
"STOCK PURCHASE AGREEMENT" means the Stock Purchase Agreement dated
as of March 30, 2000, by and between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and Sponsor, and as such
agreement may be amended, restated or otherwise modified from time to time.
"STOCKHOLDERS AGREEMENT" means the Stockholders Agreement dated as
of the date hereof by and among Holdings, Sponsor, Co-Investors, GS Mezzanine
Partners II, L.P., Permitted Investors and Management Investors, and as such
agreement may be amended, restated or otherwise modified from time to time.
"SUBJECT TRANSACTION" as defined in Section 6.8(f).
"SUBORDINATED INDEBTEDNESS" means (i) Indebtedness of Company and
its Subsidiaries under the Senior Subordinated Note Documents and (ii)
Indebtedness outstanding under Permitted Seller Notes.
"SUBSIDIARY" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof, PROVIDED in determining the percentage of ownership interests of any
Person controlled by another Person, no ownership interest in the nature of a
"qualifying share" of the former Person shall be deemed to be outstanding.
"SWING LINE LENDER" means ▇▇▇▇▇ Fargo in its capacity as Swing Line
Lender hereunder, together with its permitted successors and assigns in such
capacity.
"SWING LINE LOAN" means a Loan made by Swing Line Lender to Company
pursuant to Section 2.3.
"SWING LINE NOTE" means a promissory note in the form of Exhibit
B-4, as it may be amended, supplemented or otherwise modified from time to time.
"SWING LINE SUBLIMIT" means the lesser of (i) $5,000,000, and (ii)
the aggregate unused amount of Revolving Commitments then in effect.
"SYNDICATION AGENT" as defined in the preamble hereto.
"TAX" means any present or future tax, levy, impost, duty,
assessment, charge, fee, deduction or withholding of any nature now or hereafter
imposed, levied, collected, withheld or assessed by any taxing authority;
PROVIDED, "Tax on the overall net income" of a Person shall be construed as a
reference to a tax imposed by the jurisdiction in which that Person is organized
or in which that Person's applicable principal office (and/or, in the case of a
Lender, its lending office) is located or in which that Person (and/or, in the
case of a Lender, its lending office) is deemed to be doing business on or
measured by all or part of the net income, profits or gains (whether worldwide,
or only insofar as such income, profits or gains are considered to arise in or
Page 37
to relate to a particular jurisdiction, or otherwise) of that Person (and/or, in
the case of a Lender, its applicable lending office).
"TERM LOAN" means a Tranche A Term Loan and/or a Tranche B Term
Loan.
"TERM LOAN COMMITMENT" means the Tranche A Term Loan Commitment or
the Tranche B Term Loan Commitment of a Lender, and "TERM LOAN Commitments"
means such commitments of all Lenders in the aggregate.
"TERM LOAN MATURITY DATE" means the Tranche A Term Loan Maturity
Date or the Tranche B Term Loan Maturity Date.
"TERMINATED LENDER" as defined in Section 2.22.
"TOTAL UTILIZATION OF REVOLVING COMMITMENTS" means, as at any date
of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans (other than Revolving Loans made for the purpose of
repaying any Refunded Swing Line Loans, but not yet so applied), and (ii) the
aggregate principal amount of all outstanding Swing Line Loans.
"TRANCHE A TERM LOAN" means a Tranche A Term Loan made by a Lender
to Company pursuant to Section 2.1(a)(i).
"TRANCHE A TERM LOAN COMMITMENT" means the commitment of a Lender to
make or otherwise fund a Tranche A Term Loan and "TRANCHE A TERM LOAN
COMMITMENTS" means such commitments of all Lenders in the aggregate. The amount
of each Lender's Tranche A Term Loan Commitment, if any, is set forth on
Appendix A-1 or in the applicable Assignment Agreement, subject to any
adjustment or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Tranche A Term Loan Commitments as of the Closing Date
is $50,000,000.
"TRANCHE A TERM LOAN EXPOSURE" means, with respect to any Lender, as
of any date of determination, the outstanding principal amount of the Tranche A
Term Loans of such Lender, PROVIDED, at anytime prior to the making of the
Tranche A Term Loans, the Tranche A Term Loan Exposure of any Lender shall be
equal to such Lender's Tranche A Term Loan Commitment.
"TRANCHE A TERM LOAN MATURITY DATE" means the earlier of (i) the
sixth (6th) anniversary of the Closing Date, and (ii) the date that all Tranche
A Term Loans shall become due and payable in full hereunder, whether by
acceleration or otherwise.
"TRANCHE A TERM LOAN NOTE" means a promissory note in the form of
Exhibit B-1, as it may be amended, supplemented or otherwise modified from time
to time.
"TRANCHE B TERM LOAN" means a Tranche B Term Loan made by a Lender
to Company pursuant to Section 2.1(a)(ii) together with a New Tranche B Term
Loan made by a Lender to Company pursuant to Section 2.1(c).
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"TRANCHE B TERM LOAN COMMITMENT" means the commitment of a Lender to
make or otherwise fund a Tranche B Term Loan and "TRANCHE B TERM LOAN
COMMITMENTS" means such commitments of all Lenders in the aggregate. The amount
of each Lender's Tranche B Term Loan Commitment, if any, is set forth on
Appendix A-2 or in the applicable Assignment Agreement, subject to any
adjustment or reduction pursuant to the terms and conditions hereof. The
aggregate amount of the Tranche B Term Loan Commitments as of the Closing Date
is $200,000,000.
"TRANCHE B TERM LOAN EXPOSURE" means, with respect to any Lender, as
of any date of determination, the outstanding principal amount of the Tranche B
Term Loans of such Lender; PROVIDED, at any time prior to the making of the
Tranche B Term Loans, the Tranche B Term Loan Exposure of any Lender shall be
equal to such Lender's Tranche B Term Loan Commitment.
"TRANCHE B TERM LOAN MATURITY DATE" means the earlier of (i) the
eighth (8th) anniversary of the Closing Date, and (ii) the date that all Tranche
B Term Loans shall become due and payable in full hereunder, whether by
acceleration or otherwise.
"TRANCHE B TERM LOAN NOTE" means a promissory note in the form of
Exhibit B-2, as it may be amended, supplemented or otherwise modified from time
to time.
"TRANSACTION COSTS" means the fees, costs and expenses payable by
Holdings, Company or any of Company's Subsidiaries in connection with the
closing of the transactions contemplated by the Credit Documents and the Related
Agreements, including, without limitation, (i) any charge incurred by Holdings
and/or Company arising out of the repurchase at $15 per share on the Closing
Date of restricted Capital Stock of Holdings held by certain employees of
Holdings and its Subsidiaries; PROVIDED, that payment of an amount not to exceed
$2,000,000 of the aggregate purchase price for such restricted Capital Stock may
be deferred for not more than sixteen (16) months after the Closing Date, (ii)
any financing, legal, accounting, investment banking or other professional fees
and expenses incurred in connection with the Acquisition, including the funding
of the Acquisition Financing Requirements; PROVIDED, that such fees in the
aggregate do not exceed an amount disclosed to and reasonably acceptable to
Syndication Agent on or before the Closing Date, (iii) any other costs and
expenses incurred by Holdings and/or Company and its Subsidiaries in connection
with the Acquisition arising pursuant to certain noncompetition agreements
executed with members of senior management of Holdings, in connection with the
termination of certain employment contracts of Holdings and its Subsidiaries and
in connection with stay bonuses provided to certain employees of Holdings and
its Subsidiaries in an aggregate amount not to exceed $19,300,000, PROVIDED,
that payment of an amount not to exceed $5,000,000 of such costs and expenses
may be deferred for not more than sixteen (16) months after the Closing Date and
(iv) premium payments payable to certain note holders of Holdings in an
aggregate amount not to exceed $1,700,000.
"TYPE OF LOAN" means (i) with respect to either Term Loans or
Revolving Loans, a Base Rate Loan or a Eurodollar Rate Loan, and (ii) with
respect to Swing Line Loans, a Base Rate Loan.
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"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"UCC QUESTIONNAIRE" means a certificate in form satisfactory to the
Collateral Agent that provides information with respect to the personal or mixed
property of each Credit Party.
"UNADJUSTED EURODOLLAR RATE COMPONENT" means that component of the
interest costs to Company in respect of a Eurodollar Rate Loan that is based
upon the rate obtained pursuant to clause (i) of the definition of Adjusted
Eurodollar Rate.
"WAIVABLE MANDATORY PREPAYMENT" as defined in Section 2.15(c).
"WARRANT AGREEMENT" means the Warrant Agreement dated as of
September 20, 2000 among Holdings, GS Mezzanine Partners II, L.P. and Permitted
Investors, as in effect on the Closing Date and as such agreement may thereafter
be amended, restated, supplemented or otherwise modified from time to time to
the extent permitted under Section 6.15.
"WARRANTS" means the warrants to acquire 5.75% of the common equity
of Holdings issued by Holdings to GS Mezzanine Partners II, L.P. and Permitted
Investors on the Closing Date and pursuant to the Warrant Agreement and the
Holdings Purchase Agreement, as such warrants are in effect on the dates of
their respective issuances and as such warrants may thereafter be amended,
restated, supplemented or otherwise modified from time to time to the extent
permitted under Section 6.15.
1.2. ACCOUNTING TERMS. Except as otherwise expressly provided herein, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Holdings to Lenders pursuant to Section 5.1(a),
5.1(b) and 5.1(c) shall be prepared in accordance with GAAP as in effect at the
time of such preparation (and delivered together with the reconciliation
statements provided for in Section 5.1(e), if applicable). Subject to the
foregoing, calculations in connection with the definitions, covenants and other
provisions hereof shall utilize accounting principles and policies in conformity
with those used to prepare the Historical Financial statements.
1.3. INTERPRETATION, ETC. Any of the terms defined herein may, unless the
context otherwise requires, be used in the singular or the plural, depending on
the reference. References herein to any Section, Appendix, Schedule or Exhibit
shall be to a Section, an Appendix, a Schedule or an Exhibit, as the case may
be, hereof unless otherwise specifically provided. The use herein of the word
"include" or "including", when following any general statement, term or matter,
shall not be construed to limit such statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items
or matters, whether or not nonlimiting language (such as "without limitation" or
"but not limited to" or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter.
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SECTION 2. LOANS
2.1. TERM LOANS.
(a) LOAN COMMITMENTS. Subject to the terms and conditions hereof,
(i) each Lender severally agrees to make, on the Closing Date, a
Tranche A Term Loan to Company in an amount equal to such Lender's Tranche A
Term Loan Commitment; and
(ii) each Lender severally agrees to make, on the Closing Date, a
Tranche B Term Loan to Company in an amount equal to such Lender's Tranche B
Term Loan Commitment.
Company may make only one borrowing under each of the Tranche A Term Loan
Commitment and Tranche B Term Loan Commitment which shall be on the Closing
Date. Any amount borrowed under this Section 2.1(a) and subsequently repaid or
prepaid may not be reborrowed. Subject to Sections 2.12(a) and 2.13, all amounts
owed hereunder with respect to the Tranche A Term Loans and the Tranche B Term
Loans shall be paid in full no later than the Tranche A Term Loan Maturity Date
and the Tranche B Term Loan Maturity Date, respectively. Each Lender's Tranche A
Term Loan Commitment and Tranche B Term Loan Commitment shall terminate
immediately and without further action on the Closing Date after giving effect
to the funding of such Lender's Tranche A Term Loan Commitment and Tranche B
Term Loan Commitment on such date.
(b) BORROWING MECHANICS FOR TERM LOANS.
(i) Company shall deliver to Administrative Agent a fully executed
and delivered Closing Date Certificate (which shall be deemed to be a Funding
Notice with respect to the Term Loans for all purposes hereof) no later than
three days prior to the Closing Date. Promptly upon receipt by Administrative
Agent of such Certificate, Administrative Agent shall notify each Lender of the
proposed borrowing.
(ii) Each Lender shall make its Tranche A Term Loan and/or Tranche B
Term Loan, as the case may be, available to Administrative Agent not later than
12:00 p.m. (New York City time) on the Closing Date, by wire transfer of same
day funds in Dollars, at Administrative Agent's Principal Office. Upon
satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of the Term Loans available to
Company on the Closing Date by causing an amount of same day funds in Dollars
equal to the proceeds of all such Loans received by Administrative Agent from
Lenders to be credited to the account of Company at Administrative Agent's
Principal Office or to such other account as may be designated in writing to
Administrative Agent by Company.
(c) ADDITIONAL TRANCHE B TERM LOANS. Company may by written notice
to Sole Lead Arranger elect to request an increase to the existing Tranche B
Term Loan Commitments ("NEW TRANCHE B TERM LOAN COMMITMENTS") by an amount not
in excess of $25,000,000 in the aggregate. Each such notice shall specify (A)
the date (each, an "INCREASED AMOUNT DATE") on which Company proposes that the
New Tranche B Term Loan Commitments
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shall be effective and that Loans be made pursuant to the New Tranche B Term
Loan Commitments ("NEW TRANCHE B TERM LOANS"), which shall be a date not less
than 10 Business Days after the date on which such notice is delivered to
Administrative Agent and (B) the identity of each Lender or other Person (each,
a "NEW TRANCHE B TERM LOAN LENDER") to whom Company proposes any portion of such
New Tranche B Term Loan Commitments shall be allocated and the amounts of such
allocations; PROVIDED, that such New Tranche B Term Loan Commitments shall not
be made available to Company until after the Agents shall have declared that the
syndication of the Commitments has been successfully completed; PROVIDED,
FURTHER that any Lender approached to provide all or a portion of the New
Tranche B Term Loan Commitments may elect or decline, in its sole discretion, to
provide a New Tranche B Term Loan Commitment. Company hereby appoints Sole Lead
Arranger as sole syndication agent with respect to the syndication of the New
Tranche B Term Loans. Such New Tranche B Term Loan Commitments shall become
effective and any such New Tranche B Term Loans shall be made as of such
Increased Amount Date; PROVIDED that (1) no Default or Event of Default shall
exist on such Increased Amount Date before or after giving effect to such New
Tranche B Term Loan Commitments; (2) both before and after giving effect to the
making of any New Tranche B Term Loans each of the conditions set forth in
Section 3.2 shall be satisfied; (3) each increase in the New Tranche B Term Loan
Commitments shall be effected pursuant to one or more joinder agreements in form
and substance satisfactory to Agents, executed and delivered to Administrative
Agent, and each shall be recorded in the Register; (4) Company shall make any
payments required pursuant to Section 2.10(c) in connection with the New Tranche
B Term Loan Commitments, and (5) Company shall deliver or cause to be delivered
any legal opinions or other documents reasonably requested by Administrative
Agent in connection with any such transaction. On any Increased Amount Date on
which any New Tranche B Term Loan Commitments are effective, subject to the
satisfaction of the foregoing terms and conditions, each New Tranche B Term Loan
Lender shall make a New Tranche B Term Loan to Company in an amount equal to its
New Tranche B Term Loan Commitment. The Administrative Agent shall notify the
Lenders promptly upon receipt of Company's notice of each Increased Amount Date
and in respect thereof the New Tranche B Term Loan Commitments. The terms and
provisions of the New Tranche B Term Loans and New Tranche B Term Loan
Commitments shall be identical to the Tranche B Term Loans in the case of
Tranche B Term Loans.
2.2. REVOLVING LOANS.
(a) REVOLVING COMMITMENTS. During the Revolving Commitment Period,
subject to the terms and conditions hereof, each Lender severally agrees to make
Revolving Loans to Company in the aggregate amount up to but not exceeding such
Lender's Revolving Commitment; PROVIDED, after giving effect to the making of
any Revolving Loans in no event shall the Total Utilization of Revolving
Commitments exceed the Revolving Commitments then in effect. Amounts borrowed
pursuant to this Section 2.2(a) may be repaid and reborrowed during the
Revolving Commitment Period. Each Lender's Revolving Commitment shall expire on
the Revolving Commitment Termination Date and all Revolving Loans and all other
amounts owed hereunder with respect to the Revolving Loans and the Revolving
Commitments shall be paid in full no later than such date.
(b) BORROWING MECHANICS FOR REVOLVING LOANS.
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(i) Revolving Loans that are Base Rate Loans shall be made in an
aggregate minimum amount of $1,000,000 and integral multiples of $500,000 in
excess of that amount, and Revolving Loans that are Eurodollar Rate Loans shall
be in an aggregate minimum amount of $2,000,000 and integral multiples of
$1,000,000 in excess of that amount.
(ii) Whenever Company desires that Lenders make Revolving Loans,
Company shall deliver to Administrative Agent a fully executed and delivered
Funding Notice no later than 1:00 p.m. (New York City time) at least three
Business Days in advance of the proposed Credit Date in the case of a Eurodollar
Rate Loan, and at least one Business Day in advance of the proposed Credit Date
in the case of a Revolving Loan that is a Base Rate Loan. Except as otherwise
provided herein, a Funding Notice for a Revolving Loan that is a Eurodollar Rate
Loan shall be irrevocable on and after the related Interest Rate Determination
Date, and Company shall be bound to make a borrowing in accordance therewith.
(iii) Notice of receipt of each Funding Notice in respect of
Revolving Loans, together with the amount of each Lender's Pro Rata Share
thereof, if any, together with the applicable interest rate, shall be provided
by Administrative Agent to each applicable Lender by telefacsimile with
reasonable promptness, but (provided Administrative Agent shall have received
such notice by 1:00 p.m. (New York City time)) not later than 3:00 p.m. (New
York City time) on the same day as Administrative Agent's receipt of such Notice
from Company.
(iv) Each Lender shall make the amount of its Revolving Loan
available to Administrative Agent not later than 12:00 p.m. (New York City time)
on the applicable Credit Date by wire transfer of same day funds in Dollars, at
the Administrative Agent's Principal Office. Except as provided herein, upon
satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of such Revolving Loans available
to Company on the applicable Credit Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Revolving Loans received by
Administrative Agent from Lenders to be credited to the account of Company at
the Administrative Agent's Principal Office or such other account as may be
designated in writing to Administrative Agent by Company.
2.3. SWING LINE LOANS.
(a) SWING LINE LOANS COMMITMENTS. During the Revolving Commitment
Period, subject to the terms and conditions hereof, Swing Line Lender hereby
agrees to make Swing Line Loans to Company in the aggregate amount up to but not
exceeding the Swing Line Sublimit; PROVIDED, after giving effect to the making
of any Swing Line Loan, in no event shall the Total Utilization of Revolving
Commitments exceed the Revolving Commitments then in effect. Amounts borrowed
pursuant to this Section 2.3 may be repaid and reborrowed during the Revolving
Commitment Period. Swing Line Lender's Revolving Commitment shall expire on the
Revolving Commitment Termination Date and all Swing Line Loans and all other
amounts owed hereunder with respect to the Swing Line Loans and the Revolving
Commitments shall be paid in full no later than such date.
Page 43
(b) BORROWING MECHANICS FOR SWING LINE LOANS.
(i) Swing Line Loans shall be made in an aggregate minimum amount of
$100,000 and integral multiples of $100,000 in excess of that amount.
(ii) Whenever Company desires that Swing Line Lender make a Swing
Line Loan, Company shall deliver to Administrative Agent a Funding Notice no
later than 1:00 p.m. (New York City time) on the proposed Credit Date.
(iii) Swing Line Lender shall make the amount of its Swing Line Loan
available to Administrative Agent not later than 3:00 p.m. (New York City time)
on the applicable Credit Date by wire transfer of same day funds in Dollars, at
the Administrative Agent's Principal Office. Except as provided herein, upon
satisfaction or waiver of the conditions precedent specified herein,
Administrative Agent shall make the proceeds of such Swing Line Loans available
to Company on the applicable Credit Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Swing Line Loans received by
Administrative Agent from Swing Line Lender to be credited to the account of
Company at the Administrative Agent's Principal Office, or to such other account
as may be designated in writing to Administrative Agent by Company.
(iv) With respect to any Swing Line Loans which have not been
voluntarily prepaid by Company pursuant to Section 2.12, Swing Line Lender may
at any time in its sole and absolute discretion, deliver to Administrative Agent
(with a copy to Company), no later than 11:00 a.m. (New York City time) at least
one (1) Business Day in advance of the proposed Credit Date, a notice (which
shall be deemed to be a Funding Notice given by Company) requesting that each
Lender holding a Revolving Commitment make Revolving Loans that are Base Rate
Loans to Company on such Credit Date in an amount equal to the amount of such
Swing Line Loans (the "REFUNDED SWING LINE LOANS") outstanding on the date such
notice is given which the Swing Line Lender requests Lenders to prepay.
Notwithstanding anything contained in this Agreement to the contrary, (1) the
proceeds of such Revolving Loans made by the Lenders other than Swing Line
Lender shall be immediately delivered by the Administrative Agent to Swing Line
Lender (and not to Company) and applied to repay a corresponding portion of the
Refunded Swing Line Loans and (2) on the day such Revolving Loans are made,
Swing Line Lender's Pro Rata Share of the Refunded Swing Line Loans shall be
deemed to be paid with the proceeds of a Revolving Loan made by Swing Line
Lender to Company, and such portion of the Swing Line Loans deemed to be so paid
shall no longer be outstanding as Swing Line Loans and shall no longer be due
under the Swing Line Note of Swing Line Lender but shall instead constitute part
of Swing Line Lender's outstanding Revolving Loans to Company and shall be due
under the Revolving Loan Note issued by Company to Swing Line Lender. Company
hereby authorizes Administrative Agent and Swing Line Lender to charge Company's
accounts with Administrative Agent and Swing Line Lender (up to the amount
available in each such account) in order to immediately pay Swing Line Lender
the amount of the Refunded Swing Line Loans to the extent the proceeds of such
Revolving Loans made by Lenders, including the Revolving Loan deemed to be made
by the Swing Line Lender, are not sufficient to repay in full the Refunded Swing
Line Loans. If any portion of any such amount paid (or deemed to be paid) to
Swing Line Lender should be recovered by or on behalf of Company from Swing Line
Lender in bankruptcy, by assignment
Page 44
for the benefit of creditors or otherwise, the loss of the amount so recovered
shall be ratably shared among all Lenders in the manner contemplated by Section
2.16.
(v) If for any reason Revolving Loans are not made pursuant to
Section 2.3(b)(iv) in an amount sufficient to repay any amounts owed to Swing
Line Lender in respect of any outstanding Swing Line Loans on or before the
third Business Day after demand for payment thereof by Swing Line Lender, each
Lender holding a Revolving Commitment shall be deemed to, and hereby agrees to,
have purchased a participation in such outstanding Swing Line Loans, and in an
amount equal to its Pro Rata Share of the applicable unpaid amount together with
accrued interest thereon. Upon one (1) Business Day's notice from Swing Line
Lender, each Lender holding a Revolving Commitment shall deliver to Swing Line
Lender an amount equal to its respective participation in the applicable unpaid
amount in same day funds at the Principal Office of Swing Line Lender. In order
to evidence such participation each Lender holding a Revolving Commitment agrees
to enter into a participation agreement at the request of Swing Line Lender in
form and substance reasonably satisfactory to Swing Line Lender. In the event
any Lender holding a Revolving Commitment fails to make available to Swing Line
Lender the amount of such Lender's participation as provided in this paragraph,
Swing Line Lender shall be entitled to recover such amount on demand from such
Lender together with interest thereon for three Business Days at the rate
customarily used by Swing Line Lender for the correction of errors among banks
and thereafter at the Base Rate, as applicable.
(vi) Notwithstanding anything contained herein to the contrary, (1)
each Lender's obligation to make Revolving Loans for the purpose of repaying any
Refunded Swing Line Loans pursuant to the second preceding paragraph and each
Lender's obligation to purchase a participation in any unpaid Swing Line Loans
pursuant to the immediately preceding paragraph shall be absolute and
unconditional and shall not be affected by any circumstance, including without
limitation (A) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against Swing Line Lender, any Credit Party or any
other Person for any reason whatsoever; (B) the occurrence or continuation of a
Default or Event of Default; (C) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of any
Credit Party; (D) any breach of this Agreement or any other Credit Document by
any party thereto; or (E) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; PROVIDED that such obligations
of each Lender are subject to the condition that Swing Line Lender believed in
good faith that all conditions under Section 3.2 to the making of the applicable
Refunded Swing Line Loans or other unpaid Swing Line Loans, were satisfied at
the time such Refunded Swing Line Loans or unpaid Swing Line Loans were made, or
the satisfaction of any such condition not satisfied had been waived by
Requisite Lenders prior to or at the time such Refunded Swing Line Loans or
other unpaid Swing Line Loans were made; and (2) Swing Line Lender shall not be
obligated to make any Swing Line Loans (A) if it has elected not to do so after
the occurrence and during the continuation of a Default or Event of Default or
(3) at a time when a Funding Default exists unless Swing Line Lender has entered
into arrangements satisfactory to it and Company to eliminate Swing Line Lenders
risk with respect to the Defaulting Lender's participation in such Swing Line
Loan, including by cash collateralizing such Defaulting Lender's Pro Rata Share
of the outstanding Swing Line Loans.
Page 45
2.4. PRO RATA SHARES; AVAILABILITY OF FUNDS.
(a) PRO RATA SHARES. All Loans shall be made, and all participations
purchased, by Lenders simultaneously and proportionately to their respective Pro
Rata Shares, it being understood that no Lender shall be responsible for any
default by any other Lender in such other Lender's obligation to make a Loan
requested hereunder or purchase a participation required hereby nor shall any
Term Loan Commitment or any Revolving Commitment of any Lender be increased or
decreased as a result of a default by any other Lender in such other Lender's
obligation to make a Loan requested hereunder or purchase a participation
required hereby.
(b) AVAILABILITY OF FUNDS. Unless Administrative Agent shall have
been notified by any Lender prior to the applicable Credit Date that such Lender
does not intend to make available to Administrative Agent the amount of such
Lender's Loan requested on such Credit Date, Administrative Agent may assume
that such Lender has made such amount available to Administrative Agent on such
Credit Date and Administrative Agent may, in its sole discretion, but shall not
be obligated to, make available to Company a corresponding amount on such Credit
Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Credit Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Company and Company shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from such Credit Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate Loans for such
Class of Loans. Nothing in this Section 2.4(b) shall be deemed to relieve any
Lender from its obligation to fulfill its Term Loan Commitments and Revolving
Commitments hereunder or to prejudice any rights that Company may have against
any Lender as a result of any default by such Lender hereunder.
2.5. USE OF PROCEEDS. The proceeds of the Term Loans and the Revolving
Loans made on the Closing Date shall be applied by Company to fund, a portion of
the Acquisition Financing Requirements, to repay the Existing Indebtedness of
Holdings and its Subsidiaries (other than the Indebtedness listed on Schedule
6.1 hereto) and to pay related fees and expenses; PROVIDED, HOWEVER, in the case
of Revolving Loans, such borrowing shall not exceed $1,000,000 in aggregate
principal amount, and after giving effect to such borrowing of Revolving Loans,
the Senior Leverage Ratio determined on a pro forma basis, for the Fiscal
Quarter period most recently ending shall not exceed 3.90:1.00. The proceeds of
the Revolving Loans and Swing Line Loans made after the Closing Date shall be
applied by Company for working capital and general corporate purposes of Company
and its Subsidiaries, including Permitted Acquisitions. No portion of the
proceeds of any Credit Extension shall be used in any manner that causes or
might cause such Credit Extension or the application of such proceeds to violate
Regulation T, Regulation U or Regulation X of the Board of Governors of the
Federal Reserve System or any other regulation thereof or to violate the
Exchange Act.
Page 46
2.6. EVIDENCE OF DEBT; REGISTER; LENDERS' BOOKS AND RECORDS; NOTES.
(a) LENDERS' EVIDENCE OF DEBT. Each Lender shall maintain on its
internal records an account or accounts evidencing the Indebtedness of Company
to such Lender, including the amounts of the Loans made by it and each repayment
and prepayment in respect thereof. Any such recordation shall be prima facie
evidence thereof; PROVIDED, failure to make any such recordation, or any error
in such recordation, shall not affect any Lender's Revolving Commitments or
Company's Obligations in respect of any applicable Loans; and PROVIDED FURTHER,
in the event of any inconsistency between the Register and any Lender's records,
the reconditions in the Register shall govern.
(b) REGISTER. Administrative Agent shall maintain at its Principal
Office a register for the recordation of the names and addresses of Lenders and
the Revolving Commitments and Loans of each Lender from time to time (the
"REGISTER"). The Register shall be available for inspection by Company or any
Lender at any reasonable time and from time to time upon reasonable prior
notice. Administrative Agent shall record in the Register the Revolving
Commitments and the Loans, and each repayment or prepayment in respect of the
principal amount of the Loans, and any such recordation shall be prima facie
evidence thereof; PROVIDED, failure to make any such recordation, or any error
in such recordation, shall not affect any Lender's Revolving Commitments or
Company's Obligations in respect of any Loan. Company hereby designates ▇▇▇▇▇
Fargo to serve as Company's agent solely for purposes of maintaining the
Register as provided in this Section 2.6, and Company hereby agrees that, to the
extent ▇▇▇▇▇ Fargo serves in such capacity, ▇▇▇▇▇ Fargo and its officers,
directors, employees, agents and affiliates shall constitute "Indemnitees."
(c) NOTES. If so requested by any Lender by written notice to
Company (with a copy to Administrative Agent) at least two Business Days prior
to the Closing Date, or at any time thereafter, Company shall execute and
deliver to such Lender (and/or, if applicable and if so specified in such
notice, to any Person who is an assignee of such Lender pursuant to Section
10.6) on the Closing Date (or, if such notice is delivered after the Closing
Date, promptly after Company's receipt of such notice) a Note or Notes to
evidence such Lender's Tranche A Term Loan, Tranche B Term Loan, Revolving Loan
or Swing Line Loan, as the case may be.
2.7. INTEREST ON LOANS.
(a) Except as otherwise set forth herein, each Class of Loan shall
bear interest on the unpaid principal amount thereof from the date made through
repayment (whether by acceleration or otherwise) thereof as follows:
(i) in the case of Tranche A Term Loans and Revolving Loans:
(1) if a Base Rate Loan, at the Base Rate PLUS the Applicable
Margin; or
(2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate
PLUS the Applicable Margin;
Page 47
(ii) in the case of Swing Line Loans, at the Base Rate plus the
Applicable Margin; and
(iii) in the case of Tranche B Term Loans:
(1) if a Base Rate Loan, at the Base Rate PLUS 2.75% per annum;
or
(2) if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate
PLUS 3.75% per annum.
