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EXHIBIT 10.6
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CREDIT AGREEMENT
Dated as of January 31, 2001
among
CERIDIAN CORPORATION
(DBA THE ARBITRON COMPANY),
as the Borrower,
BANK OF AMERICA, N.A.,
as the Administrative Agent
and
Letter of Credit Issuer,
and
The Other Lenders Party Hereto
BANC OF AMERICA SECURITIES LLC,
as
Sole Lead Arranger and Sole Book Manager
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TABLE OF CONTENTS
Section Page
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS..................................................1
1.01 Defined Terms.................................................................1
1.02 Other Interpretive Provisions................................................25
1.03 Accounting Terms.............................................................26
1.04 Rounding.....................................................................26
1.05 References to Agreements and Laws............................................26
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS...........................................26
2.01 Loans........................................................................26
2.02 Borrowings, Conversions and Continuations of Loans...........................26
2.03 Letters of Credit............................................................28
2.04 Optional Prepayments.........................................................34
2.05 Mandatory Prepayments........................................................35
2.06 Reduction or Termination of Commitments......................................35
2.07 Repayment of Loans...........................................................37
2.08 Interest.....................................................................37
2.09 Fees.........................................................................38
2.10 Computation of Interest and Fees.............................................38
2.11 Evidence of Debt.............................................................38
2.12 Payments Generally...........................................................39
2.13 Sharing of Payments..........................................................41
2.14 Security and Guaranties......................................................41
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY.........................................42
3.01 Taxes........................................................................42
3.02 Illegality...................................................................43
3.03 Inability to Determine Rates.................................................43
3.04 Increased Cost and Reduced Return; Capital Adequacy..........................44
3.05 Funding Losses...............................................................44
3.06 Matters Applicable to all Requests for Compensation..........................45
3.07 Survival.....................................................................45
ARTICLE IV. CONDITIONS PRECEDENT............................................................46
4.01 Conditions to Effectiveness..................................................46
4.02 Conditions to Initial Credit Extension.......................................49
4.03 Conditions to all Credit Extensions..........................................51
ARTICLE V. REPRESENTATIONS AND WARRANTIES...................................................52
5.01 Corporate Existence and Power................................................52
5.02 Corporate Authorization; No Contravention....................................52
5.03 Governmental Authorization...................................................53
5.04 Binding Effect...............................................................53
5.05 Litigation...................................................................53
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5.06 No Default...................................................................54
5.07 ERISA Compliance.............................................................54
5.08 Title to Properties..........................................................55
5.09 Taxes........................................................................55
5.10 Financial Condition..........................................................56
5.11 Environmental Matters........................................................56
5.12 Regulated Entities...........................................................57
5.13 Collateral Documents.........................................................57
5.14 No Burdensome Restrictions...................................................57
5.15 Solvency.....................................................................57
5.16 Labor Relations..............................................................58
5.17 Intellectual Property; Proprietary Information...............................58
5.18 Insurance....................................................................59
5.19 Employment Agreements........................................................59
5.20 Spin-Off Documents; Private Placement Documents..............................59
5.21 Capitalization; Subsidiaries.................................................59
5.22 Margin Regulations...........................................................60
5.23 Brokers; Certain Expenses....................................................60
5.24 Year End.....................................................................60
5.25 Third Party Consents.........................................................60
5.26 Existing Indebtedness........................................................61
5.27 New Ceridian Obligations.....................................................61
5.28 Swap Contracts...............................................................61
5.29 Full Disclosure..............................................................61
ARTICLE VI. AFFIRMATIVE COVENANTS...........................................................61
6.01 Financial Statements.........................................................61
6.02 Certificates; Other Information..............................................62
6.03 Notices......................................................................63
6.04 Preservation of Corporate Existence, Etc.....................................65
6.05 Maintenance of Property......................................................65
6.06 Insurance....................................................................66
6.07 Payment of Obligations.......................................................66
6.08 Compliance with Laws.........................................................66
6.09 ERISA Compliance.............................................................67
6.10 Interest Rate Protection.....................................................67
6.11 Inspection of Property and Books and Records.................................67
6.12 Environmental Laws...........................................................67
6.13 Use of Proceeds..............................................................67
6.14 Additional Guarantors........................................................68
6.15 Additional Subsidiaries......................................................68
6.16 Additional Intellectual Property.............................................68
6.17 Licenses.....................................................................69
6.18 Further Assurances...........................................................69
ARTICLE VII. NEGATIVE COVENANTS.............................................................70
7.01 Limitation on Liens..........................................................70
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7.02 Mergers and Consolidations...................................................72
7.03 Indebtedness.................................................................72
7.04 Disposition of Assets........................................................73
7.05 Contingent Obligations.......................................................75
7.06 Loans and Investments........................................................76
7.07 Dividends and Payments.......................................................77
7.08 Use of Proceeds..............................................................77
7.09 Hostile Acquisition..........................................................78
7.10 Leverage Ratio...............................................................78
7.11 Fixed Charge Coverage Ratio..................................................78
7.12 Foreign Subsidiaries.........................................................79
7.13 Change in Business...........................................................79
7.14 Accounting Changes...........................................................79
7.15 Certain Contracts............................................................79
7.16 Transactions with Affiliates.................................................80
7.17 Capital Expenditures.........................................................80
7.18 Sales and Leasebacks.........................................................81
7.19 Certain Tax Matters..........................................................81
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES................................................81
8.01 Events of Default............................................................81
8.02 Remedies Upon Event of Default...............................................84
ARTICLE IX. ADMINISTRATIVE AGENT............................................................85
9.01 Appointment and Authorization of Administrative Agent........................85
9.02 Delegation of Duties.........................................................85
9.03 Liability of Administrative Agent............................................85
9.04 Reliance by Administrative Agent.............................................86
9.05 Notice of Default............................................................86
9.06 Credit Decision; Disclosure of Information by Administrative Agent...........87
9.07 Indemnification of Administrative Agent......................................87
9.08 Administrative Agent in its Individual Capacity..............................88
9.09 Successor Administrative Agent...............................................88
9.10 Other Agents; Lead Managers..................................................88
9.11 Collateral Matters...........................................................89
ARTICLE X. MISCELLANEOUS....................................................................89
10.01 Amendments, Etc..............................................................89
10.02 Notices and Other Communications; Facsimile Copies...........................91
10.03 No Waiver; Cumulative Remedies...............................................92
10.04 Attorney Costs, Expenses and Taxes...........................................92
10.05 Indemnification by the Borrower..............................................92
10.06 Payments Set Aside...........................................................93
10.07 Successors and Assigns.......................................................96
10.08 Confidentiality..............................................................97
10.09 Set-off......................................................................97
10.10 Interest Rate Limitation.....................................................97
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10.11 Counterparts.................................................................97
10.12 Integration..................................................................97
10.13 Survival of Representations and Warranties...................................97
10.14 Severability.................................................................98
10.15 Foreign Lenders..............................................................98
10.16 Removal and Replacement of Lenders...........................................99
10.17 Governing Law................................................................99
10.18 Waiver of Right to Trial by Jury............................................100
SCHEDULES
1.01(e) Existing Letters of Credit
1.01(i) Initial Permitted Indebtedness
1.01(s) Spin-Off Documents
2.01 Commitments and Pro Rata Shares
5.05 Litigation Affecting Loan Parties
5.07 ERISA Compliance
5.10 Contingent Obligations
5.11 Environmental Matters
5.17 Intellectual Property; Proprietary Information
5.19 Employment Agreements
5.21 Capitalization; Subsidiaries
5.23 Brokers' Fees and Related Expenses
5.25 Third Party Consents
7.01 Permitted Liens
7.02(b) Permitted Transactions
7.06(b) Permitted Investments
10.02 Eurodollar and Domestic Lending Offices, Addresses for Notices
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EXHIBITS
FORM OF
A Loan Notice
B Loan Note
C Compliance Certificate
D Assignment and Acceptance
E New Ceridian Guaranty
F Subsidiary Guaranty
G Borrower Security Agreement
H Subsidiary Security Agreement
I Supplemental IP Security Agreement
J Borrower Pledge Agreement
K Subsidiary Pledge Agreement
L Effectiveness Date Opinion of Counsel (Content Summary)
M Closing Date Opinion of Counsel (Content Summary)
N Additional Guarantor Assumption Agreement
O Additional Guarantor Opinion of Counsel
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CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of January ___,
2001, among CERIDIAN CORPORATION, a Delaware corporation (the "Borrower"), each
lender from time to time party hereto (collectively, the "Lenders" and
individually, a "Lender"), BANK OF AMERICA, N.A., as the Administrative Agent
and L/C Issuer, and FLEET NATIONAL BANK, as the Syndication Agent.
The Borrower has requested that the Lenders provide a revolving credit
facility, and the Lenders are willing to do so on the terms and conditions set
forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS. As used in this Agreement, the following terms
shall have the meanings set forth below:
"Account Control Agreement" means any account control agreement, deposit
account control agreement, lockbox or other agreement with any securities
intermediary or depository granting control with respect to any investment
property or deposit account for purposes of Article 9 of the UCC or other
applicable law.
"Acquisition" means, as to the Borrower and each of its Subsidiaries,
any transaction or series of related transactions for the purpose of or
resulting directly or indirectly in (a) the acquisition of all or substantially
all of the assets of a Person, or of any business or division of a Person, (b)
the acquisition of in excess of 50% of the capital stock, partnership interests,
membership interests or equity of any Person, or otherwise causing any Person to
become a Subsidiary, or (c) a merger or consolidation or any other combination
with another Person (other than a Person that is a Subsidiary).
"Additional Guarantor Assumption Agreement" has the meaning specified in
Section 6.14(a).
"Administrative Agent" means Bank of America in its capacity as the
administrative agent under any of the Loan Documents, or any successor
administrative agent, and, to the extent applicable, in its capacity as
"Collateral Agent" under and as defined in the Intercreditor Agreement.
"Administrative Agent's Office" means the Administrative Agent's address
and, as appropriate, account as set forth on Schedule 10.02, or such other
address or account as the Administrative Agent may from time to time notify to
the Borrower and the Lenders.
"Affiliate" means, as to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or
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indirectly, power (a) to vote 15% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or managing
general partners; or (b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Agent/Arranger Fee Letter" has the meaning specified in Section
2.09(b).
"Agent-Related Persons" means the Administrative Agent (including any
successor administrative agent), together with its Affiliates (including, in the
case of Bank of America in its capacity as the Administrative Agent, the
Arranger), and the officers, directors, employees, agents and attorneys-in-fact
of such Persons and Affiliates.
"Aggregate Distributable Income" means an amount equal to 50% of
Consolidated Net Income (positive or negative) calculated on a cumulative basis,
based on the year-end financial statements delivered to the Administrative Agent
pursuant to Section 6.01(a); provided that any and all amounts paid pursuant to
Section 7.07(a)(iv) or pursuant to any equivalent provision in the Private
Placement Documents shall reduce the amount of Aggregate Distributable Income on
a dollar for dollar basis.
"Aggregate Commitments" has the meaning set forth in the definition of
"Commitment."
"Agreement" means this Credit Agreement.
"Applicable Rate" means the following percentages per annum, each based
upon the applicable "Pricing Level":
APPLICABLE RATE
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Eurodollar
Rate +
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Pricing Commitment Letters of Base Rate
Level Leverage Ratio Fee Credit +
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1 Less than or equal to 0.375% 2.00% 0.500%
1.50:1
2 Less than or equal to 0.400% 2.125% 0.750%
2.00:1 but greater
than 1.50:1
3 Less than or equal to 0.425% 2.250% 0.875%
2.50:1 but greater
than 2.00:1
4 Less than or equal to 0.475% 2.375% 1.000%
3.00:1 but greater
than 2.50:1
5 Less than or equal to 0.500% 2.500% 1.125%
3.50:1 but greater
than 3.00:1
6 Greater than 3.50:1 0.550% 2.750% 1.250%
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Initially, and at all times during the first 180 days after the Closing Date,
the applicable Pricing Level shall be Level 5 unless the Leverage Ratio, as
evidenced in the pro forma Compliance Certificate delivered on the Closing Date
or thereafter (based on the Compliance Certificates delivered under Section
6.02(a)), equates to ▇▇▇▇▇ ▇, in which case the applicable Pricing Level shall
be Level 6 thereafter for the balance of such 180-day period. Each change in the
Applicable Rate based on a change of the Leverage Ratio shall be effective five
Business Days after the date the most recent Compliance Certificate is received
by the Administrative Agent until but excluding the date five Business Days
after the next Compliance Certificate is received. In the event that the
Borrower shall fail to deliver the Compliance Certificate within the time period
provided by Section 6.02(a), then, without limitation of the Lenders' other
rights and remedies hereunder, the Pricing Level shall be Level 6 from the date
upon which such Compliance Certificate was due under Section 6.02(a) until the
date upon which such Compliance Certificate is actually received by the
Administrative Agent.
"Arbitron Business" means collectively the businesses of: (a) providing
media and marketing research services to broadcasters, advertising agencies,
advertisers, on-line webcasters and cable television; (b) providing media
audience and consumer retail behavior research services to cable systems,
broadcasters, magazines, advertising agencies and newspapers; and (c) providing
application software used to access and analyze media audience information and
software applications to access and analyze consumer retail behavior and media
usage.
"Arbitron Subsidiaries" means, at all times prior to the Spin-Off
Consummation Date, those Subsidiaries designated as Arbitron Subsidiaries on
Schedule 5.21 and, at all times after the Spin-Off Consummation Date, all
Subsidiaries of the Borrower.
"Arranger" means Banc of America Securities LLC, in its capacity as sole
lead arranger and sole book manager.
"Assignment and Acceptance" means an Assignment and Acceptance
substantially in the form of Exhibit D.
"Attorney Costs" means and includes all fees and disbursements of any
law firm or other external counsel and the non-duplicative allocated cost of
internal legal services and all disbursements of internal counsel.
"Attributable Indebtedness" means, on any date, (a) in respect of any
Capital Lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a Capital Lease.
"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal years ended December
31, 1998 and December 31, 1999 (in each case, giving effect to the Spin-Off
Transaction) and the related consolidated statements of income and cash flows
for the fiscal years of the Borrower ended December 31,
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1997, December 31, 1998 and December 31, 1999, each in the final form attached
to the Form 10.
"Bank of America" means Bank of America, N.A.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." Such rate is a rate set by Bank of America based
upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Borrower" has the meaning set forth in the introductory paragraph
hereto.
"Borrower Pledge Agreement" means a Pledge Agreement executed by the
Borrower, in substantially the form of Exhibit J.
"Borrower Security Agreement" means a Security Agreement executed by the
Borrower, in substantially the form of Exhibit G.
"Borrowing" means a borrowing consisting of simultaneous Loans of the
same Type and having the same Interest Period made by each of the Lenders
pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday, or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the Administrative Agent's Office is located
and, if such day relates to any Eurodollar Rate Loan, means any such day on
which dealings in Dollar deposits are conducted by and between banks in the
applicable offshore Dollar interbank market.
"Capital Lease" means, as applied to any Person, any lease of property
by such Person as lessee that is classified as a capital lease under GAAP.
"Cash Collateralize" means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, as
collateral for the L/C Obligations, cash or deposit account balances pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented to
by the Lenders). Derivatives of such term shall have corresponding meaning.
Effective as of the time of such pledge, deposit or delivery, the Borrower
hereby grants the Administrative Agent, for the benefit of the L/C Issuer and
the Lenders, a Lien on all such cash and deposit account balances. Cash
collateral shall be maintained in blocked, non-interest bearing deposit accounts
at the Administrative Agent as depository.
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"Cash Equivalents" means:
(a) securities issued or fully guaranteed or insured by the United
States Government or any agency thereof, having maturities of not more than six
months from the date of acquisition;
(b) certificates of deposit, time deposits, Eurodollar time
deposits, repurchase agreements, reverse repurchase agreements, or bankers'
acceptances, having in each case a tenor of not more than six months, issued by
any Lender, or by any U.S. commercial or investment bank or broker having
combined capital and surplus of not less than $100,000,000 whose short term
securities are rated at least A-1 by S&P and P-1 by Moody's;
(c) commercial paper or promissory notes of an issuer rated at least
A-1 by S&P or P-1 by Moody's and in either case having a tenor of not more than
three months; and
(d) money market funds that comply with all material provisions of
Rule 2a-7 issued by the SEC under the Investment Company Act of 1940.
"Change of Control" means, with respect to the Borrower, an event or
series of events by which:
(a) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of the Borrower or its Subsidiaries, or any Person acting
in its capacity as trustee, agent or other fiduciary or administrator of any
such plan), becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Securities Exchange Act of 1934, except that a person shall be deemed
to have "beneficial ownership" of all securities that such person has the right
to acquire (such rights, "option rights"), whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of 30%
or more of the equity interests of the Borrower on a partially diluted basis
taking into account equity interests realizable upon the exercise of such
person's or group's option rights; or
(b) during any period of 12 consecutive months, a majority of the
members of the board of directors or other equivalent governing body of the
Borrower ceases to be composed of individuals (i) who were members of that board
or equivalent governing body on the first day of such period, (ii) whose
election or nomination to that board or equivalent governing body was approved
by individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body, or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body.
"Closing Date" means the first date all the conditions precedent in
Section 4.02 are satisfied or waived in accordance with Section 4.02.
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"Co-Agent" means Fleet National Bank in its capacity as syndication
agent hereunder.
"Code" means the Internal Revenue Code of 1986.
"Collateral" means all property and interests in property and proceeds
thereof now owned or hereafter acquired by the Borrower or any Guarantor and
their respective Subsidiaries in or upon which a Lien now or hereafter exists in
favor of the Lenders, or the Administrative Agent on behalf of the Lenders,
whether under this Agreement or under any other Collateral Documents.
"Collateral Agent" has the meaning specified in the Intercreditor
Agreement.
"Collateral Documents" means, collectively, (i) the Security Agreements,
(ii) the Pledge Agreements, (iii) all Account Control Agreements executed and
delivered pursuant to any other Loan Document, (iv) all documents executed by
the Borrower to accomplish Cash Collateralization or pledges of deposit
accounts, and (v) all licenses, UCC financing statements, notices and other
documents executed from time to time under or in connection with the foregoing.
"Commitment" means, as to each Lender, its obligation (a) to make Loans
to the Borrower pursuant to Section 2.01, and (b) to purchase participations in
L/C Obligations, in an aggregate principal amount at any one time outstanding
not to exceed the amount set forth opposite such Lender's name on Schedule 2.01,
as such amount may be reduced or adjusted from time to time in accordance with
this Agreement (collectively, the "Aggregate Commitments").
"Compensation Period" has the meaning specified in Section 2.12(d)(ii).
"Compliance Certificate" means a certificate substantially in the form
of Exhibit C.
"Consolidated EBITDA" means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated Net Income, plus (b) Consolidated Interest Expense, plus (c) the
amount of taxes, based on or measured by income, used or included in the
determination of such Consolidated Net Income, plus (d) the amount of all
depreciation expense and amortization expense for such period, less (e) interest
income for such period; provided, however, that Consolidated Net Income shall be
computed for these purposes without giving effect to (i) extraordinary non-cash
losses or non-cash gains, or (ii) non-cash losses or non-cash gains from
discontinued operations, except that cash payments made in any current period in
respect of non-cash charges incurred under clause (i) or (ii) in any previous
period shall be deducted from Consolidated Net Income in such current period.
"Consolidated Funded Indebtedness" means, as of any date of
determination, for Borrower and its Subsidiaries on a consolidated basis, all
(a) obligations for borrowed money, (b) obligations evidenced by bonds,
debentures, notes and loan agreements, (c) obligations in respect of letters of
credit, surety bonds, bankers' acceptances or similar instruments, (d)
obligations to pay the deferred purchase price of property or services (other
than trade payables entered into in the Ordinary Course of Business pursuant to
ordinary terms and paid within the specified time), (e) Attributable
Indebtedness incurred by the Borrower or any of its Subsidiaries in connection
with Synthetic Lease Obligations and Capital Leases and (f) Guaranty
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Obligations of the Borrower and its Subsidiaries in respect of obligations of
any Person in the nature of (a) through (d) above.
"Consolidated Interest Expense" means, for any period, for the Borrower
and its Subsidiaries on a consolidated basis, the sum of (a) all interest,
premium payments, fees, charges and related expenses of the Borrower and its
Subsidiaries in connection with borrowed money (including capitalized interest)
or in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, but excluding any fees,
charges and expenses of the Borrower and its Subsidiaries arising from the
negotiation, execution, closing and consummation of the Spin-Off Documents and
the "Facility Documents" (as such term is defined in the Intercreditor
Agreement); and (b) the portion of rent expense of the Borrower and its
Subsidiaries with respect to such period under Capital Leases that is treated as
interest in accordance with GAAP.
"Consolidated Net Income" means, for any period, for the Borrower and
its Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries, as determined in accordance with GAAP.
"Consolidated Net Worth" means, as of any date of determination, with
respect to the Borrower and its Subsidiaries on a consolidated basis,
shareholders' equity on the date of determination as determined in accordance
with GAAP.
"Consolidated Total Assets" means, as of any date of determination, the
total consolidated assets of the Borrower and its Subsidiaries as determined in
accordance with GAAP.
"Contingent Obligation" means, as to the Borrower or any of its
Subsidiaries, (a) any Guaranty Obligation of that Person; (b) any reimbursement
obligation of that Person with respect to a standby letter of credit, surety
bond, banker's acceptance, bank guaranty or similar instrument; (c) any
obligation of that Person to purchase any materials, supplies or other property
from, or to obtain the services of, another Person (other than the Borrower or
one of its Subsidiaries) if the relevant contract or other related document or
obligation requires that payment for such materials, supplies or other property,
or for such services, shall be made regardless of whether delivery of such
materials, supplies or other property is ever made or tendered, or such services
are ever performed or tendered; and (d) all Indebtedness (other than that of the
Borrower or any of its Subsidiaries) secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property (including accounts and contract rights) owned by the
Borrower or any such Subsidiary.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Credit Extension" means each of the following: (a) a Borrowing, and (b)
an L/C Credit Extension.
"Current Portion of Long Term Debt" means, as of any date of
determination, in respect of the Borrower and its Subsidiaries on a consolidated
basis, (a) current portion of long term debt
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as determined on such date in accordance with GAAP, plus (b) an amount equal to
the amount, if any, by which the Outstanding Amount on such date exceeds (i) the
Aggregate Commitments on such date less (ii) the amount of any mandatory
reduction in Aggregate Commitments scheduled to occur within the four fiscal
quarter period commencing on such date pursuant to Section 2.06(b)(i); provided,
however, during the 365 days prior to the scheduled Maturity Date (under clause
(a) of the definition of such term), "Current Portion of Long Term Debt" shall
be calculated excluding the then-Outstanding Amount.
"Debtor Relief Laws" means the Bankruptcy Code of the United States of
America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States of America or
other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.
"Default" means any event that, with the giving of any notice, the
passage of time, or both, would be an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus
(b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each
case to the fullest extent permitted by applicable Laws.
"Disposition" or "Dispose" means the direct or indirect sale,
assignment, conveyance, lease, transfer, license or other disposition (including
any sale and leaseback transaction) of any property (other than cash or Cash
Equivalents) by any Person, including any sale, assignment, transfer or other
disposition, with or without recourse, of any notes or accounts receivable or
any rights and claims associated therewith.
"Distribution" means the distribution by dividend of all stock of New
Ceridian held by the Borrower to the Borrower's shareholders, pursuant to a
tax-free transaction under Section 355 of the Code and undertaken pursuant to
the Spin-Off Documents.
"Dollar" and "$" means lawful money of the United States of America.
"EBITDA" means, in respect of any Person, for any period as determined
in accordance with GAAP, an amount equal to the sum of (a) net income, plus (b)
interest expense, plus (c) the amount of taxes, based on or measured by income,
used or included in the determination of such net income, plus (d) the amount of
all depreciation expense and amortization expense for such period, less (e)
interest income for such period; provided, however, that net income shall be
computed for these purposes without giving effect to (i) extraordinary non-cash
losses or non-cash gains, or (ii) non-cash losses or non-cash gains from
discontinued operations, except that cash payments made in any current period in
respect of non-cash charges incurred under clause (i) or (ii) in any previous
period shall be deducted from consolidated net income in such current period.
8.
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"Effectiveness Date" means the first day all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 4.01 (or, in the
case of Section 4.01(c), waived by the Person entitled to receive the applicable
payment).
"Eligible Assignee" has the meaning specified in Section 10.07(h).
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law or for release or injury
to the environment or threat to public health, personal injury (including
sickness, disease or death), property damage, natural resources damage, or
otherwise alleging liability or responsibility for damages (punitive or
otherwise), cleanup, removal, remedial or response costs, restitution, civil or
criminal penalties, injunctive relief, or other type of relief, resulting from
or based upon (a) the alleged or actual presence, placement, migration,
spillage, leakage, disposal, discharge, emission or release of any Hazardous
Material at, in, or from property, whether or not owned by the Borrower, or (b)
any other circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
"Environmental Laws" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations,
registration requirements and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental and land use matters or
health and safety matters involving Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974 and
any regulations issued pursuant thereto.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is currently or at any relevant time in the past was under
common control with the Borrower within the meaning of Section 414(b) or (c) of
the Code (and Sections 414(m) and (o) of the Code for purposes of provisions
relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which would reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon the Borrower or any ERISA Affiliate.
9.
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"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent
pursuant to the following formula:
Eurodollar Rate = Eurodollar Base Rate
--------------------------------------------
1.00 -- Eurodollar Reserve Percentage
Where,
"Eurodollar Base Rate" means, for such Interest Period:
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of the
Telerate screen that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day of such
Interest Period) with a term equivalent to such Interest Period, determined as
of approximately 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, or
(b) in the event the rate referenced in the preceding subsection (a)
does not appear on such page or service or such page or service shall cease to
be available, the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or other service
that displays an average British Bankers Association Interest Settlement Rate
for deposits in Dollars (for delivery on the first day of such Interest Period)
with a term equivalent to such Interest Period, determined as of approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period, or
(c) in the event the rates referenced in the preceding subsections
(a) and (b) are not available, the rate per annum determined by the
Administrative Agent as the rate of interest (rounded upward to the next 1/16th
of 1%) at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of the Eurodollar
Rate Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America's London
Branch to major banks in the offshore Dollar market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, rounded upward to the
next 1/100th of 1%) in effect on such day, whether or not applicable to any
Lender, under regulations issued from time to time by the Board of Governors of
the Federal Reserve System for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities") having a term comparable to such Interest Period. The Eurodollar
Rate for each outstanding Eurodollar Rate Loan shall be adjusted automatically
as of the effective date of any change in the Eurodollar Reserve Percentage.
10.
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"Eurodollar Rate Loan" means a means a Loan that bears interest at a
rate based on the Eurodollar Rate.
"Event of Default" means any of the events or circumstances specified in
Article VIII.
"Event of Loss" means with respect to any asset of any Person, any of
the following: (i) any loss, destruction or damage of such asset; (ii) any sale
or transfer of such asset in connection with any pending or threatened
institution of any proceedings for the condemnation of or seizure of such asset
or of any right of any eminent domain; or (iii) any actual condemnation,
seizure, or taking, by exercise of the power of eminent domain or otherwise, of
such asset, or confiscation of such asset or requisition of the use of such
asset.
"Evergreen Letter of Credit" has the meaning specified in Section
2.03(b)(iii).
"Excess Cash Flow" means, for any fiscal year, in respect of the
Borrower and its Subsidiaries on a consolidated basis, the excess, if any, of
Consolidated EBITDA, less the sum of (a) the aggregate amount of all principal
payments made during such year pursuant to (i) Section 2.05 and (ii) the Private
Placement Documents, plus (b) Consolidated Interest Expense for such year, plus
(c) capital expenditures and (without duplication) PPM Expenditures, to the
extent such expenditures are actually made during such year and are otherwise
permitted under Article VII, plus (d) cash taxes actually paid during such year;
provided, however, that Excess Cash Flow shall be calculated without taking into
account Consolidated EBITDA, Consolidated Interest Expense, capital expenditures
or cash taxes accrued or paid prior to the Spin-Off Consummation Date.
"Exchange Act" means the Securities Exchange Act of 1934.
"Existing Credit Facility" means that certain Amended and Restated
Credit Agreement dated as of July 31, 1997 among the Borrower, Bank of America,
as agent, and a syndicate of lenders, and after giving effect to that certain
"Waiver to Credit Agreement" entered into by such parties dated as of December
20, 2000.
"Existing Letters of Credit" means the letters of credit set forth on
Schedule 1.01(e) and issued by the "Issuing Bank" under, and as defined in, the
Existing Credit Facility.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards to the nearest 1/100 of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank on the Business Day next succeeding such day; provided that
(a) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate charged to Bank of America on such day on such
transactions as determined by the Administrative Agent.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System of the United States of America.
11.
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"Foreign Lender" has the meaning specified in Section 10.15.
"Foreign Subsidiary" means any Subsidiary of the Borrower incorporated
or organized, and existing, under the laws of any jurisdiction other than the
United States or any state thereof.
"Form 10" means, until the Closing Date, that certain Form 10 filing
prepared by New Ceridian and delivered to the SEC on or about December 6, 2000
in connection with the Spin-Off Transaction, as amended by that amendment filed
with the SEC on or about December 22, 2000, and by that amendment filed with the
SEC on or about January 22, 2001. From and after the Closing Date, the term
"Form 10" also includes: (a) any amendments to the Form 10 filed with the SEC
between the Effectiveness Date and the Closing Date to the extent permitted by
Section 4.02(a)(i)(H), and (b) any amendments filed with the SEC after the
Closing Date to the extent necessary to accommodate changes to the Spin-Off
Documents permitted by Section 7.15(c).
"Form 10 Financial Statements" means the Audited Financial Statements
plus all related unaudited financial statements of the Borrower filed with the
Form 10.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or such other principles as may be
approved by a significant segment of the accounting profession, that are
applicable to the circumstances as of the date of determination, consistently
applied.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.
"Guarantor" means each Arbitron Subsidiary party to a Guaranty and, at
all times prior to the Spin-Off Consummation Date, New Ceridian.
"Guaranties" means the Subsidiary Guaranties and the New Ceridian
Guaranty.
"Guaranty Obligation" means, as to any Person, any (a) any obligation,
contingent or otherwise, of such Person guarantying or having the economic
effect of guarantying any Indebtedness or other obligation payable or
performable by another Person (the "primary obligor") in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation, (ii) to purchase or lease
property, securities or services for the purpose of assuring the obligee in
respect of such Indebtedness or other obligation of the payment or performance
of such Indebtedness or other obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such Indebtedness or
other obligation, or (iv) entered into for the purpose of assuring in any other
manner the obligees in
12.