(b) The basis for determining the rate of interest with respect to
any Loan (except a Swing Line Loan which can be made and maintained as Base Rate
Loans only), and the Interest Period with respect to any Eurodollar Rate Loan,
shall be selected by Company and notified to Administrative Agent and Lenders
pursuant to the applicable Funding Notice or Conversion/Continuation Notice, as
the case may be. If on any day a Loan is outstanding with respect to which a
Funding Notice or Conversion/Continuation Notice has not been delivered to
Administrative Agent in accordance with the terms hereof specifying the
applicable basis for determining the rate of interest, then for that day such
Loan shall be a Base Rate Loan.
(c) In connection with Eurodollar Rate Loans there shall be no more
than twelve (12) Interest Periods outstanding at any time. In the event Company
fails to specify between a Base Rate Loan or a Eurodollar Rate Loan in the
applicable Funding Notice or Conversion/Continuation Notice, such Loan (if
outstanding as a Eurodollar Rate Loan) shall be automatically converted into a
Base Rate Loan on the last day of the then-current Interest Period for such Loan
(or if outstanding as a Base Rate Loan will remain as, or (if not then
outstanding) shall be made as, a Base Rate Loan). In the event Company fails to
specify an Interest Period for any Eurodollar Rate Loan in the applicable
Funding Notice or Conversion/Continuation Notice, Company shall be deemed to
have selected an Interest Period of one month. As soon as practicable after
10:00 a.m. (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall be prima facie
evidence thereof) the interest rate that shall apply to the Eurodollar Rate
Loans for which an interest rate is then being determined for the applicable
Interest Period and shall promptly give notice thereof (in writing or by
telephone confirmed in writing) to Company and each Lender.
(d) Interest payable pursuant to Section 2.7(a) shall be computed
(i) in the case of Base Rate Loans on the basis of a 365-day or 366-day year, as
the case may be, and (ii) in the case of Eurodollar Rate Loans, on the basis of
a 360-day year, in each case for the actual number of days elapsed in the period
during which it accrues. In computing interest on any Loan, the date of the
making of such Loan or the first day of an Interest Period applicable to such
Loan or, with respect to a Base Rate Loan being converted from a Eurodollar Rate
Loan, the date of conversion of such Eurodollar Rate Loan to such Base Rate
Loan, as the case may be, shall be included, and the date of payment of such
Loan or the expiration date of an Interest Period applicable to such Loan or,
with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan, the
date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as the
case may be, shall be excluded; PROVIDED, if a Loan is repaid on the same day on
which it is made, one day's interest shall be paid on that Loan.
Page 48
(e) Except as otherwise set forth herein, interest on each Loan
shall be payable in arrears on and to (i) each Interest Payment Date applicable
to that Loan; (ii) any prepayment of that Loan, whether voluntary or mandatory,
to the extent accrued on the amount being prepaid; and (iii) at maturity,
including final maturity; PROVIDED, however, with respect to any voluntary
prepayment of a Revolving Loan that is a Base Rate Loan, accrued interest shall
instead be payable on the applicable Interest Payment Date.
2.8. CONVERSION/CONTINUATION.
(a) Subject to Section 2.17 and so long as no Default or Event of
Default shall have occurred and then be continuing, Company shall have the
option:
(i) to convert at any time all or any part of any Term Loan or
Revolving Loan equal to $ 1,000,000 and integral multiples of $500,000 in excess
of that amount from one Type of Loan to another Type of Loan; PROVIDED, a
Eurodollar Rate Loan may only be converted on the expiration of the Interest
Period applicable to such Eurodollar Rate Loan unless Company shall pay all
amounts due under Section 2.17 in connection with any such conversion; or
(ii) upon the expiration of any Interest Period applicable to any
Eurodollar Rate Loan, to continue all or any portion of such Loan equal to
$2,000,000 and integral multiples of $ 1,000,000 in excess of that amount as a
Eurodollar Rate Loan.
(b) The Company shall deliver a Conversion/Continuation Notice to
Administrative Agent no later than 1:00 p.m. (New York City time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan). Except as otherwise provided herein, a
Conversion/Continuation Notice for conversion to, or continuation of, any
Eurodollar Rate Loans (or telephonic notice in lieu thereof) shall be
irrevocable on and after the related Interest Rate Determination Date, and
Company shall be bound to effect a conversion or continuation in accordance
therewith.
2.9. DEFAULT INTEREST. Upon the occurrence and during the continuance of
an Event of Default described in Section 8.1, the principal amount of all Loans
and, to the extent permitted by applicable law, any interest payments on the
Loans or any fees or other amounts owed hereunder not paid when due, in each
case whether at stated maturity, by notice of prepayment, by acceleration or
otherwise, shall thereafter bear interest (including post-petition interest in
any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate that is 2% per annum in excess of the interest rate
otherwise payable hereunder with respect to the applicable Loans (or, in the
case of any such fees and other amounts, at a rate which is 2% per annum in
excess of the interest rate otherwise payable hereunder for Base Rate Loans);
PROVIDED, in the case of Eurodollar Rate Loans, upon the expiration of the
Interest Period in effect at the time any such increase in interest rate is
effective such Eurodollar Rate Loans shall thereupon become Base Rate Loans and
shall thereafter bear interest payable upon demand at a rate which is 2% per
annum in excess of the interest rate otherwise payable hereunder for Base Rate
Loans. Payment or acceptance of the increased rates of interest provided for in
this
Page 49
Section 2.9 is not a permitted alternative to timely payment and shall not
constitute a waiver of any Event of Default or otherwise prejudice or limit any
rights or remedies of Administrative Agent or any Lender.
2.10. FEES.
(a) Company agrees to pay to Lenders having Revolving Exposure:
commitment fees equal to (1) the average of the daily difference between (a) the
Revolving Commitments, and (b) the aggregate principal amount of outstanding
Revolving Loans (but not any outstanding Swing Line Loans), times (2) the
Applicable Revolving Commitment Fee Percentage. All fees referred to in this
Section 2.10(a) shall be paid to Administrative Agent at its Principal Office
and upon receipt, Administrative Agent shall promptly distribute to each Lender
its Pro Rata Share thereof.
(b) All fees referred to in Section 2.10(a) shall be calculated on
the basis of a 360-day year and the actual number of days elapsed and shall be
payable quarterly in arrears on March 3 1, June 30, September 30 and December 31
of each year during the Revolving Commitment Period, commencing on the first
such date to occur after the Closing Date, and on the Revolving Commitment
Termination Date.
(c) In addition to any of the foregoing fees, Company agrees to pay
to Agents such other fees in the amounts and at the times separately agreed
upon.
2.11. SCHEDULED PAYMENTS.
SCHEDULED INSTALLMENTS. The principal amounts of the Term Loans
shall be repaid in consecutive quarterly installments (each, an "Installment")
in the aggregate amounts set forth below on the last day of each Fiscal Quarter
set forth below (each, an "INSTALLMENT DATE"), commencing December 31, 2000:
TRANCHE A TRANCHE B
FISCAL QUARTER ENDING TERM LOAN INSTALLMENTS TERM LOAN INSTALLMENTS
---------------------- ---------------------- -----------------------
December 31, 2000 $250,000 $625,000
March 31, 2001 $250,000 $625,000
June 30, 2001 $250,000 $625,000
September 30, 2001 $250,000 $625,000
December 31, 2001 $1,500,000 $625,000
March 31, 2002 $1,500,000 $625,000
Page 50
June 30, 2002 $1,500,000 $625,000
September 30, 2002 $1,500,000 $625,000
December 31, 2002 $1,750,000 $625,000
March 31, 2003 $1,750,000 $625,000
June 30, 2003 $1,750,000 $625,000
September 30, 2003 $1,750,000 $625,000
December 31, 2003 $2,000,000 $625,000
March 31, 2004 $2,000,000 $625,000
June 30, 2004 $2,000,000 $625,000
September 30, 2004 $2,000,000 $625,000
December 31, 2004 $2,750,000 $625,000
March 31, 2005 $2,750,000 $625,000
June 30, 2005 $2,750,000 $625,000
September 30, 2005 $2,750,000 $625,000
December 31, 2005 $4,250,000 $625,000
March 31, 2006 $4,250,000 $625,000
June 30, 2006 $4,250,000 $625,000
September 30, 2006 $4,250,000 $625,000
December 31, 2006 0 $23,125,000
March 31, 2007 0 $23,125,000
June 30, 2007 0 $23,125,000
September 30, 2007 0 $23,125,000
December 31, 2007 0 $23,125,000
Page 51
March 31, 2008 0 $23,125,000
June 30, 2008 0 $23,125,000
September 30, 2008 0 $23,125,000
Notwithstanding the foregoing, (x) such Installments shall be reduced in
connection with any voluntary or mandatory prepayments of the Tranche A Term
Loans or the Tranche B Term Loans, as the case may be, in accordance with
Sections 2.12, 2.14 and 2.14 as applicable; and (y) the Tranche A Term Loans and
the Tranche B Term Loans, together with all other amounts owed hereunder with
respect thereto, shall, in any event, be paid in full no later than the Tranche
A Term Loan Maturity Date and the Tranche B Term Loan Maturity Date,
respectively.
Further notwithstanding the foregoing to the contrary set forth above, the
scheduled repayment and reduction provisions with respect to New Tranche B Term
Loans shall be set forth in each applicable joinder agreement and (i) such New
Tranche B Term Loans shall be reduced in connection with any voluntary or
mandatory prepayments of the Tranche B Term Loans in accordance with Section
2.12, 2.13 and 2.14 as applicable and (ii) the Tranche B Term Loans, together
with all other amounts owed hereunder with respect thereto, shall be paid in
full no later than the Tranche B Term Loan Maturity Date.
2.12. VOLUNTARY PREPAYMENTS/COMMITMENT REDUCTIONS.
(a) VOLUNTARY PREPAYMENTS.
(i) Any time and from time to time:
(1) with respect to Base Rate Loans, Company may prepay, any such
Loans on any Business Day in whole or in part, in an aggregate
minimum amount of $1,000,000 and integral multiples of $500,000
in excess of that amount;
(2) with respect to Eurodollar Rate Loans, Company may prepay,
any such Loans on any Business Day in whole or in part in an
aggregate minimum amount of $2,000,000 and integral multiples of
$1,000,000 in excess of that amount; and
(3) with respect to Swing Line Loans, Company may prepay, any
such Loans on any Business Day in whole or in part in an
aggregate minimum amount of $100,000, and in integral multiples
of $ 100,000 in excess of that amount.
(ii) All such prepayments shall be made:
Page 52
(1) upon not less than one Business Day's prior written or
telephonic notice in the case of Base Rate Loans;
(2) upon not less than three Business Day's prior written or
telephonic notice in the case of Eurodollar Rate Loans; and
(3) upon written or telephonic notice on the date of prepayment,
in the case of Swing Line Loans;
in each case given to Administrative Agent or Swing Line Lender, as the case may
be, by 1:00 p.m. (New York City time) on the date required and, if given by
telephone, promptly confirmed in writing to Administrative Agent (and
Administrative Agent will promptly transmit such telephonic or original notice
for Term Loans or Revolving Loans, as the case may be, by telefacsimile or
telephone to each Lender) or Swing Line Lender, as the case may be. Upon the
giving of any such notice, the principal amount of the Loans specified in such
notice shall become due and payable on the prepayment date specified therein.
(b) VOLUNTARY COMMITMENT REDUCTIONS.
(i) Company may, upon not less than three Business Days' prior
written or telephonic notice confirmed in writing to Administrative Agent (which
original written or telephonic notice Administrative Agent will promptly
transmit by telefacsimile or telephone to each applicable Lender), at any time
and from time to time terminate in whole or permanently reduce in part, without
premium or penalty, the Revolving Commitments in an amount up to the amount by
which the Revolving Commitments exceed the Total Utilization of Revolving
Commitments at the time of such proposed termination or reduction; PROVIDED, any
such partial reduction of the Revolving Commitments shall be in an aggregate
minimum amount of $5,000,000 and integral multiples of $ 1,000,000 in excess of
that amount.
(ii) Company's notice to Administrative Agent shall designate the
date (which shall be a Business Day) of such termination or reduction and the
amount of any partial reduction, and such termination or reduction of the
Revolving Commitments shall be effective on the date specified in Company's
notice and shall reduce the Revolving Commitment of each Lender proportionately
to its Pro Rata Share thereof.
2.13. MANDATORY PREPAYMENTS/COMMITMENT REDUCTIONS.
(a) ASSET SALES. No later than the first Business Day following the
date of receipt by Holdings or any of its Subsidiaries of any Net Asset Sale
Proceeds, Company shall prepay the Loans and/or the Revolving Commitments shall
be permanently reduced as set forth in Section 2.14(b) in an aggregate amount
equal to such Net Asset Sale Proceeds; PROVIDED, (i) so long as no Default or
Event of Default shall have occurred and be continuing, and (ii) to the extent
that aggregate Net Asset Sale Proceeds from the Closing Date through the
applicable date of determination do not exceed $10,000,000, Company shall have
the option, directly or through one or more of its Subsidiaries, to invest Net
Asset Sale Proceeds within two hundred seventy (270) days of receipt thereof in
long term productive assets of the general type used in the business of Company
and its Subsidiaries; PROVIDED FURTHER, pending any such investment all such Net
Asset Sale Proceeds shall be applied to prepay Revolving Loans to the extent
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outstanding (without a reduction in Revolving Commitments). Notwithstanding any
of the foregoing to the contrary, upon receipt by Company of Net Asset Sale
Proceeds pursuant to the sale of assets permitted under Section 6.9(d), Company
may invest the first $1,000,000 of such proceeds directly or through one or more
of its Subsidiaries in long-term productive assets of the general type used in
the business of Company and its Subsidiaries, and the remainder of such Net
Asset Sale Proceeds shall be applied in accordance with the provisions set forth
above.
(b) INSURANCE/CONDEMNATION PROCEEDS. No later than the first
Business Day following the date of receipt by Holdings or any of its
Subsidiaries, or Administrative Agent as loss payee, of any Net
Insurance/Condemnation Proceeds, Company shall prepay the Loans and/or the
Revolving Commitments shall be permanently reduced as set forth in Section
2.14(b) in an aggregate amount equal to such Net Insurance/Condemnation
Proceeds; PROVIDED (i) so long as no Default or Event of Default shall have
occurred and be continuing, and (ii) to the extent that aggregate Net
Insurance/Condemnation Proceeds from the Closing Date through the applicable
date of determination do not exceed $10,000,000, Company shall have the option,
directly or through one or more of its Subsidiaries to invest such Net
Insurance/Condemnation Proceeds within two hundred seventy (270) days of receipt
thereof in long term productive assets of the general type used in the business
of Holdings and its Subsidiaries, which investment may include the repair,
restoration or replacement of the applicable assets thereof, PROVIDED FURTHER,
pending any such investment all such Net Insurance/Condemnation Proceeds, as the
case may be, shall be applied to prepay Revolving Loans to the extent
outstanding (without a reduction in Revolving Commitments).
(c) ISSUANCE OF EQUITY SECURITIES. On the date of receipt by
Holdings or Company of any Cash proceeds from a capital contribution to, or the
issuance of any Capital Stock of, or the sale of any Capital Stock of, Holdings
or any of its Subsidiaries (other than (i) any such capital contribution by, or
issuance made to Sponsor or any Co-Investor or any of their Affiliates or a
Permitted Investor or any of their Affiliates or (ii) pursuant to any employee
stock or stock option compensation plan), Company shall prepay the Loans and/or
the Revolving Commitments shall be permanently reduced as set forth in Section
2.14(b) in an aggregate amount equal to 75% of such proceeds, net of
underwriting discounts and commissions and other reasonable costs and expenses
associated therewith, including reasonable legal fees and expenses; PROVIDED,
HOWEVER, that notwithstanding any of the foregoing to the contrary set forth in
this Section 2.13(c), to the extent Holdings, Company and/or any of their
Subsidiaries receives any Cash proceeds from the issuance of Capital Stock or
the sale of Capital Stock of any of Holdings' Subsidiaries in connection with
the creation of a Permitted Partially-Owned Subsidiary, Holdings or Company
shall on an annual basis commencing December 31, 2001, apply the aggregate
amount of such Cash proceeds received, to the extent such aggregate amount
exceeds $250,000 per annum to prepay the Loans and/or reduce the Revolving
Commitments in accordance with Section 2.14(b).
(d) ISSUANCE OF DEBT. On the date of receipt by Holdings or any of
its Subsidiaries of any Cash proceeds from incurrence of any Indebtedness of
Holdings or any of its Subsidiaries (other than with respect to any Indebtedness
permitted to be incurred pursuant to Section 6.1), Company shall prepay the
Loans and/or the Revolving Commitments shall be permanently reduced as set forth
in Section 2.14(b) in an aggregate amount equal to 100% of
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such proceeds, net of underwriting discounts and commissions and other
reasonable costs and expenses associated therewith, including reasonable legal
fees and expenses.
(e) CONSOLIDATED EXCESS CASH FLOW. In the event that there shall be
Consolidated Excess Cash Flow for any Fiscal Year (commencing with the Fiscal
Year ending December 31, 2001), Company shall, no later than one hundred (100)
days after the end of such Fiscal Year, prepay the Loans and/or the Revolving
Commitments shall be permanently reduced as set forth in Section 2.14(b) in an
aggregate amount equal to 75% of such Consolidated Excess Cash Flow.
(f) REVOLVING LOANS AND SWING LOANS. Company shall from time to time
prepay FIRST, the Swing Line Loans, and SECOND, the Revolving Loans to the
extent necessary so that the Total Utilization of Revolving Commitments shall
not at any time exceed the Revolving Commitments then in effect.
(g) PREPAYMENT CERTIFICATE. Concurrently with any prepayment of the
Loans and/or reduction of the Revolving Commitments pursuant to Sections 2.13(a)
through 2.13(e), Company shall deliver to Administrative Agent a certificate of
an Authorized Officer demonstrating the calculation of the amount of the
applicable net proceeds or Consolidated Excess Cash Flow, as the case may be. In
the event that Company shall subsequently determine that the actual amount
received exceeded the amount set forth in such certificate, Company shall
promptly make an additional prepayment of the Loans and/or the Revolving
Commitments shall be permanently reduced in an amount equal to such excess, and
Company shall concurrently therewith deliver to Administrative Agent a
certificate of an Authorized Officer demonstrating the derivation of such
excess.
2.14. APPLICATION OF PREPAYMENTS/REDUCTIONS.
(a) APPLICATION OF VOLUNTARY PREPAYMENTS BY TYPE OF LOANS. Any
pre-payment of any Loan pursuant to Section 2.12(a) shall be applied as
specified by Company in the applicable notice of prepayment; PROVIDED, in the
event Company fails to specify the Loans to which any such prepayment shall be
applied, such prepayment shall be applied as follows:
FIRST, to repay outstanding Swing Line Loans to the full extent
thereof;
SECOND, to repay outstanding Revolving Loans to the full extent
thereof; and
THIRD, to prepay the Tranche A Term Loans and the Tranche B Term
Loans on a pro rata basis (in accordance with the respective outstanding
principal amounts thereof) and shall be further applied on a pro rata basis to
each scheduled Installment of principal of the Tranche A Term Loans and Tranche
B Term Loans.
Any prepayment of any Term Loan pursuant to Section 2.12(a) shall be
further applied on a pro rata basis to reduce the scheduled remaining
installments of principal on such Term Loan.
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(b) APPLICATION OF MANDATORY PREPAYMENTS BY TYPE OF LOANS. Any
amount required to be paid pursuant to Sections 2.13(a) through 2.13(e) shall be
applied
FIRST, to prepay Term Loans on a pro rata basis (in accordance with
the respective outstanding principal amounts thereof) and shall be further
applied on a pro rata basis to the remaining scheduled Installments of principal
of the Tranche A Term Loans and Tranche B Term Loans;
SECOND, to prepay the Swing Line Loans to the full extent thereof
and to permanently reduce the Revolving Commitments by the amount of such
prepayment;
THIRD, to prepay the Revolving Loans to the full extent thereof and
to further permanently reduce the Revolving Commitments by the amount of such
prepayment; and
FOURTH, to further permanently reduce the Revolving Commitments to
the full extent thereof.
(c) WAIVABLE MANDATORY PREPAYMENT. Anything contained herein to the
contrary notwithstanding, so long as any Tranche A Term Loans are outstanding,
in the event Company is required to make any mandatory prepayment (a "WAIVABLE
MANDATORY PREPAYMENT") of the Tranche B Term Loans, not less than three Business
Days prior to the date (the "REQUIRED PREPAYMENT DATE") on which Company is
required to make such Waivable Mandatory Prepayment, Company shall notify
Administrative Agent of the amount of such prepayment, and Administrative Agent
will promptly thereafter notify each Lender holding an outstanding Tranche B
Term Loan of the amount of such Lender's Pro Rata Share of such Waivable
Mandatory Prepayment and such Lender's option to refuse such amount. Each such
Lender may exercise such option by giving written notice to Company and
Administrative Agent of its election to do so on or before the first Business
Day prior to the Required Prepayment Date (it being understood that any Lender
which does not notify Company and Administrative Agent of its election to
exercise such option on or before the first Business Day prior to the Required
Prepayment Date shall be deemed to have elected, as of such date, not to
exercise such option). On the Required Prepayment Date, Company shall pay to
Administrative Agent the amount of the Waivable Mandatory Prepayment, which
amount shall be applied (i) in an amount equal to that portion of the Waivable
Mandatory Prepayment payable to those Lenders that have elected not to exercise
such option, to prepay the Tranche B Term Loans of such Lenders (which
prepayment shall be applied to the scheduled Installments of principal of the
Tranche B Term Loans in accordance with Section 2.14(b)), and (ii) in an amount
equal to that portion of the Waivable Mandatory Prepayment otherwise payable to
those Lenders that have elected to exercise such option, to prepay the Tranche A
Term Loans (which prepayment shall be further applied to the scheduled
installments of principal of the Tranche A Term Loans in accordance with Section
2.14(b)).
(d) APPLICATION OF PREPAYMENTS OF LOANS TO BASE RATE LOANS AND
EURODOLLAR RATE LOANS. Considering each Class of Loans being prepaid separately,
any prepayment thereof shall be applied first to Base Rate Loans to the full
extent thereof before application to Eurodollar Rate Loans, in each case in a
manner which minimizes the amount of any payments required to be made by Company
pursuant to Section 2.17(c).
Page 56
2.15. GENERAL PROVISIONS REGARDING PAYMENTS.
(a) All payments by Company of principal, interest, fees and other
Obligations shall be made in Dollars in same day funds, without defense, setoff
or counterclaim, free of any restriction or condition, and delivered to
Administrative Agent not later than 1:00 p.m. (New York City time) on the date
due at the Administrative Agent's Principal Office for the account of Lenders;
funds received by Administrative Agent after that time on such due date shall be
deemed to have been paid by Company on the next succeeding Business Day.
(b) All payments in respect of the principal amount of any Loan
(other than voluntary prepayments of Revolving Loans) shall include payment of
accrued interest on the principal amount being repaid or prepaid, and all such
payments (and, in any event, any payments in respect of any Loan on a date when
interest is due and payable with respect to such Loan) shall be applied to the
payment of interest before application to principal.
(c) Administrative Agent shall promptly distribute to each Lender at
such address as such Lender shall indicate in writing, such Lender's applicable
Pro Rata Share of all payments and prepayments of principal and interest due
hereunder, together with all other amounts due thereto, including, without
limitation, all fees payable with respect thereto, to the extent received by
Administrative Agent.
(d) Notwithstanding the foregoing provisions hereof, if any
Conversion/Continuation Notice is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
Eurodollar Rate Loans, Administrative Agent shall give effect thereto in
apportioning payments received thereafter.
(e) Subject to the provisos set forth in the definition of "Interest
Period", whenever any payment to be made hereunder shall be stated to be due on
a day that is not a Business Day, such payment shall be made on the next
succeeding Business Day and such extension of time shall be included in the
computation of the payment of interest hereunder or of the Revolving Commitment
fees hereunder.
(f) Company hereby authorizes Administrative Agent to charge
Company's accounts with Administrative Agent in order to cause timely payment to
be made to Administrative Agent of all principal, interest, fees and expenses
due hereunder (subject to sufficient funds being available in its accounts for
that purpose).
(g) Administrative Agent shall deem any payment by or on behalf of
Company hereunder that is not made in same day funds prior to 1:00 p.m. (New
York City time) to be a nonconforming payment. Any such payment shall not be
deemed to have been received by Administrative Agent until the later of (i) the
time such funds become available funds, and (ii) the applicable next Business
Day. Administrative Agent shall give prompt telephonic notice to Company and
each applicable Lender (confirmed in writing) if any payment is non-conforming.
Any non-conforming payment may constitute or become a Default or Event of
Default in accordance with the terms of Section 8.1(a). Interest shall continue
to accrue on any principal as to which a nonconforming payment is made until
such funds become available funds (but in no event less than the period from the
date of such payment to the next succeeding applicable
Page 57
Business Day) at the rate determined pursuant to Section 2.9 from the date such
amount was due and payable until the date such amount is paid in full.
(h) If an Event of Default shall have occurred and not otherwise
been waived, and the maturity of the Obligations shall have been accelerated
pursuant to Section 8.1, all payments or proceeds received by Agents hereunder
in respect of any of the Obligations, shall be applied in accordance with the
application arrangements described in Section 6.5 of the Pledge and Security
Agreement.
2.16. RATABLE SHARING. Lenders hereby agree among themselves that,
except as otherwise provided in the Collateral Documents with respect to amounts
realized from the exercise of rights with respect to Liens on the Collateral, if
any of them shall, whether by voluntary payment (other than a voluntary
prepayment of Loans made and applied in accordance with the terms hereof),
through the exercise of any right of set-off or banker's lien, by counterclaim
or cross action or by the enforcement of any right under the Credit Documents or
otherwise, or as adequate protection of a deposit treated as cash collateral
under the Bankruptcy Code, receive payment or reduction of a proportion of the
aggregate amount of principal, interest, fees and other amounts then due and
owing to such Lender hereunder or under the other Credit Documents
(collectively, the "AGGREGATE AMOUNTS DUE" to such Lender) which is greater than
the proportion received by any other Lender in respect of the Aggregate Amounts
Due to such other Lender, then the Lender receiving such proportionately greater
payment shall (a) notify Administrative Agent and each other Lender of the
receipt of such payment and (b) apply a portion of such payment to purchase
participations (which it shall be deemed to have purchased from each seller of a
participation simultaneously upon the receipt by such seller of its portion of
such payment) in the Aggregate Amounts Due to the other Lenders so that all such
recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion
to the Aggregate Amounts Due to them; PROVIDED, if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered from such Lender upon the bankruptcy or reorganization of Company or
otherwise, those purchases shall be rescinded and the purchase prices paid for
such participations shall be returned to such purchasing Lender ratably to the
extent of such recovery, but without interest. Company expressly consents to the
foregoing arrangement and agrees that any holder of a participation so purchased
may exercise any and all rights of banker's lien, set-off or counterclaim with
respect to any and all monies owing by Company to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.
2.17. MAKING OR MAINTAINING EURODOLLAR RATE LOANS.
(a) INABILITY TO DETERMINE APPLICABLE INTEREST RATE. In the event
that Administrative Agent shall have determined (which determination shall be
prima facie evidence thereof), on any Interest Rate Determination Date with
respect to any Eurodollar Rate Loans, that by reason of circumstances affecting
the London interbank market adequate and fair means do not exist for
ascertaining the interest rate applicable to such Loans on the basis provided
for in the definition of Adjusted Eurodollar Rate, Administrative Agent shall on
such date give notice (by telefacsimile or by telephone confirmed in writing) to
Company and each Lender of such determination, whereupon (i) no Loans may be
made as, or converted to, Eurodollar Rate Loans until such time as
Administrative Agent notifies Company and Lenders that the circumstances
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giving rise to such notice no longer exist, and (ii) any Funding Notice or
Conversion/Continuation Notice given by Company with respect to the Loans in
respect of which such determination was made shall be deemed to be rescinded by
Company.
(b) ILLEGALITY OR IMPRACTICABILITY OF EURODOLLAR RATE LOANS. In the
event that on any date any Lender shall have determined (which determination
shall be prima facie evidence thereof, but shall be made only after consultation
with Company and Administrative Agent) that the making, maintaining or
continuation of its Eurodollar Rate Loans (i) has become unlawful as a result of
compliance by such Lender in good faith with any law, treaty, governmental rule,
regulation, guideline or order (or would conflict with any such treaty,
governmental rule, regulation, guideline or order not having the force of law
even though the failure to comply therewith would not be unlawful), or (ii) has
become impracticable, as a result of contingencies occurring after the date
hereof which materially and adversely affect the London interbank market or the
position of such Lender in that market, then, and in any such event, such Lender
shall be an "AFFECTED LENDER" and it shall on that day give notice (by
telefacsimile or by telephone confirmed in writing) to Company and
Administrative Agent of such determination (which notice Administrative Agent
shall promptly transmit to each other Lender). Thereafter (1) the obligation of
the Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate
Loans shall be suspended until such notice shall be withdrawn by the Affected
Lender, (2) to the extent such determination by the Affected Lender relates to a
Eurodollar Rate Loan then being requested by Company pursuant to a Funding
Notice or a Conversion/Continuation Notice, the Affected Lender shall make such
Loan as (or continue such Loan as or convert such Loan to, as the case may be) a
Base Rate Loan, (3) the Affected Lender's obligation to maintain its outstanding
Eurodollar Rate Loans (the "AFFECTED LOANS") shall be terminated at the earlier
to occur of the expiration of the Interest Period then in effect with respect to
the Affected Loans or when required by law, and (4) the Affected Loans shall
automatically convert into Base Rate Loans on the date of such termination.
Notwithstanding the foregoing, to the extent a determination by an Affected
Lender as described above relates to a Eurodollar Rate Loan then being requested
by Company pursuant to a Funding Notice or a Conversion/Continuation Notice,
Company shall have the option, subject to the provisions of Section 2.17(c), to
rescind such Funding Notice or Conversion/Continuation Notice as to all Lenders
by giving notice (by telefacsimile or by telephone confirmed in writing) to
Administrative Agent of such rescission on the date on which the Affected Lender
gives notice of its determination as described above (which notice of rescission
Administrative Agent shall promptly transmit to each other Lender). Except as
provided in the immediately preceding sentence, nothing in this Section 2.17(b)
shall affect the obligation of any Lender other than an Affected Lender to make
or maintain Loans as, or to convert Loans to, Eurodollar Rate Loans in
accordance with the terms hereof.
(c) COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST
PERIODS. Company shall compensate each Lender, upon written request by such
Lender (which request shall set forth the basis for requesting such amounts),
for all reasonable losses, expenses and liabilities (including any interest paid
by such Lender to lenders of funds borrowed by it to make or carry its
Eurodollar Rate Loans and any loss, expense or liability sustained by such
Lender in connection with the liquidation or re-employment of such funds but
excluding loss of anticipated profits) which such Lender may sustain: (1) if for
any reason (other than a default by such Lender) a borrowing of any Eurodollar
Rate Loan does not occur on a date specified therefor
Page 59
in a Funding Notice or a telephonic request for borrowing, or a conversion to or
continuation of any Eurodollar Rate Loan does not occur on a date specified
therefor in a Conversion/Continuation Notice or a telephonic request for
conversion or continuation; (ii) if any prepayment or other principal payment or
any conversion of any of its Eurodollar Rate Loans occurs on a date prior to the
last day of an Interest Period applicable to that Loan; or (iii) if any
prepayment of any of its Eurodollar Rate Loans is not made on any date specified
in a notice of prepayment given by Company.
(d) BOOKING OF EURODOLLAR RATE LOANS. Any Lender may make, carry or
transfer Eurodollar Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of such Lender.
(e) ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR RATE LOANS.
Calculation of all amounts payable to a Lender under this Section 2.17 and under
Section 2.18 shall be made as though such Lender had actually funded each of its
relevant Eurodollar Rate Loans through the purchase of a Eurodollar deposit
bearing interest at the rate obtained pursuant to clause (i) of the definition
of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of such
Lender to a domestic office of such Lender in the United States of America;
PROVIDED, HOWEVER, each Lender may fund each of its Eurodollar Rate Loans in any
manner it sees fit and the foregoing assumptions shall be utilized only for the
purposes of calculating amounts payable under this Section 2.17 and under
Section 2.18.
2.18. INCREASED COSTS; CAPITAL ADEQUACY.
(a) COMPENSATION FOR INCREASED COSTS AND TAXES. Subject to the
provisions of Section 2.19 (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall be prima facie evidence thereof) that any law, treaty or
governmental rule, regulation or order, or any change therein or in the
interpretation, administration or application thereof (including the
introduction of any new law, treaty or governmental rule, regulation or order),
or any determination of a court or governmental authority, in each case that
becomes effective after the date hereof, or compliance by such Lender with any
guideline, request or directive issued or made after the date hereof by any
central bank or other governmental or quasi-governmental authority (whether or
not having the force of law): (i) subjects such Lender (or its applicable
lending office) to any additional Tax (other than any Tax on the overall net
income of such Lender) with respect to this Agreement or any of the other Credit
Documents or any of its obligations hereunder or thereunder or any payments to
such Lender (or its applicable lending office) of principal, interest, fees or
any other amount payable hereunder; (ii) imposes, modifies or holds applicable
any reserve (including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities in or for
the account of, or advances or loans by, or other credit extended by, or any
other acquisition of funds by, any office of such Lender (other than any such
reserve or other requirements with respect to Eurodollar Rate Loans that are
reflected in the definition of Adjusted Eurodollar Rate); or (iii) imposes any
other condition (other than with respect to a Tax matter) on or affecting such
Lender (or its applicable lending office) or its obligations hereunder or the
London interbank
Page 60
market; and the result of any of the foregoing is to increase the cost to such
Lender of agreeing to make, making or maintaining Loans hereunder or to reduce
any amount received or receivable by such Lender (or its applicable lending
office) with respect thereto; then, in any such case, Company shall promptly pay
to such Lender, upon receipt of the statement referred to in the next sentence,
such additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Company (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this Section
2.18(a), which statement shall be prima facie evidence thereof.
(b) CAPITAL ADEQUACY ADJUSTMENT. In the event that any Lender shall
have determined that the adoption, effectiveness, phase-in or applicability
after the Closing Date of any law, rule or regulation (or any provision thereof)
regarding capital adequacy, or any change therein or in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender's Loans or Revolving Commitments, or participations therein or
other obligations hereunder with respect to the Loans to a level below that
which such Lender or such controlling corporation could have achieved but for
such adoption, effectiveness, phase-in, applicability, change or compliance
(taking into consideration the policies of such Lender or such controlling
corporation with regard to capital adequacy), then from time to time, within
five Business Days after receipt by Company from such Lender of the statement
referred to in the next sentence, Company shall pay to such Lender such
additional amount or amounts as will compensate such Lender or such controlling
corporation on an after-tax basis for such reduction. Such Lender shall deliver
to Company (with a copy to Administrative Agent) a written statement, setting
forth in reasonable detail the basis for calculating the additional amounts owed
to Lender under this Section 2.18(b), which statement shall be prima facie
evidence thereof.
2.19. TAXES; WITHHOLDING, ETC.
(a) PAYMENTS TO BE FREE AND CLEAR. All sums payable by any Credit
Party hereunder and under the other Credit Documents shall (except to the extent
required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax (other than a franchise Tax or a Tax on the
overall net income of any Lender) imposed, levied, collected, withheld or
assessed by or within the United States of America or any political subdivision
in or of the United States of America or any other jurisdiction from or to which
a payment is made by or on behalf of any Credit Party.
(b) WITHHOLDING OF TAXES. If any Credit Party or any other Person is
required by law to make any deduction or withholding on account of any such Tax
from any sum paid or payable by any Credit Party to Administrative Agent or any
Lender under any of the Credit
Page 61
Documents: (i) Company shall notify Administrative Agent of any such requirement
or any change in any such requirement as soon as Company becomes aware of it;
(ii) Company shall pay any such Tax before the date on which penalties attach
thereto, such payment to be made (if the liability to pay is imposed on any
Credit Party) for its own account or (if that liability is imposed on
Administrative Agent or such Lender, as the case may be) on behalf of and in the
name of Administrative Agent or such Lender; (iii) the sum payable by such
Credit Party in respect of which the relevant deduction, withholding or payment
is required shall be increased to the extent necessary to ensure that, after the
making of that deduction, withholding or payment, Administrative Agent or such
Lender, as the case may be, receives on the due date a net sum equal to what it
would have received had no such deduction, withholding or payment been required
or made; and (iv) within thirty (30) days after paying any sum from which it is
required by law to make any deduction or withholding, and within thirty (30)
days after the due date of payment of any Tax which it is required by clause
(ii) above to pay, Company shall deliver to Administrative Agent evidence
satisfactory to the other affected parties of such deduction, withholding or
payment and of the remittance thereof to the relevant taxing or other authority;
PROVIDED, no such additional amount shall be required to be paid to any Lender
or Administrative Agent under clause (iii) above except to the extent that any
change after the date hereof (in the case of each Lender listed on the signature
pages hereof on the Closing Date) or after the effective date of the Assignment
Agreement pursuant to which such Lender became a Lender (in the case of each
other Lender) in any requirement mentioned therein for a deduction, withholding
or payment shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date hereof or at the date of
such Assignment Agreement, as the case may be, in respect of payments to such
Lender or Administrative Agent.
(c) EVIDENCE OF EXEMPTION FROM U.S. WITHHOLDING TAX. (i) Each Lender
that is not a United States Person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax purposes
(a "NON-US LENDER") shall deliver to Administrative Agent for transmission to
Company, on or prior to the Closing Date (in the case of each Lender listed on
the signature pages hereof on the Closing Date) or on or prior to the date of
the Assignment Agreement pursuant to which it becomes a Lender (in the case of
each other Lender), and at such other times as may be necessary in the
determination of Company or Administrative Agent (each in the reasonable
exercise of its discretion), (A) two original copies of Internal Revenue Service
Form W-8BEN or W-8ECI (or any successor forms), properly completed and duly
executed by such Lender, and such other documentation required under the
Internal Revenue Code and reasonably requested by Company to establish that such
Lender is not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of principal, interest,
fees or other amounts payable under any of the Credit Documents, or (B) if such
Lender is not a "bank" or other Person described in Section 881(c)(3) of the
Internal Revenue Code and cannot deliver either Internal Revenue Service Form
W-8BEN or W-8ECI pursuant to clause (A) above, a Certificate re Non-Bank Status
together with two original copies of Internal Revenue Service Form W-8 (or any
successor form), properly completed and duly executed by such Lender, and such
other documentation required under the Internal Revenue Code and reasonably
requested by Company to establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to any payments
to such Lender of interest payable under any of the Credit Documents. Each
Lender required to deliver any forms, certificates or other evidence with
respect to United States federal income tax withholding matters pursuant to this
Section 2.19(c) hereby agrees,
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from time to time after the initial delivery by such Lender of such forms,
certificates or other evidence, whenever a lapse in time or change in
circumstances renders such forms, certificates or other evidence obsolete or
inaccurate in any material respect, that such Lender shall promptly deliver to
Administrative Agent for transmission to Company two new original copies of
Internal Revenue Service Form W-8BEN or W-8ECI, or a Certificate re Non-Bank
Status and two original copies of Internal Revenue Service Form W-8, as the case
may be, properly completed and duly executed by such Lender, and such other
documentation required under the Internal Revenue Code and reasonably requested
by Company to confirm or establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to payments to
such Lender under the Credit Documents, or notify Administrative Agent and
Company of its inability to deliver any such forms, certificates or other
evidence. Company shall not be required to pay any additional amount to any
Non-US Lender under Section 2.19(b)(iii) if such Lender shall have failed to
deliver the forms, certificates or other evidence referred to in the second
sentence of this Section 2.19(c), or (2) to notify Administrative Agent and
Company of its inability to deliver any such forms, certificates or other
evidence, as the case may be; PROVIDED, if such Lender shall have satisfied the
requirements of the first sentence of this Section 2.19(c) on the Closing Date
or on the date of the Assignment Agreement pursuant to which it became a Lender,
as applicable, nothing in this last sentence of Section 2.19(c) shall relieve
Company of its obligation to pay any additional amounts pursuant to Section
2.18(a) in the event that, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is no longer
properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender is not subject to
withholding as described herein.
(i) If any non-corporate Lender is a United States Person as such
term is defined in the Internal Revenue Code, such Lender shall deliver to
Administrative Agent on or prior to the Closing Date or on or prior to the date
of the Assignment Agreement, pursuant to which it becomes a Lender (in the case
of each other Lender) two original copies of Internal Revenue Service Form W-9
(or any successor forms), properly completed and duly executed by such Lender
and such other documentation required under the Internal Revenue Code to
establish that such Lender is not subject to deduction or withholding of United
States federal income tax with respect to such principal, interest, fees or
other amounts payable under the any of the Credit Documents.
2.20. OBLIGATION TO MITIGATE. Each Lender agrees that, as promptly as
practicable after the officer of such Lender responsible for administering its
Loans becomes aware of the occurrence of an event or the existence of a
condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender to receive payments under Section 2.17, 2.18 or 2.19,
it will, to the extent not inconsistent with the internal policies of such
Lender and any applicable legal or regulatory restrictions, use reasonable
efforts to (a) make, issue, fund or maintain its Credit Extensions, including
any Affected Loans, through another office of such Lender, or (b) take such
other measures as such Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender pursuant to Section 2.17, 2.18 or 2.19 would be materially
reduced and if, as determined by such Lender in its sole but reasonable
discretion, the making, issuing, funding or maintaining of such
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Revolving Commitments or Loans through such other office or in accordance with
such other measures, as the case may be, would not otherwise adversely affect
such Revolving Commitments or Loans or the interests of such Lender; PROVIDED,
such Lender will not be obligated to utilize such other office pursuant to this
Section 2.20 unless Company agrees to pay all incremental expenses incurred by
such Lender as a result of utilizing such other office as described above. A
certificate as to the amount of any such expenses payable by Company pursuant to
this Section 2.20 (setting forth in reasonable detail the basis for requesting
such amount) submitted by such Lender to Company (with a copy to Administrative
Agent) shall be prima facie evidence thereof.
2.21. DEFAULTING LENDERS. Anything contained herein to the contrary
notwithstanding, in the event that any Lender, at the direction or request of
any regulatory agency or authority, defaults (a "DEFAULTING LENDER") in its
obligation to fund (a "FUNDING DEFAULT") any Revolving Loan or its portion of
any unreimbursed payment under Section 2.3(b)(iv) (in each case, a "DEFAULTED
LOAN"), then (a) during any Default Period with respect to such Defaulting
Lender, such Defaulting Lender shall be deemed not to be a "Lender" for purposes
of voting on any matters (including the granting of any consents or waivers)
with respect to any of the Credit Documents; (b) to the extent permitted by
applicable law, until such time as the Default Excess with respect to such
Defaulting Lender shall have been reduced to zero, (i) any voluntary prepayment
of the Revolving Loans shall, if Company so directs at the time of making such
voluntary prepayment, be applied to the Revolving Loans of other Lenders as if
such Defaulting Lender had no Revolving Loans outstanding and the Revolving
Exposure of such Defaulting Lender were zero, and (ii) any mandatory prepayment
of the Revolving Loans shall, if Company so directs at the time of making such
mandatory prepayment, be applied to the Revolving Loans of other Lenders (but
not to the Revolving Loans of such Defaulting Lender) as if such Defaulting
Lender had funded all Defaulted Loans of such Defaulting Lender, it being
understood and agreed that Company shall be entitled to retain any portion of
any mandatory prepayment of the Revolving Loans that is not paid to such
Defaulting Lender solely as a result of the operation of the provisions of this
clause (b); (c) such Defaulting Lender's Revolving Commitment and outstanding
Revolving Loans shall be excluded for purposes of calculating the Revolving
Commitment fee payable to Lenders in respect of any day during any Default
Period with respect to such Defaulting Lender, and such Defaulting Lender shall
not be entitled to receive any Revolving Commitment fee pursuant to Section 2.10
with respect to such Defaulting Lender's Revolving Commitment in respect of any
Default Period with respect to such Defaulting Lender; and (d) the Total
Utilization of Revolving Commitments as at any date of determination shall be
calculated as if such Defaulting Lender had funded all Defaulted Loans of such
Defaulting Lender. No Revolving Commitment of any Lender shall be increased or
otherwise affected, and, except as otherwise expressly provided in this Section
2.21, performance by Company of its obligations hereunder and the other Credit
Documents shall not be excused or otherwise modified as a result of any Funding
Default or the operation of this Section 2.21. The rights and remedies against a
Defaulting Lender under this Section 2.21 are in addition to other rights and
remedies which Company may have against such Defaulting Lender with respect to
any Funding Default and which Administrative Agent or any Lender may have
against such Defaulting Lender with respect to any Funding Default.
2.22. REMOVAL OR REPLACEMENT OF A LENDER. Anything contained herein to
the contrary notwithstanding, in the event that: (a) any Lender (an
"INCREASED-COST LENDER") shall
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give notice to Company that such Lender is an Affected Lender or that such
Lender is entitled to receive payments under Section 2.17, 2.18 or 2.19, the
circumstances which have caused such Lender to be an Affected Lender or which
entitle such Lender to receive such payments shall remain in effect, and such
Lender shall fail to withdraw such notice within five Business Days after
Company's request for such withdrawal; or (b) any Lender shall become a
Defaulting Lender, the Default Period for such Defaulting Lender shall remain in
effect, and such Defaulting Lender shall fall to cure the default as a result of
which it has become a Defaulting Lender within five Business Days after
Company's request that it cure such default; or (c) in connection with any
proposed amendment, modification, termination, waiver or consent with respect to
any of the provisions hereof as contemplated by Section 10.5(b), the consent of
Requisite Lenders shall have been obtained but the consent of one or more of
such other Lenders (each a "NON-CONSENTING LENDER") whose consent is required
shall not have been obtained; then, with respect to each such Increased-Cost
Lender, Defaulting Lender or Non-Consenting Lender (the "TERMINATED LENDER"),
Company may, by giving written notice to Administrative Agent and any Terminated
Lender of its election to do so, elect to cause such Terminated Lender (and such
Terminated Lender hereby irrevocably agrees) to assign its outstanding Loans and
its Revolving Commitments, if any, in full to one or more Eligible Assignees
(each a "REPLACEMENT LENDER") in accordance with the provisions of Section 10.6
and Terminated Lender shall pay any fees payable thereunder in connection with
such assignment; PROVIDED, (1) on the date of such assignment, the Replacement
Lender shall pay to Terminated Lender an amount equal to the sum of (A) an
amount equal to the principal of, and all accrued interest on, all outstanding
Loans of the Terminated Lender, (B) an amount equal to all unreimbursed drawing
that have been funded by such Terminated Lender, together with all then unpaid
interest with respect thereto at such time and (C) an amount equal to all
accrued, but theretofore unpaid fees owing to such Terminated Lender pursuant to
Section 2.10; (2) on the date of such assignment, Company shall pay any amounts
payable to such Terminated Lender pursuant to Section 2.17(c), 2.18 or 2.19 or
otherwise as if it were a prepayment; and (3) in the event such Terminated
Lender is a Non-Consenting Lender, each Replacement Lender shall consent, at the
time of such assignment, to each matter in respect of which such Terminated
Lender was a Non-Consenting Lender. Upon the prepayment of all amounts owing to
any Terminated Lender and the termination of such Terminated Lender's Revolving
Commitments, if any, such Terminated Lender shall no longer constitute a
"Lender" for purposes hereof; PROVIDED, any rights of such Terminated Lender to
indemnification hereunder shall survive as to such Terminated Lender.
SECTION 3. CONDITIONS PRECEDENT
3.1. CLOSING DATE. The obligation of any Lender to make a Credit
Extension on the Closing Date is subject to the satisfaction, or waiver in
accordance with Section 10.5, of the following conditions on or before the
Closing Date:
(a) CREDIT DOCUMENTS. Administrative Agent shall have received
sufficient copies of each Credit Document originally executed and delivered by
each applicable Credit Party for each Lender.
(b) ORGANIZATIONAL DOCUMENTS, INCUMBENCY. Administrative Agent shall
have received (i) sufficient copies of each Organizational Document originally
executed and delivered by each Credit Party, as applicable, and, to the extent
applicable, certified as of a recent date by
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the appropriate governmental official, for each Lender, each dated the Closing
Date or a recent date prior thereto; (ii) signature and incumbency certificates
of the officers of such Person executing the Credit Documents to which it is a
party; (iii) resolutions of the Board of Directors or similar governing body of
each Credit Party approving and authorizing the execution, delivery and
performance of this Agreement and the other Credit Documents and the Related
Agreements to which it is a party or by which it or its assets may be bound as
of the Closing Date, certified as of the Closing Date by its secretary or an
assistant secretary as being in full force and effect without modification or
amendment; (iv) a good standing certificate from the applicable Governmental
Authority of each Credit Party's jurisdiction of incorporation, organization or
formation and in each jurisdiction in which it is qualified as a foreign
corporation or other entity to do business, each dated a recent date prior to
the Closing Date; and (v) such other documents as Administrative Agent may
reasonably request.
(c) ORGANIZATIONAL AND CAPITAL STRUCTURE. The organizational
structure and capital structure of Holdings and its Subsidiaries, after giving
effect to the Acquisition, shall be as set forth on Schedule 4.1.
(d) CAPITALIZATION OF HOLDINGS AND COMPANY. On or before the Closing
Date:
(i) Sponsor, Co-Investors and the Management Investors shall have
made the Equity Contribution;
(ii) Company shall have (x) issued and sold the Senior Subordinated
Notes for gross cash proceeds therefor in an aggregate amount of not less than
$50,000,000 and (y) delivered to Administrative Agent and Syndication Agent a
certificate of its Authorized Officer, in form and substance satisfactory to
Administrative Agent and Syndication Agent, certifying that the proceeds of the
Senior Subordinated Notes have been irrevocably committed, prior to the
application of the proceeds of the Term Loans, to the payment of a portion of
the Acquisition Financing Requirements in accordance with the Merger Agreement;
(iii) Holdings shall have (x) issued and sold the Holdings Senior
Notes for gross cash proceeds therefor in an aggregate amount of not less than
$70,000,000 and (y) delivered to Administrative Agent and Syndication Agent a
certificate of its Authorized Officer, in form and substance satisfactory to
Administrative Agent and Syndication Agent, certifying that the proceeds of the
Holdings Senior Notes have been irrevocably committed, prior to the application
of the proceeds of the Term Loans, to the payment of a portion of the
Acquisition Financing Requirements in accordance with the Merger Agreement; and
(iv) Syndication Agent and Administrative Agent shall have received
evidence that the proceeds of the debt and equity capitalization of Merger Corp.
and Company described in the immediately preceding clauses (i), (ii) and (iii)
have been irrevocably committed, prior to the application of the proceeds of the
Loans, to the payment of a portion of the Acquisition Financing Requirements.
(e) CONSUMMATION OF THE ACQUISITION.
(i) Syndication Agent and Administrative Agent shall have received
evidence satisfactory to them that, immediately following the application of the
proceeds of the
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Term Loans, (1) all conditions to the Acquisition set forth in the Merger
Agreement shall have been satisfied or the fulfillment of any such conditions
shall have been waived with the consent of Syndication Agent and Administrative
Agent, (2) the Acquisition shall have become effective in accordance with the
terms of the Merger Agreement, and (3) the aggregate cash consideration paid by
Sponsor and its Co-Investors and Holdings and its Subsidiaries to the holders of
Holdings' Capital Stock in connection with the Acquisition shall not exceed
$338,000,000 (excluding the amount of cash consideration represented by the
aggregate exercise prices of any options to purchase the Capital Stock of
Holdings that are exercised after May 30, 2000 and prior to the Closing Date);
PROVIDED, HOWEVER, that such $338,000,000 shall be reduced by the aggregate
amount of deferred purchase price to be paid after the Closing Date for
restricted Capital Stock of Holdings held by certain employees of Holdings and
its Subsidiaries to be repurchased by Holdings and/or Company and its
Subsidiaries as of the Closing Date.
(ii) Syndication Agent and Administrative Agent shall each have
received a fully executed or conformed copy of each Related Agreement and any
documents executed in connection therewith, together with copies of each of the
opinions of counsel delivered to the parties under the Related Agreements, which
shall provide that Agents and Lenders may rely, or be accompanied by a letter
from each such counsel (to the extent not inconsistent with such counsel's
established internal policies) authorizing Agents and Lenders to rely, upon such
opinion to the same extent as though it were addressed to Agents and Lenders.
Each Related Agreement shall be in full force and effect and no provision
thereof shall have been modified or waived in any respect determined by
Syndication Agent or Administrative Agent to be material, in each case without
the consent of Syndication Agent and Administrative Agent.
(iii) Syndication Agent and Administrative Agent shall each have
received a certificate from an Authorized Officer of each applicable Credit
Party, in form and substance satisfactory to Syndication Agent and
Administrative Agent, to the effect set forth in clauses (i) and (ii) above.
(f) EXISTING INDEBTEDNESS. Except as set forth on Schedule 6.1, on
the Closing Date, Holdings and its Subsidiaries shall have (i) repaid in full
all Existing Indebtedness, (ii) terminated any commitments to lend or make other
extensions of credit thereunder, (iii) delivered to Syndication Agent and
Administrative Agent all documents or instruments necessary to release all Liens
securing Existing Indebtedness or other obligations of Holdings and its
Subsidiaries thereunder being repaid on the Closing Date, except for those
documents and instruments not delivered with the consent of the Syndication
Agent and Administrative Agent, such consent not to be unreasonably withheld,
and (iv) made arrangements satisfactory to Syndication Agent and Administrative
Agent with respect to the cancellation of any letters of credit outstanding
thereunder.
(g) RELATED AGREEMENTS. All Related Agreements relating to the
corporate structure of the Company and the Guarantors, all organizational
documents of such entities and the employment contracts of key employees and
executives shall be reasonably satisfactory to Agents.
(h) GOVERNMENTAL AUTHORIZATIONS AND CONSENTS. Each Credit Party
shall have obtained all Governmental Authorizations and all consents of other
Persons, in each case that are
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necessary or advisable in connection with the transactions contemplated by the
Credit Documents and the Related Agreements and each of the foregoing shall be
in full force and effect and in form and substance reasonably satisfactory to
Syndication Agent and Administrative Agent. All applicable waiting periods shall
have expired without any action being taken or threatened by any competent
authority which would restrain, prevent or otherwise impose adverse conditions
on the transactions contemplated by the Credit Documents or the Related
Agreements or the financing thereof and no action, request for stay, petition
for review or rehearing, reconsideration, or appeal with respect to any of the
foregoing shall be pending, and the time for any applicable agency to take
action to set aside its consent on its own motion shall have expired.
(i) REAL ESTATE ASSETS. In order to create in favor of Collateral
Agent, for the benefit of Secured Parties, a valid and, subject to any filing
and/or recording referred to herein, perfected First Priority security interest
in certain Real Estate Assets, Collateral Agent shall have received from Company
and each applicable Guarantor:
(i) fully executed and notarized Mortgages, in proper form for
recording in all appropriate places in all applicable jurisdictions, encumbering
each Real Estate Asset listed in Schedule 3.1(i) (each, a "CLOSING DATE
MORTGAGED PROPERTY");
(ii) an opinion of counsel (which counsel shall be reasonably
satisfactory to Collateral Agent and Syndication Agent) in such states as may be
reasonably requested by Collateral Agent and Syndication Agent with respect to
the enforceability of the form(s) of Mortgages to be recorded in such state and
such other matters as Collateral Agent may reasonably request, in each case in
form and substance reasonably satisfactory to Syndication Agent and
Administrative Agent;
(iii) in the case of each Leasehold Property that is a Closing Date
Mortgaged Property, (1) a Landlord Consent and Estoppel Agreement and (2)
evidence that such Leasehold Property is a Recorded Leasehold Interest;
(iv) (A) ALTA mortgagee title insurance policies or unconditional
commitments therefor issued by one or more title companies reasonably
satisfactory to Collateral Agent with respect to each Closing Date Mortgaged
Property (each, a "TITLE POLICY"), in amounts not less than the fair market
value of each Closing Date Mortgaged Property, together with a title report
issued by a title company with respect thereto, dated not more than thirty (30)
days prior to the Closing Date and copies of all recorded documents listed as
exceptions to title or otherwise referred to therein, each in form and substance
reasonably satisfactory to Collateral Agent; (B) evidence satisfactory to
Collateral Agent that such Credit Party has paid to the title company or the
appropriate governmental authorities all expenses and premiums of the title
company and all other sums required in connection with the issuance of each
Title Policy and all recording and stamp taxes (including mortgage recording and
intangible taxes) payable in connection with recording the Mortgages for each
Closing Date Mortgaged Property in the appropriate real estate records;
(v) evidence of flood insurance with respect to each Flood Hazard
Property that is located in a community that participates in the National Flood
Insurance
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Program, in each case in compliance with any applicable regulations of the Board
of Governors of the Federal Reserve System, in form and substance reasonably
satisfactory to Collateral Agent; and
(vi) ALTA surveys of all Closing Date Mortgaged Properties which are
not Leasehold Properties, to the extent available.
(j) PERSONAL PROPERTY COLLATERAL. In order to create in favor of
Collateral Agent, for the benefit of Secured Parties, a valid and perfected
First Priority security interest in the personal property Collateral, Collateral
Agent shall have received:
(i) evidence satisfactory to the Collateral Agent of the compliance
by each Credit Party of their obligations under the Pledge and Security
Agreement and the other Collateral Documents (including, without limitation,
their obligations to execute and deliver UCC financing statements, originals of
securities, instruments and chattel paper and any agreements governing deposit
and/or securities accounts as provided therein);
(ii) a completed UCC Questionnaire dated the Closing Date and
executed by an Authorized Officer of each Credit Party, together with all
attachments contemplated thereby, including (A) the results of a recent search,
by a Person satisfactory to Collateral Agent, of all effective UCC financing
statements (or equivalent filings) made with respect to any personal or mixed
property of any Credit Party in the jurisdictions contemplated by the UCC
Questionnaire, together with copies of all such filings disclosed by such
search, and (B) UCC termination statements (or similar documents) duly executed
by all applicable Persons for filing in all applicable jurisdictions as may be
necessary to terminate any effective UCC financing statements (or equivalent
filings) disclosed in such search (other than any such financing statements in
respect of Permitted Liens);
(iii) opinions of counsel (which counsel shall be reasonably
satisfactory to Collateral Agent and Syndication Agent) in such states as may be
reasonably requested by Collateral Agent and Syndication Agent with respect to
the creation and perfection of the security interests in favor of Collateral
Agent in such Collateral and such other matters governed by the laws of each
jurisdiction in which any Credit Party or any personal property Collateral is
located as Collateral Agent may reasonably request, in each case in form and
substance reasonably satisfactory to Collateral Agent; and
(iv) evidence that each Credit Party shall have taken or caused to
be taken any other action, executed and delivered or caused to be executed and
delivered any other agreement, document and instrument and made or caused to be
made any other filing and recording (other than as set forth herein) reasonably
required by Collateral Agent.
(k) ENVIRONMENTAL REPORTS. Syndication Agent and Administrative
Agent shall have received reports and other information, in form, scope and
substance satisfactory to Syndication Agent and Administrative Agent, regarding
environmental matters relating to the Facilities.
(l) FINANCIAL STATEMENTS; PROJECTIONS. Lenders shall have received
from Holdings (i) the Historical Financial Statements, (ii) copies of the
monthly reporting package to
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be provided under the Merger Agreement, (iii) pro forma consolidated balance
sheets satisfactory to Agents with respect to Holdings and its Subsidiaries for
the Fiscal Year ended December 31, 1999 and with respect to the most recently
ended Fiscal Quarter and month, and reflecting the consummation of the
Acquisition and all other acquisitions and divestitures occurring during such
periods and any other recent or pending acquisitions or divestitures as of the
beginning of such periods, the related financings and the other transactions
contemplated by the Credit Documents to occur on or prior to the Closing Date,
which pro forma financial statements shall be in form and substance satisfactory
to Administrative Agent and Syndication Agent, and (iv) the Projections.
(m) EVIDENCE OF INSURANCE. Syndication Agent and Administrative
Agent shall have received a certificate from Holding's insurance broker or other
evidence satisfactory to it that all insurance required to be maintained
pursuant to Section 5.5 is in full force and effect and that Administrative
Agent, for the benefit of Lenders has been named as additional insured and loss
payee thereunder to the extent required under Section 5.5.
(n) OPINION OF COUNSEL TO CREDIT PARTIES. Lenders and their
respective counsel shall have received originally executed copies of the
favorable written opinion of Irell & ▇▇▇▇▇▇▇ LLP, counsel for Credit Parties, in
the form of Exhibit D and as to such other matters as Administrative Agent or
Syndication Agent may reasonably request, dated as of the Closing Date and
otherwise in form and substance reasonably satisfactory to Administrative Agent
and Syndication Agent.
(o) OPINION OF COUNSEL TO SYNDICATION AGENT. Lenders shall have
received originally executed copies of the favorable written opinion of Skadden,
Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel to Syndication Agent, dated as of the
Closing Date, in form and substance reasonably satisfactory to Syndication Agent
and Administrative Agent.