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respect of such Indebtedness or other obligation of the payment or performance
thereof or to protect such obligees against loss in respect thereof (in whole or
in part), or (b) any Lien on any assets of such Person securing any Indebtedness
or other obligation of any other Person, whether or not such Indebtedness or
other obligation is assumed by such Person; provided, however, that the term
"Guaranty Obligation" shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guaranty
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guaranty Obligation is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as determined by the
guarantying Person in good faith.
"Hazardous Materials" means all those substances which are regulated by,
or which may form the basis of liability under, any Environmental Law, including
all substances identified under any Environmental Law as a pollutant,
contaminant, hazardous waste, hazardous constituent, hazardous chemicals,
special waste, hazardous substance, hazardous material, regulated substance, or
toxic substance, or petroleum or petroleum derived substance or waste.
"Honor Date" has the meaning set forth in Section 2.03(c)(i).
"Indebtedness" means, as to any Person at a particular time, all of the
following:
(a) all obligations of such Person for borrowed money and
all obligations of such Person evidenced by bonds, debentures, notes,
loan agreements or other similar instruments;
(b) any fixed (non-contingent) obligations of such Person
arising under letters of credit (including standby and commercial),
banker's acceptances, bank guaranties, surety bonds and similar
instruments;
(c) net obligations under any Swap Contract in an amount
equal to (i) if such Swap Contract has been closed out, the Swap
Termination Value, or (ii) if such Swap Contract has not been closed
out, the ▇▇▇▇-to-market value thereof determined on the basis of readily
available quotations provided by any recognized dealer in such Swap
Contract;
(d) whether or not so included as liabilities in accordance
with GAAP, all obligations of such Person to pay the deferred purchase
price of property or services (other than trade payables entered into in
the Ordinary Course of Business pursuant to ordinary terms and paid
within the specified time), and indebtedness (excluding prepaid interest
thereon) secured by a Lien on property owned or being purchased by such
Person (including indebtedness arising under conditional sales or other
title retention agreements), whether or not such indebtedness shall have
been assumed by such Person or is limited in recourse; and
(e) Capital Leases and Synthetic Lease Obligations.
For all purposes hereof, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture (that is not itself a
corporation, limited liability company or limited
13.
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liability partnership) in which such Person is a general partner or a joint
venturer, unless such Indebtedness is expressly made non-recourse to such Person
except for customary exceptions acceptable to the Required Lenders. The amount
of any Capital Lease or Synthetic Lease Obligation as of any date shall be
deemed to be the amount of Attributable Indebtedness in respect thereof as of
such date. Without limiting the generality of the foregoing, any indebtedness of
the Borrower to any of the Borrower's Wholly-Owned Subsidiaries, or of any of
the Borrower's Wholly-Owned Subsidiaries to other of the Borrower's Wholly-Owned
Subsidiaries, shall not constitute Indebtedness hereunder.
"Indemnified Liabilities" has the meaning set forth in Section 10.05.
"Indemnitees" has the meaning set forth in Section 10.05.
"Initial Permitted Indebtedness" means that Indebtedness set forth on
Schedule 1.01(i).
"Intellectual Property" means all trademarks, trademark rights, trade
names, trade name rights, service marks, patents, pending patent applications,
copyrights, franchises, authorizations, inventions, Proprietary Information and
goodwill now existing or hereafter arising, and all other intellectual property
rights held or used by the Borrower and its Subsidiaries.
"Intercreditor Agreement" means that Intercreditor Agreement, dated as
of the Closing Date, entered into among the Collateral Agent, the Administrative
Agent, the Private Placement Noteholders, and the "Swap Provider" (as defined
therein) as counterparty to Specified Swap Contracts, in form and substance
satisfactory to the Administrative Agent and the Lenders.
"Interest Payment Date" means, (a) as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan; provided,
however, that if any Interest Period for a Eurodollar Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning of
such Interest Period shall also be Interest Payment Dates; and (b) as to any
Base Rate Loan, the last Business Day of each March, June, September and
December and the Maturity Date.
"Interest Period" means as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or (in the case of
any Eurodollar Rate Loan) converted to or continued as a Eurodollar Rate Loan
and ending on the date one, two, three or six months thereafter, as selected by
the Borrower in its Loan Notice; provided that:
(i) any Interest Period that would otherwise end on
a day that is not a Business Day shall be extended to the next
succeeding Business Day unless, in the case of a Eurodollar Rate
Loan, such Business Day falls in another calendar month, in
which case such Interest Period shall end on the next preceding
Business Day;
(ii) any Interest Period pertaining to a Eurodollar
Rate Loan 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 end on the last Business Day of the
calendar month at the end of such Interest Period; and
14.
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(iii) no Interest Period shall extend beyond the
scheduled Maturity Date.
"Investment" of a Person means (i) the outstanding principal amount of
any loan, advance, extension of credit (other than loans, advances or extensions
of credit arising in the Ordinary Course of Business), or (ii) the amount
(measured by the amount of cash expended or the then-current fair market value
of other assets, including stock of such Person, utilized as consideration) of
any contribution of capital by such Person to any other Person or any investment
in, or purchase or other acquisition of, the stock, partnership or membership
interests, notes, debentures or other securities of any other Person made by
such Person, reduced by the amount of any distribution by such other Person
constituting a return of capital, any payment of principal on such notes,
debentures or other debt securities, or any proceeds from the sale of any equity
or debt securities of such other Person.
"IRS" means the United States Internal Revenue Service.
"IRS Ruling Letter" means an affirmative private letter ruling by the
IRS regarding the tax-free nature of the Spin-Off Transaction.
"Laws" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's
participation in any L/C Borrowing in accordance with its Pro Rata Share.
"L/C Application" means an application and agreement for the issuance or
amendment of a letter of credit in the form from time to time in use by the L/C
Issuer.
"L/C Backstop Date" means the day that is seven days prior to the
scheduled Maturity Date (or, if such day is not a Business Day, the next
preceding Business Day).
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C Issuer" means Bank of America in its capacity as issuer of Letters
of Credit hereunder, or any successor issuer of Letters of Credit hereunder.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn face amount of all outstanding Letters of Credit plus the aggregate of
all Unreimbursed Amounts, including all L/C Borrowings.
15.
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"L/C Sublimit" means an amount equal to the lesser of the Aggregate
Commitments and $25,000,000. The L/C Sublimit is part of, and not in addition
to, the Aggregate Commitments.
"Lead Lender" means Bank of America or Fleet National Bank.
"Lender" has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes the L/C Issuer.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such on Schedule 10.02, or such other office or offices as a
Lender may from time to time notify the Borrower and the Administrative Agent.
"Letters of Credit" means any standby letters of credit issued or deemed
issued hereunder, and shall include the Existing Letters of Credit.
"Leverage Ratio" means, as of any date of determination, for Borrower
and its Subsidiaries on a consolidated basis, the ratio of (a) Consolidated
Funded Indebtedness as of such date to (b) Consolidated EBITDA for the period of
the four fiscal quarters ending on such date.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable Laws of any jurisdiction), including the
interest of a purchaser of accounts receivable, but excluding the interest of a
lessor under an Operating Lease.
"Loan" has the meaning specified in Section 2.01.
"Loan Documents" means this Agreement, each Loan Note, the Collateral
Documents, the Guaranties, each Additional Guarantor Assumption Agreement, the
Intercreditor Agreement, each Request for Credit Extension, the Agent/Arranger
Fee Letter, and each Compliance Certificate and other certificates delivered
under any of the foregoing.
"Loan Note" means a promissory note made by the Borrower in favor of a
Lender evidencing Loans made by such Lender, substantially in the form of
Exhibit B.
"Loan Notice" means a notice of (a) a Borrowing, (b) a conversion of
Loans from one Type to the other, or (c) a continuation of Loans as the same
Type, pursuant to Section 2.02(a), which, if in writing, shall be substantially
in the form of Exhibit A.
"Loan Parties" means, collectively, the Borrower and all Guarantors.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Borrower or the Borrower and its
Subsidiaries taken as a whole and includes, at any time prior to the Spin-Off
Consummation Date, New Ceridian and its Subsidiaries taken as a whole;
16.
23
(b) a material impairment of the ability of any Loan Party to perform its
obligations under any Loan Document to which it is a party or, at any time prior
to the Spin-Off Consummation Date, the ability of New Ceridian to perform its
obligations under any Spin-Off Document to which it is party; or (c) a material
adverse effect upon (i) the legality, validity, binding effect or enforceability
against any Loan Party or Subsidiary of any Loan Document to which it is a party
or, at any time prior to the Spin-Off Consummation Date, against New Ceridian of
any Spin-Off Document to which it is a party, or (ii) the perfection or priority
of any Lien granted under any of the Collateral Documents.
"Material Software" means, at any time, any software program (including
all releases, versions and modifications thereof) developed, acquired or used in
connection with the Arbitron Business and as to which the Borrower and its
Subsidiaries have received gross royalty or license payments from any and all
third parties in an aggregate amount in excess of $1,000,000 during any of the
five fiscal years preceding such time.
"Material Subsidiary" means, at any time, any Arbitron Subsidiary: (a)
the assets of which are either 5% or more of Consolidated Total Assets (or the
equivalent thereof in another currency) or the gross revenues of which are 5% or
more of consolidated gross revenue of the Borrower and its Subsidiaries, based
on the most recent financial statements delivered to the Administrative Agent
under Section 4.01(a), 4.02(a) or 6.01; or (b) designated by the Borrower as a
Material Subsidiary pursuant to Section 6.15(b) and not de-designated pursuant
to Section 6.15(c).
"Maturity Date" means (a) the date that is five years after the Closing
Date, or (b) such earlier date upon which the Commitments may be terminated in
accordance with the terms hereof.
"Maximum Rate" has the meaning specified in Section 10.10.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
three calendar years, has made or been obligated to make contributions.
"Net Cash Proceeds" has the meaning specified in Section 2.06(b)(ii).
"New Ceridian" means New Ceridian Corporation, a Delaware corporation.
"New Ceridian Assets" means, at all times prior to the Spin-Off
Consummation Date, all assets of the Borrower and its Subsidiaries intended
(consistent with the Form 10) to be transferred to New Ceridian pursuant to the
Separation and not including any assets necessary to conduct the Arbitron
Business.
"New Ceridian Credit Agreement" means that certain Credit Agreement
dated as of the Effectiveness Date, among New Ceridian, the lenders from time to
time party thereto and Bank of America, N.A., as the administrative agent.
17.
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"New Ceridian Guaranty" means a Guaranty executed by New Ceridian, in
substantially the form of Exhibit E.
"Nielsen" means ▇▇▇▇▇▇▇ Media Research, Inc., a Delaware corporation.
"▇▇▇▇▇▇▇ ▇▇" means a joint venture that may be created upon the exercise
of an option granted to Nielsen pursuant to the ▇▇▇▇▇▇▇ ▇▇ Option Agreement.
"▇▇▇▇▇▇▇ ▇▇ Option Agreement" means that Option Agreement between the
Borrower and Nielsen dated as of May 31, 2000 and as in effect as of the
Effectiveness Date.
"Nonrenewal Notice Date" has the meaning specified in Section
2.03(b)(iii).
"Notice of Lien" means any "notice of lien" or similar document intended
to be filed or recorded with any court, registry, recorder" office, central
filing office, or other Governmental Authority for the purpose of evidencing,
creating, perfecting or preserving the priority of a lien securing obligations
owing to a Governmental Authority.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document, whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising
and including interest that accrues after the commencement by or against any
Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief
Laws naming such Person as the debtor in such proceeding.
"Operating Lease" means, as applied to any Person, any lease of property
which is not a Capital Lease.
"Ordinary Course of Business" means, in respect of any transaction
involving the Borrower or any Subsidiary, the ordinary course of such Person's
business, as conducted by any such Person (or its predecessor) in accordance
with past practice and undertaken by such Person in good faith and not for
purposes of evading any covenant or restriction in any Loan Document.
"Organization Documents" means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws; (b) with respect to any
limited liability company, the articles of formation and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership, joint venture or other applicable agreement of
formation and any agreement, instrument, filing or notice with respect thereto
filed in connection with its formation with the secretary of state or other
department in the state of its formation, in each case as amended from time to
time.
"Other Taxes" has the meaning specified in Section 3.01(b).
"Outstanding Amount" means (i) with respect to Loans, on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Loans, occurring on such date; and
(ii) with respect to any L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
18.
25
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date.
"Participant" has the meaning specified in Section 10.07(d).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer plan
(as described in Section 4064(a) of ERISA) has made contributions at any time
during the immediately preceding five plan years.
"Permitted Acquisition" means any Acquisition as to which all of the
following conditions are satisfied: (a) total cash and non cash consideration
(including any deferred payment) paid or required to be paid by the Borrower and
its Subsidiaries in connection with such Acquisition does not exceed
$30,000,000; (b) after giving effect to such Acquisition, total cash and non
cash consideration (including any deferred payment) paid or required to be paid
by the Borrower and its Subsidiaries in connection with all such Acquisitions in
any fiscal year does not exceed $50,000,000; (c) after giving effect to such
Acquisition, the Person, or business or division of such Person, so acquired
shall be a division or Wholly-Owned Subsidiary of the Borrower or one of its
Subsidiaries; and (d) immediately after giving effect to such Acquisition, there
shall exist no Default or Event of Default.
"Permitted Indebtedness" has the meaning specified in Section 7.03(a).
"Permitted Liens" has the meaning specified in Section 7.01.
"Permitted ▇▇▇▇▇▇▇ ▇▇" means any Person that is a ▇▇▇▇▇▇▇ ▇▇, provided
the following conditions are at all times satisfied: (i) such Person is an
entity duly formed and existing under the Laws of its jurisdiction of
incorporation or organization; (ii) no less than 50% of the beneficial ownership
of such person is owned by the Borrower and such Person is not a Subsidiary of
Nielsen or of any Affiliate of Nielsen; (iii) the assets and property of such
Person consisting of Intellectual Property or Proprietary Information
contributed by the Borrower or any Subsidiary of the Borrower are subject to no
Liens in favor of any other Person other than Permitted Liens; (iv) such Person
is authorized to use and license the Borrower's PPM Technology to the extent,
but only to the extent, consistent with the ▇▇▇▇▇▇▇ ▇▇ Option Agreement; and (v)
the Organization Documents, and all material contracts and licenses of such
Person entered into, directly or indirectly, with the Borrower or any
Subsidiary, and other material contracts to be entered into by such Person
substantially contemporaneously with its organization are in form and substance
reasonably satisfactory to the Administrative Agent and the Required Lenders.
"Permitted Swap Contract" means any Swap Contract entered into by the
Borrower or any Subsidiary for which each of the following conditions is
satisfied: (a) such contract is (or was) entered into by such Person in the
Ordinary Course of Business for the purpose of directly
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mitigating risks associated with liabilities, commitments or assets held or
reasonably anticipated by such Person (including any Swap Contract entered into
by the Borrower or any Subsidiary for the purpose of hedging interest rate risk
arising in connection with the Obligations (a "Specified Swap Contract")), or
with changes in the value of securities issued by such Person in conjunction
with a securities repurchase program not otherwise prohibited hereunder, and not
for purposes of speculation or taking a "market view"; and (b) such Swap
Contract does not contain: (i) any provision (a "walk-away" provision)
exonerating the non-defaulting party from its obligation to make payments on
outstanding transactions to the defaulting party, or (ii) with respect to any
Swap Contract that it is not a Specified Swap Contract, any provision creating
or permitting the declaration of an event of default, termination event, or
similar event upon the occurrence of an Event of Default hereunder (other than
an Event of Default under Section 8.01(a)).
"Person" means any individual, trustee, corporation, general
partnership, limited partnership, limited liability company, joint stock
company, trust, unincorporated organization, bank, business association, firm,
joint venture or Governmental Authority.
"Placement Agent" means Banc of America Securities LLC or such other
Person designated as the placement agent under the terms of the Private
Placement Documents.
"Pledge Agreements" means the Borrower Pledge Agreement and the
Subsidiary Pledge Agreements.
"Pledged Collateral" has the meaning specified in the Pledge Agreements.
"PPM Expenditures" means (a) at any time prior to the initial exercise
of the option under the ▇▇▇▇▇▇▇ ▇▇ Option Agreement to establish a ▇▇▇▇▇▇▇ ▇▇,
all capital expenditures and capitalized expenditures (including in respect of
software development and acquisition), made or incurred by the Borrower or its
Subsidiaries in anticipation of a ▇▇▇▇▇▇▇ ▇▇ or in furtherance of the
development or Disposition of PPM Technology, and (b) at any time thereafter,
the sum of the items specified in clause (a) plus all Investments made by the
Borrower and its Subsidiaries in any and all Nielsen JV's.
"PPM Technology" means (a) all patent, copyright and other intellectual
property rights and technology of the Borrower and its Subsidiaries in the
Borrower's "Portable People Meter" and "Critical Band Encoding Technique," as
such terms are defined in the ▇▇▇▇▇▇▇ ▇▇ Option Agreement, together with all
improvements and additions thereto, and (b) all other audio encoding patents
held by the Borrower and subject to the ▇▇▇▇▇▇▇ ▇▇ Option Agreement.
"Preliminary Opening Balance Sheet" has the meaning specified in Section
4.01(a)(viii).
"Private Placement" means a private placement of senior secured notes of
the Borrower in an aggregate principal amount of not less than $50,000,000
pursuant to the Private Placement Documents and entered into on or before the
Effectiveness Date.
"Private Placement Documents" means, collectively, the Note Purchase
Agreement dated of near or even date herewith among the Borrower, ▇▇▇▇ ▇▇▇▇▇▇▇
Life Insurance Company and the other Private Placement Noteholders party
thereto, together with all "Note Documents" as defined in such Note Purchase
Agreement.
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"Private Placement Noteholders" means the "Note Holders" under and as
defined in the Private Placement Documents.
"Proprietary Information" means, as to the Borrower and each of its
Subsidiaries, such Person's trade secrets, including know-how, computer
programs, and technical data, used in the development, production and sale of
products and services.
"Pro Rata Share" means, with respect to each Lender, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender's Commitment, and set forth opposite the name of such
Lender on Schedule 2.01, as such share may be adjusted as contemplated herein.
"Register" has the meaning set forth in Section 10.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the 30 day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Loans, a Loan Notice, and (b) with respect to an
L/C Credit Extension, an L/C Application.
"Required Lenders" means, as of any date of determination, Lenders whose
Voting Percentages aggregate more than 50%.
"Responsible Officer" means the president, chief executive officer,
chief financial officer, treasurer or controller of a Loan Party, and also
includes, in respect of the Borrower, the Executive Vice President of Finance
and Planning of Arbitron. Any document delivered hereunder that is signed by a
Responsible Officer of a Loan Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the
part of such Loan Party and such Responsible Officer shall be conclusively
presumed to have acted on behalf of such Loan Party.
"Revocable" means, in relation to any license of Intellectual Property,
that such license may be revoked or terminated by the licensor at any time or
upon a default or breach of condition by the licensee.
"S&P" means Standard & Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Scarborough Partnership" means that New York general partnership
created pursuant to the Scarborough Partnership Agreement.
"Scarborough Partnership Agreement" means that Partnership Agreement
between VNU Advertising Expenditure Corp. and the Borrower, dated as of December
31, 1994, as amended and in effect as of the Effectiveness Date.
"SEC" means the Securities and Exchange Commission.
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"Security Agreements" means the Borrower Security Agreement, the
Subsidiary Security Agreements and the Supplemental IP Security Agreements.
"Senior Credit Ratable Amount" means, at any time, with reference to any
mandatory prepayment hereunder pursuant to Section 2.05, an amount equal to the
quotient of: (a) the Aggregate Commitments at such time, divided by (b) the sum
of (i) the Aggregate Commitments at such time, plus (ii) the principal amount
outstanding at such time of all notes issued pursuant to the Private Placement;
provided, however, that if there exists at such time no mandatory prepayment
requirement pursuant to the Private Placement Documents in respect of such
prepayment, or if any such mandatory prepayment has been waived, the "Senior
Credit Ratable Amount" shall equal 1.0.
"Senior Note Indenture" means that Indenture dated as of June 10, 1999
between Ceridian Corporation, as Issuer, and the Bank of New York, as Trustee,
relating to 7.25% Senior Notes due 2004.
"Separation" means the consummation of (a) the transfer by way of
absolute assignment and contribution by the Borrower to New Ceridian of all
assets and businesses of the Borrower, other than the Arbitron Business, and (b)
the corresponding allocation of liabilities of the Borrower as between the
Borrower and New Ceridian, through means of novation or cross-indemnities,
pursuant to the Spin-Off Documents.
"Separation Date" means the date upon which all material aspects of the
Separation have been completed.
"Solvent" means, as to any Person at any time, that (a) the fair value
of the property of such Person is greater than the fair value of such Person's
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities evaluated for purposes of Section
101(32) of the Bankruptcy Code and, in the alternative, for purposes of the
Uniform Fraudulent Conveyances Act (as enacted in the State of New York); (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 liability of such Person on
its debts as they become absolute and matured; (c) such Person is able to
realize upon its property and pay its debts and other liabilities (including
disputed, contingent and unliquidated liabilities) as they mature in the normal
course of business; (d) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person's ability to pay as
such debts and liabilities mature; and (e) such Person is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute unreasonably
small capital.
"Specified Swap Contract" has the meaning specified in the definition of
"Permitted Swap Contract".
"Spin-Off Consummation Date" means the date upon which all material
aspects of the Spin-Off Transaction have been consummated.
"Spin-Off Deadline" means the earlier of (a) March 30, 2001 or (b) the
date occurring three Business Days after the Closing Date.
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"Spin-Off Documents" means the documents set forth in Schedule 1.01(s),
each substantially in the form attached to the Form 10 or delivered to the
Administrative Agent pursuant to Article IV.
"Spin-Off Transaction" means, collectively, (i) the Separation and (ii)
the Distribution.
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests, having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"Subsidiary Guaranty" means a Guaranty executed by any Arbitron
Subsidiary, in substantially the form of Exhibit F.
"Subsidiary Pledge Agreement" means a Pledge Agreement executed by any
Arbitron Subsidiary, in substantially the form of Exhibit K.
"Subsidiary Security Agreement" means a Security Agreement executed by
any Arbitron Subsidiary, in substantially the form of Exhibit H.
"Supplemental Financial Statements" means the unaudited pro forma
consolidated balance sheet of the Borrower and its Arbitron Subsidiaries on a
stand-alone basis for the fiscal quarter ended March 31, 2000 (giving effect to
the Spin-Off Transaction) and the related pro forma consolidated income
statement for such fiscal quarter.
"Supplemental IP Security Agreement" means any Supplemental Intellectual
Property Security Agreement, in substantially the form of Exhibit I, executed
pursuant to Section 6.16.
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
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"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amount(s) determined as the
▇▇▇▇-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Lender).
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
"Taxes" has the meaning specified in Section 3.01(a).
"Test Period" means a period of four consecutive fiscal quarters.
"Threshold Amount" means $5,000,000, except that in respect of
Indebtedness under the Private Placement Documents or any Swap Termination Value
in respect of Specified Swap Contracts, "Threshold Amount" means $0.
"Transaction Liens" means, collectively, all Liens from time to time
existing in favor of the Collateral Agent for the benefit of the Administrative
Agent and the Lenders, the Private Placement Noteholders, and any Lender
counterparty to a Specified Swap Contract, to the extent subject to the
Intercreditor Agreement.
"Type" means with respect to a Loan, its character as a Base Rate Loan
or a Eurodollar Rate Loan.
"UCC" means the Uniform Commercial Code as the same may, from time to
time, be in effect in the State of New York; provided that in the event that by
reason of mandatory provisions of law, any or all of the attachment, perfection
or priority of the security interest in any Collateral is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than the State of
New York, the term "UCC" shall mean the Uniform Commercial Code as in effect in
such other jurisdiction for purposes of the provisions hereof relating to such
attachment, perfection or priority and for the purposes of definitions related
to such provisions.
"Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).
"Voting Percentage" means, as to any Lender, (a) at any time when the
Commitments are in effect, such Lender's Pro Rata Share and (b) at any time
after the termination of the Commitments, the percentage (carried out to the
ninth decimal place) which (i) the sum of (a) the Outstanding Amount of such
Lender's Loans, plus (b) such Lender's Pro Rata Share of the Outstanding Amount
of L/C Obligations, then constitutes of (ii) the Outstanding Amount of all Loans
and L/C Obligations; provided, however, that if any Lender has failed to fund
any portion of the Loans, or participations in L/C Obligations required to be
funded by it hereunder, such
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Lender's Voting Percentage shall be deemed to be -0-, and the respective Pro
Rata Shares and Voting Percentages of the other Lenders shall be recomputed for
purposes of this definition and the definition of "Required Lenders" without
regard to such Lender's Commitment or the outstanding amount of its Loans, and
L/C Advances, as the case may be.
"Wholly-Owned Subsidiary" means any Subsidiary in which (other than
directors' qualifying shares required by law) 100% of the capital stock of each
class having ordinary voting power, and 100% of the capital stock of every other
class, in each case, at the time as of which any determination is being made, is
owned, beneficially and of record, by the Borrower, or by one or more of the
other Wholly-Owned Subsidiaries of the Borrower, or both.
1.02 OTHER INTERPRETIVE PROVISIONS.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) (i) The words "herein" and "hereunder" and words of similar
import when used in any Loan Document shall refer to such Loan Document as a
whole and not to any particular provision thereof.
(ii) Unless otherwise specified herein, Article, Section,
Exhibit and Schedule references are to this Agreement.
(iii) The term "including" is by way of example and not
limitation.
(iv) The term "documents" includes any and all instruments,
documents, agreements, certificates, notices, reports, financial
statements and other writings, however evidenced.
(c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including."
(d) Section headings herein and the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS.
(a) All accounting terms not specifically or completely defined
herein shall be construed in conformity with, and all financial data required to
be submitted pursuant to this Agreement shall be prepared in conformity with,
GAAP applied on a consistent basis, as in effect from time to time, applied in a
manner consistent with that used in preparing the Audited Financial Statements,
except as otherwise specifically prescribed herein.
(b) If at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative Agent,
the Lenders and the Borrower shall negotiate
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in good faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the Required
Lenders); provided that, until so amended, (a) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
(b) the Borrower shall provide to the Administrative Agent and the Lenders
financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such change in GAAP.
1.04 ROUNDING. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to agreements (including the Loan Documents) and
other contractual instruments shall be deemed to include all subsequent
amendments, restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, extensions,
supplements and other modifications are not prohibited by any Loan Document; and
(b) references to any Law shall include all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting such Law.
ARTICLE II.
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 LOANS. Subject to the terms and conditions set forth herein,
each Lender severally agrees to make loans (each such loan, a "Loan") to the
Borrower from time to time on any Business Day during the period from the
Closing Date to the Maturity Date, in an aggregate amount not to exceed at any
time outstanding the amount of such Lender's Commitment; provided, however, that
after giving effect to any Borrowing, (i) the aggregate Outstanding Amount of
all Loans and L/C Obligations shall not exceed the Aggregate Commitments, and
(ii) the aggregate Outstanding Amount of the Loans of any Lender, plus such
Lender's Pro Rata Share of the Outstanding Amount of all L/C Obligations shall
not exceed such Lender's Commitment. Within the limits of each Lender's
Commitment, and subject to the other terms and conditions hereof, the Borrower
may borrow under this Section 2.01, prepay under Section 2.04, and reborrow
under this Section 2.01. Loans may be Base Rate Loans or Eurodollar Rate Loans,
as further provided herein.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Each Borrowing, each conversion of Loans from one Type to the
other, and each continuation of Loans as the same Type shall be made upon the
Borrower's irrevocable notice to the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Administrative Agent not
later than 11:00 a.m., New York time, (i) three Business Days prior to the
requested date of any Borrowing of, conversion to or continuation of Eurodollar
Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans, and
(ii) on the requested date of any Borrowing of Base Rate Loans. Each such
telephonic notice must be
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confirmed promptly by delivery to the Administrative Agent of a written Loan
Notice, appropriately completed and signed by a Responsible Officer of the
Borrower. Each Borrowing of, conversion to or continuation of Eurodollar Rate
Loans shall be in a principal amount of $5,000,000 or a whole multiple of
$1,000,000 in excess thereof. Each Borrowing of or conversion to Base Rate Loans
shall be in a principal amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof. Each Loan Notice (whether telephonic or written) shall specify
(i) whether the Borrower is requesting a Borrowing, a conversion of Loans from
one Type to the other, or a continuation of Loans as the same Type, (ii) the
requested date of the Borrowing, conversion or continuation, as the case may be
(which shall be a Business Day), (iii) the principal amount of Loans to be
borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to
which existing Loans are to be converted, and (v) if applicable, the duration of
the Interest Period with respect thereto. If the Borrower fails to specify a
Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be made
or continued as, or converted to, Base Rate Loans. Any such automatic conversion
to Base Rate Loans shall be effective as of the last day of the Interest Period
then in effect with respect to the applicable Eurodollar Rate Loans. If the
Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar
Rate Loans in any such Loan Notice, but fails to specify an Interest Period, it
will be deemed to have specified an Interest Period of one month.
(b) Following receipt of a Loan Notice, the Administrative Agent
shall promptly notify each Lender of its Pro Rata Share of the applicable Loans,
and if no timely notice of a conversion or continuation is provided by the
Borrower, the Administrative Agent shall notify each Lender of the details of
any automatic conversion to Base Rate Loans described in the preceding
subsection. In the case of a Borrowing, each Lender shall make the amount of its
Loan available to the Administrative Agent in immediately available funds at the
Administrative Agent's Office not later than 2:00 p.m., New York time, on the
Business Day specified in the applicable Loan Notice. Upon satisfaction of the
applicable conditions set forth in Section 4.03 (and, if such Borrowing is the
initial Credit Extension, Section 4.02), the Administrative Agent shall make all
funds so received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of Bank of America with the amount of such funds or (ii) wire transfer of
such funds, in each case in accordance with instructions provided to the
Administrative Agent by the Borrower; provided, however, that if, on the date of
the Borrowing there are L/C Borrowings outstanding, then the proceeds of such
Borrowing shall be applied, first, to the payment in full of any such L/C
Borrowings, and second, to the Borrower as provided above.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan may
be continued or converted only on the last day of the Interest Period for such
Eurodollar Rate Loan. During the existence of a Default or Event of Default, no
Loans may be requested as, converted to or continued as Eurodollar Rate Loans
without the consent of the Required Lenders, and the Required Lenders may demand
that any or all of the then outstanding Eurodollar Rate Loans be converted
immediately to Base Rate Loans.
(d) The Administrative Agent shall promptly notify the Borrower and
the Lenders of the interest rate applicable to any Eurodollar Rate Loan upon
determination of such interest rate. The determination of the Eurodollar Rate by
the Administrative Agent shall be conclusive in the
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absence of manifest error. The Administrative Agent shall notify the Borrower
and the Lenders of any change in Bank of America's prime rate used in
determining the Base Rate promptly following the public announcement of such
change.