(p) FEES. Company shall have paid to Syndication Agent and
Administrative Agent, the fees payable on the Closing Date referred to in
Section 2.10(d).
(q) SOLVENCY CERTIFICATE; SOLVENCY APPRAISAL. On the Closing Date,
Syndication Agent and Administrative Agent shall have received (i) a Solvency
Certificate from Company and (ii) an opinion from Valuation Research, Inc. an
independent valuation consultant satisfactory to Syndication Agent and
Administrative Agent, each dated the Closing Date and addressed to Syndication
Agent, Administrative Agent and Lenders, and in form, scope and substance
satisfactory to Syndication Agent and Administrative Agent, with appropriate
attachments and demonstrating that after giving effect to the consummation of
the Acquisition and the related transactions contemplated thereby, Company and
its Subsidiaries are and will be Solvent.
(r) CLOSING DATE CERTIFICATE. Holdings and Company shall have
delivered to Syndication Agent and Administrative Agent an originally executed
Closing Date Certificate, together with all attachments thereto.
(s) CLOSING DATE. Lenders shall have made the Term Loans to Company
on or before September 20, 2000.
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(t) NO LITIGATION. There shall not exist any action, suit,
investigation, litigation or proceeding or other legal or regulatory
developments, pending or threatened in any court or before any arbitrator or
Governmental Authority that, in the reasonable opinion of Administrative Agent
and Syndication Agent, singly or in the aggregate, materially impairs the
Acquisition, the financing thereof or any other transactions contemplated by the
Credit Documents or the Related Documents, or that could have a Material Adverse
Effect.
(u) COMPLETION OF PROCEEDINGS. All partnership, corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Administrative Agent or Syndication Agent and its counsel shall be
satisfactory in form and substance to Administrative Agent and Syndication Agent
and such counsel, and Administrative Agent, Syndication Agent and such counsel
shall have received all such counterpart originals or certified copies of such
documents as Administrative Agent or Syndication Agent may reasonably request.
Each Lender, by delivering its signature page to this Agreement and funding a
Loan on the Closing Date, shall be deemed to have acknowledged receipt of, and
consented to and approved, each Credit Document and each other document required
to be approved by any Agent, Requisite Lenders or Lenders, as applicable on the
Closing Date.
Each Lender, by delivering its signature page to this Agreement and
funding a Loan on the Closing Date, shall be deemed to have acknowledged receipt
of, and consented to and approved, each Credit Document and each other document
required to be approved by any Agent, Requisite Lenders or Lenders, as
applicable on the Closing Date.
3.2. CONDITIONS TO EACH CREDIT EXTENSION.
(a) CONDITIONS PRECEDENT. The obligation of each Lender to make any
Loan on any Credit Date, including the Closing Date, are subject to the
satisfaction, or waiver in accordance with Section 10.5, of the following
conditions precedent
(i) Administrative Agent shall have received a fully executed and
delivered Funding Notice;
(ii) after making the Credit Extensions requested on such Credit
Date, (y) the Total Utilization of Revolving Commitments shall not exceed the
Revolving Commitments then in effect and (z) with respect to Revolving Loans
used to finance Permitted Acquisitions, after making the Credit Extensions on
such Credit Date, Company shall have $10,000,000 of unutilized Revolving
Commitments available and the Senior Leverage Ratio determined on a pro forma
basis as of the last day of the Fiscal Quarter most recently ended and giving
effect to the Permitted Acquisition as of such date shall be not greater than
the ratio specified in Section 6.8 with respect to such date LESS (a) 0.25 with
respect to acquisitions made by Company within the first six full Fiscal
Quarters immediately following the Closing Date and (b) 0.125 with respect to
acquisitions made by Company after the sixth full Fiscal Quarter immediately
following the Closing Date.
(iii) as of such Credit Date, the representations and warranties
contained herein and in the other Credit Documents shall be true and correct in
all material
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respects on and as of that Credit Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations and
warranties shall have been true and correct in all material respects on and as
of such earlier date; and
(iv) as of such Credit Date, no event shall have occurred and be
continuing or would result from the consummation of the applicable Credit
Extension that would constitute an Event of Default or a Default.
(v) NOTICES. Any Notice shall be executed by an Authorized Officer
in a writing delivered to Administrative Agent. In lieu of delivering a Notice,
Company may give Administrative Agent telephonic notice by the required time of
any proposed borrowing or conversion/continuation, as the case may be; PROVIDED
each such notice shall be promptly confirmed in writing by delivery of the
applicable Notice to Administrative Agent on or before the applicable date of
borrowing or continuation/conversion. Neither Administrative Agent nor any
Lender shall incur any liability to Company in acting upon any telephonic notice
referred to above that Administrative Agent believes in good faith to have been
given by a duly authorized officer or other person authorized on behalf of
Company or for otherwise acting in good faith.
SECTION 4. REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make each
Credit Extension to be made thereby, each Credit Party represents and warrants
to each Lender, on the Closing Date and on each Credit Date, that the following
statements are true and correct (it being understood and agreed that the
representations and warranties made on the Closing Date are deemed to be made
concurrently with the consummation of Acquisition contemplated hereby):
4.1. ORGANIZATION; REQUISITE POWER AND AUTHORITY; QUALIFICATION. Each of
Holdings and its Subsidiaries (a) is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization as identified
in Schedule 4.1, (b) has all requisite power and authority to own and operate
its properties, to carry on its business as now conducted and as proposed to be
conducted, to enter into the Credit Documents to which it is a party and to
carry out the transactions contemplated thereby, and (c) is qualified to do
business and in good standing in every jurisdiction where its assets are located
and wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had, and could not be reasonably expected to have, a Material Adverse Effect.
4.2. CAPITAL STOCK AND OWNERSHIP. The Capital Stock of each of Holdings and
its Subsidiaries has been duly authorized and validly issued and is fully paid
and non-assessable. Except as set forth on Schedule 4.2, as of the date hereof,
there is no existing option, warrant, call, right, commitment or other agreement
to which Holdings or any of its Subsidiaries is a party requiring, and there is
no membership interest or other Capital Stock of Holdings or any of its
Subsidiaries outstanding which upon conversion or exchange would require, the
issuance by Holdings or any of its Subsidiaries of any additional membership
interests or other Capital Stock of Holdings or any of its Subsidiaries or other
Securities convertible into, exchangeable for or evidencing the right to
subscribe for or purchase, a membership interest or other Capital Stock of
Holdings or any of its Subsidiaries. Schedule 4.2 correctly sets forth the
ownership interest of
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Holdings and each of its Subsidiaries in their respective Subsidiaries as of the
Closing Date both before and after giving effect to the Acquisition.
4.3. DUE AUTHORIZATION. The execution, delivery and performance of the
Credit Documents have been duly authorized by all necessary action on the part
of each Credit Party that is a party thereto.
4.4. NO CONFLICT. The execution, delivery and performance by Credit Parties
of the Credit Documents to which they are parties and the consummation of the
transactions contemplated by the Credit Documents do not and will not (a)
violate any provision of any law or any governmental rule or regulation
applicable to Holdings or any of its Subsidiaries, any of the Organizational
Documents of Holdings or any of its Subsidiaries, or any order, judgment or
decree of any court or other agency of government binding on Holdings or any of
its Subsidiaries except to the extent such violation could not be reasonably
expected to have a Material Adverse Effect; (b) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a default
under any Contractual Obligation of Holdings or any of its Subsidiaries except
to the extent such conflict, breach or default could not reasonably be expected
to have a Material Adverse Effect; (c) result in or require the creation or
imposition of any Lien upon any of the properties or assets of Holdings or any
of its Subsidiaries (other than any Liens created under any of the Credit
Documents in favor of Collateral Agent, on behalf of Secured Parties); or (d)
require any approval of stockholders, members or partners or any approval or
consent of any Person under any Contractual Obligation of Holdings or any of its
Subsidiaries, except for such approvals or consents which will be obtained on or
before the Closing Date and disclosed in writing to Lenders and except for any
such approvals or consents the failure of which to obtain will not have a
Material Adverse Effect.
4.5. GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Credit Parties of the Credit Documents to which they are parties and the
consummation of the transactions contemplated by the Credit Documents do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by, any Governmental Authority except as otherwise set
forth in the Merger Agreement, and except for filings and recordings with
respect to the Collateral to be made, or otherwise delivered to Collateral Agent
for filing and/or recordation, as of the Closing Date.
4.6. BINDING OBLIGATION. Each Credit Document has been duly executed and
delivered by each Credit Party that is a party thereto and is the legally valid
and binding obligation of such Credit Party, enforceable against such Credit
Party in accordance with its respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles relating to
enforceability.
4.7. HISTORICAL FINANCIAL STATEMENTS. The Historical Financial Statements
were prepared in conformity with GAAP and fairly present, in all material
respects, the financial position, on a consolidated basis, of the Persons
described in such financial statements as at the respective dates thereof and
the results of operations and cash flows, on a consolidated basis, of the
entities described therein for each of the periods then ended, subject, in the
case of any such unaudited financial statements, to changes resulting from audit
and normal year-end adjustments.
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As of the Closing Date, neither Holdings nor any of its Subsidiaries has any
contingent liability or liability for taxes, long-term lease or unusual forward
or long-term commitment that is not reflected in the Historical Financial
Statements or the notes thereto and which in any such case is material in
relation to the business, operations, properties, assets, condition (financial
or otherwise) or prospects of Holdings and any of its Subsidiaries taken as a
whole.
4.8. PROJECTIONS. On and as of the Closing Date, the Projections of
Holdings and its Subsidiaries for the period Fiscal Year 2001 through and
including Fiscal Year 2010 (the "PROJECTIONS") are based on good faith estimates
and assumptions made by the management of Holdings; PROVIDED, the Projections am
not to be viewed as facts and that actual results during the period or periods
covered by the Projections may differ from such Projections and that the
differences may be material; PROVIDED FURTHER, as of the Closing Date,
management of Holdings believed that the Projections were reasonable and
attainable.
4.9. NO MATERIAL ADVERSE CHANGE. Since December 31, 1999, no event or
change has occurred that has caused or evidences, either in any case or in the
aggregate, a Material Adverse Effect.
4.10. NO RESTRICTED JUNIOR PAYMENTS. Except as set forth in Schedule 4.10,
since December 31, 1999, neither Holdings nor any of its Subsidiaries has
directly or indirectly declared, ordered, paid or made, or set apart any sum or
property for, any Restricted Junior Payment or agreed to do so except as
permitted pursuant to Section 6.5.
4.11. ADVERSE PROCEEDINGS, ETC. There are no Adverse Proceedings,
individually or in the aggregate, that could reasonably be expected to have a
Material Adverse Effect. Neither Holdings nor any of its Subsidiaries (a) is in
violation of any applicable laws (including Environmental Laws) that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, or (b) is subject to or in default with respect to any
final judgments, writs, injunctions, decrees, rules or regulations of any court
or any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
4.12. PAYMENT OF TAXES. Except as otherwise permitted under Section 5.3,
all federal and state income tax returns and all other material tax returns and
reports of Holdings and its Subsidiaries required to be filed by any of them
have been timely filed, and all taxes shown on such tax returns to be due and
payable and all material assessments, fees and other governmental charges upon
Holdings and its Subsidiaries and upon their respective properties, assets,
income, businesses and franchises which are due and payable have been paid when
due and payable. Holdings knows of no proposed tax assessment against Holdings
or any of its Subsidiaries which is not being actively contested by Holdings or
such Subsidiary in good faith and by appropriate proceedings; PROVIDED, such
reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
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4.13. PROPERTIES.
(a) TITLE. Each of Holdings and its Subsidiaries has (i) good,
sufficient and marketable legal title to (in the case of fee interests in real
property), (ii) valid leasehold interests in (in the case of leasehold interests
in real or personal property), and (iii) good title to (in the case of all other
personal property), all of their respective properties and assets reflected in
their respective Historical Financial Statements referred to in Section 4.7 and
in the most recent financial statements delivered pursuant to Section 5.1, in
each case except for assets disposed of since the date of such financial
statements in the ordinary course of business or as otherwise permitted under
Section 6.9. Except as permitted by this Agreement, all such properties and
assets are free and clear of Liens.
(b) REAL ESTATE. As of the Closing Date, Schedule 4.13 contains a true,
accurate and complete list of (i) all Real Estate Assets, and (ii) all leases,
subleases or assignments of leases (together with all amendments, modifications,
supplements, renewals or extensions of any thereof) affecting each Real Estate
Asset of any Credit Party, regardless of whether such Credit Party is the
landlord or tenant (whether directly or as an assignee or successor in interest)
under such lease, sublease or assignment. Each agreement listed in clause (ii)
of the immediately preceding sentence is in full force and effect and Holdings
does not have knowledge of any default that has occurred and is continuing
thereunder, and each such agreement constitutes the legally valid and binding
obligation of each applicable Credit Party, enforceable against such Credit
Party in accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or limiting creditors' rights generally or by equitable principles.
4.14. ENVIRONMENTAL MATTERS. Neither Holdings nor any of its Subsidiaries
nor any of their respective Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement with any
Person relating to any Environmental Law, any Environmental Claim, to the
knowledge of Holdings or any of its Subsidiaries, or any Hazardous Materials
Activity that, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect. Neither Holdings nor any of its Subsidiaries has
received any letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
ss.9604) or any comparable state law. There are and, to each of Holdings' and
its Subsidiaries' knowledge, have been, no conditions, occurrences, or Hazardous
Materials Activities which could reasonably be expected to form the basis of an
Environmental Claim against Holdings or any of its Subsidiaries that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect. Neither Holdings nor any of its Subsidiaries nor, to
any Credit Party's knowledge, any predecessor of Holdings or any of its
Subsidiaries has filed any notice under any Environmental Law indicating past or
present treatment of Hazardous Materials at any Facility, and none of Holdings'
or any of its Subsidiaries' operations involves the generation, transportation,
treatment, storage or disposal of hazardous waste, as defined under 40 C.F.R.
Parts 260-270 or any state equivalent except for such filings, generation,
transportation, treatment, storage or disposal that could not reasonably be
expected to have a Material Adverse Effect. Compliance with all current or
reasonably foreseeable future requirements pursuant to or under Environmental
Laws could not be reasonably expected to have, individually or in the aggregate,
a Material Adverse Effect. No event or condition has occurred or is occurring
with respect to Holdings or any of its Subsidiaries
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relating to any Environmental Law, any Release of Hazardous Materials, or any
Hazardous Materials Activity which individually or in the aggregate has had, or
could reasonably be expected to have, a Material Adverse Effect.
4.15. NO DEFAULTS. Neither Holdings nor any of its Subsidiaries is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists which, with the giving of notice or the lapse of time or both,
could constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, could not reasonably be expected
to have a Material Adverse Effect.
4.16. GOVERNMENTAL REGULATION. Neither Holdings nor any of its Subsidiaries
is subject to regulation under the Public Utility Holding Company Act of 1935,
the Federal Power Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness or which may otherwise render all or any portion of the Obligations
unenforceable. Neither Holdings nor any of its Subsidiaries is a "registered
investment company" or is "controlled" by a "registered investment company" or a
"principal underwriter" of a "registered investment company" as such terms are
defined in the Investment Company Act of 1940.
4.17. MARGIN STOCK. Neither Holdings nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock. No part of
the proceeds of the Loans made to such Credit Party will be used to purchase or
carry any such margin stock or to extend credit to others for the purpose of
purchasing or carrying any such margin stock or for any purpose that violates,
or is inconsistent with, the provisions of Regulation T, U or X of the Board of
Governors of the Federal Reserve System.
4.18. EMPLOYEE MATTERS. Neither Holdings nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect. There is (a) no unfair labor practice complaint pending
against Holdings or any of its Subsidiaries, or to the best knowledge of
Holdings and Company, threatened against any of them before the National Labor
Relations Board and no grievance or arbitration proceeding arising out of or
under any collective bargaining agreement that is so pending against Holdings or
any of its Subsidiaries or to the best knowledge of Holdings and Company,
threatened against any of them, (b) no strike or work stoppage in existence or
threatened involving Holdings or any of its Subsidiaries that could reasonably
be expected to have a Material Adverse Effect, and (c) to the best knowledge of
Holdings and Company, no union representation question existing with respect to
the employees of Holdings or any of its Subsidiaries and, to the best knowledge
of Holdings and Company, no union organization activity that is taking place,
except (with respect to any matter specified in clause (a), (b) or (c) above,
either individually or in the aggregate) such as is not reasonably likely to
have a Material Adverse Effect.
4.19. EMPLOYEE BENEFIT PLANS. Holdings, each of its Subsidiaries and each
of their respective ERISA Affiliates are in material compliance with all
applicable provisions and requirements of ERISA and the Internal Revenue Code
and the regulations and published interpretations thereunder with respect to
each Employee Benefit Plan, and have substantially
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performed all their obligations under each Employee Benefit Plan. Each Employee
Benefit Plan which is intended to qualify under Section 401(a) of the Internal
Revenue Code has substantially met requirements for qualification. No material
liability to the PBGC (other than required premium payments), the Internal
Revenue Service, any Employee Benefit Plan or any Trust established under Title
IV of ERISA has been or is expected to be incurred by Holdings, any of its
Subsidiaries or any of their ERISA Affiliates. No ERISA Event has occurred or is
reasonably expected to occur. Except to the extent required under Section 4980B
of the Internal Revenue Code or similar state laws, no Employee Benefit Plan
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates. As of the most recent
valuation date for any Pension Plan, the amount of unfunded benefit liabilities
(as defined in Section 4001(a)(18) of ERISA), individually or in the aggregate
for all Pension Plans (excluding for purposes of such computation any Pension
Plans with respect to which assets exceed benefit liabilities), does not exceed
$3,500,000. As of the most recent valuation date for each Multiemployer Plan for
which the actuarial report is available, the potential liability of Holdings,
its Subsidiaries and their respective ERISA Affiliates for a complete withdrawal
from such Multiemployer Plan (within the meaning of Section 4203 of ERISA), when
aggregated with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to Section 4221(e)
of ERISA, does not exceed $3,500,000. Holdings, each of its Subsidiaries and
each of their ERISA Affiliates have complied with the requirements of Section
515 of ERISA with respect to each Multiemployer Plan and are not in material
"default" (as defined in Section 4219(c)(5) of ERISA) with respect to payments
to a Multiemployer Plan.
4.20. CERTAIN FEES. No broker's or finder's fee or commission will be
payable with respect hereto or any of the transactions contemplated hereby,
except those broker's and finder's fees otherwise disclosed to the Agents prior
to the Closing Date.
4.21. SOLVENCY. Each Credit Party is and, upon the incurrence of any
Obligation by such Credit Party on any date on which this representation and
warranty is made, will be, Solvent.
4.22. RELATED AGREEMENTS.
(a) DELIVERY. Holdings and Company have delivered to Syndication Agent
and Administrative Agent complete and correct copies of (i) each Related
Agreement and of all exhibits and schedules thereto as of the date hereof and
(ii) copies of any material amendment, restatement, supplement or other
modification to or waiver of each Related Agreement entered into after the date
hereof.
(b) REPRESENTATIONS AND WARRANTIES. Except to the extent otherwise
expressly set forth herein or in the schedules hereto, and subject to the
qualifications set forth therein, each of the representations and warranties
given by any Credit Party in any Related Agreement is true and correct in all
material respects as of the Closing Date (or as of any earlier date to which
such representation and warranty specifically relates). Notwithstanding anything
in any Related Agreement to the contrary, the representations and warranties of
each Credit Party set forth in this Section 4.23 shall, solely for purposes
hereof, survive the Closing Date for the benefit of Lenders.
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(c) GOVERNMENTAL APPROVAL. All Governmental Authorizations and all
other authorizations, approvals and consents of any other Person required by the
Related Agreements or to consummate the Acquisition have been obtained and are
in full force and effect.
(d) CONDITIONS PRECEDENT. On the Closing Date, (i) all of the
conditions to effecting or consummating the Acquisition set forth in the Related
Agreements have been duly satisfied or, with the consent of Administrative Agent
and Requisite Lenders, waived, and (ii) the Acquisition has been consummated in
accordance with the Related Agreements and all applicable laws.
4.23. SUBORDINATION OF PERMITTED SELLER NOTES AND SENIOR SUBORDINATED NOTE
DOCUMENTS. The subordination provisions of any Permitted Seller Notes, the
Senior Subordinated Note Documents or other Subordinated Indebtedness are
enforceable against the holders thereof, and the Loans and other Obligations
thereunder are and will be within the definition of "Subordinated Indebtedness"
or "Subordinated Debt", or similar term, as applicable, included in such
provisions.
4.24. COMPLIANCE WITH STATUTES, ETC. Each of Holdings and its Subsidiaries
is in compliance with all applicable statutes, regulations and orders of, and
all applicable restrictions imposed by, all Governmental Authorities, in respect
of the conduct of its business and the ownership of its property (including
compliance with all applicable Environmental Laws with respect to any Real
Estate Asset or governing its business and the requirements of any permits
issued under such Environmental Laws with respect to any such Real Estate Asset
or the operations of Holdings or any of its Subsidiaries), except such
non-compliance that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
4.25. DISCLOSURE. No representation or warranty of any Credit Party
contained in any Credit Document or in any other documents, certificates or
written statements furnished to Lenders by or on behalf of Holdings or any of
its Subsidiaries for use in connection with the transactions contemplated hereby
contains any untrue statement of a material fact or omits to state a material
fact (known to Holdings or Company, in the case of any document not furnished by
either of them) necessary in order to make the statements contained herein or
therein not misleading in light of the circumstances in which the same were
made. Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by
Holdings or Company to be reasonable at the time made, it being recognized by
Lenders that such projections as to future events are not to be viewed as facts
and that actual results during the period or periods covered by any such
projections may differ from the projected results. There are no facts known (or
which should upon the reasonable exercise of diligence be known) to Holdings or
Company (other than matters of a general economic nature) that, individually or
in the aggregate, could reasonably be expected to result in a Material Adverse
Effect and that have not been disclosed herein or in such other documents,
certificates and statements furnished to Lenders for use in connection with the
transactions contemplated hereby.
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SECTION 5. AFFIRMATIVE COVENANTS
Each Credit Party covenants and agrees that so long as any Commitment is
in effect and until payment in full of all Obligations, each Credit Party shall
perform, and shall cause each of its Subsidiaries to perform, all covenants in
this Section 5.
5.1. FINANCIAL STATEMENTS AND OTHER REPORTS. Holdings will deliver to
Administrative Agent and Lenders:
(a) MONTHLY REPORTS. As soon as available, and in any event within
forty-five (45) days after the end of each month ending after the Closing Date,
the consolidated balance sheet of Holdings and its Subsidiaries as at the end of
such month and the related consolidated statements of income, stockholders'
equity and cash flows of Holdings and its Subsidiaries for such month and for
the period from the beginning of the then current Fiscal Year to the end of such
month, setting forth in each case in comparative form (other than with respect
to cash flows) the corresponding figures for the corresponding periods of the
previous Fiscal Year and the corresponding figures from the Financial Plan for
the current Fiscal Year, to the extent prepared on a monthly basis, all in
reasonable detail, together with a Financial Officer Certification and a
Narrative Report with respect thereto;
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available, and in any
event within forty-five (45) days after the end of each of the first three
Fiscal Quarters of each Fiscal Year, the consolidated balance sheet of Holdings
and its Subsidiaries as at the end of such Fiscal Quarter and the related
consolidated statements of income, stockholders' equity and cash flows of
Holdings and its Subsidiaries for such Fiscal Quarter and for the period from
the beginning of the then current Fiscal Year to the end of such Fiscal Quarter,
setting forth in each case in comparative form the corresponding figures for the
corresponding periods of the previous Fiscal Year and the corresponding figures
from the Financial Plan for the current Fiscal Year, all in reasonable detail,
together with a Financial Officer Certification and a Narrative Report with
respect thereto;
(c) ANNUAL FINANCIAL STATEMENTS. As soon as available, and in any event
within ninety (90) days after the end of each Fiscal Year, (i) the consolidated
balance sheet of Holdings and its Subsidiaries as at the end of such Fiscal Year
and the related consolidated statements of income, stockholders' equity and cash
flows of Holdings and its Subsidiaries for such Fiscal Year, setting forth in
each case in comparative form the corresponding figures for the previous Fiscal
Year and the corresponding figures from the Financial Plan for the Fiscal Year
covered by such financial statements, in reasonable detail, together with a
Financial Officer Certification and a Narrative Report with respect thereto; and
(ii) with respect such consolidated financial statements a report thereon of
independent certified public accountants of recognized national standing
selected by Holdings, and reasonably satisfactory to Administrative Agent (which
report shall be unqualified as to going concern and scope of audit, and shall
state that such consolidated financial statements fairly present, in all
material respects, the consolidated financial position of Holdings and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in connection
with such consolidated financial
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statements has been made in accordance with generally accepted auditing
standards) together with a written statement by such independent certified
public accountants stating whether, in connection with their audit examination,
any condition or event that constitutes a Default or an Event of Default under
Section 8 hereof has come to their attention and, if such a condition or event
has come to their attention, specifying the nature and period of existence
thereof; PROVIDED that such accountants shall not be liable by reason of any
failure to obtain knowledge of any such Default or Event of Default that would
not be disclosed in the course of their audit examination;
(d) COMPLIANCE CERTIFICATE. Together with each delivery of financial
statements of Holdings and its Subsidiaries pursuant to Sections 5.1(b) and
5.1(c), a duly executed and completed Compliance Certificate;
(e) STATEMENTS OF RECONCILIATION AFTER CHANGE IN ACCOUNTING PRINCIPLES.
If, as a result of any change in accounting principles and policies from those
used in the preparation of the Historical Financial Statements, the consolidated
financial statements of Holdings and its Subsidiaries delivered pursuant to
Section 5.1(b) or 5.1(c) will differ in any material respect from the
consolidated financial statements that would have been delivered pursuant to
such subdivisions had no such change in accounting principles and policies been
made, then, together with the first delivery of such financial statements after
such change, one or more statements of reconciliation for all such prior
financial statements in form and substance satisfactory to Administrative Agent;
(f) NOTICE OF DEFAULT. Promptly upon any officer of Holdings or Company
obtaining knowledge (i) of any condition or event that constitutes a Default or
an Event of Default or that notice has been given to Holdings or Company with
respect thereto; (ii) that any Person has given any notice to Holdings or any of
its Subsidiaries or taken any other action with respect to any event or
condition set forth in Section 8.1(b); or (iii) of the occurrence of any event
or change that has caused or evidences, either in any case or in the aggregate,
a Material Adverse Effect, a certificate of its Authorized Officers specifying
the nature and period of existence of such condition, event or change, or
specifying the notice given and action taken by any such Person and the nature
of such claimed Event of Default, Default, default, event or condition, and what
action Holdings has taken, is taking and proposes to take with respect thereto;
(g) NOTICE OF LITIGATION. Promptly upon any officer of Holdings or
Company obtaining knowledge of (i) the institution of, or non-frivolous threat
of, any Adverse Proceeding not previously disclosed in writing by Company to
Lenders, or (ii) any material development in any Adverse Proceeding that, in the
case of either (i) or (ii) if adversely determined, could be reasonably expected
to have a Material Adverse Effect, or seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as a result of, the
transactions contemplated hereby, written notice thereof together with such
other information as may be reasonably available to Holdings or Company to
enable Lenders and their counsel to evaluate such matters;
(h) ERISA. (i) Promptly upon becoming aware of the occurrence any ERISA
Event, a written notice specifying the nature thereof, what action Holdings, any
of its Subsidiaries or any of their respective ERISA Affiliates has taken, is
taking or proposes to take
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with respect thereto and, when known, any action taken or threatened by the
Internal Revenue Service, the Department of Labor or the PBGC with respect
thereto; and (ii) with reasonable promptness, copies of (1) each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) filed by
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates
with the Internal Revenue Service with respect to each Pension Plan; (2) all
notices received by Holdings, any of its Subsidiaries or any of their respective
ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event;
and (3) copies of such other documents or governmental reports or filings
relating to any Employee Benefit Plan as Administrative Agent shall reasonably
request;
(i) FINANCIAL PLAN. As soon as practicable and in any event no later
than thirty (30) days after the beginning of each Fiscal Year, a consolidated
plan and financial forecast for such Fiscal Year and the next three succeeding
Fiscal Years (a "FINANCIAL PLAN"), including (i) a forecasted consolidated
balance sheet and forecasted consolidated statements of income and cash flows of
Holdings and its Subsidiaries for each such Fiscal Year, together with pro forma
Compliance Certificates for each such Fiscal Year and an explanation of the
assumptions on which such forecasts are based and (ii) forecasted consolidated
statements of income and cash flows of Holdings and its Subsidiaries for each
month of each such Fiscal Year, together with an explanation of the assumptions
on which such forecasts are based;
(j) INSURANCE REPORT. As soon as practicable and in any event by the
last day of each Fiscal Year, a report in form and substance satisfactory to
Administrative Agent outlining all material insurance coverage maintained as of
the date of such report by Holdings and its Subsidiaries and all material
insurance coverage planned to be maintained by Holdings and its Subsidiaries in
the immediately succeeding Fiscal Year;
(k) NOTICE OF CHANGE IN BOARD OF DIRECTORS. With reasonable promptness,
written notice of any change in the board of directors (or similar governing
body) of Holdings or Company;
(l) NOTICE REGARDING MATERIAL CONTRACTS. Promptly, and in any event
within ten (10) Business Days (i) after any Material Contract of Holdings or any
of its Subsidiaries is terminated or amended in a manner that is materially
adverse to Holdings or such Subsidiary, as the case may be, or (ii) any new
Material Contract is entered into, a written statement describing such event,
with copies of such material amendments or new contracts, delivered to
Administrative Agent (to the extent such delivery is permitted by the terms of
any such Material Contract, provided, no such prohibition on delivery shall be
effective if it were bargained for by Holdings or its applicable Subsidiary with
the intent of avoiding compliance with this Section 5.1 (1)), and an explanation
of any actions being taken with respect thereto;
(m) ENVIRONMENTAL REPORTS AND AUDITS. As soon as practicable following
receipt thereof, copies of all environmental audits and reports with respect to
environmental matters at any Facility or which relate to any environmental
liabilities of Holdings or its Subsidiaries which, in any such case,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect;
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(n) INFORMATION REGARDING COLLATERAL. The Company will furnish to the
Collateral Agent prompt written notice of any change (i) in any Credit Party's
corporate name, (ii) in the location of any Credit Party's chief executive
office, its principal place of business, any office in which it maintains books
or records relating to Collateral owned by it or any office or facility at which
Collateral (other than real property and improvements and fixtures thereto)
owned by it with a book value in excess of $250,000 is located (including the
establishment of any such new office or facility), (iii) in any Credit Party's
identity or corporate structure or (iv) in any Credit Party's Federal Taxpayer
Identification Number. The Company agrees not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have a valid,
legal and perfected security interest in all the Collateral and for the
Collateral at all times following such change to have a valid, legal and
perfected security interest as contemplated in the Collateral Documents. The
Company also agrees promptly to notify the Collateral Agent if any material
portion of the Collateral is damaged or destroyed;
(o) ANNUAL COLLATERAL VERIFICATIONS. Each year, at the time of delivery
of annual financial statements with respect to the preceding Fiscal Year
pursuant to Section 5.1, the Company shall deliver to the Collateral Agent an
Officer's Certificate (i) either confirming that there has been no change in
such information since the date of the UCC Questionnaire delivered on the
Closing Date or the date of the most recent certificate delivered pursuant to
this Section and/or identifying such changes and (ii) certifying that all
Uniform Commercial Code financing statements (including fixtures filings, as
applicable) or other appropriate filings, recordings or registrations, have been
filed of record in each governmental, municipal or other appropriate office in
each jurisdiction identified pursuant to clause (i) above to the extent
necessary to protect and perfect the security interests under the Collateral
Documents for a period of not less than 18 months after the date of such
certificate (except as noted therein with respect to any continuation statements
to be filed within such period); and
(p) OTHER INFORMATION. (A) Promptly upon their becoming available,
copies of (i) all financial statements, reports, notices and proxy statements
sent or made available generally by Holdings to its security holders acting in
such capacity or by any Subsidiary of Holdings to its security holders other
than Holdings or another Subsidiary of Holdings, (ii) all regular and periodic
reports and all registration statements and prospectuses, if any, filed by
Holdings or any of its Subsidiaries with any securities exchange or with the
Securities and Exchange Commission or any governmental or private regulatory
authority, (iii) all press releases and other statements made available
generally by Holdings or any of its Subsidiaries to the public concerning
material developments in the business of Holdings or any of its Subsidiaries,
and (B) such other information and data with respect to Holdings or any of its
Subsidiaries as from time to time may be reasonably requested by Administrative
Agent or any Lender.
5.2. EXISTENCE. Except as otherwise permitted under Section 6.9, each
Credit Party will, and will cause each of its Subsidiaries to, at all times
preserve and keep in full force and effect its existence and all rights and
franchises, licenses and permits material to its business; PROVIDED, no Credit
Party or any of its Subsidiaries shall be required to preserve any such
existence, right or franchise, licenses and permits if such Person's board of
directors (or similar governing body) shall determine that the preservation
thereof is no longer desirable in the
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conduct of the business of such Person, and that the loss thereof is not
disadvantageous in any material respect to such Person or to Lenders.
5.3. PAYMENT OF TAXES AND CLAIMS. Each Credit Party will, and will cause
each of its Subsidiaries to, pay all Taxes imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty or fine accrues thereon, and all claims (including
claims for labor, services, materials and supplies) for sums that have become
due and payable and that by law have or may become a Lien upon any of its
properties or assets, prior to the time when any penalty or fine shall be
incurred with respect thereto; PROVIDED no such Tax or claim need be paid if it
is being contested in good faith by appropriate proceedings promptly instituted
and diligently conducted, so long as (a) an adequate reserve or other
appropriate provision, as shall be required in conformity with GAAP shall have
been made therefor, and (b) in the case of a charge or claim which has or may
become a Lien against any of the Collateral, such contest proceedings
conclusively operate to stay the sale of any portion of the Collateral to
satisfy such Tax or claim. No Credit Party will, nor will it permit any of its
Subsidiaries to, file or consent to the filing of any consolidated income Tax
return with any Person (other than Holdings or any of its Subsidiaries).
5.4. MAINTENANCE OF PROPERTIES. Each Credit Party will, and will cause each
of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties used or useful in the business of Holdings and its Subsidiaries and
from time to time will make or cause to be made all appropriate repairs,
renewals and replacements thereof, and each Credit Party shall defend any
Collateral against all Persons at any time claiming any interest therein.
5.5. INSURANCE. Holdings will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Holdings and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by Persons of
established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for such
Persons. Without limiting the generality of the foregoing, Holdings will
maintain or cause to be maintained (a) flood insurance with respect to each
Flood Hazard Property that is located in a community that participates in the
National Flood Insurance Program, in each case in compliance with any applicable
regulations of the Board of Governors of the Federal Reserve System, and (b)
replacement value casualty insurance on the Collateral under such policies of
insurance, with such insurance companies, in such amounts, with such
deductibles, and covering such risks as are at all times carried or maintained
under similar circumstances by Persons of established reputation engaged in
similar businesses. Each such policy of insurance shall (i) name Administrative
Agent, on behalf of Lenders as an additional insured thereunder as its interests
may appear and (ii) in the case of each casualty insurance policy, contain a
loss payable clause or endorsement, satisfactory in form and substance to
Administrative Agent, that names Administrative Agent, on behalf of Lenders as
the loss payee thereunder.
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5.6. INSPECTIONS. Each Credit Party will, and will cause each of its
Subsidiaries to, permit any authorized representatives designated by any Lender
to visit and inspect any of the properties of any Credit Party and any of its
respective Subsidiaries, to inspect, copy and take extracts from its and their
financial and accounting records, and to discuss its and their affairs, finances
and accounts with its and their officers and independent public accountants, all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested; PROVIDED, that each Lender shall
coordinate with Administrative Agent with respect to the frequency and timing of
such visits and inspections so as to reasonably minimize the burden imposed on
each Credit Party and its Subsidiaries.
5.7. LENDERS MEETINGS. Holdings and Company will, upon the request of
Administrative Agent or Requisite Lenders, participate in a meeting of
Administrative Agent and Lenders once during each Fiscal Year to be held at
Company's corporate offices (or at such other location as may be agreed to by
Company and Administrative Agent) at such time as may be agreed to by Company
and Administrative Agent.
5.8. COMPLIANCE WITH LAWS. Each Credit Party will comply, and shall cause
each of its Subsidiaries and all other Persons, if any, on or occupying any
Facilities to comply, with the requirements of all applicable laws, rules,
regulations and orders of any governmental authority (including all
Environmental Laws), noncompliance with which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.
5.9. ENVIRONMENTAL.
(a) ENVIRONMENTAL DISCLOSURE. Holdings will deliver to Administrative
Agent and Lenders:
(i) as soon as practicable following receipt thereof, copies of all
environmental audits, investigations, analyses and reports of any kind or
character, whether prepared by personnel of Holdings or any of its Subsidiaries
or by independent consultants, governmental authorities or any other Persons,
with respect to significant environmental matters at any Facility or with
respect to any known Environmental Claims;
(ii) promptly upon the occurrence thereof, written notice describing in
reasonable detail (1) any Release required to be reported to any federal, state
or local governmental or regulatory agency under any applicable Environmental
Laws, (2) any remedial action taken by Holdings or any other Person in response
to (A) any Hazardous Materials Activities the existence of which has a
reasonable possibility of resulting in one or more Environmental Claims having,
individually or in the aggregate, a Material Adverse Effect, or (B) any
Environmental Claims that, individually or in the aggregate, have a reasonable
possibility of resulting in a Material Adverse Effect, and (3) Holdings or
Company's discovery of any occurrence or condition on any real property
adjoining or in the vicinity of any Facility that could cause such Facility or
any part thereof to be subject to any material restrictions on the ownership,
occupancy, transferability or use thereof under any Environmental Laws;
(iii) as soon as practicable following the sending or receipt thereof
by Holdings or any of its Subsidiaries, a copy of any and all material written
communications with
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respect to (1) any Environmental Claims that, individually or in the aggregate,
have a reasonable possibility of giving rise to a Material Adverse Effect, (2)
any Release required to be reported to any federal, state or local governmental
or regulatory agency, and (3) any request for information from any governmental
agency that suggests such agency is investigating whether Holdings or any of its
Subsidiaries may be potentially responsible for any Hazardous Materials Activity
that has a reasonable possibility of giving rise to a Material Adverse Effect;
(iv) prompt written notice describing in reasonable detail (1) any
proposed acquisition of stock, assets, or property by Holdings or any of its
Subsidiaries that could reasonably be expected to (A) expose Holdings or any of
its Subsidiaries to, or result in, Environmental Claims that could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect or
(B) affect the ability of Holdings or any of its Subsidiaries to maintain in
full force and effect all material Governmental Authorizations required under
any Environmental Laws for their respective operations and (2) any proposed
action to be taken by Holdings or any of its Subsidiaries to modify current
operations in a manner that could reasonably be expected to subject Holdings or
any of its Subsidiaries to any additional material obligations or requirements
under any Environmental Laws; and
(v) with reasonable promptness, such other documents and information as
from time to time may be reasonably requested by Administrative Agent in
relation to any matters disclosed pursuant to this Section 5.9(a).
(b) HAZARDOUS MATERIALS ACTIVITIES, ETC. Each Credit Party shall
promptly take, and shall cause each of its Subsidiaries promptly to take, any
and all actions necessary to (i) cure any violation of applicable Environmental
Laws by such Credit Party or its Subsidiaries that could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect, and (ii)
make an appropriate response to any known Environmental Claim against such
Credit Party or any of its Subsidiaries where failure to do so could reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect; PROVIDED, HOWEVER, that nothing in this Section 5.9(b) shall preclude
any Credit Party or any of its Subsidiaries from contesting in good faith any
such Environmental Claim.
5.10. SUBSIDIARIES. In the event that any Person becomes a Domestic
Subsidiary of Company, Company shall, except with respect to Permitted
Partially-Owned Subsidiaries, (a) promptly cause such Domestic Subsidiary to
become a Guarantor hereunder and a Grantor under the Pledge and Security
Agreement by executing and delivering to Administrative Agent and Collateral
Agent a Counterpart Agreement, and (b) take all such actions and execute and
deliver, or cause to be executed and delivered, all such documents, instruments,
agreements, and certificates as are similar to those described in Sections
3.1(b), 3.1(i) and 3.1(j), and to the extent reasonably requested by
Administrative Agent, such documents, instruments, agreements, and certificates
as are similar to those described in Sections 3.1(k) and 3.1(n). In the event
that any Person becomes a Foreign Subsidiary of Company, and the ownership
interests of such Foreign Subsidiary are owned by Company or by any Domestic
Subsidiary thereof, Company shall, or shall cause such Domestic Subsidiary to,
deliver, all such documents, instruments, agreements, and certificates as are
similar to those described in Sections 3.1(b), and Company shall take, or shall
cause such Domestic Subsidiary to take, all of the actions referred to in
Section 3.1(j)(i) necessary to grant and to perfect a First Priority Lien in
favor of Administrative Agent, for the
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benefit of Secured Parties, under the Pledge and Security Agreement in not more
than 65% of such ownership interests. With respect to each such Subsidiary,
Company shall promptly send to Administrative Agent written notice setting forth
with respect to such Person (i) the date on which such Person became a
Subsidiary of Company, and (ii) all of the data required to be set forth in
Schedules 4.1 and 4.2 with respect to all Subsidiaries of Company; PROVIDED,
such written notice shall be deemed to supplement Schedule 4.1 and 4.2 for all
purposes hereof.
5.11. ADDITIONAL MATERIAL REAL ESTATE ASSETS. In the event that any Credit
Party acquires a Material Real Estate Asset or a Real Estate Asset owned on the
Closing Date becomes a Material Real Estate Asset and such interest has not
otherwise been made subject to the Lien of the Collateral Documents in favor of
Collateral Agent, for the benefit of Secured Parties, then such Credit Party,
contemporaneously with acquiring such Material Real Estate Asset, shall take all
such actions and execute and deliver, or cause to be executed and delivered, all
such mortgages, documents, instruments, agreements, opinions and certificates
similar to those described in Sections 3.1(i), 3.1(j) and 3.1(k) with respect to
each such Material Real Estate Asset that Collateral Agent shall reasonably
request to create in favor of Collateral Agent, for the benefit of Secured
Parties, a valid and, subject to any filing and/or recording referred to herein,
perfected First Priority security interest in such Material Real Estate Assets.
In addition to the foregoing, Company shall, at the request of Requisite
Lenders, deliver, from time to time, to Collateral Agent such appraisals as are
required by law or regulation of Real Estate Assets with respect to which
Collateral Agent has been granted a Lien.
5.12. INTEREST RATE PROTECTION. No later than ninety (90) days following
the Closing Date and at all times thereafter, Company shall maintain, or caused
to be maintained, in effect one or more Interest Rate Agreements for a term of
not less than two (2) years and otherwise in form and substance reasonably
satisfactory to Administrative Agent and Syndication Agent, which Interest Rate
Agreements shall effectively limit the Unadjusted Eurodollar Rate Component of
the interest costs to Company with respect to an aggregate notional principal
amount of not less than 25% of the aggregate principal amount of the Tranche A
Term Loans and the Tranche B Term Loans outstanding from time to time (based on
the assumption that such notional principal amount was a Eurodollar Rate Loan
with an Interest Period of three months) to a rate equal to that which is
reasonably satisfactory to the Administrative Agent and the Syndication Agent.
5.13. FURTHER ASSURANCES. At any time or from time to time upon the request
of Administrative Agent, each Credit Party will, at its expense, promptly
execute, acknowledge and deliver such further documents and do such other acts
and things as Administrative Agent or Collateral Agent may reasonably request in
order to effect fully the purposes of the Credit Documents. In furtherance and
not in limitation of the foregoing, each Credit Party shall take such actions as
Administrative Agent or Collateral Agent may reasonably request from time to
time to ensure that the Obligations are guarantied by the Guarantors and are
secured by substantially all of the assets of Holdings, and its Subsidiaries and
all of the outstanding Capital Stock of Company and its Subsidiaries (subject to
limitations contained in the Credit Documents with respect to Foreign
Subsidiaries).
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SECTION 6. NEGATIVE COVENANTS
Each Credit Party covenants and agrees that, so long as any Commitment is
in effect and until payment in full of all Obligations, such Credit Party shall
perform, and shall cause each of its Subsidiaries to perform, all covenants in
this Section 6.
6.1. INDEBTEDNESS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or guaranty, or
otherwise become or remain directly or indirectly liable with respect to any
Indebtedness, except:
(a) the Obligations;
(b) Indebtedness of any Guarantor Subsidiary to Company or to any other
Guarantor Subsidiary, or of Company to any Guarantor Subsidiary; PROVIDED, (i)
all such Indebtedness shall be evidenced by promissory notes and all such notes
shall be subject to a First Priority Lien pursuant to the Pledge and Security
Agreement, (ii) all such Indebtedness shall be unsecured and subordinated in
right of payment to the payment in full of the Obligations pursuant to the terms
of the applicable promissory notes or an intercompany subordination agreement
that in any such case, is reasonably satisfactory to Administrative Agent, and
(iii) any payment by any such Guarantor Subsidiary under any guaranty of the
Obligations shall result in a pro tanto reduction of the amount of any
Indebtedness owed by such Subsidiary to Company or to any of its Subsidiaries
for whose benefit such payment is made;
(c) (x) (i) Indebtedness incurred by Company with respect to the Senior
Subordinated Notes and (ii) other Indebtedness incurred to refinance, in whole
or in part, Indebtedness under the Senior Subordinated Notes if the terms and
conditions thereof are not less favorable, taken as a whole, to the obligor
thereon or to the Lenders than the Indebtedness being refinanced and the average
life to maturity thereof is greater than or equal to that of the Indebtedness
being refinanced; provided, such Indebtedness permitted under the immediately
preceding clause (ii) above shall (A) not include Indebtedness of an obligor
that was not an obligor with respect to the Indebtedness being refinanced, (B)
not exceed in principal amount (or accreted value, in the case of any such
refinancing Indebtedness issued with a discount) the Indebtedness (including the
amount of interest and principal (and premium, if any)) being refinanced plus
the amount of customary underwriting discounts, financing fees and commissions
and other reasonable costs and expenses associated with the issuance thereof,
(C) be subordinated to the Obligations on terms which are not less favorable,
taken as a whole, to the Lenders than the corresponding terms of the
Indebtedness being refinanced, and (D) not be incurred, created or assumed if
any Default or Event of Default has occurred and is continuing or would result
therefrom; and (y) (1) Indebtedness incurred by Holdings with respect to the
Holdings Senior Notes and (ii) other Indebtedness incurred to refinance, in
whole or in part, Indebtedness under the Holdings Senior Notes if the terms and
conditions thereof are not less favorable, taken as a whole, to the obligor
thereon or to the Lenders than the Indebtedness being refinanced and the average
life to maturity thereof is greater than or equal to that of the Indebtedness
being refinanced; PROVIDED, such Indebtedness permitted under the immediately
preceding clause (ii) above shall (A) not include Indebtedness of an obligor
that was not an obligor with respect to the Indebtedness being refinanced, (B)
not exceed in principal amount (or accreted value, in the case of any such
refinancing Indebtedness issued with a discount) the
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Indebtedness (including the amount of interest and principal (and premium, if
any)) being refinanced plus the amount of customary underwriting discounts,
financing fees and commissions and other reasonable costs and expenses
associated with the issuance thereof, and (C) not be incurred, created or
assumed if any Default or Event of Default has occurred and is continuing or
would result therefrom;
(d) Indebtedness incurred by Holdings pursuant to Section 6.5(a);
PROVIDED, that such Indebtedness shall be unsecured and subordinated in right of
payment to the payment in full of the Obligations pursuant to the terms of the
applicable promissory notes or an intercompany subordination agreement that in
any such case, is reasonably satisfactory to Administrative Agent;
(e) Indebtedness incurred by Holdings or any of its Subsidiaries
arising from agreements providing for indemnification, adjustment of purchase
price or similar obligations, or from guaranties or letters of credit, surety
bonds or performance bonds securing the performance of the Company or any such
Subsidiary pursuant to such agreements, in connection with Permitted
Acquisitions or permitted dispositions of any business, assets or Subsidiary of
Holdings or any of its Subsidiaries;
(f) Indebtedness which may be deemed to exist pursuant to any
guaranties, performance, surety, statutory, appeal or similar obligations
incurred in the ordinary course of business;
(g) Indebtedness in respect of netting services, overdraft protections
and otherwise in connection with deposit accounts;
(h) guaranties in the ordinary course of business of the obligations of
suppliers, customers, franchisees and licensees of Holdings and its
Subsidiaries;
(i) guaranties by Company of Indebtedness of a Guarantor Subsidiary or
guaranties by a Subsidiary of Company of Indebtedness of Company or a Guarantor
Subsidiary with respect, in each case, to Indebtedness otherwise permitted to be
incurred pursuant to this Section 6.1;
(j) Indebtedness described in Schedule 6.1, but not any extensions,
renewals or replacements of such Indebtedness except (i) renewals and extensions
expressly provided for in the agreements evidencing any such Indebtedness as the
same are in effect on the date of this Agreement and (ii) refinancings and
extensions of any such Indebtedness if the terms and conditions thereof are not
less favorable to the obligor thereon or to the Lenders than the Indebtedness
being refinanced or extended, and the average life to maturity thereof is
greater than or equal to that of the Indebtedness being refinanced or extended;
PROVIDED, such Indebtedness permitted under the immediately preceding clause (i)
or (ii) above shall not (A) include Indebtedness of an obligor that was not an
obligor with respect to the Indebtedness being extended, renewed or refinanced,
(B) exceed in a principal amount the Indebtedness being renewed, extended or
refinanced or (C) incurred, created or assumed if any Default or Event of
Default has occurred and is continuing or would result therefrom;
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(k) Indebtedness with respect to Capital Leases in an aggregate amount
not to exceed at any time $3,500,000;
(l) purchase money Indebtedness in an aggregate amount not to exceed at
any time $3,500,000 (including any Indebtedness acquired in connection with a
Permitted Acquisition); PROVIDED, any such Indebtedness (i) shall be secured
only to the asset acquired in connection with the incurrence of such
Indebtedness, and (ii) shall constitute not less than 75% of the aggregate
consideration paid with respect to such asset;
(m) Permitted Seller Notes issued by Holdings as consideration in
Permitted Acquisitions; PROVIDED that the aggregate principal amount of such
Permitted Seller Notes shall not exceed $25,000,000 at any time outstanding;
(n) Earn-Out Obligations incurred by Holdings constituting
consideration payable in connection with Permitted Acquisitions; PROVIDED that
the maximum aggregate exposure, as reasonably estimated by management under all
such Earn-Out Obligations shall not exceed $3,000,000 at any time outstanding;
(o) A Subsidiary acquired pursuant to a Permitted Acquisition may
become or remain liable with respect to Indebtedness of such Subsidiary existing
at the time of the acquisition of such Subsidiary by Company or any of its
Subsidiaries and, a Subsidiary may become liable with respect to Indebtedness
secured by assets acquired pursuant to a Permitted Acquisition; PROVIDED that
(i) such Indebtedness was not incurred in connection with, or in anticipation
of, such Permitted Acquisition, and (ii) the aggregate principal amount of all
such Indebtedness does not exceed $10,000,000;
(p) Indebtedness of Company or a Subsidiary of Company to a Person to
the extent incurred in connection with the repurchase of Capital Stock of a
Subsidiary of Company owned, directly or indirectly, by veterinarians whose
employment with the Company or any of its Subsidiaries has terminated for any
reason and any guaranty of such Indebtedness by Holdings required pursuant to
certain contractual obligations existing prior to the Closing Date and not
entered into in connection with or in anticipation of the Acquisition, in an
aggregate principal amount outstanding not to exceed at any time $2,500,000;
(q) Holdings and its Subsidiaries may incur the post-Closing Date
obligations to pay Transaction Costs;
(r) Indebtedness of Holdings constituting Investments by Company
permitted under Section 6.7 hereof; and
(s) other unsecured Indebtedness of Holdings and its Subsidiaries
(other than with respect to the Permitted Seller Notes), in an aggregate amount
not to exceed at any time $5,000,000.
6.2. LIENS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Holdings or any of its Subsidiaries, whether now owned or
hereafter acquired, or
Page 89
any income or profits therefrom, or file or permit the filing of, or permit to
remain in effect, any financing statement or other similar notice of any Lien
with respect to any such property, asset, income or profits under the UCC of any
State or under any similar recording or notice statute, except:
(a) Liens in favor of Collateral Agent for the benefit of Secured
Parties granted pursuant to any Credit Document;
(b) Liens for Taxes if obligations with respect to such Taxes are being
contested in good faith by appropriate proceedings promptly instituted and
diligently conducted;
(c) statutory Liens of landlords, banks (and rights of set-off), of
carriers, warehousemen, mechanics, repairmen, workmen and materialmen, and other
Liens imposed by law (other than any such Lien imposed pursuant to Section 401
(a)(29) or 412(n) of the Internal Revenue Code or by ERISA), in each case
incurred in the ordinary course of business (i) for amounts not yet overdue or
(ii) for amounts that are overdue and that (in the case of any such amounts
overdue for a period in excess of five days) are being contested in good faith
by appropriate proceedings, so long as such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been made for any
such contested amounts;
(d) Liens incurred in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money or other Indebtedness), so long
as no foreclosure, sale or similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;
(e) easements, rights-of-way, restrictions, encroachments, and other
minor defects or irregularities in title, in each case which do not and will not
interfere in any material respect with the ordinary conduct of the business of
Holdings or any of its Subsidiaries;
(f) any interest or title of a lessor or sublessor under any lease of
real estate permitted hereunder;
(g) Liens solely on any ▇▇▇▇ ▇▇▇▇▇▇▇ money deposits made by Holdings or
any of its Subsidiaries in connection with any letter of intent or purchase
agreement entered into by it as permitted hereunder;
(h) purported Liens evidenced by the filing of precautionary UCC
financing statements relating solely to operating leases of personal property
entered into in the ordinary course of business;
(i) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(j) any zoning or similar law or right reserved to or vested in any
governmental office or agency to control or regulate the use of any real
property;
Page 90
(k) licenses of patents, trademarks and other intellectual property
rights granted by Holdings or any of its Subsidiaries in the ordinary course of
business and not interfering in any respect with the ordinary conduct of the
business of Company or such Subsidiary;
(l) Liens described in Schedule 6.2 or on a title report delivered
pursuant to Section 3.1 (i)(iv);
(m) Liens securing Indebtedness permitted pursuant to Section 6.1(k)
and 6.1(1); PROVIDED, any such Lien shall encumber only the asset acquired with
the proceeds of such Indebtedness; and
(n) Liens on assets acquired pursuant to a Permitted Acquisition
securing Indebtedness permitted under Section 6.1(o) so long as such Liens were
not created in anticipation of such Permitted Acquisition.
6.3. EQUITABLE LIEN. If any Credit Party or any of its Subsidiaries shall
create or assume any Lien upon any of its properties or assets, whether now
owned or hereafter acquired, other than Permitted Liens, it shall make or cause
to be made effective a provisions whereby the Obligations will be secured by
such Lien equally and ratably with any and all other Indebtedness secured
thereby as long as any such Indebtedness shall be so secured; provided,
notwithstanding the foregoing, this covenant shall not be construed as a consent
by Requisite Lenders to the creation or assumption of any such Lien not
otherwise permitted hereby.
6.4. NO FURTHER NEGATIVE PLEDGES. Except with respect to (a) specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to a permitted Asset Sale and (b)
restrictions by reason of customary provisions restricting assignments,
subletting or other transfers contained in leases, licenses and similar
agreements entered into in the ordinary course of business (provided that such
restrictions are limited to the property or assets secured by such Liens or the
property or assets subject to such leases, licenses or similar agreements, as
the case may be) no Credit Party nor any of its Subsidiaries shall enter into
any agreement prohibiting the creation or assumption of any Lien upon any of its
properties or assets, whether now owned or hereafter acquired.
6.5. RESTRICTED JUNIOR PAYMENTS. No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, declare, order, pay, make or
set apart any sum for any Restricted Junior Payment except the following shall
be permitted:
(a) on the Closing Date, Company may make a Restricted Junior Payment
to Holdings, in an amount equal to the net proceeds of the Term Loans, the
Senior Subordinated Notes and the Revolving Loans made on the Closing Date,
which in the case of Revolving Loans shall not exceed $1,000,000, the proceeds
of which shall be used by Holdings to fund a portion of the Acquisition
Financing Requirements, to repay the Existing Indebtedness of Holdings and its
Subsidiaries and to pay related fees and expenses;
(b) Company may make regularly scheduled payments (but not voluntary
prepayments) in respect of (i) the Senior Subordinated Notes in accordance with
the terms of, and only to the extent required by, and subject to the
subordination provisions contained in, the
Page 91
Senior Subordinated Note Indenture, (ii) any repurchase or repayment of the
Senior Subordinated Notes with the proceeds of any refinancing of the Senior
Subordinated Notes permitted under Section 6.1(c) and (iii) so long as no
Default or Event of Default shall have occurred and be continuing or shall be
caused thereby, to the extent necessary to permit Company to discharge its
obligations under the Senior Subordinated Note Registration Rights Agreement;
(c) Holdings may make regularly scheduled payments (but not voluntary
prepayments) in respect of (i) the Holdings Senior Notes in accordance with the
terms of, and only to the extent required by the Holdings Senior Note Indenture,
(ii) any repurchase or repayment of the Holdings Senior Notes with the proceeds
of any refinancing of the Holdings Senior Notes permitted under Section 6.1(c)
and (iii) to the extent necessary to permit Holdings to discharge its
obligations under the Stockholders Agreement and the Holdings Registration
Rights Agreement;
(d) Company may make Restricted Junior Payments to Holdings after the
fifth year anniversary of this Agreement, to the extent required to enable
Holdings to make, regularly scheduled payments (such payments not to include any
mandatory prepayments or redemptions), in respect of the Holdings Senior Notes
in accordance with the terms of, and only to the extent required by, the
Holdings Senior Note Indenture, so long as Holdings applies the amount of any
such Restricted Junior Payment for such purpose; PROVIDED that at the time of
such Restricted Junior Payment pursuant to this clause (d) and immediately after
giving effect thereto, no Event of Default shall have occurred and be continuing
under Section 8.1(a), Section 8.1(c) or Section 8.1(e);
(e) Subsidiaries of Company may make Restricted Junior Payments by way
of dividends to its shareholders proportionate to their respective holdings;
(f) Holdings may make regularly scheduled payments in respect of (i)
Permitted Seller Notes in accordance with the terms of, and only to the extent
required by, and subject to the subordination provisions contained in, the
agreement pursuant to which such permitted Seller Notes were issued or were
otherwise subject, and (ii) Earn-Out Obligations in accordance with the terms
of, and only to the extent required by, and subject to the subordination
provisions contained in, the documents related to the relevant Permitted
Acquisition;
(g) Company and any of its Subsidiaries may issue Indebtedness pursuant
to Section 6.1(p) and may make regularly scheduled payments in respect of such
Indebtedness and Company and its Subsidiaries may make Restricted Junior
Payments to repurchase the Capital Stock of a Subsidiary of Company owned,
directly or indirectly, by veterinarians whose employment with the Company or
any of its Subsidiaries has terminated for an reason; PROVIDED that (i) the
aggregate amount of such Restricted Junior Payments do not exceed $750,000 in
any Fiscal Year, and (ii) the aggregate principal amount of any such
Indebtedness outstanding pursuant to Section 6.1(p) does not exceed at any time
$2,500,000 in the aggregate;
(h) Company may make Restricted Junior Payments to Holdings to the
extent required to enable Holdings (i) to make scheduled payments of principal
and interest on the Permitted Seller Notes and (ii) to make payments on Earn-Out
Obligations in accordance with
Page 92
the terms of, and only to the extent required by, the documents related to the
relevant Permitted Acquisition, so long as Holdings applies the amount of any
such Restricted Junior Payment for such purpose; PROVIDED, that at the time of
such Restricted Junior Payment pursuant to this clause (h) and immediately after
giving effect thereto, no Event of Default shall have occurred and be continuing
under Section 8.1(a), Section 8.1(c) or Section 8.1(e);
(i) Holdings and/or Company and its Subsidiaries may pay Transaction
Costs (and Company may make Restricted Junior Payments to Holdings to the extent
required to enable Holdings to make such payments, so long as Holdings applies
the amount of any such Restricted Junior Payment for such purpose); PROVIDED
that at the time of such Restricted Junior Payment pursuant to this clause (i)
and immediately after giving effect thereto, no Event of Default shall have
occurred and be continuing under Sections 8.1(a), Section 8.1(c) or Section
8.1(e);
(j) Holdings may repurchase shares of Capital Stock of Holdings held by
officers and employees of Holdings and its Subsidiaries upon the termination of
the employment of such officers and employees; PROVIDED, HOWEVER, that the
amount of such repurchase shall not exceed in any Fiscal Year the sum of (1)
$1,500,000 plus (2) the unutilized portion of such $1,500,000 from the
immediately preceding Fiscal Year;
(k) Company may make Restricted Junior Payments to Holdings to the
extent required to enable Holdings to make the repurchases permitted pursuant to
Section 6.5(j), so long as Holdings applies the amount of any such Restricted
Junior Payment for such purpose;
(l) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Holdings and/or Company may make
payments to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Partners, L.P. (and Company may make Restricted
Junior Payments to Holdings to the extent required to enable Holdings to make
such payments, so long as Holdings applies the amount of any such Restricted
Junior Payments for such purpose) in an amount not to exceed in any Fiscal Year,
the sum of the following: (1) $2,550,000 plus 1.6% of any additional equity
investment made after the Closing Date by Sponsor, Co-Investors and their
Affiliates as annual management fees pursuant to the Management Services
Agreement, (2) any transaction fees to be paid to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Partners, L.P.
in connection with the Acquisition, (3) any normal and customary transaction
fees to be paid to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Partners, L.P., from time to time, under such
Management Services Agreement, and (4) the reimbursement of the normal and
customary out-of-pocket costs and expenses of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Partners, L.P.
under such Management Services Agreement; PROVIDED, HOWEVER, such payments shall
accrue during the pendency of any such Default or Event of Default and to the
extent accrued shall be payable upon the cure, waiver or recision of such
Default or Event of Default; PROVIDED, FURTHER, that the amount of such accrued
payments in the Fiscal Year in which such accrued payments are actually made
shall be in addition to the aggregate amount otherwise permitted to be paid in
such Fiscal Year as set forth in clauses (1), (2), (3) and (4) of this Section
6.5(l); and
(m) so long as no Default or Event of Default shall have occurred and
be continuing or shall be caused thereby, Company may make Restricted Junior
Payments to Holdings, to the extent necessary to permit Holdings to pay
reasonable general administrative costs and expenses and (ii) to the extent
necessary to permit Holdings to discharge the
Page 93
consolidated tax liabilities of Holdings and its Subsidiaries, in each case so
long as Holdings applies the amount of any such Restricted Junior Payment for
such purpose.