(e) After giving effect to all Borrowings, all conversions of Loans
from one Type to the other, and all continuations of Loans as the same Type,
there shall not be more than eight Interest Periods in effect with respect to
Loans.
2.03 LETTERS OF CREDIT.
(a) The Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein,
(A) the L/C Issuer agrees, in reliance upon the agreements of the other
Lenders set forth in this Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the L/C
Backstop Date, to issue Letters of Credit for the account of the
Borrower, and to amend or renew Letters of Credit previously issued by
it, in accordance with subsection (b) below, and (2) to honor drafts
under the Letters of Credit; and (B) the Lenders severally agree to
participate in Letters of Credit issued for the account of the Borrower;
provided that the L/C Issuer shall not be obligated to make any L/C
Credit Extension with respect to any Letter of Credit, and no Lender
shall be obligated to participate in, any Letter of Credit if as of the
date of such L/C Credit Extension, (x) the Outstanding Amount of all L/C
Obligations and all Loans would exceed the Aggregate Commitments, (y)
the aggregate Outstanding Amount of the Loans of any Lender, plus such
Lender's Pro Rata Share of the Outstanding Amount of all L/C
Obligations, would exceed such Lender's Commitment, or (z) the
Outstanding Amount of the L/C Obligations would exceed the L/C Sublimit.
Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrower's ability to obtain Letters of Credit shall be
fully revolving, and accordingly the Borrower may, during the foregoing
period, obtain Letters of Credit to replace Letters of Credit that have
expired or that have been drawn upon and reimbursed. All Existing
Letters of Credit outstanding as of the Closing Date shall be deemed to
have been issued pursuant hereto, and from and after the Closing Date
shall be subject to and governed by the terms and conditions hereof.
(ii) The L/C Issuer shall be under no obligation to issue any
Letter of Credit if:
(A) any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport
to enjoin or restrain the L/C Issuer from issuing such Letter of
Credit, or any Law applicable to the L/C Issuer or any request
or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the L/C Issuer
shall prohibit, or request that the L/C Issuer refrain from, the
issuance of letters of credit generally or such Letter of Credit
in particular or shall impose upon the L/C Issuer with respect
to such Letter of Credit any restriction, reserve or capital
requirement (for which the L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or
shall impose upon the L/C Issuer any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which
the L/C Issuer
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in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(B) subject to Section 2.03(b)(iii), the expiry date
of such requested Letter of Credit would occur more than twelve
months after the date of issuance or last renewal, unless the
Required Lenders have approved such expiry date;
(C) the expiry date of such requested Letter of
Credit would occur after the L/C Backstop Date, unless all the
Lenders have approved such expiry date;
(D) the issuance of such Letter of Credit would
violate one or more generally applicable policies of the L/C
Issuer; or
(E) such Letter of Credit is in a face amount less
than $100,000, or is to be denominated in a currency other than
Dollars.
(iii) The L/C Issuer shall be under no obligation to amend any
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such Letter of Credit does not accept
the proposed amendment to such Letter of Credit.
(b) Procedures for Issuance and Amendment of Letters of Credit;
Evergreen Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Borrower delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of an L/C
Application, appropriately completed and signed by a Responsible Officer
of the Borrower. Such L/C Application must be received by the L/C Issuer
and the Administrative Agent not later than 11:00 a.m., New York time,
at least two Business Days (or such later date and time as the L/C
Issuer may agree in a particular instance in its sole discretion) prior
to the proposed issuance date or date of amendment, as the case may be.
In the case of a request for an initial issuance of a Letter of Credit,
such L/C Application shall specify in form and detail satisfactory to
the L/C Issuer: (A) the proposed issuance date of the requested Letter
of Credit (which shall be a Business Day); (B) the amount thereof; (C)
the expiry date thereof; (D) the name and address of the beneficiary
thereof; (E) the documents to be presented by such beneficiary in case
of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G)
such other matters as the L/C Issuer may require. In the case of a
request for an amendment of any outstanding Letter of Credit, such L/C
Application shall specify in form and detail satisfactory to the L/C
Issuer (I) the Letter of Credit to be amended; (II) the proposed date of
amendment thereof (which shall be a Business Day); (III) the nature of
the proposed amendment; and (IV) such other matters as the L/C Issuer
may require.
(ii) Promptly after receipt of any L/C Application, the L/C
Issuer will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such L/C
Application from the Borrower and, if not, the L/C Issuer will provide
the Administrative Agent with a copy thereof. Upon receipt by the L/C
Issuer of confirmation from the Administrative Agent that the requested
issuance or
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amendment is permitted in accordance with the terms hereof, then,
subject to the terms and conditions hereof, the L/C Issuer shall, on the
requested date, issue a Letter of Credit for the account of the Borrower
or enter into the applicable amendment, as the case may be, in each case
in accordance with the L/C Issuer's usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the L/C Issuer a participation in such Letter
of Credit in an amount equal to the product of such Lender's Pro Rata
Share times the amount of such Letter of Credit.
(iii) If the Borrower so requests in any applicable L/C
Application, the L/C Issuer may, in it sole and absolute discretion,
agree to issue a Letter of Credit that has automatic renewal provisions
(each, an "Evergreen Letter of Credit"); provided that any such
Evergreen Letter of Credit must permit the L/C Issuer to prevent any
such renewal at least once in each twelve-month period (commencing with
the date of issuance of such Letter of Credit) by giving prior notice to
the beneficiary thereof not later than a day (the "Nonrenewal Notice
Date") in each such twelve-month period to be agreed upon at the time
such Letter of Credit is issued. Unless otherwise directed by the L/C
Issuer, the Borrower shall not be required to make a specific request to
the L/C Issuer for any such renewal. Once an Evergreen Letter of Credit
has been issued, the Lenders shall be deemed to have authorized (but may
not require) the L/C Issuer to permit the renewal of such Letter of
Credit at any time to a date not later than the L/C Backstop Date;
provided, however, that the L/C Issuer shall not permit any such renewal
if (A) the L/C Issuer would have no obligation at such time to issue
such Letter of Credit in its renewed form under the terms hereof, or (B)
it has received notice (which may be by telephone or in writing) on or
before the Business Day immediately preceding the Nonrenewal Notice Date
(1) from the Administrative Agent that the Required Lenders have elected
not to permit such renewal or (2) from the Administrative Agent, any
Lender or the Borrower that one or more of the applicable conditions
specified in Section 4.03 is not then satisfied. Notwithstanding
anything to the contrary contained herein, the L/C Issuer shall have no
obligation to permit the renewal of any Evergreen Letter of Credit at
any time.
(iv) Promptly after its delivery of any Letter of Credit or
any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver
to the Borrower and the Administrative Agent a true and complete copy of
such Letter of Credit or amendment.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon any drawing under any Letter of Credit, the L/C
Issuer shall notify the Borrower and the Administrative Agent thereof.
Not later than 11:00 a.m., New York time, on the date of any payment by
the L/C Issuer under a Letter of Credit (each such date, an "Honor
Date"), the Borrower shall reimburse the L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing.
If the Borrower fails to so reimburse the L/C Issuer by such time, the
Administrative Agent shall promptly notify each Lender of the Honor
Date, the amount of the unreimbursed drawing (the "Unreimbursed
Amount"), and such Lender's Pro Rata Share thereof. In such event, the
Borrower shall be deemed to have requested a Borrowing of Base Rate
Loans to be
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disbursed on the Honor Date in an amount equal to the Unreimbursed
Amount, without regard to the minimum and multiples specified in Section
2.02 for the principal amount of Base Rate Loans, but subject to the
amount of the unutilized portion of the Aggregate Commitments and the
conditions set forth in Section 4.03 (other than the delivery of a Loan
Notice). Any notice given by the L/C Issuer or the Administrative Agent
pursuant to this Section 2.03(c)(i) may be given by telephone if
immediately confirmed in writing; provided that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding
effect of such notice.
(ii) Each Lender (including the Lender acting as L/C Issuer)
shall upon any notice pursuant to Section 2.03(c)(i) make funds
available to the Administrative Agent for the account of the L/C Issuer
at the Administrative Agent's Office in an amount equal to its Pro Rata
Share of the Unreimbursed Amount not later than 2:00 p.m., New York
time, on the Business Day specified in such notice by the Administrative
Agent, whereupon, subject to the provisions of Section 2.03(c)(iii),
each Lender that so makes funds available shall be deemed to have made a
Base Rate Loan to the Borrower in such amount. The Administrative Agent
shall remit the funds so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Borrowing of Base Rate Loans because the
conditions set forth in Section 4.03 cannot be satisfied or for any
other reason, the Borrower shall be deemed to have incurred from the L/C
Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is
not so refinanced, which L/C Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at the Default
Rate. In such event, each Lender's payment to the Administrative Agent
for the account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall
be deemed payment in respect of its participation in such L/C Borrowing
and shall constitute an L/C Advance from such Lender in satisfaction of
its participation obligation under this Section 2.03.
(iv) Until each Lender funds its Loan or L/C Advance pursuant
to this Section 2.03(c) to reimburse the L/C Issuer for any amount drawn
under any Letter of Credit, interest in respect of such Lender's Pro
Rata Share of such amount shall be solely for the account of the L/C
Issuer.
(v) Each Lender's obligation to make Loans or L/C Advances
to reimburse the L/C Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.03(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including
(A) any set-off, counterclaim, recoupment, defense or other right which
such Lender may have against the L/C Issuer, the Borrower or any other
Person for any reason whatsoever; (B) the occurrence or continuance of a
Default or Event of Default, or (C) any other occurrence, event or
condition, whether or not similar to any of the foregoing. Any such
reimbursement shall not relieve or otherwise impair the obligation of
the Borrower to reimburse the L/C Issuer for the amount of any payment
made by the L/C Issuer under any Letter of Credit, together with
interest as provided herein.
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(vi) If any Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(ii),
the L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer at
a rate per annum equal to the Federal Funds Rate from time to time in
effect. A certificate of the L/C Issuer submitted to any Lender (through
the Administrative Agent) with respect to any amounts owing under this
clause (vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment
under any Letter of Credit and has received from any Lender such
Lender's L/C Advance in respect of such payment in accordance with
Section 2.03(c), if the Administrative Agent receives for the account of
the L/C Issuer any payment related to such Letter of Credit (whether
directly from the Borrower or otherwise, including proceeds of Cash
Collateral applied thereto by the Administrative Agent), or any payment
of interest thereon, the Administrative Agent will distribute to such
Lender its Pro Rata Share thereof in the same funds as those received by
the Administrative Agent.
(ii) If any payment received by the Administrative Agent for
the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required
to be returned, each Lender shall pay to the Administrative Agent for
the account of the L/C Issuer its Pro Rata Share thereof on demand of
the Administrative Agent, plus interest thereon from the date of such
demand to the date such amount is returned by such Lender, at a rate per
annum equal to the Federal Funds Rate from time to time in effect.
(e) Obligations Absolute. The obligation of the Borrower to
reimburse the L/C Issuer for each drawing under each Letter of Credit, and to
repay each L/C Borrowing and each drawing under a Letter of Credit that is
refinanced by a Borrowing of Loans, shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following:
(i) any lack of validity or enforceability of such Letter of
Credit, this Agreement, or any other agreement or instrument relating
thereto;
(ii) the existence of any claim, counterclaim, set-off,
defense or other right that the Borrower may have at any time against
any beneficiary or any transferee of such Letter of Credit (or any
Person for whom any such beneficiary or any such transferee may be
acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such Letter
of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or
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any statement therein being untrue or inaccurate in any respect; or any
loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment
made by the L/C Issuer under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of
such Letter of Credit, including any arising in connection with any
proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other circumstance
that might otherwise constitute a defense available to, or a discharge
of, the Borrower.
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will promptly notify the L/C Issuer. The Borrower shall be conclusively
deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Borrower agree that, in
paying any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document except to the extent of the
L/C Issuer's gross negligence or willful misconduct. No Agent-Related Person nor
any of the respective correspondents, participants or assignees of the L/C
Issuer shall be liable to any Lender for (i) any action taken or omitted in
connection herewith at the request or with the approval of the Lenders or the
Required Lenders, as applicable; (ii) any action taken or omitted in the absence
of gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or L/C Application. The Borrower hereby assumes all
risks of the acts or omissions of any beneficiary or transferee with respect to
its use of any Letter of Credit; provided, however, that this assumption is not
intended to, and shall not, preclude the Borrower's pursuing such rights and
remedies as it may have against the beneficiary or transferee at law or under
any other agreement. No Agent-Related Person, nor any of the respective
correspondents, participants or assignees of the L/C Issuer, shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 2.03(e); provided, however, that anything in such clauses to the
contrary notwithstanding, the Borrower may have a claim against the L/C Issuer,
and the L/C Issuer may be liable to the Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the L/C
Issuer's willful misconduct or gross negligence or the L/C Issuer's willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing, the L/C Issuer may
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accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
(g) Letter of Credit Cash Collateral. Upon the request of the
Administrative Agent (which shall be made at the direction of the L/C Issuer or
the Required Lenders), (i) if the L/C Issuer has honored any full or partial
drawing request under any Letter of Credit and such drawing has resulted in an
L/C Borrowing, or (ii) if, as of the L/C Backstop Date, any Letter of Credit may
for any reason remain outstanding and partially or wholly undrawn, the Borrower
shall immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount) until (x) in the
case of clause (i) above, such L/C Borrowing together with all related interest
and fees is repaid pursuant to a Borrowing or otherwise, or (y) in the case
clause (ii) above, such Letter of Credit expires without being drawn.
(h) Applicability of ISP98 and UCP. Unless otherwise expressly
agreed by the L/C Issuer and the Borrower when a Letter of Credit is issued, the
rules of the "International Standby Practices 1998" published by the Institute
of International Banking Law & Practice (or such later version thereof as may be
in effect at the time of issuance) shall apply to each Letter of Credit.
(i) Letter of Credit Fees. The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with its Pro
Rata Share a Letter of Credit fee for each Letter of Credit equal to the
Applicable Rate times the actual daily maximum amount available to be drawn
under each Letter of Credit. Such fee for each Letter of Credit shall be due and
payable on the last Business Day of each March, June, September and December,
commencing with the first such date to occur after the issuance of such Letter
of Credit, and on the L/C Backstop Date. If there is any change in the
Applicable Rate during any quarter, the actual daily amount of each Letter of
Credit shall be computed and multiplied by the Applicable Rate separately for
each period during such quarter that such Applicable Rate was in effect.
(j) Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer. The Borrower shall pay directly to the L/C Issuer for its own
account a fronting fee in an amount with respect to each Letter of Credit equal
to the percent specified in the Agent/Arranger Fee Letter on the maximum amount
available to be drawn thereunder, due and payable on the issuance of such Letter
of Credit. In addition, the Borrower shall pay directly to the L/C Issuer for
its own account the customary issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect. Such fees and
charges are due and payable on demand and are nonrefundable.
(k) Conflict with L/C Application. In the event of any conflict
between the terms hereof and the terms of any L/C Application, the terms hereof
shall control.
2.04 OPTIONAL PREPAYMENTS. The Borrower may, upon notice to the
Administrative Agent, at any time or from time to time voluntarily prepay Loans
in whole or in part without premium or penalty; provided that (i) such notice
must be received by the Administrative Agent not later than 11:00 a.m., New York
time, (a) three Business Days prior to any date of
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prepayment of Eurodollar Rate Loans, and (b) on the date of prepayment of Base
Rate Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a principal
amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; and
(iii) any prepayment of Base Rate Loans shall be in a principal amount of
$1,000,000 or a whole multiple of $500,000 in excess thereof. Each such notice
shall specify the date and amount of such prepayment and the Type(s) of Loans to
be prepaid. The Administrative Agent will promptly notify each Lender of its
receipt of each such notice, and of such Lender's Pro Rata Share of such
prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest thereon, together with any
additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Loans of the Lenders in accordance with their respective Pro
Rata Shares.
2.05 MANDATORY PREPAYMENTS.
(a) Outstanding Amount in Excess. If for any reason the Outstanding
Amount of all Loans and L/C Obligations exceeds the Aggregate Commitments then
in effect, the Borrower shall immediately prepay Loans and Cash Collateralize
L/C Obligations in an amount equal to such excess.
(b) General. Any prepayments pursuant to this Section 2.05 shall be
applied: (i) first to any Base Rate Loans then outstanding; (ii) second to
Eurodollar Rate Loans with the shortest Interest Periods remaining; provided,
however, that if the amount of Base Rate Loans then outstanding is not
sufficient to satisfy the entire prepayment requirement, provided there exists
no Event of Default, the Borrower may, at its option, place any amounts which it
would otherwise be required to use to prepay Eurodollar Rate Loans on a day
other than the last day of the Interest Period therefor in an interest-bearing
account pledged to the Administrative Agent for the benefit of the Lenders
pursuant to documentation satisfactory to the Administrative Agent until the end
of such Interest Period at which time such pledged amounts (plus accrued
interest thereon) will be applied to prepay such Eurodollar Rate Loans; and
(iii) third to amounts held to Cash Collateralize any Letters of Credit. The
Borrower shall pay, together with each prepayment under this Section 2.05,
accrued interest on the amount of any Eurodollar Rate Loans prepaid, and any
amounts required pursuant to Section 3.05.
2.06 REDUCTION OR TERMINATION OF COMMITMENTS.
(a) Optional Commitment Reduction. The Borrower may, upon notice to
the Administrative Agent, terminate the Aggregate Commitments, or permanently
reduce the Aggregate Commitments to an amount not less than the then Outstanding
Amount of all Loans and L/C Obligations; provided that (i) any such notice shall
be received by the Administrative Agent not later than 11:00 a.m. (New York
Time), three Business Days prior to the date of termination or reduction, (ii)
any such partial reduction shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof, and (iii) the Borrower shall pay
any amounts required by Section 3.05. The Administrative Agent shall promptly
notify the Lenders of any such notice of reduction or termination of the
Aggregate Commitments. Once reduced in accordance with this subsection, the
Commitments may not be increased.
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(b) Mandatory Commitment Reductions.
(i) Scheduled Reductions. The Aggregate Commitments shall
reduce automatically on an aggregate basis in the amount of $25,000,000
upon each of the first, second, third and fourth year anniversary dates
following the Closing Date.
(ii) Asset Dispositions. If the Borrower or any Arbitron
Subsidiary shall at any time or from time to time make or agree to make
a Disposition, other than a Disposition specified in Section 7.04(b)
(but subject to clause (d) of Section 7.04(b)(ii)), or shall suffer an
Event of Loss (except to the extent the insurance or other third party
recovery proceeds received in connection therewith are within 25 days of
receipt applied to the purchase price of replacement assets
substantially similar to those experiencing the Event of Loss), other
than any Disposition or Event of Loss occurring prior to the Separation
Date to the extent relating to New Ceridian Assets, then (A) the
Borrower shall promptly notify the Agent of such proposed Disposition or
such Event of Loss (including the amount of the estimated net cash or
Cash Equivalents proceeds, calculated exclusive of (x) reasonable
out-of-pocket expenses, (y) taxes actually paid and (z) the amount of
any Indebtedness secured solely or principally by such asset and
actually repaid ("Net Cash Proceeds") to be received by the Borrower or
such Subsidiary in respect thereof) (a "Disposition Notice") and (B)
upon the earlier of (1) the date specified for such purpose by the
Borrower in the Disposition Notice or (2) 30 days after receipt of such
Net Cash Proceeds by the Borrower or Subsidiary, the Aggregate
Commitments shall be permanently reduced by an amount equal to the
Senior Credit Ratable Amount times the amount of such Net Cash Proceeds;
provided, however, that no reduction of Commitments shall be required
under this subsection in connection with any Disposition that, alone or
together with all related Dispositions to the same Person or Affiliate
of such Person, involves Net Cash Proceeds of less than $1,000,000.
(iii) Equity or Debt Issuance.
(A) If the Borrower shall issue new common or
preferred equity, or any debt securities, the Borrower shall
promptly notify the Administrative Agent of the estimated
proceeds of such issuance net of reasonable out-of-pocket
expenses incurred by the Borrower ("Net Issuance Proceeds") to
be received by the Borrower in respect thereof (an "Issuance
Notice"). Upon the earlier of (1) the date specified for such
purpose in such Issuance Notice or (2) 30 days after the date of
receipt of such Net Issuance Proceeds actually received, the
Aggregate Commitments shall be permanently reduced by an amount
equal to the Senior Credit Ratable Amount times the amount of
such Net Issuance Proceeds actually received.
(B) No Commitment reduction shall be required under
this subsection (iii) in connection with (1) the issuance of
equity securities pursuant to Section 7.07(a)(i), (2) the
Acquisition by the Borrower or any Subsidiary of cash or Cash
Equivalents in any Permitted Acquisition, provided that the cash
or Cash Equivalents so acquired is merely incidental to such
Permitted Acquisition; or (3) the issuance of debt securities
pursuant to the Private Placement.
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(iv) Excess Cash Flow. Commencing with the fiscal year ending
in December 2001, and continuing thereafter for so long as the Aggregate
Commitments as of the last day of any fiscal year shall exceed
$50,000,000, the Aggregate Commitments shall be automatically reduced on
the fifth Business Day after the date of delivery to the Administrative
Agent of the financial statements required under Section 6.01(a) by an
amount equal to the Senior Credit Ratable Amount times 50% of the amount
of Excess Cash Flow (if positive) for such fiscal year, provided that
the Aggregate Commitments, after taking into account such reduction, are
not required to be reduced under this Section 2.06(b)(iv) to an amount
that is less than $50,000,000.
(v) Prepayment under Private Placement. If in respect of the
Private Placement the Borrower shall make or participate in any
prepayment of notes, note purchase or repurchase, redemption, or
mandatory or optional call of notes, or shall have any notes tendered to
it pursuant to any voluntary or mandatory put provision, prior to the
scheduled maturity date specified in the Private Placement Documents,
other than in respect of matters specified in Section 2.06(b)(ii) or
(iii) (collectively, a "Private Placement Prepayment"), the Borrower
shall promptly notify the Administrative Agent of such fact and the
Aggregate Commitments shall be permanently reduced by an amount equal to
the amount that would cause the ratio of the Commitment reduction
required under this subsection to the sum of such amount plus the
Private Placement Prepayment to equal the Senior Credit Ratable Amount,
such reduction to occur on the day such Private Placement Prepayment is
made.
(c) General. Any reduction of the Aggregate Commitments shall be
applied to the Commitment of each Lender according to its Pro Rata Share. All
commitment and utilization fees accrued until the effective date of any
termination of the Aggregate Commitments shall be paid on the effective date of
such termination. Optional Commitment reductions pursuant to subsection (a)
shall be applied to mandatory Commitment reductions pursuant to subsection
(b)(i) in reverse chronological order.
2.07 REPAYMENT OF LOANS. The Borrower shall repay to the Lenders on
the Maturity Date the aggregate principal amount of Loans outstanding on such
date.
2.08 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the Outstanding Amount thereof for
each Interest Period at a rate per annum equal to the Eurodollar Rate for such
Interest Period plus the Applicable Rate; and (ii) each Base Rate Loan shall
bear interest on the outstanding principal amount thereof from the applicable
borrowing date at a rate per annum equal to the Base Rate plus the Applicable
Rate.
(b) While any Event of Default exists or after acceleration, the
Borrower shall pay interest on the Outstanding Amount of all Obligations at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Law. Accrued and unpaid interest on
past due amounts (including interest on past due interest) shall be due and
payable upon demand.
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(c) Interest on each Loan shall be due and payable in arrears on
each Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.09 FEES. In addition to certain fees described in subsections (i)
and (j) of Section 2.03:
(a) Commitment Fee. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share, a
commitment fee equal to the Applicable Rate times the actual daily amount by
which the Aggregate Commitments exceed the sum of (i) the Outstanding Amount of
Loans and (ii) the Outstanding Amount of L/C Obligations. The commitment fee
shall accrue at all times from the Effectiveness Date until the Maturity Date
and shall be due and payable quarterly in arrears on the last Business Day of
each March, June, September and December, commencing with the first such date to
occur after the Effectiveness Date, and on the Maturity Date. The commitment fee
shall be calculated quarterly in arrears, and if there is any change in the
Applicable Rate during any quarter, the actual daily amount shall be computed
and multiplied by the Applicable Rate separately for each period during such
quarter that such Applicable Rate was in effect. The commitment fee shall accrue
at all times, including at any time during which one or more of the conditions
in Article IV is not met.
(b) Arrangement and Agency Fees. The Borrower shall pay an
arrangement fee to the Arranger for the Arranger's own account, and shall pay an
agency fee to the Administrative Agent for the Administrative Agent's own
account, in the amounts and at the times specified in the letter agreement,
dated September 7, 2000 (the "Agent/Arranger Fee Letter"), among the Borrower,
the Arranger and the Administrative Agent. Such fees shall be fully earned when
paid and shall be nonrefundable for any reason whatsoever.
(c) Lenders' Upfront Fee. On the Effectiveness Date, the Borrower
shall pay to the Administrative Agent, for the account of the Lenders in
accordance with their respective Pro Rata Shares, an upfront fee in an amount
set forth in the Agent/Arranger Fee Letter. Such upfront fees are for the credit
facilities committed by the Lenders under this Agreement and are fully earned on
the date paid. The upfront fee paid to each Lender is solely for its own account
and is nonrefundable for any reason whatsoever.
2.10 COMPUTATION OF INTEREST AND FEES. Computation of interest on
Base Rate Loans shall be calculated on the basis of a year of 365 or 366 days,
as the case may be, and the actual number of days elapsed. Computation of all
other types of interest and all fees shall be calculated on the basis of a year
of 360 days and the actual number of days elapsed, which results in a higher
yield to the payee thereof than a method based on a year of 365 or 366 days.
Interest shall accrue on each Loan for the day on which the Loan is made, and
shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid, provided that any Loan that is repaid on the same
day on which it is made shall bear interest for one day.
2.11 EVIDENCE OF DEBT.
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(a) The Credit Extensions made by each Lender shall be evidenced by
one or more accounts or records maintained by such Lender and by the
Administrative Agent in the ordinary course of business. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrower and the interest and payments thereon. Any failure so to record
or any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect to the
Loans and L/C Obligations. In the event of any conflict between the accounts and
records maintained by any Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of
such Lender shall control. Upon the request of any Lender made through the
Administrative Agent, such Lender's Loans may be evidenced by a Loan Note, in
addition to such accounts or records. Each Lender may attach schedules to its
Loan Note(s) and endorse thereon the date, Type (if applicable), amount and
maturity of the applicable Loans and payments with respect thereto.
(b) In addition to the accounts and records referred to in
subsection (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit. In the event of
any conflict between the accounts and records maintained by the Administrative
Agent and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control.
2.12 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 12:00 noon,
New York time, on the date specified herein. The Administrative Agent will
promptly distribute to each Lender its Pro Rata Share (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender's Lending Office. All payments received by the Administrative
Agent after 12:00 noon, New York time, shall be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue.
(b) Subject to the definition of "Interest Period," if any payment
to be made by the Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.
(c) If at any time insufficient funds are received by and available
to the Administrative Agent to pay fully all amounts of principal, L/C
Borrowings, interest and fees then due hereunder, such funds shall be applied
(i) first, toward costs and expenses (including Attorney Costs and amounts
payable under Article III) incurred by the Administrative Agent and each Lender,
(ii) second, toward repayment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (iii) third, toward repayment of
principal and L/C Borrowings then due
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hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal and L/C Borrowings then due to such parties.
(d) Unless the Borrower or any Lender has notified the
Administrative Agent prior to the date any payment is required to be made by it
to the Administrative Agent hereunder, that the Borrower or such Lender, as the
case may be, will not make such payment, the Administrative Agent may assume
that the Borrower or such Lender, as the case may be, has timely made such
payment and may (but shall not be so required to), in reliance thereon, make
available a corresponding amount to the Person entitled thereto. If and to the
extent that such payment was not in fact made to the Administrative Agent in
immediately available funds, then:
(i) if the Borrower failed to make such payment, each Lender
shall forthwith on demand repay to the Administrative Agent the portion
of such assumed payment that was made available to such Lender in
immediately available funds, together with interest thereon in respect
of each day from and including the date such amount was made available
by the Administrative Agent to such Lender to the date such amount is
repaid to the Administrative Agent in immediately available funds, at
the Federal Funds Rate from time to time in effect; and
(ii) if any Lender failed to make such payment, such Lender
shall forthwith on demand pay to the Administrative Agent the amount
thereof in immediately available funds, together with interest thereon
for the period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is
recovered by the Administrative Agent (the "Compensation Period") at a
rate per annum equal to the Federal Funds Rate from time to time in
effect. If such Lender pays such amount to the Administrative Agent,
then such amount shall constitute such Lender's Loan, included in the
applicable Borrowing. If such Lender does not pay such amount forthwith
upon the Administrative Agent's demand therefor, the Administrative
Agent may make a demand therefor upon the Borrower, and the Borrower
shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal
to the rate of interest applicable to the applicable Borrowing. Nothing
herein shall be deemed to relieve any Lender from its obligation to
fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender with respect to any
amount owing under this subsection (d) shall be conclusive, absent manifest
error.
(e) If any Lender makes available to the Administrative Agent funds
for any Loan to be made by such Lender as provided in the foregoing provisions
of this Article II, and the conditions to the applicable Credit Extension set
forth in Article IV are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.
(f) The obligations of the Lenders hereunder to make Loans and to
fund participations in Letters of Credit are several and not joint. The failure
of any Lender to make
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any Loan or to fund any such participation on any date required hereunder shall
not relieve any other Lender of its corresponding obligation to do so on such
date, and no Lender shall be responsible for the failure of any other Lender to
so make its Loan or purchase its participation.
(g) Nothing herein shall be deemed to obligate any Lender to obtain
the funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.13 SHARING OF PAYMENTS. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans of any Type
made by it, or the participations in L/C Obligations held by it, any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify the Administrative
Agent of such fact, and (b) purchase from the other Lenders such participations
in the Loans of such Type made by them and/or such subparticipations in the
participations in L/C Obligations, as shall be necessary to cause such
purchasing Lender to share the excess payment in respect of such Type of Loan or
such participations, as the case may be, pro rata with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from the purchasing Lender, such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) the total amount so recovered from
the purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender may, to
the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off, but subject to Section 10.09) with respect to
such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. The Administrative Agent will keep
records (which shall be conclusive and binding in the absence of manifest error)
of participations purchased under this Section and will in each case notify the
Lenders following any such purchases or repayments. Each Lender that purchases a
participation pursuant to this Section shall from and after such purchase have
the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.
2.14 SECURITY AND GUARANTIES. (a) (a) The Obligations shall be
secured at all times in accordance with the terms hereof and the Collateral
Documents.
(b) The Obligations of the Borrower under this Agreement, each of
the Loan Notes and all other Loan Documents shall be unconditionally guaranteed
by the Guarantors pursuant to the Guaranties.