6.6. RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS. Except as provided herein,
no Credit Party shall, nor shall it permit any of its Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary of
Company to (a) pay dividends or make any other distributions on any of such
Subsidiary's Capital Stock owned by Company or any other Subsidiary of Company,
(b) repay or prepay any Indebtedness owed by such Subsidiary to Company or any
other Subsidiary of Company, (c) make loans or advances to Company or any other
Subsidiary of Company, or (d) transfer any of its property or assets to Company
or any other Subsidiary of Company other than restrictions (i) in agreements
evidencing Indebtedness permitted by Section 6.1(k), Section 6.1(l) and Section
6.1(o) that impose restrictions on the transfer of property so acquired or
securing such Indebtedness and (ii) by reason of customary provisions
restricting assignments, subletting or other transfers contained in leases,
licenses, joint venture agreements and similar agreements entered into in the
ordinary course of business, and (iii) that are or were created by virtue of any
transfer of, agreement to transfer or option or right with respect to any
property, assets or Capital Stock not otherwise prohibited under this Agreement.
6.7. INVESTMENTS. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including without limitation any Joint Venture, except:
(a) on or before the Closing Date, Holdings shall make a capital
contribution to Company of all of Holdings' assets;
(b) Cash Equivalents;
(c) equity investments owned as of the Closing Date in any Subsidiary
and Investments made after the Closing Date in any Subsidiary of Company;
(d) Investments (i) in accounts receivable arising and trade credit
granted in the ordinary course of business and in any Securities received in
satisfaction or partial satisfaction thereof from financially troubled account
debtors and (ii) deposits, prepayments and other credits to suppliers made in
the ordinary course of business consistent with the past practices of Holdings
and its Subsidiaries;
(e) intercompany loans to the extent permitted under Section 6.1(b);
(f) Consolidated Capital Expenditures permitted by Section 6.8(e);
(g) loans and advances to employees of Holdings and its Subsidiaries
made in the ordinary course of business, including to purchase Capital Stock of
Holdings, in an aggregate principal amount not to exceed $2,000,000 at any one
time outstanding; PROVIDED, HOWEVER, that the amount allocable to loans and
advances to purchase Capital Stock of Holdings shall not exceed $1,000,000 in
the aggregate; PROVIDED, FURTHER, HOWEVER, that the proceeds received by
Holdings of such purchase of Holdings' Capital Stock, shall be used by Holdings
to acquire
Page 94
Capital Stock of Company or otherwise used to make a common equity contribution
to Company or to repay loans or advances made to Holdings by Company pursuant to
Section 6.7(i);
(h) the payment of Transaction Costs;
(i) loans and advances from Company to Holdings to permit Holdings to
make payments contemplated to be made pursuant to Section 6.5 hereof;
(j) Investments made to purchase the Capital Stock of any Subsidiary of
Company from a Person who is not an Affiliate of Company and loans and advances
to Persons permitted pursuant to Section 6.9(g) to purchase Capital Stock of any
Subsidiary of Company in order to allow such purchases;
(k) Investments made in connection with Permitted Acquisitions
permitted pursuant to Section 6.9;
(l) Investments described in Schedule 6.7; and
(m) other Investments in an aggregate amount not to exceed at any time
$4,000,000.
6.8. FINANCIAL COVENANTS.
(a) INTEREST COVERAGE RATIO. Company shall not permit the Interest
Coverage Ratio as of the last day of any Fiscal Quarter, beginning with the
Fiscal Quarter ending March 31, 2001, to be less than the correlative ratio
indicated:
FISCAL QUARTER INTEREST COVERAGE RATIO
------------------------ -----------------------
March 31, 2001 2.00:1.00
June 30, 2001 2.00:1.00
September 30, 2001 2.00:1.00
December 31, 2001 2.00:1.00
March 31, 2002 2.25:1.00
June 30, 2002 2.25:1.00
September 30, 2002 2.25:1.00
December 31, 2002 2.50:1.00
March 31, 2003 2.50:1.00
June 30, 2003 2.50:1.00
September 30, 2003 2.50:1.00
December 31, 2003 2.75:1.00
March 31, 2004 2.75:1.00
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June 30, 2004 3.00:1.00
September 30, 2004 3.00:1.00
December 31, 2004 and 3.50:1.00
thereafter
(b) FIXED CHARGE COVERAGE RATIO. Company shall not permit the Fixed
Charge Coverage Ratio as of the last day of any Fiscal Quarter, beginning with
the Fiscal Quarter ending March 31, 2001, to exceed the correlative ratio
indicated:
FISCAL QUARTER INTEREST COVERAGE RATIO
------------------------ -----------------------
March 31, 2001 1.05:1.00
June 30, 2001 1.05:1.00
September 30, 2001 1.05:1.00
December 31, 2001 1.05:1.00
March 31, 2002 1.10:1.00
June 30, 2002 1.10:1.00
September 30, 2002 1.10:1.00
December 31, 2002 1.10:1.00
March 31, 2003 1.10:1.00
June 30, 2003 1.10:1.00
September 30, 2003 1.10:1.00
December 31, 2003 1.10:1.00
March 31, 2004 1.10:1.00
June 30, 2004 1.10:1.00
September 30, 2004 1.10:1.00
December 31, 2004 1.10:100
March 31, 2005 1.10:1.00
June 30, 2005 1.10:1.00
September 30, 2005 1.10:1.00
December 31, 2005 and 1.15:1.00
thereafter
Page 96
(c) LEVERAGE RATIO. Company shall not permit the Leverage Ratio as of
the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending
March 31, 2001, to exceed the correlative ratio indicated:
FISCAL QUARTER INTEREST COVERAGE RATIO
------------------------ -----------------------
March 31, 2001 4.25:1.00
June 30, 2001 4.10:1.00
September 30, 2001 4.00:1.00
December 31, 2001 4.00:1.00
March 31, 2002 4.00:1.00
June 30, 2002 4.00:1.00
September 30, 2002 4.00:1.00
December 31, 2002 3.75:1.00
March 31, 2003 3.75:1.00
June 30, 2003 3.25:1.00
September 30, 2003 3.25:1.00
December 31, 2003 3.00:1.00
March 31, 2004 3.00:1.00
June 30, 2004 3.00:1.00
September 30, 2004 3.00:1.00
December 31, 2004 3.00:100
March 31, 2005 3.00:1.00
June 30, 2005 3.00:1.00
September 30, 2005 3.00:1.00
December 31, 2005 and 2.75:1.00
thereafter
(d) SENIOR LEVERAGE RATIO. Company shall not permit the Senior Leverage
Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal
Quarter ending March 31, 2001, to exceed the correlative ratio indicated:
FISCAL QUARTER INTEREST COVERAGE RATIO
----------------------- -----------------------
March 31, 2001 4.00:1.00
June 30, 2001 4.00:1.00
September 30, 2001 4.00:1.00
Page 97
December 31, 2001 4.00:1.00
March 31, 2002 3.75:1.00
June 30, 2002 3.75:1.00
September 30, 2002 3.75:1.00
December 31, 2002 3.40:1.00
March 31, 2003 3.40:1.00
June 30, 2003 3.40:1.00
September 30, 2003 3.40:1.00
December 31, 2003 3.00:1.00
March 31, 2004 3.00:1.00
June 30, 2004 3.00:1.00
September 30, 2004 3.00:1.00
December 31, 2004 and 2.75:1.00
thereafter
(e) MAXIMUM CONSOLIDATED CAPITAL EXPENDITURES. Holdings shall not, and
shall not permit its Subsidiaries to, make or incur Consolidated Capital
Expenditures, in any Fiscal Year beginning with the Fiscal Year 2001, in an
aggregate amount for Holdings and its Subsidiaries in excess of $20,000,000;
PROVIDED, that 50% of any unutilized amount for any Fiscal Year may be utilized
in the next succeeding Fiscal Year, but in no event shall any amount from any
Fiscal Year prior to the immediately preceding Fiscal Year be utilized in the
calculations of the foregoing.
(f) CERTAIN CALCULATIONS. With respect to any period during which a
Permitted Acquisition or an Asset Sale has occurred (each, a "SUBJECT
TRANSACTION"), for purposes of determining compliance with the financial
covenants set forth in this Section 6.8 (but not for purposes of determining the
Applicable Margin or Applicable Commitment Fee Percentage), Consolidated
Adjusted EBITDA shall be calculated with respect to such period on a pro forma
basis (including pro forma adjustments arising out of events which are directly
attributable to a specific transaction, are factually supportable and are
expected to have a continuing impact, in each case determined on a basis
consistent with Article 11 of Regulation S-X promulgated under the Securities
Act and as interpreted by the staff of the Securities and Exchange Commission,
which would include cost savings resulting from head count reduction, closure of
facilities and similar restructuring charges, which pro forma adjustments shall
be certified by the chief financial officer of Company) using the historical
audited financial statements, to the extent available, of any business so
acquired or to be acquired or sold or to be sold and the consolidated financial
statements of Holdings and its Subsidiaries which shall be reformulated as if
such Subject Transaction, and any Indebtedness incurred or repaid in connection
therewith, had been consummated or incurred or repaid at the beginning of such
period (and assuming that such Indebtedness bears interest during any portion of
the applicable measurement period prior to the
Page 98
relevant acquisition at the weighted average of the interest rates applicable to
outstanding Loans incurred during such period); PROVIDED, HOWEVER, calculations
of pro forma Consolidated Adjusted EBITDA with respect to a Permitted
Acquisition, the aggregate consideration for which constitutes $3,000,000 or
less, shall be based on reasonable estimations made by Company of such
pre-acquisition EBITDA based on actual pre-acquisition revenues; PROVIDED,
FURTHER that, such Consolidated Adjusted EBITDA shall not exceed in such case
20% of such actual pre-acquisition revenues.
6.9. FUNDAMENTAL CHANGES; DISPOSITION OF ASSETS; ACQUISITIONS. No Credit
Party shall, nor shall it permit any of its Subsidiaries to, enter into any
transaction of merger or consolidation, or liquidate, wind-up or dissolve itself
(or suffer any liquidation or dissolution), or convey, sell, lease or sub-lease
(as lessor or sublessor), transfer or otherwise dispose of, in one transaction
or a series of transactions, all or any part of its business, assets or property
of any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible, whether now owned or hereafter acquired, or acquire by purchase or
otherwise (other than purchases or other acquisitions of inventory, materials
and equipment in the ordinary course of business) the business, property or
fixed assets of, or stock or other evidence of beneficial ownership of, any
Person or any division or line of business or other business unit of any Person,
except:
(a) any Subsidiary of Holdings may be merged with or into Company or
any Guarantor Subsidiary, or be liquidated, wound up or dissolved, or all or any
part of its business, property or assets may be conveyed, sold, leased,
transferred or otherwise disposed of, in one transaction or a series of
transactions, to Company or any Guarantor Subsidiary; PROVIDED, in the case of
such a merger, Company or such Guarantor Subsidiary, as applicable shall be the
continuing or surviving Person;
(b) sales or other dispositions of assets that do not constitute Asset
Sales;
(c) Asset Sales, the proceeds of which (valued at the principal amount
thereof in the case of non-Cash proceeds consisting of notes or other debt
Securities and valued at fair market value in the case of other non-Cash
proceeds) (i) are less than $5,000,000 with respect to any single Asset Sale or
series of related Asset Sales and (ii) when aggregated with the proceeds of all
other Asset Sales made within the same Fiscal Year, are less than $15,000,000;
PROVIDED (i) the consideration received for such assets shall be in an amount at
least equal to the fair market value thereof (determined in good faith by the
board of directors of Company (or similar governing body)), (2) no less than 80%
thereof shall be paid in Cash, and (3) the Net Asset Sale Proceeds thereof shall
be applied as required by Section 2.13(a);
(d) any disposition of Company's partnership interest in the Vet's
Choice joint venture with Heinz Pet Products;
(e) and disposition of Company's interest in ▇▇▇▇▇.▇▇▇, inc.;
(f) disposals of obsolete, worn out, redundant or surplus property;
(g) sales, assignments or other dispositions by Company and any of its
Subsidiaries of the Capital Stock of any of their respective Subsidiaries to be
owned, directly or indirectly, by one or more licensed veterinarians who will be
actively involved in such
Page 99
Subsidiary; PROVIDED that Company designates such Subsidiary as a Permitted
Partially-Owned Subsidiary;
(h) Permitted Acquisitions, the consideration for which constitutes (i)
$10,000,000 or less in the aggregate from the Closing Date through the end of
the fourth Fiscal Quarter of Fiscal Year 2000, (ii) $25,000,000 or less in the
aggregate in Fiscal Year 2001, and (iii) $30,000,000 or less in the aggregate in
any Fiscal Year thereafter; PROVIDED, that $5,000,000 of any unutilized amount
for any Fiscal Year may be utilized in the next immediately succeeding Fiscal
Year (but not in any Fiscal Years thereafter); PROVIDED, FURTHER, HOWEVER, that
with respect to any acquisition the consideration of which is greater than
$7,500,000, Company shall not make such acquisition without the prior consent of
Administrative Agent and Syndication Agent, such consent not to be unreasonably
withheld;
(i) Sales and lease backs permitted pursuant to Section 6.11;
(j) Investments made in accordance with Section 6.7; and
(k) the Acquisition.
6.10. DISPOSAL OF SUBSIDIARY INTERESTS. Except for any sale of interests
in the Capital Stock of any of its Subsidiaries in compliance with the
provisions of Section 6.9, no Credit Party shall, (a) directly or indirectly
sell, assign, pledge or otherwise encumber or dispose of any Capital Stock of
any of its Subsidiaries, except to qualify directors if required by applicable
law; or (b) permit any of its Subsidiaries directly or indirectly to sell,
assign, pledge or otherwise encumber or dispose of any Capital Stock of any of
its Subsidiaries, except to another Credit Party (subject to the restrictions on
such disposition otherwise imposed hereunder), or to qualify directors if
required by applicable law.
6.11. SALES AND LEASE-BACKS. No Credit Party shall, nor shall it permit any
of its Subsidiaries to, directly or indirectly, become or remain liable as
lessee or as a guarantor or other surety with respect to any lease of any
property (whether real, personal or mixed), whether now owned or hereafter
acquired, which such Credit Party (a) has sold or transferred or is to sell or
to transfer to any other Person (other than Holdings or any of its
Subsidiaries), or (b) intends to use for substantially the same purpose as any
other property which has been or is to be sold or transferred by such Credit
Party to any Person (other than Holdings or any of its Subsidiaries) in
connection with such lease; PROVIDED, HOWEVER, that Company and its Subsidiaries
may sell and lease-back assets in an aggregate amount not to exceed $5,000,000
in any Fiscal Year.
6.12. TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES. No Credit Party shall,
nor shall it permit any of its Subsidiaries to, directly or indirectly, enter
into or permit to exist any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any holder of 10%
or more of any class of Capital Stock of Holdings or any of its Subsidiaries or
with any Affiliate of Holdings or of any such holder, on terms that are less
favorable to Holdings or that Subsidiary, as the case may be, than those that
might be obtained at the time from a Person who is not such a holder or
Affiliate; PROVIDED, the foregoing restriction shall not apply to (a) any
transaction between Holdings, Company and any Subsidiary; (b) reasonable and
customary fees paid to members of the board of directors (or similar governing
Page 100
body) of Holdings and its Subsidiaries; (c) compensation and management equity
arrangements for officers and other employees of Holdings and its Subsidiaries
entered into in the ordinary course of business; (d) management or other fees or
expenses paid to Sponsor or any of its Affiliates pursuant to Section 6.5(l);
(e) the performance by Holdings and/or Company of their respective obligations
under the Related Agreements; (f) payment of Transaction Costs to the extent
such payments are made to any holder of 10% or more of any class of Capital
Stock of Holdings or any of its Subsidiaries or to any Affiliate of Holdings or
of any such holder; and (g) sales or purchases by Company or any of its
Subsidiaries of the Capital Stock of a Subsidiary of Company; PROVIDED, that
with respect to such sales, Company designates such Subsidiary a Permitted
Partially-Owned Subsidiary, and, with respect to such purchases, such purchases
are permitted pursuant to Sections 6.1 (p) and 6.5(g).
6.13. CONDUCT OF BUSINESS. From and after the Closing Date, no Credit Party
shall, nor shall it permit any of its Subsidiaries to, engage in any business
other than (i) the businesses engaged in by such Credit Party on the Closing
Date and businesses or lines of businesses the same as, related, complementary
or ancillary to, the business in which such Credit Party is engaged as of the
Closing Date and (ii) such other lines of business as maybe consented to by
Requisite Lenders.
6.14. PERMITTED ACTIVITIES OF HOLDINGS. Notwithstanding anything to the
contrary contained herein, Holdings shall not (a) incur, directly or indirectly,
any Indebtedness or any other obligation or liability whatsoever other than the
Indebtedness and obligations permitted to be incurred by Holdings under Section
6.1 (including, without limitation, Indebtedness and obligations owing to
Company, Indebtedness and obligations under the Related Agreements, Permitted
Seller Notes and Earn-Out Obligations and Indebtedness and obligations set forth
on Schedule 6.1 for which Holdings is obligor as of the Closing Date),
obligations to pay Transaction Costs, obligations for Taxes and administrative
costs and expenses as contemplated on Sections 6.5(l) and 6.5(m) and any
pre-Merger liabilities of Holdings which remain liabilities of Holdings after
the Closing Date as a matter of law; (b) create or suffer to exist any Lien upon
any property or assets now owned or hereafter acquired by it other than the
Liens created under the Collateral Documents to which it is a party or permitted
pursuant to Section 6.2; (c) engage in any business or activity or own any
assets other than (i) holding 100% of the Capital Stock of Company, (ii)
performing its obligations and activities incidental thereto under the Credit
Documents, and to the extent not inconsistent therewith, the Related Agreements
(iii) performing its obligations under Permitted Seller Notes and Earn-Out
Obligations and for Taxes and administrative costs and expenses as contemplated
by Sections 6.5(l) and 6.5(m); and (iv) making Restricted Junior Payments and
Investments to the extent permitted by this Agreement; (d) consolidate with or
merge with or into, or convey, transfer or lease all or substantially all its
assets to, any Person; (e) sell or otherwise dispose of any Capital Stock of any
of its Subsidiaries except to the extent permitted by Section 6.9; (f) create or
acquire any Subsidiary or make or own any Investment in any Person other than
Company and other than as permitted under Section 6.7(g); or (g) fail to hold
itself out to the public as a legal entity separate and distinct from all other
Persons.
6.15. AMENDMENTS OR WAIVERS OF CERTAIN RELATED AGREEMENTS. Except as set
forth in Section 6.16, no Credit Party shall nor shall it permit any of its
Subsidiaries to, agree to any material amendment, restatement, supplement or
other modification to, or waiver of, any of its
Page 101
material rights under any Related Agreement after the Closing Date without in
each case obtaining the prior written consent of Requisite Lenders to such
amendment, restatement, supplement or other modification or waiver.
6.16. AMENDMENTS OR WAIVERS WITH RESPECT TO SUBORDINATED INDEBTEDNESS. No
Credit Party shall, nor shall it permit any of its Subsidiaries to, amend or
otherwise change the terms of any Subordinated Indebtedness, or make any payment
consistent with an amendment thereof or change thereto, if the effect of such
amendment or change is to increase the interest rate on such Subordinated
Indebtedness, change (to earlier dates) any dates upon which payments of
principal or interest are due thereon, change any event of default or condition
to an event of default with respect thereto (other than to eliminate any such
event of default or increase any grace period related thereto), change the
redemption, prepayment or defeasance provisions thereof, change the
subordination provisions of such Subordinated Indebtedness (or of any guaranty
thereof), or if the effect of such amendment or change, together with all other
amendments or changes made, is to increase materially the obligations of the
obligor thereunder or to confer any additional rights on the holders of such
Subordinated Indebtedness (or a trustee or other representative on their behalf)
which would be adverse to any Credit Party or Lenders.
6.17. DESIGNATION OF "SENIOR INDEBTEDNESS". Company shall not designate any
Indebtedness as "Senior Indebtedness" (as defined in the Senior Subordinated
Note Indenture) for purposes of the Senior Subordinated Note Indenture without
the prior written consent of Requisite Lenders.
6.18. FISCAL YEAR. No Credit Party shall, nor shall it permit any of its
Subsidiaries to, change its Fiscal Year-end from December 31.
SECTION 7. GUARANTY
7.1. GUARANTY OF THE OBLIGATIONS. Subject to the provisions of Section 7.2,
Guarantors jointly and severally hereby irrevocably and unconditionally guaranty
to Administrative Agent for the ratable benefit of the Beneficiaries the due and
punctual payment in full of all Obligations when the same shall become due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11
U.S.C. ss. 362(a)) (collectively, the "GUARANTEED OBLIGATIONS").
7.2. CONTRIBUTION BY GUARANTORS. All Guarantors desire to allocate among
themselves (collectively, the "CONTRIBUTING GUARANTORS"), in a fair and
equitable manner, their obligations arising under this Guaranty. Accordingly, in
the event any payment or distribution is made on any date by a Guarantor (a
"FUNDING GUARANTOR") under this Guaranty that exceeds its Fair Share as of such
date, such Funding Guarantor shall be entitled to a contribution from each of
the other Contributing Guarantors in the amount of such other Contributing
Guarantor's Fair Share Shortfall as of such date, with the result that all such
contributions will cause each Contributing Guarantor's Aggregate Payments to
equal its Fair Share as of such date. "FAIR SHARE" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (a)
the ratio of (i) the Fair Share Contribution Amount with respect to such
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Contributing Guarantor to (ii) the aggregate of the Fair Share Contribution
Amounts with respect to all Contributing Guarantors multiplied by (b) the
aggregate amount paid or distributed on or before such date by all Funding
Guarantors under this Guaranty in respect of the obligations Guaranteed. "FAIR
SHARE SHORTFALL" means, with respect to a Contributing Guarantor as of any date
of determination, the excess, if any, of the Fair Share of such Contributing
Guarantor over the Aggregate Payments of such Contributing Guarantor. "FAIR
SHARE CONTRIBUTION AMOUNT" means, with respect to a Contributing Guarantor as of
any date of determination, the maximum aggregate amount of the obligations of
such Contributing Guarantor under this Guaranty that would not render its
obligations hereunder or thereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any comparable applicable provisions of state law; PROVIDED, solely for
purposes of calculating the "FAIR SHARE CONTRIBUTION AMOUNT" with respect to any
Contributing Guarantor for purposes of this Section 7.2, any assets or
liabilities of such Contributing Guarantor arising by virtue of any rights to
subrogation, reimbursement or indemnification or any rights to or obligations of
contribution hereunder shall not be considered as assets or liabilities of such
Contributing Guarantor. "AGGREGATE PAYMENTS" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (i)
the aggregate amount of all payments and distributions made on or before such
date by such Contributing Guarantor in respect of this Guaranty (including,
without limitation, in respect of this Section 7.2), minus (2) the aggregate
amount of all payments received on or before such date by such Contributing
Guarantor from the other Contributing Guarantors as contributions under this
Section 7.2. The amounts payable as contributions hereunder shall be determined
as of the date on which the related payment or distribution is made by the
applicable Funding Guarantor. The allocation among Contributing Guarantors of
their obligations as set forth in this Section 7.2 shall not be construed in any
way to limit the liability of any Contributing Guarantor hereunder. Each
Guarantor is a third party beneficiary to the contribution agreement set forth
in this Section 7.2.
7.3. PAYMENT BY GUARANTORS. Subject to Section 7.2, Guarantors hereby
jointly and severally agree, in furtherance of the foregoing and not in
limitation of any other right which any Beneficiary may have at law or in equity
against any Guarantor by virtue hereof, that upon the failure of Company to pay
any of the Guaranteed Obligations when and as the same shall become due, whether
at stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. ss.
362(a)), Guarantors will upon demand pay, oR cause to be paid, in Cash, to
Administrative Agent for the ratable benefit of Beneficiaries, an amount equal
to the sum of the unpaid principal amount of all Guaranteed Obligations then due
as aforesaid, accrued and unpaid interest on such Guaranteed Obligations
(including interest which, but for Company's becoming the subject of a case
under the Bankruptcy Code, would have accrued on such Guaranteed Obligations,
whether or not a claim is allowed against Company for such interest in the
related bankruptcy case) and all other Guaranteed Obligations then owed to
Beneficiaries as aforesaid.
7.4. LIABILITY OF GUARANTORS ABSOLUTE. Each Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and unconditional
and shall not be affected by any circumstance which constitutes a legal or
equitable discharge of a guarantor or surety other than payment in full of the
Guaranteed Obligations. In furtherance of the foregoing and without limiting the
generality thereof, each Guarantor agrees as follows:
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(a) this Guaranty is a guaranty of payment when due and not of
collectability. This Guaranty is a primary obligation of each Guarantor and not
merely a contract of surety;
(b) Administrative Agent may enforce this Guaranty upon the occurrence
of an Event of Default notwithstanding the existence of any dispute between
Company and any Beneficiary with respect to the existence of such Event of
Default;
(c) the obligations of each Guarantor hereunder are independent of the
obligations of Company and the obligations of any other guarantor (including any
other Guarantor) of the obligations of Company, and a separate action or actions
may be brought and prosecuted against such Guarantor whether or not any action
is brought against Company or any of such other guarantors and whether or not
Company is joined in any such action or actions;
(d) payment by any Guarantor of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge any
Guarantor's liability for any portion of the Guaranteed Obligations which has
not been paid. Without limiting the generality of the foregoing, if
Administrative Agent is awarded a judgment in any suit brought to enforce any
Guarantor's covenant to pay a portion of the Guaranteed Obligations, such
judgment shall not be deemed to release such Guarantor from its covenant to pay
the portion of the Guaranteed Obligations that is not the subject of such suit,
and such judgment shall not, except to the extent satisfied by such Guarantor,
limit, affect, modify or abridge any other Guarantor's liability hereunder in
respect of the Guaranteed Obligations;
(e) any Beneficiary, upon such terms as it deems appropriate, without
notice or demand and without affecting the validity or enforceability hereof or
giving rise to any reduction, limitation, impairment, discharge or termination
of any Guarantor's liability hereunder, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the time,
place, manner or terms of payment of the Guaranteed Obligations; (ii) settle,
compromise, release or discharge, or accept or refuse any offer of performance
with respect to, or substitutions for, the Guaranteed Obligations or any
agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other guaranties of
the Guaranteed Obligations and take and hold security for the payment hereof or
the Guaranteed Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guaranteed Obligations,
any other guaranties of the Guaranteed Obligations, or any other obligation of
any Person (including any other Guarantor) with respect to the Guaranteed
Obligations; (v) enforce and apply any security now or hereafter held by or for
the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations
and direct the order or manner of sale thereof, or exercise any other right or
remedy that such Beneficiary may have against any such security, in each case as
such Beneficiary in its discretion may determine consistent herewith or the
applicable Hedge Agreement and any applicable security agreement, including
foreclosure on any such security pursuant to one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially reasonable,
and even though such action operates to impair or extinguish any right of
reimbursement or subrogation or other right or remedy of any Guarantor against
Company or any security for the Guaranteed Obligations; and (vi) exercise any
other rights available to it under the Credit Documents or the Hedge Agreements;
and
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(f) this Guaranty and the obligations of Guarantors hereunder shall be
valid and enforceable and shall not be subject to any reduction, limitation,
impairment, discharge or termination for any reason (other than payment in full
of the Guaranteed Obligations), including the occurrence of any of the
following, whether or not any Guarantor shall have had notice or knowledge of
any of them: (i) any failure or omission to assert or enforce or agreement or
election not to assert or enforce, or the stay or enjoining, by order of court,
by operation of law or otherwise, of the exercise or enforcement of, any claim
or demand or any right, power or remedy (whether arising under the Credit
Documents or the Hedge Agreements, at law, in equity or otherwise) with respect
to the Guaranteed Obligations or any agreement relating thereto, or with respect
to any other guaranty of or security for the payment of the Guaranteed
Obligations; (ii) any rescission, waiver, amendment or modification of, or any
consent to departure from, any of the terms or provisions (including provisions
relating to events of default) hereof, any of the other Credit Documents, any of
the Hedge Agreements or any agreement or instrument executed pursuant thereto,
or of any other guaranty or security for the Guaranteed Obligations, in each
case whether or not in accordance with the terms hereof or such Credit Document,
such Hedge Agreement or any agreement relating to such other guaranty or
security; (iii) the Guaranteed Obligations, or any agreement relating thereto,
at any time being found to be illegal, invalid or unenforceable in any respect;
(iv) the application of payments received from any source (other than payments
received pursuant to the other Credit Documents or any of the Hedge Agreements
or from the proceeds of any security for the Guaranteed Obligations, except to
the extent such security also serves as collateral for indebtedness other than
the Guaranteed Obligations) to the payment of indebtedness other than the
Guaranteed Obligations, even though any Beneficiary might have elected to apply
such payment to any part or all of the Guaranteed Obligations; (v) any
Beneficiary's consent to the change, reorganization or termination of the
corporate structure or existence of Holdings or any of its Subsidiaries and to
any corresponding restructuring of the Guaranteed Obligations; (vi) any failure
to perfect or continue perfection of a security interest in any collateral which
secures any of the Guaranteed Obligations; (vii) any defenses, set-offs or
counterclaims which Company may allege or assert against any Beneficiary in
respect of the Guaranteed Obligations, including failure of consideration,
breach of warranty, payment, statute of frauds, statute of limitations, accord
and satisfaction and usury; and (viii) any other act or thing or omission, or
delay to do any other act or thing, which may or might in any manner or to any
extent vary the risk of any Guarantor as an obligor in respect of the Guaranteed
Obligations.