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ARTICLE III.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Subject to Section 3.01(e), any and all payments by the Borrower
to or for the account of the Administrative Agent or any Lender under any Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and all liabilities with respect thereto,
excluding, in the case of the Administrative Agent and each Lender, taxes
imposed on or measured by its net income, and franchise taxes imposed on it (in
lieu of net income taxes), by the jurisdiction (or any political subdivision
thereof) under the Laws of which the Administrative Agent or such Lender, as the
case may be, is organized or maintains a lending office (all such non-excluded
taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or
similar charges, and liabilities being hereinafter referred to as "Taxes"). If
the Borrower shall be required by any Laws to deduct any Taxes from or in
respect of any sum payable under any Loan Document to the Administrative Agent
or any Lender, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section), the Administrative Agent and such Lender
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable Laws, and (iv) within 30 days
after the date of such payment, the Borrower shall furnish to the Administrative
Agent (which shall forward the same to such Lender) the original or a certified
copy of a receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes or
Other Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent (for the account of such Lender) or to such Lender, at the
time interest is paid, such additional amount that such Lender specifies as
necessary to preserve the after-tax yield (after factoring in all taxes,
including taxes imposed on or measured by net income) such Lender would have
received if such Taxes or Other Taxes had not been imposed.
(d) Subject to Section 3.01(e), the Borrower agrees to indemnify the
Administrative Agent and each Lender for (i) the full amount of Taxes and Other
Taxes (including any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section) paid by the Administrative
Agent and such Lender, (ii) amounts payable under Section 3.01(c) and (iii) any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, in each case whether or not such Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
Payment under this subsection (d) shall be
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made within 30 days after the date the Lender or the Administrative Agent makes
a demand therefor.
(e) The Borrower shall not be required to pay any additional amount
in respect of United States federal income tax pursuant to Section 3.01(a) to
any Lender for the account of any Lending Office of such Lender:
(i) if the obligation to pay such additional amounts would
not have arisen but for a failure by such Lender to comply with its
obligations under Section 10.15 in respect of such Lending Office; or
(ii) If any Lender shall have delivered to the Borrower the
forms referred to in Section 10.15, and such Lender shall not at any
time be entitled to exemption from deduction or withholding of United
States federal income tax in respect of payments by the Borrower
hereunder for the account of the Lending Office of such Lender for any
reason other than a change in United States law or regulations or in the
official interpretation of such law or regulations by any Governmental
Authority charged with the interpretation or administration thereof
(whether or not having the force of law) after the date of delivery of
such forms.
3.02 ILLEGALITY. If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or materially restricts the authority of such Lender to
purchase or sell, or to take deposits of, Dollars in the applicable offshore
Dollar market, or to determine or charge interest rates based upon the
Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through
the Administrative Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans
shall be suspended until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, the Borrower shall, upon demand from such
Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on
the last day of the Interest Period thereof, if such Lender may lawfully
continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans.
Upon any such prepayment or conversion, the Borrower shall also pay interest on
the amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES. If the Administrative Agent
determines in connection with any request for a Eurodollar Rate Loan or a
conversion to or continuation thereof that (a) Dollar deposits are not being
offered to banks in the applicable offshore Dollar market for the applicable
amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for such
Eurodollar Rate Loan, or (c) the Eurodollar Rate for such Eurodollar Rate Loan
does not adequately and fairly reflect the cost to the Lenders of funding such
Eurodollar Rate Loan, the Administrative Agent will promptly notify the Borrower
and all Lenders. Thereafter, the obligation of the Lenders to
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make or maintain Eurodollar Rate Loans shall be suspended until the
Administrative Agent revokes such notice. Upon receipt of such notice, the
Borrower may revoke any pending request for a Borrowing, conversion or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans in the
amount specified therein.
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY.
(a) If any Lender determines that as a result of the introduction of
or any change in or in the interpretation of any Law, or such Lender's
compliance therewith, there shall be any increase in the cost to such Lender of
agreeing to make or making, funding or maintaining Eurodollar Rate Loans or (as
the case may be) issuing or participating in Letters of Credit, or a reduction
in the amount received or receivable by such Lender in connection with any of
the foregoing (excluding for purposes of this subsection (a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements utilized, as to Eurodollar Rate Loans, in the determination of the
Eurodollar Rate), then from time to time within 30 days after written demand of
such Lender (such demand to be accompanied by a certificate pursuant to Section
3.06(a)), with a copy of such demand to be sent to the Administrative Agent, the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law
regarding capital adequacy or any change therein or in the interpretation
thereof, or compliance by such Lender (or its Lending Office) therewith, has the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to
capital adequacy and such Lender's desired return on capital), then from time to
time within 30 days after written demand of such Lender (such demand to be
accompanied by a certificate pursuant to Section 3.06(a)), with a copy of such
demand to be sent to the Administrative Agent, the Borrower shall pay to such
Lender such additional amounts as will compensate such Lender for such
reduction.
(c) If the Borrower is required to pay any amount to any Lender or
the Administrative Agent pursuant to subsection (a) or (b) of this Section 3.04,
then such Lender shall use reasonable efforts (consistent with legal and
regulatory restrictions) to change the jurisdiction of its Lending Office to
another existing location of such Lender so as to eliminate any such additional
payment by the Borrower which may thereafter accrue, if such change in the sole
judgment of such Lender is not otherwise disadvantageous to such Lender.
3.05 FUNDING LOSSES. Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall promptly compensate
such Lender for and hold such Lender harmless from any loss, cost or expense
incurred by it as a result of:
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(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);
(b) any failure by the Borrower (for a reason other than the failure
of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower;
(c) any assignment of a Eurodollar Rate Loan on a day other than the
last day of the Interest Period therefor as a result of a request by the
Borrower pursuant to Section 10.16; or
(d) any assignment by any Lead Lender of a Eurodollar Rate Loan on a
day on or before 180 days after the Closing date and other than the last day of
the Interest Period therefor;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
The Borrower shall also pay any customary administrative fees charged by such
Lender in connection with the foregoing.
For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to have funded each
Eurodollar Rate Loan made by it at Eurodollar Base Rate used in determining the
Eurodollar Rate for such Loan by a matching deposit or other borrowing in the
applicable offshore Dollar interbank market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the calculation of the
additional amount or amounts to be paid to it hereunder shall be conclusive in
the absence of manifest error. In determining such amount, the Administrative
Agent or such Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under Section
3.01, 3.02 or 3.04, the Borrower may remove or replace such Lender in accordance
with Section 10.16.
(c) The Borrower shall not be obligated to pay any amounts under
Sections 3.01(d), 3.04(a) or 3.04(b) which arose prior to the date that is 180
days preceding the date of the demand required by each such Section or that is
attributable to periods prior to the date that is 180 days preceding the date of
such demand.
3.07 SURVIVAL. All of the Borrower's obligations under this Article
III shall survive termination of the Commitments and payment in full of all the
other Obligations.
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ARTICLE IV.
CONDITIONS PRECEDENT
4.01 CONDITIONS TO EFFECTIVENESS. The effectiveness of this Agreement
is subject to satisfaction of the following conditions precedent; provided that
at the election of the Administrative Agent any of the items required to be
delivered pursuant to subsection (a)(iv), (a)(vi), (e) or (f) may be waived for
purposes of this Section 4.01 provided they shall be deemed added to Section
4.02 and delivered or accomplished by no later than the Closing Date:
(a) Unless waived by all the Lenders (or by the Administrative Agent
with respect to immaterial matters or items specified in clause (iv) below with
respect to which the Borrower has given assurances satisfactory to the
Administrative Agent that such items shall be delivered promptly following the
Effectiveness Date), the Administrative Agent's receipt of the following, each
of which shall be originals or facsimiles (followed promptly by originals)
unless otherwise specified, each properly executed by a Responsible Officer of
the signing Loan Party that is a party thereto, each dated the Effectiveness
Date (or, in the case of certificates of governmental officials, a recent date
before the Effectiveness Date) and each in form and substance satisfactory to
the Administrative Agent and the Lenders:
(i) executed counterparts of this Agreement and the
Guaranties, sufficient in number for distribution to the Administrative
Agent, each Lender and the Borrower;
(ii) Loan Notes executed by the Borrower in favor of each
Lender requesting such a Loan Note, each in a principal amount equal to
such Lender's Commitment;
(iii) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent may require to
establish the identities of and verify the authority and capacity of
each Responsible Officer thereof authorized to act as a Responsible
Officer in connection with this Agreement and the other Loan Documents
to which such Loan Party is a party;
(iv) such evidence as the Administrative Agent may reasonably
require to verify that each Loan Party is duly organized or formed,
validly existing, in good standing and qualified to engage in business
in each jurisdiction (A) in which it is incorporated, or has any
headquarter function, or (B) in which it is required to be qualified to
engage in business if the absence of such qualification could have a
Material Adverse Effect; including certified copies of each Loan Party's
Organization Documents, certificates of good standing and/or
qualification to engage in business and tax good standing certificates
in such jurisdictions;
(v) a certificate signed by a Responsible Officer of the
Borrower certifying (A) that all representations and warranties
contained in Article V are true and correct on and as of the
Effectiveness Date and no Default or Event of Default exists on and as
of such date; (B) that there has been no event or circumstance since the
date of the most recent of the Audited Financial Statements which has or
could be reasonably expected to have a Material Adverse Effect; and (C)
that the Borrower's and New Ceridian's senior management are highly
confident that the Spin-Off Consummation Date will occur by no
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later than the Spin-Off Deadline under the terms specified in the
Spin-Off Documents delivered under subsection (a)(vii) below.
(vi) one or more opinions of counsel to each Loan Party with
respect to those matters set forth listed at Exhibit L;
(vii) a certificate signed by a Responsible Officer of the
Borrower certifying the attachment of (A) true and complete draft or
final copies of all material Spin-Off Documents, which shall be in form
and substance reasonably satisfactory to the Administrative Agent and
the Lenders; (B) true and complete copy of the Form 10 as submitted by
the Borrower to the SEC in connection with the Spin-Off Transaction
(together with and including all exhibits and attachments thereto),
which shall be in form and substance satisfactory to the Administrative
Agent and the Lenders; (C) true and complete copy of the Private
Placement Documents, which shall satisfy the following conditions: (I)
having a maturity date occurring not sooner than January 31, 2008, (II)
having representations and warranties, covenants and events of default
not more restrictive than those contained in the Loan Documents; (III)
having no prepayment or amortization of the principal amount of such
notes until maturity, or prepayments in form and substance satisfactory
to the Lenders; (IV) having no collateral other than the Collateral, and
(V) having no guarantor other than the Guarantors; (D) a true and
complete copy of the Scarborough Partnership Agreement; (E) a true and
complete copy of the ▇▇▇▇▇▇▇ ▇▇ Option Agreement; and (F) a solvency
opinion provided by the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ firm in respect of the Borrower
and New Ceridian, respectively, addressed to the Administrative Agent,
dated as of the Effectiveness Date, and any and all certificates and
other documents provided by the Borrower to the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ firm in
respect of such opinion;
(viii) such other financial information and documentation as
the Administrative Agent or any Lender may reasonably request, in form
and substance reasonably satisfactory to the Administrative Agent and
the Lenders, including (A) five-year financial projections for the
Borrower and its Arbitron Subsidiaries on a stand-alone basis, (B) a
preliminary pro forma opening balance sheet of the Borrower and its
Subsidiaries as of the Separation Date ("Preliminary Opening Balance
Sheet"), prepared by the Borrower, and (C) a consolidated balance sheet
of the Borrower and its Arbitron Subsidiaries on a stand-alone basis, as
of December 31, 2000, as prepared by the Borrower consistent with GAAP,
reflecting the consummation of the Spin-Off Transaction as of such date,
but without giving effect to the refinancing of the Borrower's Existing
Credit Facility and other Indebtedness pursuant to this Agreement, the
New Ceridian Credit Agreement and the Private Placement, and in
substantially similar form as the column captioned "Historical-Arbitron"
in the balance sheet labeled as "Arbitron Unaudited Pro Forma Condensed
Combined Balance Sheet Data" set forth in the Form 10;
(ix) evidence of the Borrower's receipt of the IRS Ruling
Letter;
(x) evidence of a waiver or consent with respect to defaults
otherwise arising under the Existing Credit Facility from the
consummation of the Spin-Off Transaction
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and the financings contemplated thereby by the "Agent" and "Lenders" as
defined in and party to the Existing Credit Facility; and
(xi) such other assurances, certificates, documents, consents
or opinions as the Administrative Agent, the L/C Issuer, or the Required
Lenders reasonably may require.
(b) The corporate, legal, capital, tax, contractual, and management
structure and attributes of the Borrower and its Subsidiaries and of the
Spin-Off Transaction shall be satisfactory to the Administrative Agent and the
Lenders.
(c) Any fees required to be paid on or before the Effectiveness Date
shall have been paid, and unless waived by the Administrative Agent, the
Borrower shall have paid all Attorney Costs of the Administrative Agent to the
extent invoiced prior to or on the Effectiveness Date, plus such additional
amounts of Attorney Costs as shall constitute its reasonable estimate of
Attorney Costs incurred or to be incurred by it through the closing proceedings
(provided that such estimate shall not thereafter preclude a final settling of
accounts between the Borrower and the Administrative Agent).
(d) The Effectiveness Date shall occur no later than February 5,
2001.
(e) The Collateral Documents shall be executed by each Loan Party
other than New Ceridian, in appropriate form for recording, where necessary,
together with:
(i) acknowledgment copies of all UCC-l financing statements
filed, registered or recorded to perfect the security interests of the
Collateral Agent for the benefit of the Administrative Agent and the
Lenders, or other evidence reasonably satisfactory to the Administrative
Agent that there has been filed, registered or recorded all financing
statements and other filings, registrations and recordings (including
filings at the U.S. Copyright Office, the U.S. Patent and Trademark
Office or other applicable Governmental Authority in respect of
Intellectual Property and Proprietary Information) necessary and
advisable to perfect or protect the Liens of the Collateral Agent for
the benefit of the Lenders in accordance with applicable law, with such
exceptions as the Administrative Agent and the Lenders may permit in
their discretion;
(ii) true and complete copies of copyright filings of the
Borrower and its Subsidiaries at the U.S. Copyright Office in respect of
computer databases registered during the years 1999 and 2000 and of
Material Software, as more fully required pursuant to the Security
Agreements;
(iii) written advice relating to such Lien and judgment
searches as the Administrative Agent shall have requested, and such
termination statements or other documents as may be necessary to confirm
that the Collateral is subject to no other Liens in favor of any Persons
(other than Permitted Liens);
(iv) all certificates and instruments representing the
Pledged Collateral, stock transfer powers executed in blank with
signatures guaranteed as the Administrative Agent or any Lender may
specify; provided that in no event shall more than 65% of the capital
stock of any Foreign Subsidiary be required to be so pledged;
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(v) Account Control Agreements, executed by all parties
thereto, relating to (A) any deposit accounts maintained by the Borrower
in relation to the Arbitron Business with Bank of America or any of its
Affiliates, and (B) any securities accounts maintained by the Borrower
in relation to the Arbitron Business;
(vi) such consents, estoppels, subordination agreements and
other documents and instruments executed by landlords, tenants and other
Persons party to material contracts relating to any Collateral as to
which the Collateral Agent shall be granted a Lien for the benefit of
the Lenders, as requested by the Collateral Agent or any Lender; and
(vii) evidence that all other actions necessary or, in the
reasonable opinion of the Administrative Agent or the Lenders, desirable
to perfect and protect the first priority Lien created by the Collateral
Documents and to enhance the Administrative Agent's ability to preserve
and protect its interests in and access to the Collateral, have been
taken.
(f) Insurance Policies. The Borrower shall provide evidence in form
and substance satisfactory to Administrative Agent and any Lender that the
Administrative Agent has been named as loss payee/mortgagee and as additional
insured, for the benefit of the Lenders, as their interests may appear, as
required in accordance with Section 6.06 and the Collateral Documents, together
with a certificate of insurance as to all insurance coverage on the properties
of the Borrower and its Subsidiaries.
4.02 CONDITIONS TO INITIAL CREDIT EXTENSION. The obligation of each
Lender to make its initial Credit Extension hereunder is subject to satisfaction
of the following conditions precedent:
(a) Unless waived by all the Lenders, the Administrative Agent's
receipt of the following, each of which shall be originals or facsimiles
(followed promptly by originals) unless otherwise specified, each properly
executed by a Responsible Officer of the signing Loan Party, each dated the
Closing Date and each in form and substance satisfactory to the Administrative
Agent and the Lenders:
(i) a certificate signed by a Responsible Officer of the
Borrower certifying (A) that all representations and warranties of the
Borrower contained in Article V are true and correct on and as of the
Closing Date, (B) that there exists as of such date no Default
or Event of Default, (C) that there has been no event or circumstance
since the date of the most recent Audited Financial Statements which has
or could reasonably be expected to have a Material Adverse Effect, (D)
that the Separation Date has occurred pursuant to the Spin-Off
Documents, which are in full force and effect and in substantially the
form delivered in connection with the Effectiveness Date (or otherwise
in form and substance satisfactory to the Administrative Agent and the
Lenders), (E) that the Borrower's and New Ceridian's senior management
are highly confident that the Spin-Off Consummation Date will occur by
no later than the Spin-Off Deadline; (F) that the Borrower has obtained
stockholder approval to effect a reverse stock split of the Borrower's
shares of common stock at a ratio not to exceed 1-for-5, which shall
occur
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promptly but in any event not more than 60 days after the Spin-Off
Consummation Date; (G) that the Board of Directors of the Borrower has
authorized and approved the final terms of the Spin-Off Transaction
(including declaration of a dividend of shares of New Ceridian's common
stock to Borrower's shareholders); (H) that the SEC has approved the
form of the Form 10, as it may have been amended since the Effectiveness
Date to reflect (I) revisions made to conform the Spin-Off Documents
filed with the Form 10 to those delivered to the Administrative Agent
pursuant to Section 4.01(a)(vii), (II) the inclusion of the opinions
described in Section 4.02(a)(iv), (III) any required date revisions not
inconsistent with the terms hereof, (IV) ministerial revisions necessary
to address administrative issues or facial ambiguities, and (V) other
amendments satisfactory to the Required Lenders , (I) that all
conditions precedent pursuant to the Private Placement have been
satisfied and that the Private Placement has been, or is
contemporaneously with the initial funding hereunder being, fully
funded; and (J) such other matters relating to the Spin-Off Transaction
as the Administrative Agent may request;
(ii) a pro forma Compliance Certificate of the Borrower and
its Subsidiaries, signed by a Responsible Officer of the Borrower;
(iii) a certificate signed by a Responsible Officer of the
Borrower certifying the attachment of (A) a true and complete copy of
the final pro forma opening balance sheet of the Borrower and its
Subsidiaries as of the Separation Date, by the Borrower, which shall
contain in the opinion of the Administrative Agent and the Lenders no
material adverse discrepancies from the Preliminary Opening Balance
Sheet, (B) a true and complete copy of the Supplemental Financial
Statements, and (C) an audited balance sheet of the Borrower and its
Arbitron Subsidiaries as of December 31, 2000, which balance sheet shall
contain in the opinion of the Administrative Agent and the Lenders no
material adverse discrepancies from the balance sheet delivered by the
Borrower under Section 4.01(a)(viii)(C), accompanied by the opinion of
KPMG Peat Marwick LLP or another nationally-recognized independent
public accounting firm, which report shall state that such balance sheet
presents fairly in all material respects the financial position of the
Borrower and the Arbitron Subsidiaries on a stand-alone basis as of such
date and such opinion shall not be qualified or limited for any reason;
(iv) a certificate signed by a Responsible Officer of the
Borrower certifying the Borrower's receipt, and attaching a true and
complete copy, of (A) a solvency opinion provided by the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
firm in respect of the Borrower and New Ceridian, respectively,
addressed to the Administrative Agent, dated as of the Closing Date, and
including any and all certificates and other documents provided by the
Borrower to the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ firm in respect of such opinion; (B) a
fairness, financial viability and "fair value" opinion addressed to the
Borrower (or its Board of Directors) and relating to the Spin-Off
Transaction, provided by the Borrower's financial advisors, Bear ▇▇▇▇▇▇▇
& Co., and including any and all certificates and other documents
provided by the Borrower to Bear ▇▇▇▇▇▇▇ & Co. in respect of such
opinion;
(v) evidence: (A) of payment (prior to or upon the initial
funding) of all funded Indebtedness of the Borrower existing immediately
prior to the Closing Date and termination of all credit commitments,
including the Existing Credit Facility, together
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with evidence of the release of all Liens securing obligations in
connection therewith, but excluding the Initial Permitted Indebtedness,
and (B) of the allocation, which shall be satisfactory to the
Administrative Agent and the Lenders, of all contingent and other
liabilities of the Borrower as between the Borrower and New Ceridian,
with such third party acknowledgments or consents relating thereto as
the Administrative Agent may request;
(vi) one or more opinions of counsel to the Borrower
regarding the matters specified in Exhibit M; and
(vii) such other assurances, certificates, documents, consents
or opinions as the Administrative Agent, the L/C Issuer, or the Required
Lenders reasonably may require.
(b) The Closing Date shall occur no later than March 30, 2001.
(c) The corporate, legal, capital, tax, contractual, and management
structure and attributes of the Borrower and its Subsidiaries and of the
Spin-Off Transaction shall conform to those deemed satisfactory by the
Administrative Agent and the Lenders as a condition to the Effectiveness Date,
or shall otherwise be satisfactory to the Administrative Agent and the Lenders.
4.03 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each
Lender to honor any Request for Credit Extension (other than a Loan Notice
requesting only a conversion of Loans to the other Type, or a continuation of
Loans as the same Type) is subject to the following conditions precedent:
(a) The representations and warranties of the Borrower contained in
Article V, and the representations and warranties of any Loan Party in any Loan
Document, shall be true and correct and as of the date of such Credit Extension,
except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they shall be true and correct as of such
earlier date.
(b) No Default or Event of Default shall exist, or would result from
such proposed Credit Extension.
(c) The Administrative Agent and, if applicable, the L/C Issuer
shall have received a Request for Credit Extension in accordance with the
requirements hereof.
(d) The Administrative Agent shall have received, in form and
substance satisfactory to it, such other assurances, certificates, documents or
consents related to the foregoing as the Administrative Agent or the Required
Lenders reasonably may require.
Each Request for Credit Extension (other than a Loan Notice requesting
only a conversion of Loans to the other Type or a continuation of Loans as the
same Type) submitted by the Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.03(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension.
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ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Administrative Agent and
each Lender as follows:
5.01 CORPORATE EXISTENCE AND POWER.
(a) Each of the Borrower and each Material Subsidiary:
(i) is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation;
(ii) has the power and authority and all material
governmental licenses, authorizations, consents and approvals to own its
assets and carry on its business and to execute, deliver, and perform
its obligations under the Loan Documents;
(iii) is duly qualified as a foreign corporation, licensed and
in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification or license, except where the failure to be
so qualified, licensed or in good standing would not adversely affect
the business or operations of the Borrower or such Subsidiary in any
significant manner; and
(iv) is in compliance with all material Laws applicable to
it.
(b) Each Subsidiary of the Borrower which is not a Material
Subsidiary:
(i) is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation;
(ii) has the power and authority and all governmental
licenses, authorizations, consents and approvals to own its assets and
carry on its business;
(iii) is duly qualified as a foreign corporation, licensed and
in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification; and
(iv) is in compliance with all material Laws applicable to
it;
except where any failure to comply with the requirements of this subsection (b)
would not, individually or in the aggregate, result in a Material Adverse
Effect.
(c) As of the Closing Date, the Borrower does not have any material
place of business other than in the State of New York and the State of Maryland.
5.02 CORPORATE AUTHORIZATION; NO CONTRAVENTION. The execution,
delivery and performance by each Loan Party of this Agreement and each other
Loan Document and each Spin-Off Document, and the consummation of the Spin-Off
Transaction, have been duly
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authorized by all necessary corporate action by or on behalf of such Loan Party,
and do not and will not:
(a) contravene the terms of such Loan Party's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation (other than the Senior Note Indenture) to which such Loan Party is a
party or any order, injunction, writ or decree of any Governmental Authority to
which such Loan Party or its property is subject; or
(c) violate any Law applicable to such Loan Party.
5.03 GOVERNMENTAL AUTHORIZATION. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority (except for recordings or filings in connection with the
Liens granted to the Administrative Agent under the Collateral Documents) is
necessary or required in connection (a) with the execution, delivery or
performance by, or enforcement against, the Borrower or any other Loan Party of
this Agreement or any other Loan Document or (b) the execution, delivery or
performance by or enforcement against the Borrower or any other Person party
thereto of the Spin-Off Documents, or (c) the consummation of the Spin-Off
Transaction, except in each case as have been obtained on or before the Closing
Date.
5.04 BINDING EFFECT.
(a) This Agreement and each other Loan Document to which the
Borrower or any of its Subsidiaries is a party, when executed and delivered,
will constitute the legal, valid and binding obligations of the Borrower and any
of its Subsidiaries to the extent it is a party thereto, enforceable against
such Person in accordance with their respective terms, except as enforceability
may be limited by applicable bankruptcy, insolvency, or similar laws affecting
the enforcement of creditors' rights generally or by equitable principles
relating to enforceability.
(b) From and after the Closing Date, each Spin-Off Document
constitutes the legal, valid and binding obligation of each Person party
thereto, enforceable against such Person in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability. As of the Closing Date, all conditions
precedent to the effectiveness of the Spin-Off Documents have been satisfied.
5.05 LITIGATION. Attached hereto as Schedule 5.05 is a list of all
material litigation in which the Borrower or any Subsidiary of the Borrower is a
plaintiff or a defendant as of the Effectiveness Date. There are no actions,
suits, proceedings, claims or disputes pending, or to the best knowledge of the
Borrower, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, against the Borrower or its Subsidiaries or
their respective properties which:
(a) purport to affect or pertain to this Agreement, or any other
Loan Document, or any of the transactions contemplated hereby or thereby; or
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(b) challenge in any respect the legality or validity of any
material aspect of the Spin-Off Transaction; or
(c) except as provided in Schedule 5.05, would reasonably be
expected to have a Material Adverse Effect (and assuming for this purpose the
reasonable likelihood of an adverse decision). No injunction, writ, temporary
restraining order or any order of any nature has been issued by any court or
other Governmental Authority purporting to enjoin or restrain the execution,
delivery or performance of this Agreement or any other Loan Document, or the
consummation of any material aspect of the Spin-Off Transaction, or directing
that the transactions provided for herein or therein not be consummated as
herein or therein provided. Since the Effectiveness Date, there has been no
change in the status of any of the matters set forth in Schedule 5.05 that would
reasonably be expected to result in a Material Adverse Effect. All amounts
potentially payable by the Borrower or any Arbitron Subsidiary (including upon
judgment or settlement) in connection with any matter set forth in Schedule 5.05
not relating to the Arbitron Business are subject from and after the Separation
Date to a binding indemnification obligation by New Ceridian in favor of the
Borrower or such Arbitron Subsidiary.
5.06 NO DEFAULT. No Default or Event of Default exists or would
result from the incurring of any Obligations by the Borrower or any other Loan
Party or from the grant or perfection of the Transaction Liens on the
Collateral. As of the Effectiveness Date and the Closing Date, neither the
Borrower nor any of its Subsidiaries, (a) is in default under or with respect to
any Contractual Obligation in any respect which, individually or together with
all such defaults, could reasonably be expected to have a Material Adverse
Effect, or (b) is in default under or with respect to any Spin-Off Document. As
of the Effectiveness Date, there exists no "Default" or "Event of Default," and
as of the Closing Date, there exists no "Event of Default," under and as defined
in (i) the Existing Credit Facility, (ii) the Senior Note Indenture, or (iii)
the Private Placement Documents.
5.07 ERISA COMPLIANCE. Except as referenced or provided for in either
Schedule 5.05 or Schedule 5.07 attached hereto:
(a) To the best knowledge of the Borrower, no facts or circumstances
exist which would reasonably be expected to have a Material Adverse Effect in
connection with the failure of any Plan, or the failure of the Borrower, an
ERISA Affiliate or any Person with regard to the Plan, to comply with the
applicable provisions of ERISA, the Code and other Federal or state law. The
Borrower and each ERISA Affiliate have made all required contributions to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any amortization period pursuant to Section 412 of the Code
has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or would, if determined adversely to
the Borrower or any Plan, reasonably be expected to result in a Material Adverse
Effect. There has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan which has resulted or would
reasonably be expected to result in a Material Adverse Effect.
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(c) To the best knowledge of the Borrower (i) no ERISA Event has
occurred or is reasonably expected to occur; (ii) neither the Borrower nor any
ERISA Affiliate has incurred, nor reasonably expects to incur, any liability
under Title IV of ERISA with respect to any Pension Plan (other than premiums
due and not delinquent under Section 4007 of ERISA); (iii) neither the Borrower
nor any ERISA Affiliate has incurred, nor reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Section 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (iv) neither the
Borrower nor any ERISA Affiliate has engaged in a transaction that would
reasonably be expected to be subject to Section 4069 or 4212(c) of ERISA.
5.08 TITLE TO PROPERTIES. As of the Effectiveness Date and the
Closing Date, the property of the Borrower and its Subsidiaries is subject to no
Liens, other than Permitted Liens. As of the Closing Date, the Borrower has
retained and has title to or a valid and enforceable leasehold or licensee's
interest in all assets necessary to and appropriate for conducting the Arbitron
Business, and such assets are subject to no Liens, claims or interest of third
parties other than Permitted Liens, and the interests of lessors and licensors
not otherwise prohibited under any Loan Document or Private Placement Document.
5.09 TAXES.
(a) The Borrower and its Subsidiaries have filed all Federal and
other material tax returns and reports required to be filed, and have paid all
Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP and no Notice of Lien has been filed or recorded. There is
no proposed tax assessment against the Borrower or any of its Subsidiaries which
would, if the assessment were made, have a Material Adverse Effect.
(b) None of the representations and warranties made by the Borrower,
New Ceridian or any of their Subsidiaries to the IRS in connection with the
Spin-Off Transaction (including with respect to the tax-free nature of the
Spin-Off Transaction and in connection with the Borrower's request for the IRS
Ruling Letter) as of the date such representations and warranties are made or
deemed made, and none of the statements contained in any report, exhibit,
statement or certificate furnished by or on behalf of the Borrower, New Ceridian
or any of their Subsidiaries to the IRS in connection with the Spin-Off
Transaction as of the date such statements are made or deemed made, contains any
untrue statement of a material fact or omits any material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances in which they are made, not misleading.
(c) As of the Effectiveness Date, the Closing Date and Spin-Off
Consummation Date, there is no "plan or series of related transactions" of the
type described in Section 355(e) of the Code.
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5.10 FINANCIAL CONDITION.
(a) The Form 10 Financial Statements and the Supplemental Financial
Statements:
(i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise
expressly noted therein, subject to ordinary, good faith year-end audit
adjustments and the absence of footnotes in the case of quarterly
financial statements,
(ii) are complete, accurate and fairly present the financial
condition of the Borrower and its Subsidiaries as of the date thereof,
and results of operation for the period covered thereby, in each case
based upon the assumed consummation of the Spin-Off Transaction on such
date, and
(iii) comply with all applicable Laws relating to spin-off
transactions.
(b) Except as disclosed in filings by the Borrower with the
Securities and Exchange Commission on Form 10-Q for the quarter ended June 30,
2000, or the Form 10, since December 31, 1999 there has been no Material Adverse
Effect.
(c) As of the Effectiveness Date and the Closing Date, the Borrower
and its consolidated Subsidiaries have not incurred any material Contingent
Obligations except for those specified in Schedule 5.10, which Schedule also
specifies which Contingent Obligations pertain to the Arbitron Business, and
those specified in Section 7.05(a), Section 7.05(d)(i) or Section 7.05(f).
Except as expressly otherwise stated in Schedule 5.10, New Ceridian is subject,
from and after the Separation Date, to a binding obligation to fully indemnify
the Borrower in respect of all Contingent Obligations specified in such Schedule
5.10 not relating to the Arbitron Business. The projections delivered pursuant
to Section 4.01(a)(viii) have been reasonably prepared, in good faith, based
upon reasonable assumptions, and are consistent with the prepayment requirements
set forth in this Agreement and in the Note Purchase Agreement.
(d) The Preliminary Opening Balance Sheet delivered by the Borrower
to the Administrative Agent pursuant to Section 4.01(a)(viii) and the pro forma
opening balance sheet delivered by the Borrower to the Administrative Agent
pursuant to Section 4.02(a)(iii): (i) were prepared on a basis consistent with
GAAP as applied to the Borrower's financial statements, (ii) have been
reasonably prepared on bases reflecting the best currently available estimates
and judgments of the senior management of the Borrower and New Ceridian as to
the expected future performance of the Borrower, (iii) accurately reflect all
material adjustments required to be made to give effect to the Spin-Off
Transaction, and (iv) present fairly on a pro forma basis the estimated
consolidated financial position of the Borrower and its Arbitron Subsidiaries as
of the date thereof, assuming consummation of the Spin-Off Transaction.
5.11 ENVIRONMENTAL MATTERS.
(a) The ongoing operations of the Borrower and each of its
Subsidiaries comply in all respects with all Environmental Laws, except such
non-compliance which would not (if enforced in accordance with applicable law)
result in liability that would reasonably be expected to have a Material Adverse
Effect.
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(b) As of the Effectiveness Date and the Closing Date, except as
specifically disclosed on Schedule 5.11, neither the Borrower nor any of its
Subsidiaries, nor any of their respective present property or operations, is
subject to any outstanding written order from or agreement with any Governmental
Authority, nor subject to any judicial or docketed administrative proceeding,
respecting any Environmental Law, Environmental Claim or Hazardous Material.
(c) Except as specifically disclosed on Schedule 5.11, there are no
Hazardous Materials or other conditions or circumstances existing with respect
to any property, or arising from operations of the Borrower or any of its
Subsidiaries that would reasonably be expected to give rise to Environmental
Claims with a potential liability of the Borrower and its Subsidiaries that in
the aggregate for any such condition, circumstance or property would reasonably
be expected to have a Material Adverse Effect.
(d) Except as expressly otherwise stated in Schedule 5.11, New
Ceridian is subject from and after the Separation Date, to a binding obligation
to fully indemnify the Borrower in respect of all matters referenced in such
Schedule 5.11 not relating to the Arbitron Business.
5.12 REGULATED ENTITIES. None of the Borrower, any Person controlling
the Borrower, or any Subsidiary of the Borrower, is (a) an "investment company"
within the meaning of the Investment Company Act of 1940; or (b) subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, any state public utilities code, or any
other Federal or state statute or regulation limiting its ability to incur
Indebtedness, except that certain Persons who may be deemed to control the
Borrower are registered investment companies within the meaning of the
Investment Company Act of 1940.
5.13 COLLATERAL DOCUMENTS. The Collateral Documents are effective to
create in favor of the Administrative Agent for the benefit of the Lenders, a
legal, valid and enforceable first priority security interest, subject to the
terms of the Intercreditor Agreement, in all right, title and interest of the
Loan Parties in the Collateral described therein; and UCC-1 financing statements
have been filed in the offices in all of the jurisdictions listed in the
schedules to the Security Agreements.
5.14 NO BURDENSOME RESTRICTIONS. Neither the Borrower nor any of its
Subsidiaries is a party to or bound by any Contractual Obligation, or subject to
any charter or corporate restriction, or any Law, which could reasonably be
expected to have a Material Adverse Effect. As of the Effectiveness Date and the
Closing Date, no Subsidiary (other than New Ceridian and Subsidiaries that are
not Arbitron Subsidiaries) is party to or bound by any Contractual Obligation
restricting the ability of such Subsidiary to pay dividends or make loans to the
Borrower.
5.15 SOLVENCY. The Borrower and each of its Material Subsidiaries are
Solvent. Both immediately before and after the Separation Date and the Spin-Off
Consummation Date, New Ceridian is Solvent. All statements contained in any
certificate delivered to the Administrative Agent pursuant to Section
4.01(a)(viii) and Section 4.02(a)(iv) are true and accurate in all material
respects and not materially misleading, and do not contain any material
omissions of fact.
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5.16 LABOR RELATIONS. There are no strikes, lockouts or other labor
disputes against the Borrower or any of its Subsidiaries, or, to the best of the
Borrower's knowledge, threatened against or affecting the Borrower or any of its
Subsidiaries, and no significant unfair labor practice complaint is pending
against the Borrower or any of its Subsidiaries or, to the best knowledge of the
Borrower, threatened against any of them before any Governmental Authority
which, in any case, could reasonably be expected to have a Material Adverse
Effect.
5.17 INTELLECTUAL PROPERTY; PROPRIETARY INFORMATION Except as
specifically set forth on Schedule 5.17:
(a) The Borrower owns (directly or through the Arbitron
Subsidiaries) all of the Intellectual Property and Proprietary Information that
is material to the Arbitron Business (including that in relation to the
"Portable People Meter" and "Critical Band Encoding Technique"), free of any
right, claim or interest of any Person, except for Permitted Liens.
(b) To the best knowledge of the Borrower, no Intellectual Property
or Proprietary Information now employed by the Borrower or its Subsidiaries and
relating to the Arbitron Business infringes upon any rights held by any other
Person.
(c) As of the Closing Date and Spin-Off Consummation Date, except as
specifically disclosed on Schedule 5.05 attached hereto, no claim or litigation
regarding any Intellectual Property or Proprietary Information relating to the
Arbitron Business is pending against the Borrower or its Subsidiaries or, to the
Borrower's knowledge, threatened against any of such Persons.
(d) As of the Closing Date and Spin-Off Consummation Date, neither
Borrower nor any of its Subsidiaries uses pursuant to a license agreement with
any third party (except for ordinary shrinkwrap licenses for software products
that the Borrower and its Subsidiaries use in the Ordinary Course of Business
and licenses specified on Schedule 5.17) any patents, trademarks, service marks,
trade names, copyrights, trade secrets or franchises material to the conduct of
the Arbitron Business.
(e) As of the Closing Date and Spin-Off Consummation Date, in
relation to the Arbitron Business, each of the Borrower's and its Subsidiaries'
respective employees who, either alone or in concert with others, developed,
invented, discovered, derived, programmed or designed Intellectual Property or
Proprietary Information, or who has knowledge of or access to information about
Intellectual Property or Proprietary Information, has entered into one or more
effective assignment of rights agreements in favor of the Borrower or its
Subsidiaries, as applicable, no material exceptions have been taken by any such
employee to the terms of any such agreements, and neither the Borrower nor any
of its Subsidiaries is aware that any of its respective employees is in
violation thereof.
(f) As of the Closing Date and Spin-Off Consummation Date, neither
the Borrower nor its Subsidiaries believes it is or will be necessary in
relation to the Arbitron Business to utilize any inventions of any of their
respective employees (or people they currently intend to hire or retain) that
were invented prior to such employment, except those inventions formally
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assigned or transferred to the Borrower or the Arbitron Subsidiaries, as
applicable, by such employees.
(g) As of the Effectiveness Date, neither Borrower nor any Arbitron
Subsidiary owns, licenses or sub-licenses any Material Software in connection
with the Arbitron Business.
5.18 INSURANCE. As of the Closing Date and Spin-Off Consummation
Date, the properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies, in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or such Subsidiary operates.
5.19 EMPLOYMENT AGREEMENTS. Except as set forth on Schedule 5.19, as
of the Effectiveness Date, Closing Date and Spin-Off Consummation Date, in
relation to the Arbitron Business neither the Borrower nor any of its
Subsidiaries is (a) party to or bound by any employment contract or agreement,
agency, independent contractor or sales representative agreement involving
annual compensation at a base rate equal to or exceeding $200,000, golden
parachute agreement, or change of control agreement; or (b) obligated to make
any payments on account of any severance, golden-parachute, or change of control
agreement.
5.20 SPIN-OFF DOCUMENTS; PRIVATE PLACEMENT DOCUMENTS.
(a) The representations and warranties of the Borrower contained in
the Spin-Off Documents and in any other document filed or delivered to the SEC
in connection with the Spin-Off Transaction are true and correct in all material
respects as of the Effectiveness Date and the Closing Date and as of any other
date specified in such documents. There are no material documents or agreements
to be entered into by the Borrower or the Arbitron Subsidiaries in connection
with the Spin-Off Transaction, other than the Spin-Off Documents.
(b) The representations and warranties of the Borrower contained in
the Private Placement Documents, and in any other documents delivered to the
Placement Agent in connection therewith, are true and correct in all material
respects as of the Effectiveness Date and the Closing Date and as of any other
date specified in such documents.
5.21 CAPITALIZATION; SUBSIDIARIES.
(a) As of the Effectiveness Date, the Closing Date, and the Spin-Off
Consummation Date, Schedule 5.21 sets forth: (i) a true, correct and reasonably
detailed description of all Subsidiaries, and specifying which Subsidiaries are
(a) Arbitron Subsidiaries and (b) Material Subsidiaries; and (ii) all authorized
shares of capital stock of the Borrower and all the Arbitron Subsidiaries, and
the number of shares of each class of capital stock of such Subsidiaries that
are issued and outstanding. All of the issued and outstanding shares of capital
stock of the Borrower and the Subsidiaries have been duly authorized and are
validly issued, fully paid and non-assessable, and are free and clear of any
Liens and other restrictions (including any restrictions on the right to vote,
sell or otherwise dispose of such capital stock) and of any preemptive or other
similar rights to subscribe for or to purchase any such capital stock.
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(b) Except as set forth on Schedule 5.21 (which Schedule sets forth
a true, correct and complete description of, with respect to each security,
title, name of the holder or Person, as applicable, the number of shares of
capital stock underlying such security, exercise price, expiration date and
percentage of shares of such capital stock on a fully diluted basis), as of the
Effectiveness Date and Closing Date, there are: (i) no outstanding rights to
acquire equity in any Subsidiary; (ii) no voting trusts of other agreements or
undertakings with respect to the voting of the capital stock of any Subsidiary;
(iii) no obligations or rights (whether fixed or contingent) on the part of any
Subsidiary, any of its directors or officers, or any other Person to purchase,
repurchase, redeem or "put" any outstanding shares of the capital stock of such
Persons; and (iv) no agreements to which any Subsidiary, any of its directors or
officers, or any other Person is a party granting any other Person any rights of
first offer or first refusal, registration rights or "drag-along" "tag-along" or
similar rights with respect to any transfer of any capital stock or equity
rights of any Subsidiary.
(c) As of the Effectiveness Date, the Closing Date and the Spin-Off
Consummation Date, all shares of capital stock and equity rights of the Borrower
or any Subsidiary that have been issued have been issued and offered in
compliance with all applicable federal and state securities laws. Except as set
forth on Schedule 5.21 no additional shares of capital stock of any Arbitron
Subsidiary will become issuable to any Person pursuant to any "anti-dilution"
provisions of any such issued and outstanding securities of any Subsidiary on
account of the issuance of any securities.
5.22 MARGIN REGULATIONS. Neither the Borrower, New Ceridian, nor any
Subsidiary is engaged in the business of extending credit for the purpose of
purchasing or carrying "margin stock" (within the meaning of Regulation U of the
Federal Reserve Board). No part of the proceeds of the Loans is being or will be
used to purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any margin stock.
5.23 BROKERS; CERTAIN EXPENSES. No Loan Party or Affiliate has paid
or is obligated to pay any fee or commission to any broker, finder, investment
bank or other intermediary, in connection with this Agreement or any of the
Spin-Off Documents or the transactions contemplated hereby or thereby, other
than as set forth on Schedule 5.23. No Loan Party or Affiliate is bound by any
agreement or commitment for the provision of investment banking or financial
advisory services with respect to any recapitalization, issuance of debt or
equity securities or other capital or financing transactions involving the Loan
Parties that would operate to restrict or prevent the occurrence of the Closing
Date or the Spin-Off Consummation Date.
5.24 YEAR END. As of the Effectiveness Date, Borrower's and New
Ceridian's fiscal year ends on December 31 of each year.
5.25 THIRD PARTY CONSENTS. Other than as set forth in Schedule 5.25,
and except as have been obtained before the Closing Date, no approval, consent,
exemption, authorization, amendment or waiver, or other action by, or notice to,
or filing with, any Person is necessary or required in connection with (a) the
execution, delivery or performance by or enforcement against the Borrower or New
Ceridian of the Spin-Off Documents, (b) the consummation of the Spin-Off
Transaction or (c) the conduct of the Arbitron Business from and after the
Closing Date and the Spin-Off Consummation Date.
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5.26 EXISTING INDEBTEDNESS. As of the Closing Date, neither the
Borrower nor any of the Arbitron Subsidiaries is indebted on account of any
Indebtedness, except Initial Permitted Indebtedness. The allocation of
Indebtedness and other obligations existing as of the Closing Date, as between
the Borrower and New Ceridian, has been undertaken in a fair and reasonable
fashion.
5.27 NEW CERIDIAN OBLIGATIONS. From and after the Closing Date, New
Ceridian is legally obligated, under the Spin-Off Documents, to indemnify the
Borrower and hold the Borrower harmless from all material obligations of the
Borrower and its Arbitron Subsidiaries other than those incurred pursuant to or
in furtherance of the Arbitron Business, and New Ceridian has neither repudiated
nor breached in any material respect such obligation.
5.28 SWAP CONTRACTS. As of the Closing Date, neither the Borrower nor
any Subsidiary is party to any Swap Contracts other than Permitted Swap
Contracts.
5.29 FULL DISCLOSURE. None of the representations or warranties made
by the Borrower, New Ceridian or any of their respective Subsidiaries in the
Loan Documents as of the date such representations and warranties are made or
deemed made, and none of the statements contained in each exhibit, report,
statement or certificate furnished by or on behalf of the Borrower or any
Subsidiary in connection with the Loan Documents as of the date such statements
are made or deemed made, contains any untrue statement of a material fact or
omits any material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they are
made, not misleading. The Form 10 (including all Exhibits thereto) does not
contain any untrue statement of a material fact or omit any material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they are made, not misleading.
ARTICLE VI.
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that, so long as any Lender shall have
any Commitment hereunder, or any Loan or other Obligation shall remain unpaid or
unsatisfied, unless the Required Lenders waive compliance in writing:
6.01 FINANCIAL STATEMENTS. The Borrower shall deliver to the
Administrative Agent and each Lender in form and detail satisfactory to the
Administrative Agent and the Required Lenders:
(a) as soon as available, but not later than 90 days after the end
of each fiscal year commencing with the fiscal year ending December 31, 2000, a
copy of the audited consolidated financial statements of the Borrower as of the
end of such fiscal year, setting forth in each case in comparative form the
figures for the previous year (based on the Audited Financial Statements, if
applicable), and accompanied by the opinion of KPMG Peat Marwick LLP or another
nationally-recognized independent public accounting firm, which opinion shall
state that such consolidated financial statements present fairly in all material
respects the financial position of the Borrower and its Subsidiaries as of the
dates indicated (on a stand-alone basis reflecting the consummation of the
Spin-Off Transaction, in the case of the December 31, 2000 statements) and the
results of
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their operations and their cash flows for the periods indicated in conformity
with GAAP; such opinion shall not be qualified or limited for any reason,
including because of a restricted or limited examination by such accountant of
any material portion of the Borrower's or any Subsidiary's records;
(b) (i) as soon as available, but not later than 45 days after the
end of the first three fiscal quarters of each fiscal year of the Borrower, (A)
a copy of the Borrower's quarterly report on Form 10-Q filed with the SEC with
respect to such fiscal quarter, (B) an operating report summarizing the
Borrower's consolidated year-to-date profit and loss, revenue, operating profit,
invested capital, and cash flow information; and (ii) if the Borrower at such
time is not required to file such Form 10-Q with the SEC under the Exchange Act,
as soon as available, but in any event within 60 days after the end of each
fiscal quarter, a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal quarter, and the related consolidated
statements of income and cash flows for such fiscal quarter and for the portion
of the Borrower's fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year, and the corresponding portion of the previous fiscal year
(based on the Audited Financial Statements or the Supplemental Financial
Statements, if applicable), together with the items described in clause (i)(B)
of this subsection; all in reasonable detail and certified by a Responsible
Officer of the Borrower as fairly presenting the financial condition, results of
operations, and cash flows of the Borrower and its Subsidiaries in accordance
with GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes;
(c) promptly upon receipt thereof, copies of all reports submitted
to the Borrower or any of its Subsidiaries by its independent certified public
accountants in connection with each annual, interim or special audit examination
of the Borrower or any of its Subsidiaries made by such accountants, including
the "management letter" submitted by such accountants to the Borrower or any of
its Subsidiaries in connection with their annual audit; and
(d) as soon as available and in any event not less than 30 days
prior to the start of each fiscal year, a consolidated financial forecast for
the Borrower and its Subsidiaries for the following fiscal year, including
forecasted consolidated balance sheets, consolidated statements of income,
shareholders' equity and cash flows of the Borrower and its Subsidiaries, which
forecast shall (i) state the assumptions used in the preparation thereof, (ii)
contain such other information as reasonably requested by any Lender and (iii)
be in form reasonably satisfactory to the Administrative Agent and the Required
Lenders.
6.02 CERTIFICATES; OTHER INFORMATION. The Borrower shall furnish to
the Administrative Agent and each Lender:
(a) as soon as available, but in any event not later than 15 days
after the delivery of the financial statements referred to in Section 6.01(a)
and (b) above, a Compliance Certificate, signed by a Responsible Officer;
(b) copies of each registration statement (or prospectus contained
therein) of the Borrower other than with respect to employee benefit plans, each
periodic report regarding the Borrower required pursuant to Section 13 of the
Exchange Act, each annual report, each proxy
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statement and any amendments to any of the above filed or reported by the
Borrower with or to any securities exchange or the SEC, copies of each
communication from the Borrower or any Subsidiary to the Borrower's shareholders
generally, promptly upon the filing or making thereof and copies of such other
filings, reports and communications with the Borrower's shareholders as the
Administrative Agent may from time to time request;
(c) upon release, copies of all financially material press releases
by the Borrower or any Material Subsidiary;
(d) promptly after the creation or Acquisition of any Material
Subsidiary, the name of such Subsidiary, a description of its business, the
price paid for the stock or assets of such Subsidiary, its net worth and the
value of its assets;
(e) promptly after the execution and filing thereof, copies of all
patent, trademark and copyright filing certificates of the Borrower and any
Subsidiary as required more fully under the Security Agreements; and
(f) promptly, such additional business, financial, corporate affairs
and other information as the Administrative Agent, at the request of any Lender,
may from time to time reasonably request.
Reports required to be delivered pursuant to Sections 6.01 or 6.02(b)
shall be deemed to have been delivered on the date on which Borrower posts such
reports on the Borrower's website on the Internet at the website address listed
on Schedule 10.02 hereof or when such report is posted on the Securities and
Exchange Commission's website at ▇▇▇.▇▇▇.▇▇▇.; provided that (x) Borrower shall
deliver paper copies of such reports to the Administrative Agent and any Lender
who requests the Borrower to deliver such paper copies until written request to
cease delivering paper copies is given by the Administrative Agent or such
Lender, (y) the Borrower shall notify by facsimile the Administrative Agent and
each Lender of the posting of any such reports, and (z) in every instance the
Borrower shall provide paper copies of the Compliance Certificates required by
Section 6.02(a) to the Administrative Agent and each of the Lenders. Except for
such Compliance Certificates, the Administrative Agent shall have no obligation
to request the delivery or to maintain copies of the reports referred to above,
and in any event shall have no responsibility to monitor compliance by the
Borrower with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
reports.
6.03 NOTICES. The Borrower shall promptly notify the Administrative
Agent and each Lender upon a Responsible Officer of the Borrower obtaining
knowledge:
(a) of the occurrence of any Default or Event of Default and, until
the Spin-Off Consummation Date, the occurrence of any "Default" or "Event of
Default" under and as defined in the New Ceridian Credit Agreement;
(b) of (i) any breach or non-performance of, or any default under,
any Contractual Obligation of the Borrower or any of its Subsidiaries which
would reasonably be expected to result in a Material Adverse Effect; and (ii)
any dispute, litigation, investigation, proceeding or suspension by an
Governmental Authority that may exist or come to exist at any time in which
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the Borrower or any of its Subsidiaries is a party which would reasonably be
expected to result in a Material Adverse Effect (and assuming for this purpose
the reasonable likelihood of an adverse decision);
(c) of the commencement of, or any material development in, any
litigation or proceeding affecting the Borrower or any Subsidiary which would
reasonably be expected to: (i) have a Material Adverse Effect (and taking into
account the reasonable likelihood of an adverse decision), (ii) if adversely
resolved against such Person, result in the imposition of an injunction or other
stay of the performance of this Agreement or any Loan Document or the
consummation of the Spin-Off Transaction, or (iii) involve an aggregate
liability of $1,000,000 (or its equivalent in another currency) or more;
(d) of (i) any and all enforcement, cleanup, removal or other
governmental or regulatory actions affecting the Borrower or any of its
Subsidiaries or any of their respective properties pursuant to any applicable
Environmental Laws, (ii) all other Environmental Claims, and (iii) any
environmental or similar condition on any real property adjoining or in the
vicinity of the property of the Borrower or any Subsidiary that could reasonably
be anticipated to cause the property of the Borrower or any of its Subsidiaries
or any part thereof to be subject to any restrictions on the ownership,
occupancy, transferability or use of such property under any Environmental Laws,
if, individually or in the aggregate, the events or conditions described or the
amount claimed in clauses (i), (ii) and (iii) would reasonably be expected to
result in a Material Adverse Effect;
(e) of the occurrence of any ERISA Event affecting the Borrower or
any ERISA Affiliate, and deliver to the Administrative Agent and each Lender a
copy of any notice with respect to such event that is filed with a Governmental
Authority and any notice delivered by a Governmental Authority to the Borrower
or any ERISA Affiliate with respect to such event;
(f) of any Material Adverse Effect subsequent to the date of the
most recent audited financial statements of the Borrower delivered to the
Lenders pursuant to Section 6.01(a);
(g) of any labor controversy resulting in or threatening to result
in any strike, work stoppage, boycott, shutdown or other labor disruption
against or involving the Borrower or any of its Subsidiaries;
(h) of the creation, purchase, or acquisition of any Subsidiary
(including its jurisdiction of incorporation);
(i) of: (i) any Subsidiary being or becoming a Material Subsidiary,
and (ii) of any Material Subsidiary ceasing to be a Material Subsidiary;
(j) of the occurrence of the Separation Date and the Spin-Off
Consummation Date;
(k) of (i) the exercise or termination of any option under the
▇▇▇▇▇▇▇ ▇▇ Option Agreement, (ii) the formation of any ▇▇▇▇▇▇▇ ▇▇, (iii) any
decision by the Borrower not to commercially deploy the PPM Technology and (iv)
the occurrence of any material breach or default under the terms of the ▇▇▇▇▇▇▇
▇▇ Option Agreement or the Scarborough Partnership Agreement;
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(l) of any material breach or default under, or any material waiver
or consent granted pursuant to, any Spin-Off Document;
(m) of the occurrence of any Event of Loss or Disposition with
respect to any assets of the Borrower or any Material Subsidiary (other than New
Ceridian) where the fair value of the assets exceed on an aggregate basis, for
each such occurrence, $250,000; and
(n) of the occurrence of any "Default" or "Event of Default" (or
comparable term) under, and as defined in, the Private Placement Documents.
Each notice pursuant to this Section 6.03 shall be accompanied by a
certificate by a Responsible Officer of the Borrower setting forth details of
the occurrence referred to therein, and stating what action, if any, the
Borrower proposes to take with respect thereto and at what time. Each notice
under Section 6.03(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been breached or
violated.
6.04 PRESERVATION OF CORPORATE EXISTENCE, ETC. The Borrower shall,
and shall cause each of its Subsidiaries to:
(a) except as permitted in Section 7.02, preserve and maintain in
full force and effect its corporate existence and good standing under the laws
of its state or jurisdiction of incorporation;
(b) preserve and maintain in full force and effect all material
rights, privileges, qualifications, permits, licenses and franchises necessary
or desirable in the normal conduct of its business except in connection with
transactions permitted by Sections 7.02 and 7.04;
(c) use its reasonable efforts, in the Ordinary Course of Business,
to preserve its business organization and preserve the goodwill and business of
the customers, suppliers and others having material business relations with it;
and
(d) preserve or renew all of its registered trademarks, trade names
and service marks, the non-preservation of which would reasonably be expected to
have a Material Adverse Effect, provided, however, that the Borrower shall not
be deemed to be in default under this Section 6.04 if a Subsidiary (other than a
Material Subsidiary) fails to comply herewith so long as such failure is not
material.
On or before the Spin-Off Consummation Date, the Borrower shall file
with appropriate Governmental Authorities all necessary filings in order to
change its name to "Arbitron Inc."
6.05 MAINTENANCE OF PROPERTY. The Borrower shall maintain, and shall
cause each of its Subsidiaries to maintain, and preserve all its property which
is used or useful in its business in good working order and condition, ordinary
wear and tear excepted, make all necessary repairs thereto and renewals and
replacements thereof, except as permitted by Section 7.04, and to keep such
property free of any Hazardous Materials. The Borrower shall use at least the
standard of care typical in the industry in the operation of its facilities.
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6.06 INSURANCE. The Borrower shall maintain, and shall cause each of
its Material Subsidiaries to maintain, with financially sound and reputable
independent insurers, insurance with respect to its properties and business
against loss or damage of the kinds customarily insured against by Persons
engaged in the same or similar business, of such types and in such amounts as
are customarily carried under similar circumstances by such other Persons;
including workers' compensation insurance, public liability and property and
casualty insurance. All such policies, to the extent consisting of CGL or
property or casualty policies, shall name the Administrative Agent as loss
payee/mortgagee and as additional insured, for the benefit of the Lenders, as
their interests may appear. Upon request of the Administrative Agent or any
Lender, the Borrower shall furnish the Administrative Agent, with sufficient
copies for each Lender, at reasonable intervals (but not more than once per
calendar year) a certificate of a Responsible Officer of the Borrower (and, if
requested by the Administrative Agent, any insurance broker of the Borrower)
setting forth the nature and extent of all insurance maintained by the Borrower
and its Material Subsidiaries in accordance with this Section 6.06 (and which,
in the case of a certificate of a broker, were placed through such broker).
6.07 PAYMENT OF OBLIGATIONS. (a) The Borrower shall, and shall cause
its Subsidiaries to, pay and discharge as the same shall become due and payable,
all their respective obligations and liabilities, including:
(i) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same
are being contested in good faith by appropriate proceedings and
adequate reserves in accordance with GAAP are being maintained by the
Borrower or such Subsidiary;
(ii) all lawful claims which, if unpaid, would by law become
a Lien upon its property; and
(iii) all Indebtedness, as and when due and payable, but
subject to any subordination provisions contained in any instrument or
agreement evidencing such Indebtedness;
provided, however, that the Borrower and its Subsidiaries shall not be deemed to
be in default under this Section 6.07(a) if failure to comply herewith would not
result in a Material Adverse Effect.
(b) The Borrower shall use its commercially reasonable efforts to
cause, on or prior to the Spin-Off Consummation Date or as soon as practicable
thereafter, the Borrower and all Arbitron Subsidiaries to be released as
guarantors of or obligors for any liability described in Schedule 5.10 and
allocated to New Ceridian pursuant to the Distribution Agreement between the
Borrower and New Ceridian dated on or before the Separation Date.
6.08 COMPLIANCE WITH LAWS. The Borrower shall comply, and shall cause
each of its Subsidiaries to comply, in all material respects with all material
Laws applicable to it or its business (including the Federal Fair Labor
Standards Act), except such as may be contested in good faith or as to which a
bona fide dispute may exist.
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6.09 ERISA COMPLIANCE. The Borrower shall, and shall cause each of
its ERISA Affiliates to: (a) maintain each Pension Plan in compliance with
ERISA, the Code and other applicable Laws; (b) cause each Pension Plan that is
qualified under Section 401(a) of the Code to maintain such qualification; and
(c) make all required contributions to any Pension Plan subject to Section 412
of the Code.
6.10 INTEREST RATE PROTECTION. Within 90 days of the Closing Date,
the Borrower shall enter into and shall maintain in effect one or more Specified
Swap Contracts providing protection against fluctuations in interest rates with
respect to at least 50% of the difference between the Outstanding Amount from
time to time and the outstanding principal amount from time to time of notes
issued pursuant to the Private Placement; on such terms and with such financial
institutions as shall be satisfactory to the Administrative Agent and the
Required Lenders.
6.11 INSPECTION OF PROPERTY AND BOOKS AND RECORDS. The Borrower shall
maintain and shall cause each of its Material Subsidiaries to maintain proper
books of record and account, in which full, true and correct entries in
conformity with GAAP consistently applied shall be made of all financial
transactions and matters involving the assets and business of the Borrower and
such Subsidiaries. The Borrower shall permit, and shall cause each of its
Material Subsidiaries to permit, representatives and independent contractors of
the Administrative Agent or any Lender to visit and inspect any of their
respective properties, to examine their respective corporate, financial and
operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
officers and independent public accountants at such reasonable times during
normal business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; provided, however, when a Default exists, (i)
the Administrative Agent or any Lender may do any of the foregoing with respect
to the Borrower or any Subsidiary at any time during normal business hours and
without advance notice and (ii) such inspection, examination and meetings shall
be at the Borrower's expense.
6.12 ENVIRONMENTAL LAWS.
(a) The Borrower shall, and shall cause each of its Subsidiaries to,
conduct its operations and keep and maintain its property in compliance in all
material respects with all Environmental Laws.