7.5. WAIVERS BY GUARANTORS. Each Guarantor hereby waives, for the benefit
of Beneficiaries: (a) any right to require any Beneficiary, as a condition of
payment or performance by such Guarantor, to (i) proceed against Company, any
other guarantor (including any other Guarantor) of the Guaranteed Obligations or
any other Person, (ii) proceed against or exhaust any security held from
Company, any such other guarantor or any other Person, (iii) proceed against or
have resort to any balance of any Deposit Account or credit on the books of any
Beneficiary in favor of Company or any other Person, or (iv) pursue any other
remedy in the power of any Beneficiary whatsoever; (b) any defense arising by
reason of the incapacity, lack of authority or any disability or other defense
of Company or any other Guarantor including any defense based on or arising out
of the lack of validity or the unenforceability of the Guaranteed Obligations or
any agreement or instrument relating thereto or by reason of the cessation of
the liability of Company or any other Guarantor from any cause other than
payment in full of the Guaranteed Obligations; (c) any defense based upon any
statute or rule of law which provides that the obligation of a surety must be
neither larger in amount nor in other respects more
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burdensome than that of the principal; (d) any defense based upon any
Beneficiary's errors or omissions in the administration of the Guaranteed
Obligations, except behavior which amounts to bad faith; (e) (i) any principles
or provisions of law, statutory or otherwise, which are or might be in conflict
with the terms hereof and any legal or equitable discharge of such Guarantor's
obligations hereunder, (ii) the benefit of any statute of limitations affecting
such Guarantor's liability hereunder or the enforcement hereof, (iii) any rights
to set-offs, recoupments and counterclaims, and (iv) promptness, diligence and
any requirement that any Beneficiary protect, secure, perfect or insure any
security interest or lien or any property subject thereto; (f) notices, demands,
presentments, protests, notices of protest, notices of dishonor and notices of
any action or inaction, including acceptance hereof, notices of default
hereunder, the Hedge Agreements or any agreement or instrument related thereto,
notices of any renewal, extension or modification of the Guaranteed Obligations
or any agreement related thereto, notices of any extension of credit to Company
and notices of any of the matters referred to in Section 7.4 and any right to
consent to any thereof, and (g) any defenses or benefits that may be derived
from or afforded by law which limit the liability of or exonerate guarantors or
sureties, or which may conflict with the terms hereof.
7.6. GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Until the
Guaranteed Obligations shall have been indefeasibly paid in full and the
Revolving Commitments shall have terminated each Guarantor hereby waives any
claim, right or remedy, direct or indirect, that such Guarantor now has or may
hereafter have against Company or any other Guarantor or any of its assets in
connection with this Guaranty or the performance by such Guarantor of its
obligations hereunder, in each case whether such claim, right or remedy arises
in equity, under contract, by statute, under common law or otherwise and
including without limitation (a) any right of subrogation, reimbursement or
indemnification that such Guarantor now has or may hereafter have against
Company with respect to the Guaranteed Obligations, (b) any right to enforce, or
to participate in, any claim, right or remedy that any Beneficiary now has or
may hereafter have against Company, and (c) any benefit of, and any right to
participate in, any collateral or security now or hereafter held by any
Beneficiary. In addition, until the Guaranteed Obligations shall have been
indefeasibly paid in full and the Revolving Commitments shall have terminated
each Guarantor shall withhold exercise of any right of contribution such
Guarantor may have against any other guarantor (including any other Guarantor)
of the Guaranteed Obligations, including, without limitation, any such right of
contribution as contemplated by Section 7.2. Each Guarantor further agrees that,
to the extent the waiver or agreement to withhold the exercise of its rights of
subrogation, reimbursement, indemnification and contribution as set forth herein
is found by a court of competent jurisdiction to be void or voidable for any
reason, any rights of subrogation, reimbursement or indemnification such
Guarantor may have against Company or against any collateral or security, and
any rights of contribution such Guarantor may have against any such other
guarantor, shall be junior and subordinate to any rights any Beneficiary may
have against Company, to all right, title and interest any Beneficiary may have
in any such collateral or security, and to any right any Beneficiary may have
against such other guarantor. If any amount shall be paid to any Guarantor on
account of any such subrogation, reimbursement, indemnification or contribution
rights at any time when all Guaranteed Obligations shall not have been paid in
full, such amount shall be held in trust for Administrative Agent on behalf of
Beneficiaries and shall forthwith be paid over to Administrative Agent for the
benefit of Beneficiaries to be credited and applied against the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms hereof.
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7.7. SUBORDINATION OF OTHER OBLIGATIONS. Any Indebtedness of Company or any
Guarantor now or hereafter held by any Guarantor (the "OBLIGEE GUARANTOR") is
hereby subordinated in right of payment to the Guaranteed Obligations, and any
such indebtedness collected or received by the Obligee Guarantor after an Event
of Default has occurred and is continuing shall be held in trust for
Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over
to Administrative Agent for the benefit of Beneficiaries to be credited and
applied against the Guaranteed Obligations but without affecting, impairing or
limiting in any manner the liability of the Obligee Guarantor under any other
provision hereof.
7.8. CONTINUING GUARANTY. This Guaranty is a continuing guaranty and shall
remain in effect until all of the Guaranteed Obligations shall have been finally
and indefeasibly paid in full and the Revolving Commitments shall have
terminated. Each Guarantor hereby irrevocably waives any right to revoke this
Guaranty as to future transactions giving rise to any Guaranteed Obligations.
7.9. AUTHORITY OF GUARANTORS OR COMPANY. It is not necessary for any
Beneficiary to inquire into the capacity or powers of any Guarantor or Company
or the officers, directors or any agents acting or purporting to act on behalf
of any of them.
7.10. FINANCIAL CONDITION OF COMPANY. Any Credit Extension may be made to
Company or continued from time to time, and any Hedge Agreements may be entered
into from time to time, in each case without notice to or authorization from any
Guarantor regardless of the financial or other condition of Company at the time
of any such grant or continuation or at the time such Hedge Agreement is entered
into, as the case may be. No Beneficiary shall have any obligation to disclose
or discuss with any Guarantor its assessment, or any Guarantor's assessment, of
the financial condition of Company. Each Guarantor has adequate means to obtain
information from Company on a continuing basis concerning the financial
condition of Company and its ability to perform its obligations under the Credit
Documents and the Hedge Agreements, and each Guarantor assumes the
responsibility for being and keeping informed of the financial condition of
Company and of all circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations. Each Guarantor hereby waives and relinquishes any duty
on the part of any Beneficiary to disclose any matter, fact or thing relating to
the business, operations or conditions of Company now known or hereafter known
by any Beneficiary.
7.11. BANKRUPTCY, ETC. (a) So long as any Guaranteed Obligations remain
outstanding, no Guarantor shall, without the prior written consent of
Administrative Agent acting pursuant to the instructions of Requisite Lenders,
commence or join with any other Person in commencing any bankruptcy,
reorganization or insolvency case or proceeding of or against Company or any
other Guarantor. The obligations of Guarantors hereunder shall not be reduced,
limited, impaired, discharged, deferred, suspended or terminated by any case or
proceeding, voluntary or involuntary, involving the bankruptcy, insolvency,
receivership, reorganization, liquidation or arrangement of Company or any other
Guarantor or by any defense which Company or any other Guarantor may have by
reason of the order, decree or decision of any court or administrative body
resulting from any such proceeding.
(b) Each Guarantor acknowledges and agrees that any interest on any
portion of the Guaranteed Obligations which accrues after the commencement of
any case or proceeding
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referred to in clause (a) above (or, if interest on any portion of the
Guaranteed Obligations ceases to accrue by operation of law by reason of the
commencement of such case or proceeding, such interest as would have accrued on
such portion of the Guaranteed Obligations if such case or proceeding had not
been commenced) shall be included in the Guaranteed Obligations because it is
the intention of Guarantors and Beneficiaries that the Guaranteed Obligations
which are Guaranteed by Guarantors pursuant hereto should be determined without
regard to any rule of law or order which may relieve Company of any portion of
such Guaranteed Obligations. Guarantors will permit any trustee in bankruptcy,
receiver, debtor in possession, assignee for the benefit of creditors or similar
person to pay Administrative Agent, or allow the claim of Administrative Agent
in respect of, any such interest accruing after the date on which such case or
proceeding is commenced.
(c) In the event that all or any portion of the Guaranteed Obligations
are paid by Company, the obligations of Guarantors hereunder shall continue and
remain in full force and effect or be reinstated, as the case may be, in the
event that all or any part of such payment(s) are rescinded or recovered
directly or indirectly from any Beneficiary as a preference, fraudulent transfer
or otherwise, and any such payments which are so rescinded or recovered shall
constitute Guaranteed Obligations for all purposes hereunder.
7.12. DISCHARGE OF GUARANTY UPON SALE OF GUARANTOR. If all of the Capital
Stock of any Guarantor or any of its successors in interest hereunder shall be
sold or otherwise disposed of (including by merger or consolidation) in
accordance with the terms and conditions hereof, the Guaranty of such Guarantor
or such successor in interest, as the case may be, hereunder shall automatically
be discharged and released without any further action by any Beneficiary or any
other Person effective as of the time of such Asset Sale.
SECTION 8. EVENTS OF DEFAULT
8.1. EVENTS OF DEFAULT. If any one or more of the following conditions or
events shall occur:
(a) FAILURE TO MAKE PAYMENTS WHEN DUE. Failure by Company to pay (i)
when due any installment of principal of any Loan, whether at stated maturity,
by acceleration, by notice of voluntary prepayment, by mandatory prepayment or
otherwise; or (ii) any interest on any Loan or any fee or any other amount due
hereunder within five (5) days after the date due; or
(b) DEFAULT IN OTHER AGREEMENTS. (i) Failure of any Credit Party or any
of their respective Subsidiaries to pay when due any principal of or interest on
or any other amount payable in respect of one or more items of Indebtedness
(other than Indebtedness referred to in Section 8.1(a)) in a principal amount of
$3,500,000 or more, beyond the grace period, if any, provided therefor and the
holder of such Indebtedness has any rights or remedies exercisable as a result
of such failure; or (ii) breach or default by any Credit Party with respect to
any other material term of (i) one or more items of Indebtedness in the
individual or aggregate principal amounts referred to in clause (i) above or (2)
any loan agreement, mortgage, indenture or other agreement relating to such
item(s) of Indebtedness, in each case beyond the grace period, if any, provided
therefor, if the effect of such breach or default is to cause, or to permit the
holder or
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holders of that Indebtedness (or a trustee on behalf of such holder or holders),
to cause, that Indebtedness to become or be declared due and payable (or
redeemable) prior to its stated maturity or the stated maturity of any
underlying obligation, as the case may be; or
(c) BREACH OF CERTAIN COVENANTS. Failure of any Credit Party to perform
or comply with any term or condition contained in Section 2.5, Section 5.2 or
Section 6; or
(d) BREACH OF REPRESENTATIONS, ETC. Any representation, warranty,
certification or other statement made or deemed made by any Credit Party in any
Credit Document or in any statement or certificate at any time given by any
Credit Party or any of its Subsidiaries in writing pursuant hereto or thereto or
in connection herewith or therewith shall be false in any material respect as of
the date made or deemed made; or
(e) OTHER DEFAULTS UNDER CREDIT DOCUMENTS. Any Credit Party shall
default in the performance of or compliance with any term contained herein or
any of the other Credit Documents, other than any such term referred to in any
other Section of this Section 8.1, and such default shall not have been remedied
or waived within thirty (30) days after the earlier of (i) an officer of such
Credit Party becoming aware of such default or (ii) receipt by Company of notice
from Administrative Agent or any Lender of such default; or
(f) INVOLUNTARY BANKRUPTCY, APPOINTMENT OF RECEIVER, ETC. (i) A court
of competent jurisdiction shall miter a decree or order for relief in respect of
Holdings or any of its Subsidiaries in an involuntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or (ii) an
involuntary case shall be commenced against Holdings or any of its Subsidiaries
under the Bankruptcy Code or under any other applicable bankruptcy, insolvency
or similar law now or hereafter in effect; or a decree or order of a court
having jurisdiction in the premises for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other officer having similar
powers over Holdings or any of its Subsidiaries, or over all or a substantial
part of its property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other custodian of
Holdings or any of its Subsidiaries for all or a substantial part of its
property; or a warrant of attachment, execution or similar process shall have
been issued against any substantial part of the property of Holdings or any of
its Subsidiaries, and any such event described in this clause (ii) shall
continue for sixty (60) days without having been dismissed, bonded or
discharged; or
(g) VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC. (i) Holdings or
any of its Subsidiaries shall have an order for relief entered with respect to
it or shall commence a voluntary case under the Bankruptcy Code or under any
other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, or shall consent to the entry of an order for relief in an involuntary
case, or to the conversion of an involuntary case to a voluntary case, under any
such law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of its
property; or Holdings or any of its Subsidiaries shall make any assignment for
the benefit of creditors; or (ii) Holdings or any of its Subsidiaries shall be
unable, or shall fail generally, or shall admit in writing its inability, to pay
its debts as such debts become due; or the board of directors (or similar
governing body) of Holdings or any of its
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Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise
authorize any action to approve any of the actions referred to herein or in
Section 8.1(f); or
(h) JUDGMENTS AND ATTACHMENTS. Any money judgment, writ or warrant of
attachment or similar process involving an amount in excess of $3,500,000 (to
the extent not adequately covered by insurance as to which a solvent and
unaffiliated insurance Company has acknowledged coverage) shall be entered or
filed against Holdings or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of sixty (60) days (or in any event later than five days prior to the
date of any proposed sale thereunder); or
(i) DISSOLUTION. Any order, judgment or decree shall be entered against
any Credit Party decreeing the dissolution or split up of such Credit Party and
such order shall remain undischarged or unstayed for a period in excess of
thirty (30) days; or
(j) EMPLOYEE BENEFIT PLANS. There shall occur one or more ERISA Events
which individually or in the aggregate results in or might reasonably be
expected to result in liability of Holdings, any of its Subsidiaries or any of
their respective ERISA Affiliates in excess of $3,500,000 during the term
hereof, there shall exist one or more facts or circumstances that might
reasonably be expected to result in the imposition of a Lien pursuant to Section
401(a)(29) or 412(n) of the Internal Revenue Code or pursuant to ERISA with
respect to any Pension Plan; or there shall exist an amount of unfunded benefit
liabilities (as defined in Section 400 1 (a)(1 8) of ERISA), individually or in
the aggregate for all Pension Plans (excluding for purposes of such computation
any Pension Plans with respect to which assets exceed benefit liabilities),
which exceeds $3,500,000; or
(k) CHANGE OF CONTROL. A Change of Control shall occur; or
(l) GUARANTIES, COLLATERAL DOCUMENTS AND OTHER CREDIT DOCUMENTS. At any
time after the execution and delivery thereof, (i) the Guaranty for any reason,
other than the satisfaction in full of all Obligations, shall cease to be in
full force and effect (other than in accordance with its terms) or shall be
declared to be null and void or any Guarantor shall repudiate its obligations
thereunder, (ii) this Agreement or any Collateral Document ceases to be in full
force and effect (other than by reason of a release of Collateral in accordance
with the terms hereof or thereof or the satisfaction in full of the Obligations
in accordance with the terms hereof) or shall be declared null and void, or
Collateral Agent shall not have or shall cease to have a valid and perfected
Lien in any Collateral purported to be covered by the Collateral Documents with
the priority required by the relevant Collateral Document, in each case for any
reason other than the failure of Collateral Agent or any Secured Party to take
any action within its control, or (iii) any Credit Party shall contest the
validity or enforceability of any Credit Document in writing or deny in writing
that it has any further liability, including with respect to future advances by
Lenders, under any Credit Document to which it is a party;
THEN, (i) upon the occurrence of any Event of Default described in Section
8.1(f) or 8.1(g), automatically, and (2) upon the occurrence of any other Event
of Default, at the request of (or with the consent of) Requisite Lenders, upon
notice to Company by Administrative Agent, (A) the Revolving Commitments, if
any, of each Lender having such Revolving Commitments
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shall immediately terminate; (B) each of the following shall immediately become
due and payable, in each case without presentment, demand, protest or other
requirements of any kind, all of which are hereby expressly waived by each
Credit Party: (I) the unpaid principal amount of and accrued interest on the
Loans, and (II) all other Obligations; PROVIDED, the foregoing shall not affect
in any way the obligations of Lenders under Section 2.3(b)(iv); and (C) the
Administrative Agent may cause the Collateral Agent to enforce any and all Liens
and security interests created pursuant to Collateral Documents.
Notwithstanding any of the foregoing to the contrary set forth herein, it shall
not constitute an Event of Default hereunder if any of the circumstances
described above in Sections 8.1(f), 8.1(g), 8.1(i) and 8.1(l) shall have
occurred with respect to one or more Subsidiaries of Company which in the
aggregate do not account for more than 2.50% of Company's total Consolidated
Adjusted EBITDA for the four-Fiscal Quarter period most recently ended.
SECTION 9. AGENTS
9.1. APPOINTMENT OF AGENTS. GSCP is hereby appointed Lead Arranger and
Syndication Agent hereunder, and each Lender hereby authorizes Lead Arranger and
Syndication Agent to act as its agents in accordance with the terms hereof and
the other Credit Documents. ▇▇▇▇▇ Fargo is hereby appointed Administrative Agent
hereunder and under the other Credit Documents and each Lender hereby authorizes
Administrative Agent to act as its agent in accordance with the terms hereof and
the other Credit Documents. Each Agent hereby agrees to act upon the express
conditions contained herein and the other Credit Documents, as applicable. The
provisions of this Section 9 are solely for the benefit of Agents and Lenders
and no Credit Party shall have any rights as a third party beneficiary of any of
the provisions hereof. In performing its functions and duties hereunder, each
Agent shall act solely as an agent of Lenders and does not assume and shall not
be deemed to have assumed any obligation towards or relationship of agency or
trust with or for Holdings or any of its Subsidiaries. Syndication Agent,
without consent of or notice to any party hereto, may assign any and all of its
rights or obligations hereunder to any of its Affiliates. As of the Closing
Date, all the respective obligations of GSCP, in its capacity as Lead Arranger
and Syndication Agent, shall terminate.
9.2. POWERS AND DUTIES. Each Lender irrevocably authorizes each Agent to
take such action on such Lender's behalf and to exercise such powers, rights and
remedies hereunder and under the other Credit Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. Each
Agent shall have only those duties and responsibilities that are expressly
specified herein and the other Credit Documents. Each Agent may exercise such
powers, rights and remedies and perform such duties by or through its agents or
employees. No Agent shall have, by reason hereof or any of the other Credit
Documents, a fiduciary relationship in respect of any Lender; and nothing herein
or any of the other Credit Documents, expressed or implied, is intended to or
shall be so construed as to impose upon any Agent any obligations in respect
hereof or any of the other Credit Documents except as expressly set forth herein
or therein.
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9.3. GENERAL IMMUNITY.
(a) NO RESPONSIBILITY FOR CERTAIN MATTERS. No Agent shall be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectability or sufficiency hereof or any other
Credit Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by any of Agent to Lenders or by or on behalf of any
Credit Party to any Agent or any Lender in connection with the Credit Documents
and the transactions contemplated thereby or for the financial condition or
business affairs of any Credit Party or any other Person liable for the payment
of any Obligations, nor shall any Agent be required to ascertain or inquire as
to the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained in any of the Credit Documents or as to the
use of the proceeds of the Loans or as to the existence or possible existence of
any Event of Default or Default. Anything contained herein to the contrary
notwithstanding, Administrative Agent shall not have any liability arising from
confirmations of the amount of outstanding Loans or the component amounts
thereof.
(b) EXCULPATORY PROVISIONS. No Agent nor any of its officers, partners,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by any Agent under or in connection with any of the Credit Documents
except to the extent caused by such Agent's gross negligence or willful
misconduct. Each Agent shall be entitled to refrain from any act or the taking
of any action (including the failure to take an action) in connection herewith
or any of the other Credit Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required to give such instructions
under Section 10.5) and, upon receipt of such instructions from Requisite
Lenders (or such other Lenders, as the case may be), such Agent shall be
entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper Person or Persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Holdings and its Subsidiaries), accountants,
experts and other professional advisors selected by it; and (ii) no Lender shall
have any right of action whatsoever against any Agent as a result of such Agent
acting or (where so instructed) refraining from acting hereunder or any of the
other Credit Documents in accordance with the instructions of Requisite Lenders
(or such other Lenders as may be required to give such instructions under
Section 10.5).
9.4. AGENTS ENTITLED TO ACT AS LENDER. The agency hereby created shall in
no way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans, each Agent shall have the same
rights and powers hereunder as any other Lender and may exercise the same as if
it were not performing the duties and functions delegated to it hereunder, and
the term "Lender" shall, unless the context clearly otherwise indicates, include
each Agent in its individual capacity. Any Agent and its Affiliates may accept
deposits from, lend money to
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and generally engage in any kind of banking, trust, financial advisory or other
business with Holdings or any of its Affiliates as if it were not performing the
duties specified herein, and may accept fees and other consideration from
Company for services in connection herewith and otherwise without having to
account for the same to Lenders.
9.5. LENDERS' REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENT.
(a) Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Holdings and
its Subsidiaries in connection with Credit Extensions hereunder and that it has
made and shall continue to make its own appraisal of the creditworthiness of
Holdings and its Subsidiaries. No Agent shall have any duty or responsibility,
either initially or on a continuing basis, to make any such investigation or any
such appraisal on behalf of Lenders or to provide any Lender with any credit or
other information with respect thereto, whether coming into its possession
before the making of the Loans or at any time or times thereafter, and no Agent
shall have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
(b) Each Lender, by delivering its signature page to this Agreement and
funding its Tranche A Term Loan, Tranche B Term Loan and/or a Revolving Loan on
the Closing Date, shall be deemed to have acknowledged receipt of, and consented
to and approved, each Credit Document and each other document required to be
approved by any Agent, Requisite Lenders or Lenders, as applicable on the
Closing Date.
9.6. RIGHT TO INDEMNITY. Each Lender, in proportion to its Pro Rata Share,
severally agrees to indemnify each Agent, to the extent that such Agent shall
not have been reimbursed by any Credit Party, for and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including counsel fees and disbursements) or disbursements of
any kind or nature whatsoever which may be imposed on, incurred by or asserted
against such Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Credit Documents or otherwise in its
capacity as such Agent in any way relating to or arising out hereof or the other
Credit Documents; PROVIDED, no Lender 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. If any indemnity furnished to any Agent for any purpose
shall, in the opinion of such Agent, be insufficient or become impaired, such
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished; PROVIDED,
in no event shall this sentence require any Lender to indemnify any Agent
against any liability, obligation, loss, damage, penalty, action, judgment,
suit, cost, expense or disbursement in excess of such Lender's Pro Rata Share
thereof; and PROVIDED FURTHER, this sentence shall not be deemed to require any
Lender to indemnify any Agent against any liability, obligation, loss, damage,
penalty, action, judgment, suit, cost, expense or disbursement described in the
proviso in the immediately preceding sentence.
9.7. SUCCESSOR ADMINISTRATIVE AGENT AND SWING LINE LENDER. Administrative
Agent may resign at any time by giving thirty (30) days' prior written notice
thereof to Lenders and Company, and Administrative Agent may be removed at any
time with or without cause by an instrument or concurrent instruments in writing
delivered to Company and Administrative
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Agent and signed by Requisite Lenders. Upon any such notice of resignation or
any such removal, Requisite Lenders shall have the right, upon five Business
Days' notice to Company, to appoint a successor Administrative Agent. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, that successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Administrative Agent and the retiring or removed
Administrative Agent shall promptly (i) transfer to such successor
Administrative Agent all sums, Securities and other items of Collateral held
under the Collateral Documents, together with all records and other documents
necessary or appropriate in connection with the performance of the duties of the
successor Administrative Agent under the Credit Documents, and (ii) execute and
deliver to such successor Administrative Agent such amendments to financing
statements, and take such other actions, as may be necessary or appropriate in
connection with the assignment to such successor Administrative Agent of the
security interests created under the Collateral Documents, whereupon such
retiring or removed Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring or removed Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent hereunder. Any resignation or removal of
Administrative Agent pursuant to this Section shall also constitute the
resignation or removal of ▇▇▇▇▇ Fargo or its successor as Swing Line Lender, and
any successor Administrative Agent appointed pursuant to this Section shall,
upon its acceptance of such appointment, become the successor Swing Line Lender
for all purposes hereunder. In such event (a) Company shall prepay any
outstanding Swing Line Loans made by the retiring or removed Administrative
Agent in its capacity as Swing Line Lender, (b) upon such prepayment, the
retiring or removed Administrative Agent and Swing Line Lender shall surrender
any Swing Line Note held by it to Company for cancellation, and (c) Company
shall issue, if so requested by Successor Administrative Agent and Swing Line
Loan Lender, a new Swing Line Note to the successor Administrative Agent and
Swing Line Lender, in the principal amount of the Swing Line Loan Sublimit then
in effect and with other appropriate insertions.
9.8. COLLATERAL DOCUMENTS AND GUARANTY.
(a) AGENTS UNDER COLLATERAL DOCUMENTS AND GUARANTY. Each Lender hereby
further authorizes Agent, on behalf of and for the benefit of Lenders, to be the
agent for and representative of Lenders with respect to the Guaranty, the
Collateral and the Collateral Documents. Subject to Section 10.5, without
further written consent or authorization from Lenders, Administrative Agent or
Collateral Agent, as applicable, may execute any documents or instruments
necessary to (i) release any Lien encumbering any item of Collateral that is the
subject of a sale or other disposition of assets permitted hereby or to which
Requisite Lenders (or such other Lenders as may be required to give such consent
under Section 10.5) have otherwise consented or (ii) release any Guarantor from
the Guaranty pursuant to Section 7.13 or with respect to which Requisite Lenders
(or such other Lenders as may be required to give such consent under Section
10.5) have otherwise consented.
(b) RIGHT TO REALIZE ON COLLATERAL AND ENFORCE GUARANTY. Anything
contained in any of the Credit Documents to the contrary notwithstanding,
Company, Administrative Agent, Collateral Agent and each Lender hereby agree
that (i) no Lender shall have any right
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individually to realize upon any of the Collateral or to enforce the Guaranty,
it being understood and agreed that all powers, rights and remedies hereunder
may be exercised solely by Administrative Agent, on behalf of Lenders in
accordance with the terms hereof and all powers, rights and remedies under the
Collateral Documents may be exercised solely by Collateral Agent, and (ii) in
the event of a foreclosure by Collateral Agent on any of the Collateral pursuant
to a public or private sale, Administrative Agent or any Lender may be the
purchaser of any or all of such Collateral at any such sale and Collateral
Agent, as agent for and representative of Secured Parties (but not any Lender or
Lenders in its or their respective individual capacities unless Requisite
Lenders shall otherwise agree in writing) shall be entitled, for the purpose of
bidding and making settlement or payment of the purchase price for all or any
portion of the Collateral sold at any such public sale, to use and apply any of
the Obligations as a credit on account of the purchase price for any collateral
payable by Collateral Agent at such sale.
SECTION 10. MISCELLANEOUS
10.1. NOTICES. Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given to a Credit Party,
Lead Arranger, Syndication Agent, Collateral Agent, Administrative Agent or
Swing Line Lender, shall be sent to such Person's address as set forth on
Appendix B or in the other relevant Credit Document, and in the case of any
Lender, the address as indicated on Appendix B or otherwise indicated to
Administrative Agent in writing. Each notice hereunder shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service and signed for against receipt thereof, upon
receipt of telefacsimile or telex, or three Business Days after depositing it in
the United States mail with postage prepaid and properly addressed; PROVIDED, no
notice to any Agent shall be effective until received by such Agent.
10.2. EXPENSES. Whether or not the transactions contemplated hereby shall
be consummated, Company agrees to pay promptly (a) all the actual and reasonable
costs and expenses of preparation of the Credit Documents and any consents,
amendments, waivers or other modifications thereto; (b) all the costs of
furnishing all opinions by counsel for Company and the other Credit Parties; (c)
the reasonable and documented fees, expenses and disbursements of counsel to
Agents (in each case including allocated costs of internal counsel) in
connection with the negotiation, preparation, execution and administration of
the Credit Documents and any consents, amendments, waivers or other
modifications thereto and any other documents or matters requested by Company;
(d) all the actual costs and reasonable and documented expenses of creating and
perfecting Liens in favor of Collateral Agent, for the benefit of Lenders
pursuant hereto, including filing and recording fees, expenses and taxes, stamp
or documentary taxes, search fees, title insurance premiums and reasonable fees,
expenses and disbursements of counsel to each Agent and of counsel providing any
opinions that any Agent or Requisite Lenders may request in respect of the
Collateral or the Liens created pursuant to the Collateral Documents; (e) all
the actual costs and reasonable and documented fees, expenses and disbursements
of any auditors, accountants, consultants or appraisers; (f) all the actual
costs and reasonable and documented expenses (including the reasonable fees,
expenses and disbursements of any appraisers, consultants, advisors and agents
employed or retained by Collateral Agent and its counsel) in connection with the
custody or preservation of any of the Collateral; (g) all other actual and
reasonable and documented costs and expenses incurred by
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each Agent in connection with the syndication of the Loans and Commitments and
the negotiation, preparation and execution of the Credit Documents and any
consents, amendments, waivers or other modifications thereto and the
transactions contemplated thereby; and (h) after the occurrence of a Default or
an Event of Default, all costs and expenses, including reasonable and documented
attorneys' fees (including allocated costs of internal counsel) and costs of
settlement, incurred by any Agent and Lenders in enforcing any Obligations of or
in collecting any payments due from any Credit Party hereunder or under the
other Credit Documents by reason of such Default or Event of Default (including
in connection with the sale of, collection from, or other realization upon any
of the Collateral or the enforcement of the Guaranty) or in connection with any
refinancing or restructuring of the credit arrangements provided hereunder in
the nature of a "work-out" or pursuant to any insolvency or bankruptcy cases or
proceedings.