(b) Upon the written request of the Administrative Agent or any
Lender, the Borrower shall submit to the Administrative Agent with sufficient
copies for each Lender, at the Borrower's sole cost and expense, a report
providing an update of the status of any environmental, health or safety
compliance, hazard or liability issue identified in any notice or report
required pursuant to Section 6.03(d).
6.13 USE OF PROCEEDS. The Borrower may use the proceeds of the Loans
and the Letters of Credit (a) to provide all or a portion of the funds necessary
to repay in full all of the Indebtedness of the Borrower that is outstanding as
of the Closing Date, to the extent otherwise permitted or required hereunder,
and to replace any letters of credit outstanding under the Existing Credit
Facility, (b) to the extent otherwise permitted or required hereunder, to
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repurchase or redeem securities of the Borrower, and (c) for working capital and
other general corporate purposes (including Permitted Acquisitions).
6.14 ADDITIONAL GUARANTORS. If any Arbitron Subsidiary, other than a
Foreign Subsidiary, shall at any time become a Material Subsidiary, or if the
Borrower or any Subsidiary otherwise shall incorporate, create or acquire any
Material Subsidiary, other than a Foreign Subsidiary, the Borrower shall cause
such Material Subsidiary to furnish promptly, but in no event more than 30 days
thereafter, each of the following to the Administrative Agent, in sufficient
quantities for each Lender:
(a) if such Subsidiary is the first such Subsidiary, a duly executed
Subsidiary Guaranty, and for each such succeeding Subsidiary, a duly executed
notice and agreement in substantially the form of Exhibit N (an "Additional
Guarantor Assumption Agreement");
(b) a duly executed Subsidiary Security Agreement, in substantially
the form of Exhibit H, together with such other Collateral Documents as the
Administrative Agent or any Lender may request; and
(c) (i) copies of the resolutions of the board of directors (or
equivalent governing body) of such Subsidiary approving and authorizing the
execution, delivery and performance by such Subsidiary of its Subsidiary
Guaranty or Additional Guarantor Assumption Agreement, this Agreement, and the
other Loan Documents, including all Collateral Documents to which it is a
party), certified as of the effective date of such Additional Guarantor
Assumption Agreement by the Secretary or an Assistant Secretary (or other
appropriate officer) of such Subsidiary; (ii) a certificate of the Secretary or
Assistant Secretary (or other appropriate officer) of such Subsidiary certifying
the names and true signatures of the officers of such Subsidiary authorized to
execute and deliver and perform, as applicable, its Additional Guarantor
Assumption Agreement, this Agreement and all other Loan Documents and Collateral
Documents to be delivered hereunder; (iii) copies of the articles or certificate
of incorporation and bylaws (or other applicable Organization Documents) of such
Subsidiary as in effect on the effective date of such Additional Guarantor
Assumption Agreement, certified by the Secretary or Assistant Secretary (or
other appropriate officer) of such Subsidiary as of such date; and (iv) an
opinion of counsel to such Subsidiary and addressed to the Administrative Agent
and the Lenders, in form satisfactory to the Administrative Agent and addressing
the matters set forth in Exhibit O.
6.15 ADDITIONAL SUBSIDIARIES.
(a) If the Borrower directly or indirectly incorporates, creates or
acquires any additional Arbitron Subsidiary, then within 10 days thereafter, the
Borrower shall (i) (A) pledge the capital stock of such additional Subsidiary to
the Collateral Agent pursuant to the Borrower Pledge Agreement, if such stock is
directly owned by the Borrower, or (B) if such stock is owned by a Subsidiary,
cause such Subsidiary to pledge the capital stock of such additional Subsidiary
to the Administrative Agent pursuant to a Subsidiary Pledge Agreement, (ii)
execute and deliver, or cause such Subsidiary to have executed and delivered, to
the Collateral Agent stock transfer powers executed in blank with signatures
guaranteed as the Collateral Agent shall request, such Subsidiary Security
Agreements and UCC-1 financing statements (as furnished by the Collateral Agent)
for filing in each jurisdiction in which such filing is necessary to establish
and perfect the
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first priority security interest of the Collateral Agent (subject to the terms
of the Intercreditor Agreement) in the Collateral with respect to the Borrower
or such Subsidiary, and (iii) deliver such other items as reasonably requested
by the Administrative Agent in connection with the foregoing, including
resolutions, incumbency and officers' certificates, opinions of counsel, search
reports and other certificates and documents; provided, however, that if any
additional Subsidiary so incorporated, created or acquired is a Foreign
Subsidiary, in no event shall more than 65% of the capital stock of any such
Foreign Subsidiary be required to be so pledged.
(b) If the combined EBITDA of all Arbitron Subsidiaries that are not
Material Subsidiaries is greater than or equal to 10% of Consolidated EBITDA,
based on the Borrower's quarterly financial statements for the most recent
calendar quarter delivered to the Administrative Agent pursuant to Section 6.01,
the Borrower shall designate one or more such Subsidiaries as a Material
Subsidiary, such that after giving effect to all such designations the combined
EBITDA of all remaining Arbitron Subsidiaries that are not Material Subsidiaries
is less than 10% of Consolidated EBITDA. Within 10 days of the date of any such
designation, the Borrower and any Subsidiary designated as a Material Subsidiary
shall take all actions required under Section 6.14.
(c) Following the delivery of Borrower's quarterly financial
statements pursuant to Section 6.01, the Borrower may de-designate any
Subsidiary previously designated as a Material Subsidiary under subsection (b)
of this Section so that such Subsidiary shall no longer be treated as a Material
Subsidiary, effective as of the date on which such de-designation is made,
provided that: (i) such Subsidiary is not independently a Material Subsidiary
under subsection (a) of the definition thereof and (ii) after giving effect to
such de-designation the combined EBITDA of all Subsidiaries that are not
Material Subsidiaries (including the EBITDA of the Subsidiary that has been
de-designated) shall be less than 10% of Consolidated EBITDA. Notwithstanding
any such de-designation, all Collateral Documents and Subsidiary Guaranties
executed by each such Subsidiary pursuant to Section 6.14 shall continue in full
force and effect according to their respective terms, and subject to the terms
of the Intercreditor Agreement.
6.16 ADDITIONAL INTELLECTUAL PROPERTY. The Borrower and each Arbitron
Subsidiary shall execute such Supplemental IP Security Agreements and shall
undertake such other filings, recordations, registrations and actions from time
to time with respect to Intellectual Property created, purchased or otherwise
acquired by the Borrower or such Subsidiary after the Effectiveness Date, as
more fully set forth in the Borrower Security Agreement and Subsidiary Security
Agreement or as reasonably requested by the Administrative Agent or any Lender.
6.17 LICENSES. The Borrower shall, and shall cause each of its
Subsidiaries to, obtain and maintain all material licenses, authorizations,
consents, filings, exemptions, registrations and other governmental approvals
necessary in connection with the execution, delivery and performance of the Loan
Documents, the consummation of the transactions therein contemplated or the
operation and conduct of its business and ownership of their properties.
6.18 FURTHER ASSURANCES.
(a) The Borrower shall ensure that all written information, exhibits
and reports furnished to the Administrative Agent or the Lenders do not and will
not contain any untrue
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statement of a material fact and do not and will not omit to state any material
fact necessary to make the statements contained therein not misleading in light
of the circumstances in which made, and will promptly disclose to the
Administrative Agent and the Lenders and correct any defect or error that may be
discovered therein or in any Loan Document or in the execution, acknowledgment
or recordation thereof.
(b) Promptly upon request by the Administrative Agent or the
Required Lenders, the Borrower shall (and shall cause any of its Subsidiaries
to) do, execute, acknowledge and deliver any and all such further acts,
certificates, security agreements, assignments, estoppel certificates, financing
statements, and continuations or amendments thereof, termination statements,
notices of assignment, transfers, assurances and other instruments as the
Administrative Agent or such Lenders, as the case may be, may reasonably require
from time to time in order (i) to carry out more effectively the purposes of
this Agreement or any other Loan Document, (ii) to subject to the Liens created
by any of the Collateral Documents any of the properties, rights or interests
covered by any of the Collateral Documents, (iii) to perfect and maintain the
validity, effectiveness and priority of any of the Collateral Documents and the
Liens intended to be created thereby, and (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Administrative Agent and
Lenders the rights granted or now or hereafter intended to be granted to the
Lenders under any Loan Document or under any other document executed in
connection therewith.
ARTICLE VII.
NEGATIVE COVENANTS
The Borrower hereby covenants and agrees that, so long as any Lender
shall have any Commitment hereunder, or any Loan or other Obligation shall
remain unpaid or unsatisfied, unless the Required Lenders waive compliance in
writing:
7.01 LIMITATION ON LIENS. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, directly or indirectly, make,
create, incur, assume or suffer to exist any Lien upon or with respect to any
part of its property (including Intellectual Property, Proprietary Information
and accounts and notes receivable, with or without recourse), whether now owned
or hereafter acquired, other than the following ("Permitted Liens"):
(a) any Lien created under any Loan Document;
(b) (i) Liens existing on the Closing Date and listed on Schedule
7.01 and any renewals or extensions thereof, provided that the property covered
thereby is not increased and any renewal or extension of the obligations secured
or benefited thereby is permitted by Section 7.03(a)(iii); and (ii) at any time
prior to the Spin-Off Consummation Date, Liens on New Ceridian Assets that
would, if such assets were at such time owned or held by New Ceridian,
constitute "Permitted Liens" under and as defined in the New Ceridian Credit
Agreement;
(c) Liens for taxes, fees, assessments or other governmental charges
or statutory obligations which are not delinquent or remain payable without
penalty, or to the extent that non-payment thereof is permitted by Section 6.07,
provided that no Notice of Lien has been filed or recorded under the Code;
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(d) Liens arising in the Ordinary Course of Business in connection
with obligations (other than obligations for borrowed money) that are not
overdue or which are being contested in good faith and by appropriate
proceedings, including, but not limited to Liens under bid, performance and
other surety bonds, supersedeas and appeal bonds, Liens on advance or progress
payments received from customers under contracts for the sale, lease or license
of goods, software, services, or real estate and upon the products being sold or
licensed, in each case securing performance of the underlying contract or the
repayment of such advances in the event final acceptance of performance under
such contracts does not occur; and Liens upon funds collected temporarily from
others pending payment or remittance on their behalf; provided that the
aggregate value of all collateral pledged by the Borrower together with its
Subsidiaries to secure Liens arising under this subsection and subsection (e) of
this Section do not exceed on an aggregate, consolidated basis at any time
outstanding the amount of $2,500,000;
(e) Liens (other than any Lien imposed by ERISA) required in the
Ordinary Course of Business in connection with workers' compensation,
unemployment insurance and other social security legislation; provided that the
aggregate value of all collateral pledged by the Borrower together with its
Subsidiaries to secure Liens arising under this subsection and subsection (d) of
this Section do not exceed on an aggregate, consolidated basis at any time
outstanding the amount of $2,500,000;
(f) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the Ordinary Course of Business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the businesses of the Borrower and its
Subsidiaries;
(g) purchase money security interests on any property acquired or
held by the Borrower or its Subsidiaries in the Ordinary Course of Business
securing Indebtedness incurred or assumed for the purpose of financing all or
any part of the cost of acquiring such property to the extent permitted under
Section 7.03; provided, however, that (i) any such Lien attaches to such
property concurrently with or within 20 days after the acquisition thereof, (ii)
such Lien attaches solely to the property so acquired in such transaction, and
(iii) the principal amount of the debt secured thereby does not exceed 100% of
the cost of such property;
(h) Liens securing the property of any Person that is acquired by
the Borrower or any of its Subsidiaries after the Effectiveness Date; provided
that such Liens existed prior to the date of such acquisition and were not
created in contemplation thereof or for purposes of circumventing this
Agreement;
(i) Liens consisting of pledges of cash collateral or government
securities to secure on a ▇▇▇▇-to-market basis Permitted Swap Contracts,
provided that the aggregate value of such collateral so pledged by the Borrower
and all such Subsidiaries in favor of all counterparties thereunder does not at
any time exceed $1,000,000;
(j) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided, however, that (i) such deposit account is not
a dedicated cash collateral account and is not subject to restrictions against
access
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by the Borrower in excess of those set forth by regulations promulgated by the
Federal Reserve Board, and (ii) such deposit account is not intended by the
Borrower or any of its Subsidiaries to provide collateral to the depository
institution; and
(k) Liens existing pursuant to the Private Placement Documents or
pursuant to collateral documents securing any Specified Swap Contract, and in
each case, subject to the Intercreditor Agreement.
7.02 MERGERS AND CONSOLIDATIONS.
(a) The Borrower shall not, and shall not permit any of its Arbitron
Subsidiaries to, merge, consolidate with or into, or convey, transfer, lease or
otherwise dispose of (whether in one or a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired) to or
in favor of any Person, except as provided in subsection (b) of this Section.
(b) Section 7.02(a) shall not prohibit:
(i) Permitted Acquisitions;
(ii) the merger or consolidation of any Subsidiary (except
New Ceridian) into the Borrower, or with or into any other Subsidiary,
provided that if any such transaction is between a Subsidiary and a
Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary is the continuing
or surviving corporation;
(iii) dispositions of assets pursuant to a dissolution or
liquidation otherwise permitted under this Agreement of a Subsidiary;
(iv) the sale or other disposition of all or substantially
all of the assets of a Subsidiary of the Borrower to the Borrower or to
a Wholly-Owned Subsidiary of the Borrower; or
(v) the mergers, consolidations or transfers of assets
listed on Schedule 7.02(b) attached hereto.
7.03 INDEBTEDNESS.
(a) Borrower and Subsidiaries. The Borrower shall not, and shall not
permit any Subsidiaries to, create, incur, assume or suffer to exist any
Indebtedness other than the following (collectively referred to herein as
"Permitted Indebtedness"):
(i) the Obligations;
(ii) Indebtedness arising from taxes, fees, assessments or
other governmental charges or statutory obligations which are not
delinquent or remain payable without penalty, or to the extent that
non-payment thereof is permitted by Section 6.07;
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(iii) (A) Initial Permitted Indebtedness of the Borrower or
any Subsidiary existing on the Closing Date or extensions, renewals and
refinancings of such Indebtedness, provided that the principal amount of
such Indebtedness being extended, renewed or refinanced does not
increase; and (B) at all times prior to the Spin-Off Consummation Date,
Indebtedness constituting "Initial Permitted Indebtedness" under and as
defined in the New Ceridian Credit Agreement;
(iv) accounts payable of Borrower or its Subsidiaries to
trade creditors for goods and services and current operating liabilities
(not the result of the borrowing of money) incurred in the Ordinary
Course of Business in accordance with customary terms and paid within
the specified time, unless contested in good faith by appropriate
proceedings and reserved for in accordance with GAAP;
(v) obligations in respect of Permitted Swap Contracts;
(vi) Indebtedness of Borrower or any Subsidiary of the
Borrower secured by Permitted Liens of the type referred to in Section
7.01(g), in a principal amount (including imputed principal for Capital
Leases) not to exceed $5,000,000, in the aggregate for the Borrower and
all Subsidiaries of the Borrower, at any time outstanding;
(vii) Indebtedness not secured by any Lien, in an outstanding
principal amount not to exceed, together with the principal amount of
Indebtedness outstanding at such time under clause (vi), $10,000,000 at
any time in the aggregate for the Borrower and all Subsidiaries;
(viii) unsecured Indebtedness not to exceed $14,000,000
incurred prior to December 31, 2001 in favor of the seller of certain
assets relating to a Person known as "Coventry", as partial
consideration for the Borrower's acquisition of such assets; provided
the sum of all payments (including principal, interest, fees and other
amounts) required to be made thereunder over the scheduled term thereof
does not exceed $16,000,000;
(ix) Indebtedness arising in connection with the Private
Placement Documents;
(x) prior to the Closing Date, Indebtedness required to be
repaid on or before the Closing Date pursuant to Section 4.02(a)(v); and
(xi) Indebtedness of Wholly-Owned Subsidiaries incurred
pursuant to transactions permitted under Section 7.06(f).
(b) Subsidiaries. The Borrower shall not permit any of its
Subsidiaries to incur, assume or suffer to exist any Indebtedness if the
aggregate principal amount of all Indebtedness of any such Subsidiary at any
time would exceed 10% of such Subsidiary's net worth.
7.04 DISPOSITION OF ASSETS.
(a) The Borrower shall not, and shall not permit any of its
Subsidiaries, to Dispose of any assets (including Intellectual Property,
Proprietary Information, accounts and rights to
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payment), whether now owned or hereafter acquired, or enter into any agreement
to make any Disposition of such assets, except as permitted under subsection
(b).
(b) Section 7.04(a) shall not apply to or restrict:
(i) (A) the Spin-Off Transaction; or (B) at any time prior
to the Spin-Off Consummation Date, Dispositions of New Ceridian Assets
that would be permitted under the New Ceridian Credit Agreement if such
assets were at such time assets of New Ceridian;
(ii) the sale of equipment to the extent that such equipment
is exchanged for credit against the purchase price of similar
replacement equipment, or the proceeds of such sale are reasonably
promptly, but in no event more than 30 days, applied to the purchase
price of such replacement equipment; provided, however, that: (A) the
replacement equipment has comparable value and is of the same type, and
used for the same purpose, as the equipment sold; (B) the Person selling
equipment under this subsection is the same Person that purchases any
replacement equipment; (C) any such sale is conducted at arm's length
and under commercially reasonable terms; and (D) to the extent there
exists more than $1,000,000 of Net Cash Proceeds from all such equipment
sold which have not yet been invested in replacement equipment, such
amount shall be promptly applied under Section 2.05(a);
(iii) the transfer of assets by the Borrower (A) to any of its
Material Subsidiaries if such transfer is a sale for fair market value
and the consideration received by the Borrower is cash; or (B) to any
Wholly-Owned Subsidiary;
(iv) Revocable licenses in the Ordinary Course of Business of
Intellectual Property of the Borrower or its Subsidiaries to third
parties (other than a ▇▇▇▇▇▇▇ ▇▇) upon commercially reasonable terms and
that do not, singly or in the aggregate, result in a Material Adverse
Effect;
(v) (A) assignments and sales to a Permitted ▇▇▇▇▇▇▇ ▇▇ of
software used or usable for the compilation of data solely derived from
PPM Technology, and to the extent, but only to the extent, consistent
with the ▇▇▇▇▇▇▇ ▇▇ Option Agreement; and (B) Revocable, non-exclusive
licenses of software and other Intellectual Property to a Permitted
▇▇▇▇▇▇▇ ▇▇ in the Ordinary Course of Business upon commercially
reasonable terms that do not, singly or in the aggregate, result in a
Material Adverse Effect;
(vi) the license by the Borrower of its PPM Technology,
solely for the purpose of audience measurement, to a Permitted ▇▇▇▇▇▇▇
▇▇ to the extent, but only to the extent, consistent with the ▇▇▇▇▇▇▇ ▇▇
Option Agreement, and otherwise in form and substance satisfactory to
the Administrative Agent and the Required Lenders;
(vii) the non-transferable, exclusive U.S. license by the
Borrower of its "Critical Band Encoding Technology" to Nielsen and the
license to a Permitted ▇▇▇▇▇▇▇ ▇▇ of encoding patents, to the extent,
but only to the extent, consistent with the ▇▇▇▇▇▇▇ ▇▇ Option Agreement,
and otherwise in form and substance reasonably satisfactory to the
Administrative Agent and the Required Lenders;
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(viii) the Disposition of assets or stock of Ceridian Info Tech
(India) Private Limited and CSW Research Limited; provided that no
Intellectual Property or Proprietary Information is Disposed of as part
of any such Disposition, other than Intellectual Property and
Proprietary Information that is not materially related to the Arbitron
Business; and further provided that the total aggregate value of all
assets and stock transferred pursuant to this clause does not exceed
$3,500,000;
(ix) the transfer by any Subsidiary of the Borrower of assets
(upon voluntary liquidation or otherwise) to the Borrower or a
Wholly-Owned Subsidiary of the Borrower that is a Material Subsidiary;
or
(x) transfers by the Borrower or its Subsidiaries totaling
on a consolidated, aggregate basis for all such transfers in any fiscal
year an amount not in excess of $1,000,000; provided that (A) each such
transfer is otherwise permitted pursuant to the Loan Documents, (B) the
consideration paid to the Company or its Subsidiaries in connection with
each such transfer is exclusively in the form of cash or Cash
Equivalents, (C) unused transfers permitted by this subsection (b)(x)
shall not accrue to the following year, and (D) after giving effect to
each such transfer there shall exist no Default or Event of Default.
7.05 CONTINGENT OBLIGATIONS. The Borrower shall not, and shall not
suffer or permit any of its Subsidiaries to, create, incur, assume or suffer to
exist any Contingent Obligations, except:
(a) Contingent Obligations set forth in Schedule 5.10, or incurred
pursuant to any Loan Document or any Specified Swap Contract;
(b) Contingent Obligations arising in connection with supersedeas or
appeal bonds in respect of litigation to which the Borrower or any of its
Subsidiaries is a party or a real party in interest, in an amount for all such
obligations on an aggregate consolidated basis not to exceed $1,000,000 at any
time outstanding; provided that after giving effect to each such obligation
there shall exist no Default or Event of Default;
(c) endorsements for collection or deposit in the Ordinary Course of
Business;
(d) until the Spin-Off Consummation Date, (i) Contingent Obligations
incurred in connection with the guaranty, of near or even date herewith, made by
the Borrower in favor of Bank of America, N.A. (in its capacity as
administrative agent under the New Ceridian Credit Agreement) to guarantee the
obligations of New Ceridian under the New Ceridian Credit Agreement; and (ii)
Contingent Obligations not incurred pursuant to or in furtherance of the
Arbitron Business;
(e) Contingent Obligations incurred pursuant to the Private
Placement Documents;
(f) Contingent Obligations consisting of Guaranty Obligations of (i)
the Borrower in respect of Indebtedness of any Wholly-Owned Subsidiary or (ii)
any Subsidiary in respect of Indebtedness of the Borrower or any Wholly-Owned
Subsidiary; and
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(g) other Contingent Obligations of the Borrower and its
Subsidiaries in an aggregate amount not in excess of $1,000,000 at any time
outstanding.
7.06 LOANS AND INVESTMENTS. The Borrower shall not, nor shall it
permit any of its Subsidiaries to, purchase, acquire, hold or maintain the
capital stock, assets (constituting a business unit), obligations or other
securities of or any interest in any Person, or otherwise extend any credit to,
make any Guaranty Obligation with respect to or make any additional investments
in any Person, other than:
(a) Investments listed on Schedule 7.06(b) and held by the Borrower
or any Subsidiary as of the Closing Date;
(b) Investments in the form of Cash Equivalents or investment grade
marketable securities;
(c) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sales of goods or services or franchising
activities in the Ordinary Course of Business, and Investments received in
satisfaction or partial satisfaction thereof from financially troubled account
debtors to the extent reasonably necessary in order to prevent or limit loss;
(d) Investments resulting in Permitted Acquisitions;
(e) advances to officers, directors and employees of the Borrower
and its Subsidiaries in an aggregate amount for all such advances by the
Borrower and its Subsidiaries not to exceed in the aggregate $1,000,000 at any
time outstanding, for travel, entertainment, relocation and analogous purposes
arising in the Ordinary Course of Business;
(f) extensions of credit by the Borrower to any of its Wholly-Owned
Subsidiaries or by any of its Wholly-Owned Subsidiaries to another of its
Wholly-Owned Subsidiaries or the Borrower, in each case in the Ordinary Course
of Business;
(g) Contingent Obligations permitted by Section 7.05;
(h) Investments permitted by Section 7.02;
(i) Investments resulting from Dispositions permitted under Section
7.04(b)(iii), (vi), (vii) or (ix);
(j) Investments consisting of PPM Expenditures in an amount not to
exceed $5,000,000 for all such Investments in respect of all Nielsen JV's on an
aggregate basis in any fiscal year;
(k) Investments existing or entered into prior to the Separation
Date to the extent constituting New Ceridian Assets; or
(l) additional Investments otherwise permitted hereunder in Persons
that are not, and will not be after giving effect to each such Investment, a
Subsidiary, in an amount not to exceed
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$3,500,000 in the aggregate for all such Investments in any fiscal year;
provided that this subsection shall not permit Investments in either the
Scarborough Partnership or any ▇▇▇▇▇▇▇ ▇▇.
7.07 DIVIDENDS AND PAYMENTS.
(a) The Borrower shall not, and shall not suffer or permit any of
its Subsidiaries to, declare or make any dividend payment or other distribution
of assets, properties, cash, rights, obligations or securities on account of any
shares of any class of its capital stock, or purchase, redeem, or otherwise
acquire for value any shares of its capital stock or any warrants, rights or
options to acquire such shares, now or hereafter outstanding, except that the
Borrower may:
(i) declare and make (A) the Distribution, or (B) dividend
payments or other distributions payable solely in shares of its common
stock (and, solely in respect of fractional shares, cash of a de minimis
amount);
(ii) purchase, redeem or otherwise acquire shares of its
common stock or warrants or options to acquire any such shares out of
proceeds received from the substantially concurrent issue of new shares
of its common stock, after taking into account (A) any prepayment made
under Section 2.05 as a result of any reduction in the Aggregate
Commitments under Section 2.06(b)(iii) in relation to such issuance and
(B) any prepayment made or required to be made under the Private
Placement Documents in relation to such issuance;
(iii) make payments in the Ordinary Course of Business in
connection with its Pension Plan or in connection with the employment,
termination or compensation of its employees, officers or directors; and
(iv) from and after that date on which the Borrower's 2002
year end financial statements are received by the Administrative Agent
pursuant to Section 6.01, declare or pay cash dividends to its
stockholders out of (and in an aggregate amount not exceeding) Aggregate
Distributable Income; provided, however, that immediately after giving
effect to any such proposed declaration or payment there exists no
Default or Event of Default.
(b) The Borrower shall not suffer or permit any Subsidiary of the
Borrower (other than New Ceridian) to grant or otherwise agree to or suffer to
exist any consensual restrictions on the ability of such Subsidiary to pay
dividends and make other distributions to the Borrower, or to pay any
Indebtedness owed to the Borrower or transfer properties and assets to the
Borrower.
(c) After the Spin-Off Consummation Date, the Subsidiaries may
declare and make dividend payments in the Ordinary Course of Business to the
Borrower and to Wholly-Owned Subsidiaries (and, in the case of a dividend
payment by a non-Wholly-Owned Subsidiary, to the Borrower and any Subsidiary and
to each other owner of capital stock of such Subsidiary on a pro rata basis
based on their relative ownership interests).
7.08 USE OF PROCEEDS. The Borrower shall not and shall not suffer or
permit any of its Subsidiaries to use any portion of the Loan proceeds, or the
Letter of Credit, directly or indirectly, in violation of Regulation T, U or X
of the Federal Reserve Board.
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7.09 HOSTILE ACQUISITION. The Borrower shall not, and shall not
permit any of its Subsidiaries to, make any Acquisition unless: (a) the
Acquisition complies with applicable Laws, (b) the board of directors or
equivalent governing body of the Person to be so acquired provides written
consent or approval of such Acquisition prior to its commencement; and (c) such
Acquisition is otherwise permitted hereunder.
7.10 LEVERAGE RATIO. The Borrower shall not permit its Leverage Ratio
for any fiscal quarter, beginning with the fiscal quarter ended December 31,
2000, calculated as of the last date of such quarter, to exceed, for the Test
Period ending on such date (including in respect of Test Period fiscal quarters
ending prior to the Effectiveness Date, and using for this purpose the Form 10
Financial Statements and the Supplemental Financial Statements), the following
amounts:
------------------------------------------------------------
FISCAL QUARTER ENDING: MAXIMUM LEVERAGE RATIO
------------------------------------------------------------
December 31, 2000 through 3.75 to 1.00
September 30, 2001
------------------------------------------------------------
December 31, 2001 through
September 30, 2002 3.25 to 1.00
------------------------------------------------------------
December 31, 2002 through
September 30, 2003 3.00 to 1.00
------------------------------------------------------------
December 31, 2003 through
September 30, 2004 2.75 to 1.00
------------------------------------------------------------
December 31, 2004 and
thereafter 2.50 to 1.00
------------------------------------------------------------
7.11 FIXED CHARGE COVERAGE RATIO. The Borrower shall not permit as of
the last day of any fiscal quarter, beginning with the fiscal quarter ended
December 31, 2000: (a) the sum of (i) the Borrower's Consolidated EBITDA for the
Test Period ending on such day, less (ii) taxes actually paid in cash or Cash
Equivalents for the Test Period ending on such day, less (iii) capital
expenditures plus (without duplication) PPM Expenditures for the Test Period
ending on such day, (b) divided by the sum of (i) Consolidated Interest Expense
for the Test Period ending on such day plus (ii) Current Portion of Long-Term
Debt as of such day; for the Borrower and its Subsidiaries on a consolidated
basis (including in respect of Test Period fiscal quarters ending prior to the
Effectiveness Date, and using for this purpose the Form 10 Financial Statements
and the Supplemental Financial Statements), to be less than the following
amounts:
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------------------------------------------------------------
FISCAL QUARTER ENDING MINIMUM RATIO
------------------------------------------------------------
December 31, 2000 through 2.00 to 1.00
September 30, 2001
------------------------------------------------------------
December 31, 2001 through 2.25 to 1.00
September 30, 2002
------------------------------------------------------------
December 31, 2002 through 2.50 to 1.00
September 30, 2003
------------------------------------------------------------
December 31, 2003 through 3.00 to 1.00
September 30, 2004
------------------------------------------------------------
December 31, 2004 and 3.50 to 1.00
thereafter
------------------------------------------------------------
7.12 FOREIGN SUBSIDIARIES. The Borrower shall not, and shall not
suffer or permit any Subsidiary to, (a) make any Disposition of, or make any
Investment of, any of its property, business or assets (including Intellectual
Property, Proprietary Information, accounts and rights to payment), whether now
owned or hereafter acquired, to or in any Foreign Subsidiary, except
Dispositions or Investments that, individually or in the aggregate, (i) are
otherwise permitted hereunder and (ii) would not reasonably be expected to have
a Material Adverse Effect on the business, results of operation or financial
condition of the Borrower together with those of its Subsidiaries that are not
Foreign Subsidiaries, taken as a whole, or (b) make any Investment in, or any
Disposition to, Ceridian Info Tech (India) Private Limited in an aggregate
amount, for all such Investments and Dispositions in respect of the Borrower and
all Subsidiaries together from and after the Effectiveness Date, in excess of
$200,000.
7.13 CHANGE IN BUSINESS. The Borrower shall not, and shall not permit
any of its Subsidiaries to, (i) engage in any material line of business
substantially different from those lines of business carried on by the Borrower
and its Subsidiaries on the Closing Date; (ii) extend any material amount of
Indebtedness to or make any material equity Investment in any Person which
engages in one or more lines of business all of which are substantially
different from those lines of business carried on by the Borrower and its
Subsidiaries on the Effectiveness Date; or (iii) enter into any joint venture
which engages in a material line of business substantially different from those
lines of business carried on by the Borrower and its Subsidiaries on the
Effectiveness Date.
7.14 ACCOUNTING CHANGES. The Borrower shall not, and shall not suffer
or permit any of its Subsidiaries to, make any significant change in accounting
treatment or reporting practices, except as required or permitted by GAAP, or
change the fiscal year of the Borrower or of any of its consolidated
Subsidiaries.
7.15 CERTAIN CONTRACTS.
(a) The Borrower shall not permit any of its Arbitron Subsidiaries
(other than New Ceridian) to enter into any Contractual Obligation restricting
the ability of such Subsidiary to pay dividends or make loans to the Borrower or
Arbitron Subsidiaries of the Borrower.
(b) The Borrower shall not, and shall not suffer or permit any of
its Subsidiaries to, enter into any amendment, restatement, extension,
supplement or other modification of the
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Private Placement Documents (i) if the effect of any such action would be to
render any of the conditions set forth in Section 4.01(a)(vii)(c) inaccurate or
unsatisfied in any respect, or (ii) that would increase the rate of interest or
any "Make Whole Amount" payable under the Private Placement Documents.
(c) Unless consented to by the Required Lenders, the Borrower shall
not, and shall not suffer or permit any of its Subsidiaries to, enter into any
amendment, revision, supplement or modification to any of the Spin-Off Documents
after the Closing Date, other than (i) ministerial changes necessary to address
administrative issues, or (ii) changes necessary to address facial ambiguities.
7.16 TRANSACTIONS WITH AFFILIATES.
(a) The Borrower shall not, and shall not suffer or permit any of
its Subsidiaries to, enter into any material transaction of any kind with any
Affiliate of the Borrower (other than a Subsidiary), or with New Ceridian and
any of its Subsidiaries, other than arm's-length transactions with such Persons
that are otherwise permitted hereunder.
(b) The Borrower shall not suffer or permit any ▇▇▇▇▇▇▇ ▇▇ or the
Scarborough Partnership to Dispose of, or grant any Lien upon, Intellectual
Property or Proprietary Information licensed to either such Person by the
Borrower, provided, however, that the Scarborough Partnership may grant licenses
of such Intellectual Property (i) to the Borrower, and (ii) to third Persons in
the Ordinary Course of Business upon commercially reasonable terms; and provided
further that a Permitted ▇▇▇▇▇▇▇ ▇▇ may ▇▇▇▇▇ licenses in such Intellectual
Property (A) to the Borrower, (B) to Nielsen to the extent, but only to the
extent, consistent with the ▇▇▇▇▇▇▇ ▇▇ Option Agreement, and otherwise in form
and substance satisfactory to the Administrative Agent and the Required Lenders
and (C) which are non-exclusive, non-transferable and Revocable to other Persons
on commercially reasonable terms in the Ordinary Course of Business and
consistent with the ▇▇▇▇▇▇▇ ▇▇ Option Agreement.
(c) Except as consented to in writing by the Administrative Agent
and the Required Lenders, the Borrower shall not make or permit any amendment,
modification, extension, renewal, restatement or assignment of the ▇▇▇▇▇▇▇ ▇▇
Option Agreement or the Scarborough Partnership Agreement that would, directly
or indirectly, (i) increase the amount of cash contributions or payments
required to be made by the Borrower or any of its Subsidiaries to Nielsen, any
▇▇▇▇▇▇▇ ▇▇, or the Scarborough Partnership (ii) require the license or other
Disposition of Intellectual Property of the Borrower or its Subsidiaries other
than the property previously contemplated or alter the license or other transfer
arrangements such that they involve longer terms, or less consideration than
previously contemplated, or (iii) include products, applications or markets
other than as previously contemplated, (iv) cause any such ▇▇▇▇▇▇▇ ▇▇ to no
longer satisfy the requirements of a Permitted ▇▇▇▇▇▇▇ ▇▇, or (v) foreseeably be
detrimental to the Borrower or its Subsidiaries or to the interests of the
Lenders.
7.17 CAPITAL EXPENDITURES. The Borrower shall not, nor shall it
permit any of its Subsidiaries to, make any expenditures for fixed or capital
assets of the Borrower or its Subsidiaries, including obligations under Capital
Leases, in excess of $5,000,000 in the aggregate for all such Persons, on a
consolidated basis, in any fiscal year (not including
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equipment and real estate subject to a sale-leaseback transaction consented to
by the Required Lenders, and completed no later than 90 days after the date on
which such property is sold by the Borrower or Subsidiary pursuant to such
sale-leaseback transaction); provided, however, that this Section shall not
restrict the incurrence of capital expenditures in respect of New Ceridian
Assets prior to the Spin-Off Consummation Date, provided that any lease or other
obligation (other than obligations in respect of trade payables entered into in
the Ordinary Course of Business on customary payment terms) of the Borrower or
any Arbitron Subsidiary related to such New Ceridian Asset shall be released or
terminated on or before the Spin-Off Consummation Date.
7.18 SALES AND LEASEBACKS. The Borrower shall not, nor shall it
permit any of its Subsidiaries to, become liable, directly or indirectly, with
respect to any lease, whether an operating lease or a Capital Lease, of any
property (whether real, personal or mixed), whether now owned or hereafter
acquired, (a) which the Borrower or such Subsidiary has sold or transferred or
is to sell or transfer to any other Person, or (b) which the Borrower or such
Subsidiary intends to use for substantially the same purposes as any other
property which has been or is to be sold or transferred by the Borrower or such
Subsidiary to any other Person in connection with such lease.
7.19 CERTAIN TAX MATTERS. The Borrower shall not, (a) during the two
year period following the Closing Date, cease to be engaged in the active trade
or business relied upon for purposes of satisfying the requirements of Section
355(b) of the Code and obtaining, and staying in conformity with, the IRS Ruling
Letter; or (b) during the applicable period provided by Section 355(e)(2)(b) of
the Code with respect to the Distribution, enter into any transaction or make
any change to its equity structure (including stock issuance, pursuant to the
exercise of options, option grants or otherwise, capital contributions or
acquisitions, but not including the Distribution) that may cause the
Distribution to be treated as part of a plan pursuant to which one or more
Persons acquire directly or indirectly capital stock of the Borrower
representing a "50 percent or greater interest" within the meaning of Section
355(e) of the Code; provided that, in each case, the Borrower may take such
actions if (i) the Borrower obtains an private letter ruling from the IRS to the
effect that such actions should not result in the Distribution being taxable to
New Ceridian or its shareholders, or (ii) the Borrower delivers to the
Administrative Agent an opinion of independent counsel addressed to the
Administrative Agent to the same effect, provided, that such opinion is
reasonably acceptable in form and substance to the Administrative Agent.
ARTICLE VIII.
EVENTS OF DEFAULT AND REMEDIES
8.01 EVENTS OF DEFAULT. Any of the following shall constitute an
Event of Default:
(a) Non-Payment. The Borrower fails to pay (i) when and as required
to be paid herein, any amount of principal of any Loan, or any L/C Obligation,
or (ii) within three days after the same becomes due, any interest on any Loan
or on any L/C Obligation, or any commitment, utilization or other fee due
hereunder, or (iii) within five days after the same becomes due, any other
amount payable hereunder or under any other Loan Document; or
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(b) Specific Covenants. The Borrower fails to perform or observe any
term, covenant, or agreement contained in Section 6.03(a), (b), (c), (d), or
(f), Section 6.09, Section 6.13 or in Article VII; or the Borrower fails to
perform or observe any term, covenant or agreement contained in Section 6.01 or
Section 6.02 or in Section 6.03 (other than subsections (a), (b), (c), (d) or
(f) thereof) and such failure continues unremedied for a period of 10 days; or
(c) Other Defaults. The Borrower fails to perform or observe any
other term or covenant contained in this Agreement or any other Loan Document,
and such default continues unremedied for a period of 20 days; or
(d) Representations and Warranties. Any representation or warranty
made or deemed made by the Borrower or any other Loan Party herein, in any other
Loan Document, or in any document delivered in connection herewith or therewith
proves to have been incorrect in any material respect when made or deemed made;
or
(e) Cross-Default. (i) The Borrower or any Subsidiary (A) fails to
make any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or Guaranty
Obligation (other than Indebtedness hereunder and Indebtedness under Swap
Contracts) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than the Threshold Amount, or
(B) fails to observe or perform any other agreement or condition relating to any
such Indebtedness or Guaranty Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event occurs,
the effect of which default or other event is to cause, or to permit the holder
or holders of such Indebtedness or the beneficiary or beneficiaries of such
Guaranty Obligation (or a trustee or agent on behalf of such holder or holders
or beneficiary or beneficiaries) to cause, with the giving of notice if
required, such Indebtedness to be demanded or to become due or to be repurchased
or redeemed (automatically or otherwise) prior to its stated maturity, or such
Guaranty Obligation to become payable or cash collateral in respect thereof to
be demanded; or (ii) there occurs under any Swap Contract an Early Termination
Date (as defined in such Swap Contract) resulting from (I) any event of default
under such Swap Contract as to which the Borrower or any Subsidiary is the
Defaulting Party (as defined in such Swap Contract) or (II) any Termination
Event (as so defined) under such Swap Contract as to which the Borrower or any
Subsidiary is an Affected Party (as so defined) and, in either event, the Swap
Termination Value owed by the Borrower or such Subsidiary as a result thereof is
greater than the Threshold Amount; or
(f) Insolvency Proceedings, Etc. Any Loan Party, any of its
Subsidiaries, the Scarborough Partnership or the ▇▇▇▇▇▇▇ ▇▇ institutes or
consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of its
property; or any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer is appointed without the application or consent
of such Person and the appointment continues undischarged or unstayed for 60
calendar days; or any proceeding under any Debtor Relief Law relating to any
such Person or to all or any part of its property is instituted without the
consent of such Person and continues undismissed or unstayed for 60 calendar
days, or an order for relief is
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entered in any such proceeding; provided, however, that it shall not be an Event
of Default under this subsection (f) if any Subsidiary of the Borrower to which
this subsection applies does not have annual revenues in excess of 1% of the
consolidated revenues of the Borrower or net worth which constitutes more than
5% of the Consolidated Net Worth of the Borrower in the fiscal year immediately
preceding the date this subsection first becomes applicable to such Subsidiary;
or
(g) Inability to Pay Debts; Attachment. (i) The Borrower or any
Subsidiary becomes unable or admits in writing its inability or fails generally
to pay its debts as they become due, or (ii) any writ or warrant of attachment
or execution or similar process is issued or levied against all or any material
part of the property of any such Person and is not released, vacated or fully
bonded within 30 days after its issue or levy; provided, however, that it shall
not be an Event of Default under this subsection (g) if any Subsidiary of the
Borrower to which this subsection applies does not have annual revenues in
excess of 1% of the consolidated revenues of the Borrower or net worth which
constitutes more than 5% of the Consolidated Net Worth of the Borrower in the
fiscal year immediately preceding the date this subsection first becomes
applicable to such Subsidiary; or
(h) Judgments. There is entered against the Borrower or any
Subsidiary (i) a final judgment, order or decree for the payment of money in an
aggregate amount exceeding $5,000,000 (to the extent not covered by independent
third-party insurance as to which the insurer does not dispute coverage), or
(ii) any non-monetary final judgment, order or decree that has, or would
reasonably be expected to have, a Material Adverse Effect and, in either case,
(a) enforcement proceedings are commenced by any creditor upon such judgment,
order or decree, or (b) there shall be any period of 10 consecutive days during
which such judgment, order or decree continues unsatisfied and during which a
stay of enforcement of such judgment, order, or decree by reason of a pending
appeal or otherwise, shall not be in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or would reasonably be expected to
result in liability of the Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount that would reasonably be
expected to result in a Material Adverse Effect, or (ii) the Borrower or any
ERISA Affiliate fails to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount
that would reasonably be expected to result in a Material Adverse Effect; or
(j) Invalidity of Loan Documents. Any Loan Document, at any time
after its execution and delivery and for any reason other than the agreement of
all the Lenders or satisfaction in full of all the Obligations, ceases to be in
full force and effect, or is declared by a court of competent jurisdiction to be
null and void, invalid or unenforceable in any material respect; or any Loan
Party denies that it has any or further liability or obligation under any Loan
Document, or purports to revoke, terminate or rescind any Loan Document; or
(k) Invalidity of Spin-Off Documents. Any Spin-Off Document, at any
time after its execution and delivery and for any reason other than the
satisfaction in full of all the obligations therein, ceases to be in full force
and effect, or is declared by a court of competent jurisdiction to be null and
void, invalid or unenforceable in any respect; or any party thereto denies that
it has
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any or further liability or obligation under any Spin-Off Document, or purports
to revoke, terminate or rescind any Spin-Off Document; or
(l) Change of Control. There occurs any Change of Control;
(m) Collateral. (i) Any provision of any Collateral Document
shall for any reason cease to be valid and binding on or enforceable
against the Borrower or any Subsidiary party thereto, or the Borrower or
any Subsidiary shall so state in writing or bring an action to limit its
obligations or liabilities thereunder, or
(ii) any Collateral Document shall for any reason (other than
pursuant to the terms thereof) cease to create a valid security interest
in the Collateral purported to be covered thereby, or such security
interest shall for any reason cease to be a perfected and first priority
security interest subject only to Permitted Liens; or
(n) Guarantor Defaults. Any Guarantor fails in any material respect
to perform or observe any term, covenant or agreement in its Guaranty; or any
Guaranty is for any reason partially (including with respect to future advances)
or wholly revoked or invalidated, or otherwise ceases to be in full force and
effect, or any Guarantor or any other Person contests in any manner the validity
or enforceability thereof or denies that it has any further liability or
obligation thereunder; or any event described at subsections (f) or (g) of this
Section occurs with respect to any Guarantor; or
(o) Spin-Off Consummation. The Spin-Off Consummation Date does not
occur on or before the Spin-Off Deadline.
8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs,
the Administrative Agent shall, at the request of, or may, with the consent of,
the Required Lenders,
(a) declare the commitment of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C Obligations
(in an amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any event specified in subsection
(f) of Section 8.01, the obligation of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically become
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due and payable, and the obligation of the Borrower to Cash Collateralize the
L/C Obligations as aforesaid shall automatically become effective, in each case
without further act of the Administrative Agent or any Lender.
ARTICLE IX.
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably (subject to Section 9.09)
appoints, designates and authorizes the Administrative Agent to take such action
on its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary contained elsewhere herein or in any other Loan
Document, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the
Administrative Agent have or be deemed to have any fiduciary relationship with
any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to the Administrative Agent is not intended to connote any fiduciary
or other implied (or express) obligations arising under agency doctrine of any
applicable law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties.
(b) The L/C Issuer shall act on behalf of the Lenders with respect
to any Letters of Credit issued by it and the documents associated therewith
until such time (and except for so long) as the Administrative Agent may agree
at the request of the Required Lenders to act for the L/C Issuer with respect
thereto; provided, however, that the L/C Issuer shall have all of the benefits
and immunities (i) provided to the Administrative Agent in this Article IX with
respect to any acts taken or omissions suffered by the L/C Issuer in connection
with Letters of Credit issued by it or proposed to be issued by it and the
application and agreements for letters of credit pertaining to the Letters of
Credit as fully as if the term "Administrative Agent" as used in this Article IX
included the L/C Issuer with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to the L/C Issuer.
9.02 DELEGATION OF DUTIES. The Administrative Agent may execute any
of its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects in the
absence of gross negligence or willful misconduct.
9.03 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person shall
(a) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its
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own gross negligence or willful misconduct in connection with its duties
expressly set forth herein), or (b) be responsible in any manner to any Lender
or participant for any recital, statement, representation or warranty made by
any Loan Party or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of any Loan Party or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
any Affiliate thereof.
9.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel to any Loan Party), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under any
Loan Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of the Required
Lenders or all the Lenders, if required hereunder, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and participants. Where this Agreement expressly permits or prohibits an
action unless the Required Lenders otherwise determine, the Administrative Agent
shall, and in all other instances, the Administrative Agent may, but shall not
be required to, initiate any solicitation for the consent or a vote of the
Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01 and Section 4.02, each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter either sent by the Administrative
Agent to such Lender for consent, approval, acceptance or satisfaction, or
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender.
9.05 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Administrative Agent for the account of the
Lenders, unless the Administrative Agent shall have received written notice from
a Lender or the Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a "notice of default." The
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Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be directed by the Required Lenders in accordance with
Article VIII; provided, however, that unless and until the Administrative Agent
has received any such direction, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable or in the best
interest of the Lenders.
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE
AGENT. Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereinafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their respective Subsidiaries, and all
applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. Each Lender also represents that it
will, independently and without reliance upon any Agent-Related Person and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and the other Loan Parties. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent herein, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of any of the Loan Parties or any of
their respective Affiliates which may come into the possession of any
Agent-Related Person.
9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of any Loan Party and without limiting the obligation of any Loan Party
to do so), based on such Lender's Pro Rata Share, and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the
payment to any Agent-Related Person of any portion of such Indemnified
Liabilities resulting from such Person's gross negligence or willful misconduct;
provided, however, that no action taken in accordance with the directions of the
Required Lenders or all Lenders, as the case may be, shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section.
Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share (based on such Lender's
Pro Rata Share) of any costs or out-of-pocket expenses (including Attorney
Costs) incurred by the Administrative Agent in connection with the
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preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Administrative Agent is not reimbursed for such expenses
by or on behalf of the Borrower. The undertaking in this Section shall survive
termination of the Commitments, the payment of all Obligations hereunder and the
resignation or replacement of the Administrative Agent.
9.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. Bank of America
and its Affiliates may make loans to, issue letters of credit for the account
of, accept deposits from, acquire equity interests in and generally engage in
any kind of banking, trust, financial advisory, underwriting or other business
with each of the Loan Parties and their respective Affiliates as though Bank of
America were not the Administrative Agent or the L/C Issuer hereunder and
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, Bank of America or its Affiliates may receive
information regarding any Loan Party or its Affiliates (including information
that may be subject to confidentiality obligations in favor of such Loan Party
or such Affiliate) and acknowledge that the Administrative Agent shall be under
no obligation to provide such information to them. With respect to its Loans,
Bank of America shall have the same rights and powers under this Agreement as
any other Lender and may exercise such rights and powers as though it were not
the Administrative Agent or the L/C Issuer, and the terms "Lender" and "Lenders"
include Bank of America in its individual capacity.
9.09 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 30 days' notice to the Lenders. If the
Administrative Agent resigns under this Agreement, the Required Lenders shall
appoint from among the Lenders a successor administrative agent for the Lenders
which successor administrative agent shall be consented to by the Borrower at
all times other than during the existence of an Event of Default (which consent
of the Borrower shall not be unreasonably withheld or delayed). If no successor
administrative agent is appointed prior to the effective date of the resignation
of the Administrative Agent, the Administrative Agent may appoint, after
consulting with the Lenders and the Borrower, a successor administrative agent
from among the Lenders. Upon the acceptance of its appointment as successor
administrative agent hereunder, such successor administrative agent shall
succeed to all the rights, powers and duties of the retiring Administrative
Agent and the term "Administrative Agent" shall mean such successor
administrative agent and the retiring Administrative Agent's appointment, powers
and duties as Administrative Agent shall be terminated. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article IX and Sections 10.03 and 10.13 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. If no successor administrative agent
has accepted appointment as Administrative Agent by the date which is 30 days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above.
9.10 OTHER AGENTS; LEAD MANAGERS. None of the Lenders identified on
the facing page or signature pages of this Agreement as a "syndication agent,"
"documentation agent," "co-
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agent" or "lead manager" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. Without limiting the foregoing, none of the Lenders so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
9.11 COLLATERAL MATTERS.
(a) The Administrative Agent is authorized on behalf of all the
Lenders, without the necessity of any notice to or further consent from the
Lenders, from time to time to take any action with respect to any Collateral or
the Collateral Documents which may be necessary to perfect and maintain
perfected the security interest in and Liens upon the Collateral granted
pursuant to the Collateral Documents.
(b) The Lenders irrevocably authorize the Administrative Agent, at
its option and in its discretion, to release any Lien granted to or held by the
Administrative Agent upon any Collateral (i) upon termination of the Commitments
and payment in full of all Loans and all other Obligations known to the
Administrative Agent and payable under this Agreement or any other Loan
Document; (ii) constituting property sold or to be sold or disposed of as part
of or in connection with any Disposition permitted hereunder; (iii) constituting
property in which the Borrower or any Subsidiary owned no interest at the time
the Lien was granted or at any time thereafter; (iv) constituting property
leased to the Borrower or any Subsidiary in a transaction permitted under this
Agreement; (v) consisting of an instrument evidencing Indebtedness or other debt
instrument, if the indebtedness evidenced thereby has been paid in full; or (vi)
if approved, authorized or ratified in writing by the Required Lenders or all
the Lenders, as the case may be, as provided in Section 10.01(f). Upon request
by the Administrative Agent at any time, the Lenders will confirm in writing the
Administrative Agent's authority to release particular types or items of
Collateral pursuant to this Section 9.11(b), provided that the absence of any
such confirmation for whatever reason shall not affect the Administrative
Agent's rights under this Section 9.11.
Each Bank agrees with and in favor of each other (which agreement shall
not be for the benefit of the Borrower or any Subsidiary) that the Borrower's
obligation to such Bank under this Agreement and the other Loan Documents is not
and shall not be secured by any real property collateral now or hereafter
acquired by such Bank.
ARTICLE X.
MISCELLANEOUS
10.01 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and the Borrower or the applicable Loan Party, as
the case may be, and acknowledged by the Administrative Agent, and each such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such amendment,
waiver or consent shall, unless in writing and signed by each of the Lenders
directly
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affected thereby and by the Borrower, and acknowledged by the Administrative
Agent, do any of the following:
(a) extend or increase the Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 8.02);
(b) postpone any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees or other amounts due to
the Lenders (or any of them) hereunder or under any other Loan Document;
(c) reduce the principal of, or the rate of interest specified
herein on, any Loan or L/C Borrowing, or any fees or other amounts payable
hereunder or under any other Loan Document; provided, however, that only the
consent of the Required Lenders shall be necessary to amend the definition of
"Default Rate" or to waive any obligation of the Borrower to pay interest at the
Default Rate;
(d) change the percentage of the Aggregate Commitments or of the
aggregate unpaid principal amount of the Loans and L/C Obligations which is
required for the Lenders or any of them to take any action hereunder;
(e) change the Pro Rata Share or Voting Percentage of any Lender
other than as set forth in Section 3.06(b) or 10.16;
(f) amend this Section, or any provision herein providing for
consent or other action by all the Lenders;
(g) amend Section 2.06(b), or amend Section 4.01 or 4.02 or waive
any condition precedent specified therein (subject to the proviso in the
introductory clause to Section 4.01); or
(h) discharge any Guarantor, or release all or substantially all of
the Collateral except as otherwise may be provided herein or in the Collateral
Documents;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Required Lenders or all
the Lenders, as the case may be, affect the rights or duties of the L/C Issuer
under this Agreement or any L/C Application relating to any Letter of Credit
issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless
in writing and signed by the Administrative Agent in addition to the Required
Lenders or all the Lenders, as the case may be, affect the rights or duties of
the Administrative Agent under this Agreement or any other Loan Document; and
(iii) the Agent/Arranger Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, any Lender that has failed to
fund any portion of the Loans, or participations in L/C Obligations required to
be funded by it hereunder shall not have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Pro Rata Share or the
Commitment amount of such Lender may not be increased without the consent of
such Lender.
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10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all notices
and other communications provided for hereunder shall be in writing (including
by facsimile transmission) and mailed, faxed or delivered, to the address,
facsimile number or (subject to subsection (c) below) electronic mail address
specified for notices on Schedule 10.02; or, in the case of the Borrower, the
Administrative Agent, or the L/C Issuer to such other address as shall be
designated by such party in a notice to the other parties, and in the case of
any other party, to such other address as shall be designated by such party in a
notice to the Borrower, the Administrative Agent, and the L/C Issuer. All such
notices and other communications shall be deemed to be given or made upon the
earlier to occur of (i) actual receipt by the intended recipient and (ii) (A) if
delivered by hand or by courier, when signed for by the intended recipient; (B)
if delivered by first class mail, four Business Days after deposit in the mails,
postage prepaid; (C) if delivered by facsimile, when sent and receipt has been
confirmed by telephone; and (D) if delivered by electronic mail (which form of
delivery is subject to the provisions of subsection (c) below), when delivered;
provided, however, that notices and other communications to the Administrative
Agent, or the L/C Issuer pursuant to Article II shall be in writing and shall
not be effective until actually received by such Person. Any notice or other
communication permitted to be given, made or confirmed by telephone hereunder
shall be given, made or confirmed by means of a telephone call to the intended
recipient at the number specified on Schedule 10.02, it being understood and
agreed that a voicemail message shall in no event be effective as a notice,
communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually-signed originals and shall be binding on all
Loan Parties, the Administrative Agent and the Lenders. The Administrative Agent
may also require that any such documents and signatures be confirmed by a
manually-signed original thereof; provided, however, that the failure to request
or deliver the same shall not limit the effectiveness of any facsimile document
or signature.
(c) Limited Use of Electronic Mail. Electronic mail and internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information, and to distribute Loan Documents for
execution by the parties thereto, and may not be used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. The Administrative
Agent and the Lenders shall be entitled to rely and act upon any notices
(including telephonic Loan Notices purportedly given by or on behalf of the
Borrower even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. The Borrower shall indemnify each
Agent-Related Person and each Lender from all losses, costs, expenses and
liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of the Borrower. All telephonic notices to and
other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.
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10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein or therein provided are cumulative and not
exclusive of any rights, remedies, powers and privileges provided by law.
10.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and expenses shall include all search, filing, recording, title
insurance and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by the Administrative Agent and the cost of
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender. The agreements in this Section shall survive
the termination of the Commitments and repayment of all the other Obligations.
At the election of any Indemnitee, the Borrower shall defend such Indemnitee
using legal counsel satisfactory to such Indemnitee in such Person's sole
discretion, at the sole cost and expense of the Borrower; provided, however,
that the Borrower shall only be obligated to hire one counsel to represent all
of the Lenders unless any Lender advises the Borrower that its legal counsel has
advised it that its interest is materially different from that of the other
Lenders and it would not be adequately represented without its own separate
counsel, in which case the borrower shall hire separate counsel for such Lender,
satisfactory to such Lender. All amounts owing under this Section 10.04 shall be
paid within 30 days after demand.
10.05 INDEMNIFICATION BY THE BORROWER. Whether or not the transactions
contemplated hereby are consummated, the Borrower agrees to indemnify, save and
hold harmless each Agent-Related Person, each Lender and their respective
Affiliates, directors, officers, employees, counsel, agents and
attorneys-in-fact (collectively the "Indemnitees") from and against: (a) any and
all claims, demands, actions or causes of action that are asserted against any
Indemnitee by any Person (other than the Administrative Agent or any Lender)
relating directly or indirectly to a claim, demand, action or cause of action
that such Person asserts or may assert against any Loan Party, any Affiliate of
any Loan Party or any of their respective officers or directors; (b) any and all
claims, demands, actions or causes of action that may at any time (including at
any time following repayment of the Obligations and the resignation or removal
of the Administrative Agent or the replacement of any Lender) be asserted or
imposed against any Indemnitee, arising out of or relating to, the Loan
Documents, any predecessor loan documents, the Commitments, the use or
contemplated use of the proceeds of any Credit
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Extension, or the relationship of any Loan Party, the Administrative Agent and
the Lenders under this Agreement or any other Loan Document; (c) any
administrative or investigative proceeding by any Governmental Authority arising
out of or related to a claim, demand, action or cause of action described in
subsection (a) or (b) above; and (d) any and all liabilities (including
liabilities under indemnities), losses, costs or expenses (including Attorney
Costs) that any Indemnitee suffers or incurs as a result of the assertion of any
foregoing claim, demand, action, cause of action or proceeding, or as a result
of the preparation of any defense in connection with any foregoing claim,
demand, action, cause of action or proceeding, in all cases, and whether or not
an Indemnitee is a party to such claim, demand, action, cause of action or
proceeding (all the foregoing, collectively, the "Indemnified Liabilities");
provided that no Indemnitee shall be entitled to indemnification for any claim
caused by its own gross negligence or willful misconduct or for any loss
asserted against it by another Indemnitee. The agreements in this Section shall
survive the termination of the Commitments and repayment of all the other
Obligations.
10.06 PAYMENTS SET ASIDE. To the extent that the Borrower makes a
payment to the Administrative Agent or any Lender, or the Administrative Agent
or any Lender exercises its right of set-off, and such payment or the proceeds
of such set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by the Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect.
10.07 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender (and any attempted assignment or transfer by the Borrower without
such consent shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, the Indemnitees) any legal or equitable
right, remedy or claim under or by reason of this Agreement.
(b) Subject to the prior consent of the Administrative Agent, the
L/C Issuer and, provided there exists no Default or Event of Default, the
Borrower (such Borrower consent not to be unreasonably withheld), any Lender may
assign to one or more Eligible Assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans (including for purposes of this subsection (b), participations in
L/C Obligations at the time owing to it); provided that (i) except in the case
of an assignment of the
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entire remaining amount of the assigning Lender's Commitment and the Loans at
the time owing to it or in the case of an assignment to a Lender or an Affiliate
of a Lender or an Approved Fund with respect to a Lender, the aggregate amount
of the Commitment (which for this purpose includes Loans outstanding thereunder)
subject to each such assignment, determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the Administrative
Agent, shall not be less than $5,000,000 unless the Administrative Agent
otherwise consents, (ii) each partial assignment shall be made as an assignment
of a proportionate part of all the assigning Lender's rights and obligations
under this Agreement with respect to the Loans or the Commitment assigned, and
(iii) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance, together with a processing
and recordation fee of $4,000. Subject to acceptance and recording thereof by
the Administrative Agent pursuant to subsection (c) of this Section, from and
after the effective date specified in each Assignment and Acceptance, the
Eligible Assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 3.01,
10.04 and 10.05). Upon request, the Borrower (at its expense) shall execute and
deliver new or replacement Loan Notes to the assigning Lender and the assignee
Lender. Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this subsection shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at the Administrative Agent's Office a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amount of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.