10.3. INDEMNITY. In addition to the payment of expenses pursuant to Section
10.2, whether or not the transactions contemplated hereby shall be consummated,
each Credit Party agrees to defend (subject to Indemnitees' selection of
counsel), indemnify, pay and hold harmless, each Agent and Lender and the
officers, partners, directors, trustees, employees, agents and Affiliates of
each Agent and each Lender (each, an "INDEMNITEE"), from and against any and all
Indemnified Liabilities; PROVIDED, no Credit Party shall have any obligation to
any Indemnitee hereunder with respect to any Indemnified Liabilities to the
extent such Indemnified Liabilities arise from the gross negligence or willful
misconduct of that Indemnitee. To the extent that the undertakings to defend,
indemnify, pay and hold harmless set forth in this Section 10.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, the applicable Credit Party shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them. To the extent permitted by applicable law, no Credit Party shall assert,
and each hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, any Credit Document or any agreement or instrument or transaction
contemplated hereby.
10.4. SET-OFF. In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default each Lender is hereby authorized by each
Credit Party at any time or from time to time subject to the consent of
Administrative Agent (such consent not to be unreasonably withheld or delayed),
without notice to any Credit Party or to any other Person (other than
Administrative Agent), any such notice being hereby expressly waived, to set off
and to appropriate and to apply any and all deposits (general or special,
including Indebtedness evidenced by certificates of deposit, whether matured or
unmatured, but not including trust accounts) and any other Indebtedness at any
time held or owing by such Lender to or for the credit or the account of any
Credit Party against and on account of the obligations and liabilities of any
Credit Party to such Lender hereunder, and participations therein and under the
other Credit Documents, including all claims of any nature or description
arising out of or connected hereto and participations therein or with any other
Credit Document, irrespective of whether or not (a) such Lender shall have made
any demand hereunder or (b) the principal of or the interest on the Loans or any
other amounts due hereunder shall have become due and payable pursuant to
Section 2 and although such obligations and liabilities, or any of them, may be
contingent or unmatured. Each Credit Party hereby further
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grants to Administrative Agent and each Lender a security interest in all
Deposit Accounts maintained with Administrative Agent or such Lender as security
for the Obligations.
10.5. AMENDMENTS AND WAIVERS.
(a) REQUISITE LENDERS' CONSENT. Subject to Section 10.5(b) and 10.5(c),
no amendment, modification, termination or waiver of any provision of the Credit
Documents, or consent to any departure by any Credit Party therefrom, shall in
any event be effective without the written concurrence of the Requisite Lenders.
(b) AFFECTED LENDERS' CONSENT. Without the written consent of each
Lender (other than a Defaulting Lender) that would be affected thereby, no
amendment, modification, termination, or consent shall be effective if the
effect thereof would:
(i) extend the scheduled final maturity of any Loan or Note;
(ii) waive, reduce or postpone any scheduled repayment (but not
prepayment);
(iii) reduce the rate of interest on any Loan (other than any waiver of
any increase in the interest rate applicable to any Loan pursuant to Section
2.10) or any fee payable hereunder;
(iv) extend the time for payment of any such interest or fees;
(v) reduce the principal amount of any Loan;
(vi) amend, modify, terminate or waive any provision of this Section
10.5(b) or Section 10.5(c);
(vii) amend the definition of "REQUISITE LENDERS" or "PRO RATA SHARE";
PROVIDED, with the consent of Requisite Lenders, additional extensions of credit
pursuant hereto may be included in the determination of "REQUISITE LENDERS" or
"PRO RATA SHARE" on substantially the same basis as the Term Loan Commitments,
the Term Loans, the Revolving Commitments and the Revolving Loans are included
on the Closing Date;
(viii) release or otherwise subordinate all or substantially all of the
Collateral or all or substantially all of the Guarantors from the Guaranty
except as expressly provided in the Credit Documents; or
(ix) consent to the assignment or transfer by any Credit Party of any
of its rights and obligations under any Credit Document.
(c) OTHER CONSENTS. No amendment, modification, termination or waiver
of any provision of the Credit Documents, or consent to any departure by any
Credit Party therefrom, shall:
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(i) increase any Revolving Commitment of any Lender over the amount
thereof then in effect without the consent of such Lender; PROVIDED, no
amendment, modification or waiver of any condition precedent, covenant, Default
or Event of Default shall constitute an increase in any Revolving Commitment of
any Lender;
(ii) amend, modify, terminate or waive any provision hereof relating to
the Swing Line Sublimit or the Swing Line Loans without the consent of Swing
Line Lender;
(iii) amend the definition of "REQUISITE CLASS LENDERS" without the
consent of Requisite Class Lenders of each Class; PROVIDED, with the consent of
the Requisite Lenders, additional extensions of credit pursuant hereto may be
included in the determination of such "REQUISITE CLASS LENDERS" on substantially
the same basis as the Term Loan Commitments, the Term Loans, the Revolving
Commitments and the Revolving Loans are included on the Closing Date;
(iv) alter the required application of any repayments or prepayments as
between Classes pursuant to Section 2.14 without the consent of Requisite Class
Lenders of each Class which is being allocated a lesser repayment or prepayment
as a result thereof, PROVIDED, Requisite Lenders may waive, in whole or in part,
any prepayment so long as the application, as between Classes, of any portion of
such prepayment which is still required to be made is not altered; or
(v) amend, modify, terminate or waive any provision of Section 9 as the
same applies to any Agent, or any other provision hereof as the same applies to
the rights or obligations of any Agent, in each case without the consent of such
Agent, in each case without the consent of such Agent.
(d) EXECUTION OF AMENDMENTS, ETC. Administrative Agent may, but shall
have no obligation to, with the concurrence of any Lender, execute amendments,
modifications, waivers or consents on behalf of such Lender. Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances. Any amendment, modification, termination,
waiver or consent effected in accordance with this Section 10.5 shall be binding
upon each Lender at the time outstanding, each future Lender and, if signed by a
Credit Party, on such Credit Party.
10.6. SUCCESSORS AND ASSIGNS; PARTICIPATIONS.
(a) GENERALLY. This Agreement shall be binding upon the parties hereto
and their respective successors and assigns and shall inure to the benefit of
the parties hereto and the successors and assigns of Lenders. No Credit Party's
rights or obligations hereunder nor any interest therein may be assigned or
delegated by any Credit Party without the prior written consent of all Lenders.
(b) REGISTER. Company, Administrative Agent and Lenders shall deem and
treat the Persons listed as Lenders in the Register as the holders and owners of
the corresponding Commitments and Loans listed therein for all purposes hereof,
and no assignment or transfer of any such Commitment or Loan shall be effective,
in each case, unless and until an Assignment
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Agreement effecting the assignment or transfer thereof shall have been delivered
to and accepted by Administrative Agent and recorded in the Register as provided
in Section 10.6(e). Prior to such recordation, all amounts owed with respect to
the applicable Commitment or Loan shall be owed to the Lender listed in the
Register as the owner thereof, and any request, authority or consent of any
Person who, at the time of making such request or giving such authority or
consent, is listed in the Register as a Lender shall be prima facie evidence
thereof.
(c) RIGHT TO ASSIGN. Each Lender shall have the right at any time to
sell, assign or transfer all or a portion of its rights and obligations under
this Agreement, including, without limitation, all or a portion of its
Commitment or Loans owing to it, Note or Notes held by it, or other Obligation
(provided, HOWEVER, that each such assignment shall be of a uniform, and not
varying, percentage of all rights and obligations under and in respect of any
Loan and any related Commitments):
(i) to any Person meeting the criteria of clause (i) of the definition
of the term of "Eligible Assignee" upon the giving of notice to Company and
Administrative Agent; and
(ii) to any Person meeting the criteria of clause (ii) of the
definition of the term of "Eligible Assignee" and, in the case of assignments of
Revolving Loans or Revolving Commitments to any such Person (except in the case
of assignments made by or to GSCP), consented to by each of Company and
Administrative Agent (such consent not to be (x) unreasonably withheld or
delayed or, (y) in the case of Company, required at any time an Event of Default
shall have occurred and then be continuing); PROVIDED, further each such
assignment pursuant to this Section 10.6(c)(ii) shall be in an aggregate amount
of not less than (A) $5,000,000 (or such lesser amount as may be agreed to by
Company and Administrative Agent or as shall constitute the aggregate amount of
the Revolving Commitments, Revolving Loans and/or Tranche A Term Loans of the
assigning Lender) with respect to the assignment of the Revolving Commitments,
Revolving Loans and/or Tranche A Term Loans and (B) $1,000,000 (or such lesser
amount as may be agreed to by Company and Administrative Agent or as shall
constitute the aggregate amount of the Tranche B Term Loans of the assigning
Lender) with respect to the assignment of the Tranche B Term Loans.
(d) MECHANICS. The assigning Lender and the assignee thereof shall
execute and deliver to Administrative Agent an Assignment Agreement, together
with (i) a processing and recordation fee of $500 in the case of assignments
pursuant to Section 10.6(c)(i) or made by or to GSCP, and $2,000 in the case of
all other assignments (except that only one fee shall be payable in the case of
contemporaneous assignments to Related Funds), and (ii) such forms, certificates
or other evidence, if any, with respect to United States federal income tax
withholding matters as the assignee under such Assignment Agreement may be
required to deliver to Administrative Agent pursuant to Section 2.19(c).
(e) NOTICE OF ASSIGNMENT. Upon its receipt of a duly executed and
completed Assignment Agreement, together with the processing and recordation fee
referred to in Section 10.6(d) (and any forms, certificates or other evidence
required by this Agreement in connection therewith), Administrative Agent shall
record the information contained in such Assignment
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Agreement in the Register, shall give prompt notice thereof to Company and shall
maintain a copy of such Assignment Agreement.
(f) REPRESENTATIONS AND WARRANTIES OF ASSIGNEE. Each Lender, upon
execution and delivery hereof or upon executing and delivering an Assignment
Agreement, as the case may be, represents and warrants as of the Closing Date or
as of the applicable Effective Date (as defined in the applicable Assignment
Agreement) that (i) it is an Eligible Assignee; (ii) it has experience and
expertise in the making of or investing in commitments or loans such as the
applicable Commitments or Loans, as the case may be; and (iii) it will make or
invest in, as the case may be, its Commitments or Loans for its own account in
the ordinary course of its business and without a view to distribution of such
Commitments or Loans within the meaning of the Securities Act or the Exchange
Act or other federal securities laws (it being understood that, subject to the
provisions of this Section 10.6, the disposition of such Commitments or Loans or
any interests therein shall at all times remain within its exclusive control).
(g) EFFECT OF ASSIGNMENT. Subject to the terms and conditions of this
Section 10.6, as of the "Effective Date" specified in the applicable Assignment
Agreement: (i) the assignee thereunder shall have the rights and obligations of
a "Lender" hereunder to the extent such rights and obligations hereunder have
been assigned to it pursuant to such Assignment Agreement and shall thereafter
be a party hereto and a "Lender" for all purposes hereof, (ii) the assigning
Lender thereunder shall, to the extent that rights and obligations hereunder
have been assigned thereby pursuant to such Assignment Agreement, relinquish its
rights (other than any rights which survive the termination hereof under Section
10.8) and be released from its obligations hereunder (and, in the case of an
Assignment Agreement covering all or the remaining portion of an assigning
Lender's rights and obligations hereunder, such Lender shall cease to be a party
hereto; PROVIDED, anything contained in any of the Credit Documents to the
contrary notwithstanding, such assigning Lender shall continue to be entitled to
the benefit of all indemnities hereunder as specified herein with respect to
matters arising out of the prior involvement of such assigning Lender, as a
Lender hereunder; (iii) the Commitments shall be modified to reflect the
Commitment of such assignee and any remaining Commitment of such assigning
Lender, if any; and (iv) if any such assignment occurs after the issuance of any
Note hereunder, the assigning Lender shall, upon the effectiveness of such
assignment or as promptly thereafter as practicable, surrender its applicable
Notes to Administrative Agent for cancellation, and thereupon Company shall
issue and deliver new Notes, if so requested by the assignee and/or assigning
Lender, to such assignee and/or to such assigning Lender, with appropriate
insertions, to reflect the new Commitments and/or outstanding Loans of the
assignee and/or the assigning Lender.
(h) PARTICIPATIONS. Each Lender shall have the right at any time to
sell one or more participations to any Person (other than Holdings, any of its
Subsidiaries or any of its Affiliates) in all or any part of its Commitments,
Loans or in any other Obligation. The holder of any such participation, other
than an Affiliate of the Lender granting such participation, shall not be
entitled to require such Lender to take or omit to take any action hereunder
except with respect to any amendment modification or waiver that would (i)
extend the final scheduled maturity of any Loan or Note in which such
participant is participating, or reduce the rate or extend the time of payment
of Interest or Fees thereon (except in connection with a waiver of applicability
of any post default increase in interest rates) or reduce the principal amount
thereof,
Page 120
or increase the amount of the participant's participation over the amount
thereof then in effect (it being understood that a waiver of any Default or
Event of Default or of a mandatory reduction in the Commitment shall not
constitute a change in the terms of such participation, and that an increase in
any Commitment or Loan shall be permitted without the consent of any participant
if the participant's participation is not increased as a result thereof), (ii)
consent to the assignment or transfer by any Credit Party of any of its rights
and obligations under this Agreement or (iii) release all or substantially all
of the Collateral under the Collateral Documents (except as expressly provided
in the Credit Documents) supporting the Loans hereunder in which such
participant is participating. All amounts payable by any Credit Party hereunder,
including amounts payable to such Lender pursuant to Section 2.17(c), 2.18 or
2.19, shall be determined as if such Lender had not sold such participation.
Each Credit Party and each Lender hereby acknowledge and agree that, solely for
purposes of Sections 2.16 and 10.4, (1) any participation will give rise to a
direct obligation of each Credit Party to the participant and (2) the
participant shall be considered to be a "Lender."
(i) CERTAIN OTHER ASSIGNMENTS. In addition to any other assignment
permitted pursuant to this Section 10.6, (i) any Lender may assign and pledge
all or any portion of its Loans, the other Obligations owed to such Lender, and
its Notes, if any, to any Federal Reserve Bank as collateral security pursuant
to Regulation A of the Board of Governors of the Federal Reserve System and any
operating circular issued by such Federal Reserve Bank, and (ii) with the
consent of Administrative Agent any Lender which is an investment fund may
pledge all or any portion of its Notes, if any, or Loans to its trustee in
support of its obligations to such trustee; PROVIDED, no Lender, as between
Company and such Lender, shall be relieved of any of its obligations hereunder
as a result of any such assignment and pledge, and PROVIDED FURTHER in no event
shall the applicable Federal Reserve Bank or trustee be considered to be a
"Lender" or be entitled to require the assigning Lender to take or omit to take
any action hereunder.
10.7. INDEPENDENCE OF COVENANTS. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within the limitations of, another covenant shall not
avoid the occurrence of a Default or an Event of Default if such action is taken
or condition exists.
10.8. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties and agreements made herein shall survive the
execution and delivery hereof and the making of any Credit Extension.
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in Sections 2.17(c), 2.18, 2.19, 10.2,
10.3 and 10.4 and the agreements of Lenders set forth in Sections 2.16 and 9.6
shall survive the payment of the Loans and the reimbursement of any amounts
drawn thereunder, and the termination hereof.
10.9. NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the part of
any Agent or any Lender in the exercise of any power, right or privilege
hereunder or under any other Credit Document shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other power, right or
privilege. The rights, powers and remedies given to each Agent and each Lender
hereby are
Page 121
cumulative and shall be in addition to and independent of all rights, powers and
remedies existing by virtue of any statute or rule of law or in any of the other
Credit Documents or any of the Hedge Agreements. Any forbearance or failure to
exercise, and any delay in exercising, any right, power or remedy hereunder
shall not impair any such right, power or remedy or be construed to be a waiver
thereof, nor shall it preclude the further exercise of any such right, power or
remedy.
10.10. MARSHALLING; PAYMENTS SET ASIDE. Neither any Agent nor any Lender
shall be under any obligation to marshal any assets in favor of any Credit Party
or any other Person or against or in payment of any or all of the Obligations.
To the extent that any Credit Party makes a payment or payments to
Administrative Agent or Lenders (or to Administrative Agent, on behalf of
Lenders), or Administrative Agent or Lenders enforce any security interests or
exercise their rights of setoff, and such payment or payments or the proceeds of
such enforcement or setoff or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, any
other state or federal law, common law or any equitable cause, then, to the
extent of such recovery, the obligation or part thereof originally intended to
be satisfied, and all Liens, rights and remedies therefor or related thereto,
shall be revived and continued in full force and effect as if such payment or
payments had not been made or such enforcement or setoff had not occurred.
10.11. SEVERABILITY. In case any provision in or obligation hereunder or
any Note shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.12. OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS. The
obligations of Lenders hereunder are several and no Lender shall be responsible
for the obligations or Commitment of any other Lender hereunder. Nothing
contained herein or in any other Credit Document, and no action taken by Lenders
pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out hereof and it shall not be necessary for any other Lender to
be joined as an additional party in any proceeding for such purpose.
10.13. ENTIRE AGREEMENT. This Agreement (together with the schedules
hereto, the letter agreements dated the date hereof and making specific
reference hereto, exhibits hereto, annexes hereto and the other agreements,
documents and instruments delivered pursuant hereto) and the Credit Documents
and Related Agreements constitute the entire agreement among the parties or any
of them with respect to the subject matter hereof and thereof and supersede all
other prior agreements and understandings, both written and verbal, among the
parties or any of them with respect to the subject matter hereof.
10.14. HEADINGS. Section headings herein are included herein for
convenience of reference only and shall not constitute a part hereof for any
other purpose or be given any substantive effect.
Page 122
10.15. APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT
OF LAWS PRINCIPLES THEREOF.
10.16. CONSENT TO JURISDICTION. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST
ANY CREDIT PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT,
OR ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇. BY EXECUTING
AND DELIVERING THIS AGREEMENT, EACH CREDIT PARTY, FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, IRREVOCABLY (A) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (B) WAIVES ANY DEFENSE OF
FORUM NON CONVENIENS; (C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO THE APPLICABLE CREDIT PARTY AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SECTION 10.1; (D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE CREDIT
PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (E) AGREES AGENTS AND
LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST ANY CREDIT PARTY IN THE COURTS OF ANY OTHER
JURISDICTION.
10.17. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR
ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN
TRANSACTION OR THE LENDER/COMPANY RELATIONSHIP THAT IS BEING ESTABLISHED. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS
TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND
ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT
THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT
EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT
EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH
PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER
WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS
Page 123
WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN
WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS
SECTION 10.17 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
HERETO OR ANY OF THE OTHER CREDIT DOCUMENTS OR TO ANY OTHER DOCUMENTS OR
AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. IN THE EVENT OF LITIGATION,
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
10.18. CONFIDENTIALITY. Each Lender shall hold all non-public information
obtained pursuant to the requirements hereof which has been identified as
confidential by Company in accordance with such Lender's customary procedures
for handling confidential information of this nature and in accordance with
prudent lending or investing practices, it being understood and agreed by
Company that in any event a Lender may make disclosures to Affiliates of such
Lender (and to other persons authorized by a Lender or Agent to organize,
present or disseminate such information in connection with disclosures otherwise
made in accordance with this Section 10.18), disclosures reasonably required by
any bona fide or potential assignee, transferee or participant in connection
with the contemplated assignment, transfer or participation by such Lender of
any Loans or any participations therein or by any direct or indirect contractual
counterparties (or the professional advisors thereto) in Hedge Agreements
(provided, such counterparties and advisors are advised of and agree to be bound
by the provisions of this Section 10.18) or disclosures required or requested by
any governmental agency or representative thereof or by the NAIC or pursuant to
legal process; PROVIDED, unless specifically prohibited by applicable law or
court order, each Lender shall make reasonable efforts to notify Company of any
request by any governmental agency or representative thereof (other than any
such request in connection with any examination of the financial condition or
other routine examination of such Lender by such governmental agency) for
disclosure of any such non-public information prior to disclosure of such
information.
10.19. USURY SAVINGS CLAUSE. Notwithstanding any other provision herein,
the aggregate interest rate charged with respect to any of the Obligations,
including all charges or fees in connection therewith deemed in the nature of
interest under applicable law shall not exceed the Highest Lawful Rate. If the
rate of interest (determined without regard to the preceding sentence) under
this Agreement at any time exceeds the Highest Lawful Rate, the outstanding
amount of the Loans made hereunder shall bear interest at the Highest Lawful
Rate until the total amount of interest due hereunder equals the amount of
interest which would have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect. In addition, if when
the Loans made hereunder are repaid in full the total interest due hereunder
(taking into account the increase provided for above) is less than the total
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect, then to
the extent permitted by law, Company shall pay to Administrative Agent an amount
equal to the difference between the amount of interest paid and the amount of
interest which would have been paid if the Highest Lawful Rate had at all times
been in effect. Notwithstanding the foregoing, it is the intention of Lenders
and Company to conform strictly to any applicable usury laws. Accordingly, if
any Lender contracts for, charges, or receives any consideration which
constitutes interest in excess of the Highest Lawful
Page 124
Rate, then any such excess shall be cancelled automatically and, if previously
paid, shall at such Lender's option be applied to the outstanding amount of the
Loans made hereunder or be refunded to Company.
10.20. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.
10.21. EFFECTIVENESS. This Agreement shall become effective upon the
execution of a counterpart hereof by each of the parties hereto and receipt by
Company and Administrative Agent of written or telephonic notification of such
execution and authorization of delivery thereof.
[Remainder of page intentionally left blank]
Page 125
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
COMPANY: VICAR OPERATING, INC.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer and President
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Financial Officer and Assistant
Secretary
HOLDINGS: VETERINARY CENTERS OF AMERICA, INC.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer and President
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Financial Officer and Assistant
Secretary
GUARANTORS: AAH MERGER CORPORATION
ACADEMY ANIMAL, INC.
▇▇▇▇▇▇▇▇ ANIMAL HOSPITAL, INC.
ANIMAL EMERGENCY CLINIC, P.C.
ANIMAL CLINIC OF SANTA ▇▇▇▇, INC.
BEAUMONT VETERINARY ASSOCIATES, P.C.
BERLA, INC.
CACOOSING ANIMAL HOSPITAL, LTD.
CACOOSING PET CARE & NUTRITION CENTER, INC.
CLARMAR ANIMAL HOSPITAL, INC.
▇▇▇▇▇▇▇▇ VETERINARY CLINIC, INC.
DIAGNOSTIC VETERINARY SERVICE, INC.
EAGLE PARK ANIMAL CLINIC, INC.
EAGLE RIVER VETERINARY HOSPITAL, INC.
EDGEBROOK, INC.
FLORIDA VETERINARY LABORATORIES, INC.
FOX CHAPEL ANIMAL HOSPITAL, INC.
FREEHOLD, INC.
▇▇▇▇ ANIMAL HOSPITAL, INC.
Page 126
GOLDEN MERGER CORPORATION
H.B. ANIMAL CLINICS, INC.
HOWELL BRANCH ANIMAL HOSPITAL, P.A.
HIGHLANDS ANIMAL HOSPITAL, INC.
LAKE ▇▇▇▇▇▇▇ VETERINARY CLINIC, INC.
LAKEWOOD ANIMAL HOSPITAL, INC.
▇▇▇▇▇▇▇ VETERINARY HOSPITAL, INC.
▇▇▇▇▇▇▇▇▇ VETERINARY CLINIC, INC.
▇▇▇▇▇▇ ANIMAL HOSPITAL
M.S. ANIMAL HOSPITALS, INC.
NEWARK ANIMAL HOSPITAL, INC.
NORTHERN ANIMAL HOSPITAL, INC.
NORTH ROCKVILLE VETERINARY HOSPITAL, INC.
NORTHSIDE ANIMAL HOSPITAL, P.C.
▇▇▇▇▇ ANIMAL HOSPITAL, INC.
OAK HILL VETERINARY HOSPITAL, INC.
OLD TOWN VETERINARY HOSPITAL, INC.
PET PRACTICE (MASSACHUSETTS), INC.
PETS' RX, INC.
PETS' RX NEVADA, INC.
PPI OF PENNSYLVANIA, INC.
PRINCETON ANIMAL HOSPITAL, INC.
PROFESSIONAL VETERINARY SERVICES, INC.
RIVIERA ANIMAL HOSPITAL, INC.
▇▇▇▇▇▇▇▇▇ BLVD. ANIMAL HOSPITAL, INC.
ROSSMOOR - ELDORADO ANIMAL HOSPITAL, INC.
ROSSMOOR CENTER ANIMAL CLINIC, INC.
SAN ▇▇▇▇▇▇▇ ANIMAL CLINIC
SILVER SPUR ANIMAL HOSPITAL, INC.
SOUTH COUNTY VETERINARY CLINIC, INC.
SPANISH RIVER ANIMAL HOSPITAL, INC.
TAMPA ANIMAL MEDICAL CENTER, INC.
THE PET PRACTICE (FLORIDA), INC.
THE PET PRACTICE (ILLINOIS), INC.
THE PET PRACTICE (MASSACHUSETTS), INC.
THE PET PRACTICE OF MICHIGAN, INC.
VCA ALABAMA, INC.
VCA ALBANY ANIMAL HOSPITAL, INC.
VCA ALBUQUERQUE, INC.
VCA ALL PETS ANIMAL COMPLEX, INC.
VCA ALPINE ANIMAL HOSPITAL, INC.
VCA ▇▇▇▇▇▇▇▇ OF CALIFORNIA ANIMAL HOSPITAL, INC.
VCA ANIMAL HOSPITALS, INC.
VCA ANIMAL HOSPITAL WEST, INC.
VCA APAC ANIMAL HOSPITAL, INC.
Page 127
VCA - ▇▇▇▇▇, INC.
VCA BAY AREA ANIMAL HOSPITAL, INC.
VCA CACOOSING ANIMAL HOSPITAL, INC.
VCA CASTLE ▇▇▇▇▇▇▇ VETERINARY HOSPITAL, INC.
VCA CENTERS-TEXAS, INC.
VCA CENVET, INC
VCA CLARMAR ANIMAL HOSPITAL, INC.
VCA CLINICAL VETERINARY LABS, INC.
VCA CLINIPATH LABS, INC.
VCA CLOSTER, INC.
VCA ▇▇▇▇▇▇▇▇ ANIMAL HOSPITAL, INC.
VCA DOVER ANIMAL HOSPITAL, INC.
VCA EAGLE RIVER ANIMAL HOSPITAL, INC.
VCA EAST ANCHORAGE ANIMAL HOSPITAL, INC.
VCA GOLDEN COVE ANIMAL HOSPITAL, INC.
VCA GREATER SAVANNAH ANIMAL HOSPITAL, INC.
VCA HOWELL BRANCH ANIMAL HOSPITAL, INC.
VCA INFORMATION SYSTEMS, INC.
VCA KANEOHE ANIMAL HOSPITAL, INC.
VCA LAKESIDE ANIMAL HOSPITAL, INC.
VCA LAMB AND ▇▇▇▇▇▇▇ ANIMAL HOSPITAL, INC.
VCA ▇▇▇▇▇▇▇ ANIMAL HOSPITAL, INC.
VCA ▇▇▇▇▇ ANIMAL HOSPITAL, INC.
VCA MARINA ANIMAL HOSPITAL, INC.
VCA ▇▇▇▇▇▇ ANIMAL HOSPITAL, INC.
VCA MISSION, INC.
VCA NORTHBORO ANIMAL HOSPITAL, INC.
VCA NORTHWEST VETERINARY DIAGNOSTICS, INC.
VCA OF COLORADO-▇▇▇▇▇▇▇▇, INC.
VCA OF NEW YORK, INC.
VCA OF SAN ▇▇▇▇, INC.
VCA OF ▇▇▇▇▇▇▇▇, INC.
VCA PROFESSIONAL ANIMAL LABORATORY, INC.
VCA REAL PROPERTY ACQUISITION CORPORATION
VCA REFERRAL ASSOCIATES ANIMAL HOSPITAL, INC.
VCA ▇▇▇▇▇▇ ANIMAL HOSPITAL, INC.
VCA - ROSSMOOR, INC.
VCA SILVER SPUR ANIMAL HOSPITAL, INC.
VICA SOUTH SHORE ANIMAL HOSPITAL, INC.
VCA SPECIALTY PET PRODUCTS, INC.
VCA SQUIRE ANIMAL HOSPITAL, INC.
VCA ST. PETERSBURG ANIMAL HOSPITAL, INC.
VCA TEXAS MANAGEMENT, INC.
VCA WYOMING ANIMAL HOSPITAL, INC.
VETERINARY HOSPITALS, INC.
WEST LOS ANGELES VETERINARY MEDICAL
GROUP, INC.
Page 128
WESTWOOD DOG & CAT HOSPITAL
W.E. ▇▇▇▇▇▇▇▇, D.V.M., WORTH ANIMAL
HOSPITAL, CHARTERED
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, D.V.M., LTD.
▇▇▇▇▇▇▇, INC.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer and President
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Financial Officer and Assistant
Secretary
VCA VILLA ANIMAL HOSPITAL, L.P.
By: VCA Animal Hospitals, Inc.,
General Partner
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer and President
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Financial Officer and Assistant
Secretary
VETERINARY CENTERS OF AMERICA-TEXAS, L.P.
By: VCA Centers-Texas, Inc.,
General Partner
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Executive Officer and President
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Financial Officer and Assistant
Secretary
Page 129
SOLE LEAD ARRANGER,
SOLE SYNDICATION AGENT AND
A LENDER: ▇▇▇▇▇▇▇ SACHS CREDIT PARTNERS L.P.
By: /S/
---------------------------------------
Authorized Signatory
Page 130
ADMINISTRATION AGENT,
SWING LINE LENDER AND
A LENDER: ▇▇▇▇▇ FARGO BANK, N.A.,
By: /S/ S. ▇▇▇▇▇▇▇ ST. GEME
-------------------------------------
Name: S. ▇▇▇▇▇▇▇ St. Geme
Title: Vice President
Page 131