(d) Any Lender may, without the consent of, or notice to, the
Borrower or the Administrative Agent, sell participations to one or more banks
or other entities (a "Participant") in all or a portion of such Lender's rights
and/or obligations under this Agreement (including all or a portion of its
Commitment and/or the Loans (including such Lender's participations in L/C
Obligations) owing to it); provided that (i) such Lender's obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrower, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any
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provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, waiver or other modification that would (A) postpone any date
upon which any payment of money is scheduled to be paid to such Participant (B)
reduce the principal, interest, fees or other amounts payable to such
Participant, or (C) release the Guarantor from the Guaranty. Subject to
subsection (e) of this Section, the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant to
subsection (b) of this Section. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 10.09 as though it were a
Lender, provided such Participant agrees to be subject to Section 2.12 as though
it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Section 3.01 or 3.04 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 3.01 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
10.15 as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its
Loan Notes, if any) to secure obligations of such Lender, including any pledge
or assignment to secure obligations to a Federal Reserve Bank; provided that no
such pledge or assignment shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
(g) If the consent of the Borrower to an assignment or to an
Eligible Assignee is required hereunder (including a consent to an assignment
which does not meet the minimum assignment threshold specified in clause (i) of
the proviso to the first sentence of Section 10.07(b)), the Borrower shall be
deemed to have given its consent five Business Days after the date notice
thereof has been delivered by the assigning Lender (through the Administrative
Agent) unless such consent is expressly refused by the Borrower prior to such
fifth Business Day.
(h) As used herein, the following terms have the following meanings:
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender;
(c) an Approved Fund; and (d) any other Person (other than a natural Person)
approved by the Administrative Agent, in the case of any assignment of a Loan,
and the L/C Issuer, and unless (x) such Person is taking delivery of an
assignment in connection with physical settlement of a credit derivatives
transaction or (y) an Event of Default has occurred and is continuing, the
Borrower (each such approval not to be unreasonably withheld or delayed).
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"Fund" means any Person (other than a natural Person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
(i) Notwithstanding anything to the contrary contained herein, if at
any time Bank of America assigns all of its Commitment and Loans pursuant to
subsection (b) above, Bank of America may, upon 20 days' notice to the Borrower
and the Lenders, resign as L/C Issuer. The Borrower shall be entitled to appoint
from among the Lenders a successor L/C Issuer hereunder; provided, however, that
no failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as L/C Issuer. Bank of America shall retain all
the rights and obligations of the L/C Issuer hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as L/C
Issuer and all L/C Obligations with respect thereto (including the right to
require the Lenders to make Base Rate Loans or fund participations in
Unreimbursed Amounts pursuant to Section 2.03(c)).
10.08 CONFIDENTIALITY. Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential); (b) to the extent requested
by any regulatory authority; (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process; (d) to any other party
to this Agreement; (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder; (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any Eligible Assignee of
or Participant in, or any prospective Eligible Assignee of or Participant in,
any of its rights or obligations under this Agreement or (ii) any direct or
indirect contractual counterparty or prospective counterparty (or such
contractual counterparty's or prospective counterparty's professional advisor)
to any credit derivative transaction relating to obligations of the Borrower;
(g) with the consent of the Borrower; (h) to the extent such Information (i)
becomes publicly available other than as a result of a breach of this Section or
(ii) becomes available to the Administrative Agent or any Lender on a
nonconfidential basis from a source other than the Borrower; (i) to the National
Association of Insurance Commissioners or any other similar organization or any
nationally recognized rating agency that requires access to information about a
Lender's or its Affiliates' investment portfolio in connection with ratings
issued with respect to such Lender or its Affiliates; or (j) to any Person from
time to time party (directly, or through any agent or trustee) to the
Intercreditor Agreement. For the purposes of this Section, "Information" means
all information received from the Borrower relating to the Borrower or its
business, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; provided that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified
in writing at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
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10.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrower or any other Loan Party, any such notice being
waived by the Borrower (on its own behalf and on behalf of each Loan Party) to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of the respective Loan Parties against any and all Obligations owing
to such Lender, now or hereafter existing, irrespective of whether or not the
Administrative Agent or such Lender shall have made demand under this Agreement
or any other Loan Document and although such Obligations may be contingent or
unmatured. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.
10.10 INTEREST RATE LIMITATION. Notwithstanding anything to the
contrary contained in any Loan Document, the interest paid or agreed to be paid
under the Loan Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the "Maximum Rate"). If the Administrative
Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if
it exceeds such unpaid principal, refunded to the Borrower. In determining
whether the interest contracted for, charged, or received by the Administrative
Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable Law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations.
10.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.12 INTEGRATION. This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this
Agreement. Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.
10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the
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Administrative Agent or any Lender or on their behalf and notwithstanding that
the Administrative Agent or any Lender may have had notice or knowledge of any
Default or Event of Default at the time of any Credit Extension, and shall
continue in full force and effect as long as any Loan or any other Obligation
shall remain unpaid or unsatisfied or any Letter of Credit shall remain
outstanding.
10.14 SEVERABILITY. Any provision of this Agreement and the other Loan
Documents to which the Borrower is a party that is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions thereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.15 FOREIGN LENDERS. Each Lender that is a "foreign corporation,
partnership or trust" within the meaning of the Code (a "Foreign Lender") shall
deliver to the Administrative Agent, prior to receipt of any payment subject to
withholding under the Code (or after accepting an assignment of an interest
herein), two duly signed completed copies of either IRS Form W-8BEN or any
successor thereto (relating to such Person and entitling it to an exemption
from, or reduction of, withholding tax on all payments to be made to such Person
by the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any successor
thereto (relating to all payments to be made to such Person by the Borrower
pursuant to this Agreement) or such other evidence satisfactory to the Borrower
and the Administrative Agent that such Person is entitled to an exemption from,
or reduction of, U.S. withholding tax. Thereafter and from time to time, each
such Person shall (a) promptly submit to the Administrative Agent such
additional duly completed and signed copies of one of such forms (or such
successor forms as shall be adopted from time to time by the relevant United
States taxing authorities) as may then be available under then current United
States laws and regulations to avoid, or such evidence as is satisfactory to the
Borrower and the Administrative Agent of any available exemption from or
reduction of, United States withholding taxes in respect of all payments to be
made to such Person by the Borrower pursuant to this Agreement, (b) promptly
notify the Administrative Agent of any change in circumstances which would
modify or render invalid any claimed exemption or reduction, and (c) take such
steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable
Laws that the Borrower make any deduction or withholding for taxes from amounts
payable to such Person. If such Person fails to deliver the above forms or other
documentation, then the Administrative Agent may withhold from any interest
payment to such Person an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction. If any
Governmental Authority asserts that the Administrative Agent did not properly
withhold any tax or other amount from payments made in respect of such Person,
such Person shall indemnify the Administrative Agent therefor, including all
penalties and interest, any taxes imposed by any jurisdiction on the amounts
payable to the Administrative Agent under this Section, and costs and expenses
(including Attorney Costs) of the Administrative Agent. The obligation of the
Lenders under this Section shall survive the payment of all Obligations and the
resignation or replacement of the Administrative Agent.
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105
10.16 REMOVAL AND REPLACEMENT OF LENDERS.
(a) Under any circumstances set forth herein providing that the
Borrower shall have the right to remove or replace a Lender as a party to this
Agreement, the Borrower may, upon notice to such Lender and the Administrative
Agent, (i) remove such Lender by terminating such Lender's Commitment or (ii)
replace such Lender by causing such Lender to assign its Commitment (without
payment of any assignment fee) pursuant to Section 10.07(b) to one or more other
Lenders or Eligible Assignees procured by the Borrower; provided, however, that
if the Borrower elects to exercise such right with respect to any Lender
pursuant to Section 3.06(b), it shall be obligated to remove or replace, as the
case may be, all Lenders that have made similar requests for compensation
pursuant to Section 3.01 or 3.04. The Borrower shall (x) pay in full all
principal, interest, fees and other amounts owing to such Lender through the
date of termination or assignment (including any amounts payable pursuant to
Section 3.05), (y) provide appropriate assurances and indemnities (which may
include letters of credit) to the L/C Issuer as it may reasonably require with
respect to any continuing obligation to purchase participation interests in any
L/C Obligations then outstanding, and (z) release such Lender from its
obligations under the Loan Documents. Any Lender being replaced shall execute
and deliver an Assignment and Acceptance with respect to such Lender's
Commitment and outstanding Credit Extensions. The Administrative Agent shall
distribute an amended Schedule 2.01, which shall be deemed incorporated into
this Agreement, to reflect changes in the identities of the Lenders and
adjustments of their respective Commitments and/or Pro Rata Shares resulting
from any such removal or replacement. The Borrower may not under any
circumstances remove or replace the Lender that is the L/C Issuer without
causing such Lender simultaneously to be replaced as L/C Issuer and, causing
such Lender to be released from all liability in respect of then-outstanding
Letters of Credit; all pursuant to documentation in form and substance
satisfactory to such Lender.
(b) In order to make all the Lenders' interests in any outstanding
Credit Extensions ratable in accordance with any revised Pro Rata Shares after
giving effect to the removal or replacement of a Lender, the Borrower shall pay
or prepay, if necessary, on the effective date thereof, all outstanding Loans of
all Lenders, together with any amounts due under Section 3.05. The Borrower may
then request Loans from the Lenders in accordance with their revised Pro Rata
Shares. The Borrower may net any payments required hereunder against any funds
being provided by any Lender or Eligible Assignee replacing a terminating
Lender. The effect for purposes of this Agreement shall be the same as if
separate transfers of funds had been made with respect thereto.
10.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE
99.
▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW
YORK, OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT
AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER, THE ADMINISTRATIVE
AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN THE
JURISDICTION OF SUCH COURTS IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT
RELATED THERETO. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
10.18 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
100.
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SCHEDULE 1.01(e)
EXISTING LETTERS OF CREDIT
--------------------- ------------------ ------------------------- -------------- ---------------
LETTER OF CREDIT BENEFICIARY U.S. DOLLAR AMOUNT ISSUE DATE EXPIRATION
NO. (AS OF DATE
EFFECTIVENESS DATE)
--------------------- ------------------ ------------------------- -------------- ---------------
7504494 222 Riverside $151,283.33 11/28/00 12/01/01
Plaza Corp c/o
(Arbitron) NY State
Teachers'
Retirement
System
--------------------- ------------------ ------------------------- -------------- ---------------
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SCHEDULE 1.01(i)
INITIAL PERMITTED INDEBTEDNESS
1. Repayment obligations pursuant to the Letters of Credit described in
Schedule 1.01(e).
2. There are no existing capital leases.
3. Final payment in the amount of three million dollars ($3,000,000) to
Tapscan Inc. due on May 4, 2001 under the Asset Purchase Agreement dated
May 4, 1998.
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SCHEDULE 1.01(s)
SPIN-OFF DOCUMENTS
1. The Form 10
2. Amended and Restated Certificate of Incorporation of the Borrower
3. Amended and Restated Bylaws of the Borrower
4. Distribution Agreement dated on or before the Separation Date between
the Borrower and New Ceridian (see Schedules below)
Schedule Description of Schedule
-------- -----------------------
1.1(o) Conveyancing and Assumption Instruments
1.1(g) Debt Realignment Plan
1.1(ff) List of Divested Business Entities Relating to Arbitron Business
1.1(gg) December 31, 1999 Media Information Balance Sheet
1.1 (ii)(iii) Government Contracts Exclusively Relating to Media Information Business
1.1 (ii)(iv) Lease Agreements Relating to Media Information Business
1.1(ll) List of Certain Liabilities to remain with the Corporation after Spin-Off
1.1(ll) A List of Certain Liabilities to be Assumed by New Ceridian
2.8(a) Guarantees where Corporation (Arbitron Inc.) is to be removed as a Guarantor
2.8(b) Guarantees where New Ceridian is to be removed as a guarantor of a Media
Information Liability
7.3(b) Allocation of deductibles with respect to Shared Insurance Policies
7.3(e) Allocation of deductible for Workers' Compensation, General Liability and
Automotive Liability Claims
8.5 Allocation of Expenses
5. Personnel Agreement dated on or before the Separation Date between
Arbitron and New Ceridian
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6. Tax Matters Agreement dated on or before the Separation Date between
Arbitron and New Ceridian
7. Transition Services Agreement dated on or before the Separation Date
between Arbitron and New Ceridian
8. Information Statement dated December 6, 2000 attached as Annex A to the
Form 10
9. ▇▇▇▇ of Sale and Assumption Agreement, dated on or before the Separation
Date, between the Borrower and the Parent.
10. Real Estate Sublease Agreement, dated on or before the Separation Date,
between the Borrower, as sub-lessor, and the Parent, as sub-lessee,
related to the facilities located at ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇.
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SCHEDULE 2.01
COMMITMENTS
AND PRO RATA SHARES
LENDER COMMITMENT PRO RATA SHARE
------------------------------------------- -------------------------- -------------------------------
Bank of America, N.A. $40,000,000 17.777777778%
Fleet National Bank $40,000,000 17.777777778%
The Chase Manhattan Bank $30,000,000 13.333333333%
U.S. Bank National Association $30,000,000 13.333333333%
The Bank of New York $20,000,000 8.888888889%
BNP Paribas $20,000,000 8.888888889%
Bear ▇▇▇▇▇▇▇ Corporate Lending Inc. $15,000,000 6.666666667%
Citizens Bank of Massachusetts $15,000,000 6.666666667%
The Royal Bank of Scotland plc $15,000,000 6.666666667%
------------------------------------------- -------------------------- -------------------------------
Total $225,000,000 100%
----- ------------ ----
------------------------------------------- -------------------------- -------------------------------
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SCHEDULE 5.05
LITIGATION AFFECTING LOAN PARTIES
The following information is provided regarding various matters in
litigation involving the Borrower and the Subsidiaries of the Borrower. The
information provided includes matters where the plaintiff has alleged damages in
an amount that exceeds $5,000,000 or where such damages are currently unknown,
but could potentially exceed $5,000,000, and excludes threatened litigation
where the threatening party or parties specified no Dollar threshold. Inclusion
of any matter on the lists provided below shall not be deemed a conclusion on
the part of the Borrower or its Subsidiaries that an adverse determination in
connection with such matter is likely or expected, or that such a determination
would necessarily result in a Material Adverse Effect. Terms not otherwise
defined in this Schedule are used herein as defined in the Agreement.
1. Flying J, Inc. v. Comdata Network, Inc. and Trendar Corporation, et. al.
In July 1996, Comdata was sued in the U.S. District Court for the Northern
District of Utah by Flying J, an operator of a large chain of truck stops and
formerly a significant Comdata customer. The complaint alleges violations of
various antitrust laws, tortious interference with contract and unfair
competition. Specifically, Flying J alleges that Comdata's market position in
the transportation industry caused Flying J's agreement(s) with another truck
stop chain to deploy point-of-sale authorization devices and truck driver
service kiosks to unravel. Comdata filed a motion to dismiss, stay or transfer
this case to the U.S. District Court for the Eastern District of Tennessee where
Comdata had previously filed suit against Flying J in April 1996, seeking a
temporary restraining order and, later, a permanent injunction to prevent Flying
J from misappropriating certain confidential and proprietary information of
Comdata, including misuse of Comdata's Comchek card numbers. Although the
temporary restraining order was granted by the Tennessee court and remained in
place through mid-December 1996, the Tennessee court declined to issue a
permanent injunction and the Tennessee case, accordingly, was dismissed. The
plaintiff filed an amended complaint in the Utah case in mid-January 1997. In
January 1999, plaintiffs filed a second and third amended complaint seeking to
add claims for interference with contractual relations with NCR and NTS, Inc.
Plaintiffs' expert report has been filed under seal. A motion is pending to have
the court reconsider its denial of plaintiffs' motion the Borrower as a party.
Similar motions have been denied twice previously. Meanwhile, plaintiffs have
sued the Borrower separately, repeating the same allegations made against
Comdata. The complaint was accompanied with a motion to stay following the
Borrower's answer. Ceridian has answered and is pursuing dispositive motions to
dismiss. Ceridian believes that the separate suit filed against it is subject to
various affirmative defenses, including, without limitation, lack of standing,
laches, unclean hands, no damages as a result of conduct of the Borrower and
statute of limitation defenses, and in addition the Borrower does not believe
that suit reaches the damages thresholds specified above. The suit is disclosed
only to provide a complete description of the current circumstances. The lawsuit
against Comdata is currently scheduled for a four-week trial beginning in June
2001.
2. Fortune Funding LLC, et al. v. Ceridian Corporation. On July 28, 2000
the owner of the Borrower's former headquarters building sued the Borrower in
the United States District Court for the District of Minnesota. The complaint
alleges breach of contract, violation of Minn. Stat.
1.
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561.17, common law waste, intentional and negligent misrepresentation, and
violation of the consumer fraud act.
3. The Huntington National Bank v. ABR Benefits Services, Inc. The
Huntington National Bank sued ABR Benefits Services in Circuit Court, Pinellas
County, Florida. Plaintiff terminated their contract with ABR and claims breach
of contract and wrongful retention of hardware and software. ABR's professional
liability carrier is paying costs. The matter is currently in the discovery
phase.
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SCHEDULE 5.07
ERISA COMPLIANCE
Not Applicable.
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SCHEDULE 5.10
CONTINGENT OBLIGATIONS
1. Reimbursement obligations relating to letters of credit set forth in
Schedule 1.01(e).
2. Contingent Obligations arising in connection with the Borrower's
guarantee of the obligations of New Ceridian under the New Ceridian Credit
Agreement.
3. The Borrower's obligations to pay certain obligations as expressly set
forth in the Spin-Off Documents.
4. Existing Contingent Obligations relating to a $1,200,000 letter of
credit required by Liberty Sites, Ltd., the landlord of the Montreal, Canada
facilities, and Contingent Obligations related to a guaranty of the account
party's obligations in respect thereto, given to the issuing bank (CIBC) by the
Borrower as of the Effectiveness Date, and by New Ceridian on the Closing Date.
5. Existing Contingent Obligations of $100,000 relating to the obligations
of Resumix (a divested subsidiary) under a switchboard lease/purchase.
6. Existing Contingent Obligations of $18,900,000 under surety bonds
primarily relating to various licensing or permitting requirements of Comdata
(and its subsidiaries) for fuel tax, ATM, check cashing and related matters.
7. Existing Contingent Obligations of $900,000 under performance guarantees
of Empros (a divested business operation) in Mexico, as to which the Borrower
has a "back-up" indemnity from Siemens, the acquiror of Empros.
8. Existing Guarantees by the Borrower as of the Effectiveness Date, as
described in Schedule 1.01(i), by New Ceridian as of the Closing Date, in
substantially the form of Exhibit E, and by the Borrower's domestic Material
Subsidiaries, in substantially the form of Exhibit F.
9. Contingent Obligations relating to a $2,000,000 Letter of Credit (the
amount subject to rescission) issued under the Existing Credit Facility and to
be reissued under the New Ceridian Credit Agreement.
10. Contingent Obligations arising in connection with the Borrower's
guarantee to landlords in respect of 5 sales office locations leased by CCL (no
sum certain), which guarantees were executed on March 10, 1998.
11. Contingent Obligations arising in connection with the Borrower's
guarantee in the amount of $1,103,170 to IBM Canada, LTd of obligations of CCL,
which guarantee was executed on December 7, 1998 and expires on January 1, 2003.
12. Contingent Obligations arising in connection with the Borrower's
guarantee in the amount of $3,000,000 to CIBC of obligations of Pernicom, which
guarantee was executed on August 27, 1999.
1.
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13. Contingent Obligations arising in connection with the Borrower's
customer guarantee for no sum certain to Asda of obligations of Centre-File,
which guarantee was executed on September 5, 1997.
14. Contingent Obligations arising in connection with the Borrower's
overdraft guarantee for no sum certain to National Westminster of obligations of
Centre-File, which guarantee was executed on August 18, 1997.
15. Contingent Obligations arising in connection with the Borrower's
landlord guarantee in the amount of $34,000 to Kingsway Group PLC of obligations
of CCP, which guarantee was executed on July 1, 2000 and expires on December 24,
2002.
16. Contingent Obligations arising in connection with the Borrower's
customer guarantee for no sum certain to Exxon Card Services of obligations of
LAES/Comdata, which guarantee was executed on September 24, 1997 and expires on
September 24, 2002.
17. Contingent Obligations arising in connection with the Borrower's
customer guarantee for no sum certain to Exxon Card Services of obligations of
SVS/Comdata, which guarantee was executed on March 1, 1999 and expires on March
1, 2004.
18. Contingent Obligations arising in connection with the Borrower's
guarantee for no sum certain to IBM of obligations of Comdata, which guarantee
was executed on June 30, 1998.
19. Contingent Obligations arising in connection with the Borrower's
landlord guarantee for no sum certain to Norwestern Mutual Insurance of
obligations of Comdata.
20. Contingent Obligations arising in connection with the Borrower's
guarantee in the amount of $0 to AmSouth (1st American) of obligations of
Comdata, which guarantee was executed on September 4, 1998.
21. Contingent Obligations arising in connection with the Borrower's
guarantee in the amount of $0 to Chase Manhattan Bank of obligations of
▇▇▇▇▇▇▇▇.▇▇▇, which guarantee was executed on October 1, 1999.
22. Contingent Obligations arising in connection with the Borrower's
guarantee in the amount of $575,000 to Amplicon of obligations of Usertech,
which guarantee was executed on November 3, 2000 and expires on November 1,
2003.
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SCHEDULE 5.11
ENVIRONMENTAL MATTERS
The following information is provided regarding various matters relating
to Environmental Laws, Environmental Claims and Hazardous Materials involving
the Borrower and its Subsidiaries. Inclusion of any matter on the lists provided
below shall not be deemed a conclusion on the part of the Borrower that such
matter would or could reasonably be expected to result in a Material Adverse
Effect. Terms not otherwise defined in this Schedule are used herein as defined
in the Agreement.
1. Printed Circuits Operations, St. Louis Park, Minnesota. Groundwater
contamination was discovered at the printed circuits facility formerly operated
by the Borrower's Computer Products division in St. Louis Park. Despite the sale
of the printed circuits business and the transfer of the St. Louis Park real
estate to CD Systems in connection with the spin-off of CD Systems, the Borrower
remains responsible for environmental matters related to this site. A consent
order was signed with the Minnesota Pollution Control Agency ("MPCA") which
obligates the Borrower to perform MPCA-approved remedial actions. The MPCA has
accepted the Borrower's proposed remedial alternative involving the treatment
and discharge of contaminated groundwater, and has issued a record of decision
setting the recommended cleanup levels for the groundwater. A response action
plan was submitted and approved and remediation facilities have been in
operation since July 1990. Groundwater clean up has progressed to the point
where the site is expected to start the closure and delisting process within the
next 1-2 years. CD Systems is pursuing a sale of this property. The remaining
cost of implementing remedial actions was most recently estimated by management
to be under $500,000.
2. Imprimis/Seagate Environmental Matters. The Borrower has agreed to
indemnify Seagate against a portion of environmental liabilities relating the
Imprimis facilities and sites where Imprimis may have disposed of hazardous
materials, to the extent such liabilities relate to occurrences that predate the
sale of Imprimis to Seagate, and to the extent such liabilities exceed the
amount of applicable reserves on the closing balance sheet of Imprimis. Because
those reserves have been exhausted, the Borrower is responsible for up to $8.2
million of the next $9.2 million of such liabilities, and for 50 percent of such
liabilities beyond that amount, with a maximum indemnification obligation of
$15.7 million. The Borrower has paid approximately $8.2 million to Seagate
pursuant to this indemnity through mid-2000. The Borrower has established
reserves for the full amount of its remaining liability with respect to this
indemnification undertaking.
3. Chemical Marketing Corporation of America. In April and May 1999, MPCA
has requested information, under the Minnesota Environmental Response and
Liability Act regarding the possible release of hazardous substances or
pollutants of contaminants at the Chemical Marketing Company of America Site,
previously located at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇.
The Borrower's initial review of its documents shows that it had shipped
hazardous waste from its former VTC subsidiary's location at ▇▇▇▇ ▇. ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ back in the early 1980's. The Borrower has
responded to the requests and is in discussion with MPCA and other PRPs
regarding site clean up. Total clean up
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costs are estimated by management to be between $660,000 to $1,400,000. The
Borrower has adequate reserves available to cover anticipated clean up costs.
4. Spring Grove, Minnesota. After detecting low levels of contamination in
two municipal ▇▇▇▇▇ in Spring Grove, the MPCA requested information from the
Borrower and Northern Engraving Corporation ("NEC") regarding a facility in
Spring Grove operated by the Borrower from 1965 to 1971 and since that time by
NEC. The Borrower and NEC subsequently entered into a consent order with the
MPCA pursuant to which the Borrower and NEC are implementing certain remedial
actions and have reimbursed the MPCA for 75% of its past costs in connection
with this matter. Estimated future costs for the Borrower under the consent
order may be as much as $500,000 over a period of as much as thirty years.
5. Freeway Sanitary Landfill, Burnsville, Minnesota. In April 1994, the
Borrower received a request for information from the MPCA regarding the
Borrower's connection with this landfill. Apparently groundwater contamination
has been discovered in connection with this facility. The Borrower's
investigation to date suggests that some waste materials generated by the
Borrower were disposed of at this landfill during the relevant time period
(1969-1990) in accordance with applicable law. In 1996, the State of Minnesota,
under the Minnesota Landfill Cleanup Law, assumed responsibility for all further
response actions at the site. The Landfill Cleanup Law requires the Borrower to
preserve its rights to insurance coverage for cleanup costs at the site.
6. Oak Grove Landfill, Anoka County, Minnesota. This landfill in Anoka
County, Minnesota, closed in 1984, was the subject of an investigation by the
EPA and MPCA for several years. The Borrower's involvement with the site,
allegedly as a result of utilizing a transporter who disposed of waste at the
landfill, was relatively small. Nevertheless, the Borrower joined an Oak Grove
PRP group, which has negotiated a consent decree with the EPA. The Borrower
contributed approximately $250,000 to the PRP group and does not expect to make
any significant future payments with respect to this site. In 1996, the State of
Minnesota, under the Minnesota Landfill Cleanup Law, assumed responsibility for
all further response actions at the site. The Landfill Cleanup Law requires the
Borrower to preserve its rights to insurance coverage for cleanup costs at the
site. The State of Minnesota has recently brought a lawsuit against the
insurance companies and has subpoenaed all applicable records from PRP.
7. Isanti County, Minnesota. In the 1991 settlement of a civil action filed
in the U.S. District Court for Minnesota, the Borrower and nine other parties
agreed to reimburse the EPA and the MPCA for costs incurred in the surface
cleanup of five waste disposal sites in Isanti County, and to create a
remediation fund to conduct remedial activities at the sites for a period of 12
years, at which time the State of Minnesota would take over the sites. The
Borrower has paid its share of these amounts. The settlement agreement also
provides that unless new information is discovered during the 12 year period
that indicates the seven settling PRPs have in the past been responsible for any
additional contamination at these sites, the settling PRPs would obtain a full
release from the State at the conclusion of the 12 year period.
8. Ecolotech, Minneapolis and St. ▇▇▇▇, Minnesota. Prior to 1987, the
Borrower shipped wastes to Ecolotech, which operated facilities in Minneapolis
and St. ▇▇▇▇. Soil and groundwater contamination where discovered at the sites
and a consent order was entered into by the generators (including the Borrower)
with the MPCA in 1987. Remedial efforts specified for the
2.
119
sites have been completed. The Borrower is awaiting termination of the consent
order by the MPCA.
9. Hopkins Landfill, Hopkins, Minnesota. In March 1994, the Borrower
received a letter from the City of ▇▇▇▇▇▇▇ identifying the Borrower as having
used the Hopkins Landfill for disposal of waste and seeking reimbursement of
methane remediation costs. The City then placed a "hold" on its reimbursement
request until the state legislature passed the Landfill Cleanup Law. In July
1996, the Borrower received a request from MPCA for information regarding the
Borrower's connection with this landfill. The records search to date has not
uncovered any disposal records for the ▇▇▇▇▇▇▇ Landfill. The State of Minnesota,
under the Minnesota Landfill Cleanup Law, has assumed responsibility for all
further response actions at the site. The Landfill Cleanup Law requires the
Borrower to preserve its rights to insurance coverage for cleanup costs at the
site.
10. Other. The Borrower has identified certain of its facilities that
contain asbestos containing materials ("ACM"). As to such facilities, it is the
Borrower's policy and practice, in accordance with applicable Environmental
Laws, to manage ACM in place or remove it when necessary. The Borrower is also
aware of underground storage tanks located in its Comdata subsidiary facilities
in Brentwood, Tennessee and Newberry, South Carolina which are being utilized in
accordance with applicable Environmental Laws.
3.
120
SCHEDULE 5.17
INTELLECTUAL PROPERTY; PROPRIETARY INFORMATION
(a)
(i) TVScan software and trademark license dated May 1, 1998
from Tapscan Inc. to Arbitron for its exclusive use in the radio, agency
and advertising industries worldwide and the television and cable
industries outside the U.S. TVScan processes and provides custom
analysis reports of television viewing data.
(ii) Software used for internal business: See 4(d) below.
(iii) License agreement between Arbitron and Claritas Inc. for
PRIZM/Clusters (population) data.
(iv) License agreement between Arbitron and Market Statistics
for demographic and economic data.
(v) Software license agreement dated July 17, 2000 between
Ceridian and Lariat Software, Inc. for software to be used in Borrower's
services or processes.
(vi) Software license agreement between CSW Research Ltd.,
and outside third parties. The licensed software is used in connection
with survey research, including questionnaire design, automated
telephone dialing, and data analysis. All agreements listed are for a
one year term and are auto renewing for a like term.
(b) None.
(c) See Schedule 5.05, Item 3.
(d) See the list below.
ACT
Add Strip
Adobe Acrobat 4
ADOBE ACROBAT FULL
Adobe After Effects 4
Adobe Illustrator 6
Adobe Illustrator 7
Adobe PageMaker 6.5
Adobe Photoshop 5.5, 6 and 5LE
Adobe Type Manager Deluxe and Lite 4.6
Alladin StuffIt Deluxe 5.5
▇▇▇▇▇▇▇ Cold Fusion 4
Apple OS 8.6 and 9.0.4
ARCSERVE
1.
121
ASPChart Charting Component
ATAMAN TELNET
ATLAS GIS
AUDIX VOICEPOWER
BackupEXEC
BARSPOOL
C++/DEC
CAS FOR WINDOWS
CDR
CLIENTS & PROFITS
Clients & Profits 4.0
CODE1+
COLD FUSION
COMPARERITE
Corel Draw 6
CRYSTAL INFO
CUTEFTP
DATAJET
DB BRZ
DBASE IV
DEFINITY G1
Deltagraph 4.5
DESIGNER
DEVELOPER
DOC1/DEC
DOC1/NT
DTC MANAGER
EDIFY
EXCEED6
Extensis Portfolio 5
Extensis Suitcase 8 and 9
EZCASE
EZFLOW
Fetch 3.03
FileMaker Pro 3, 4 and 5
FOREHELP
FREELANCE GRAPHICS
GEMBASE
GEOCODER
GHOST
GOLDMINE
HELPDESK
HP UNIX
HYPERION
IMAGE PRO
2.
122
IMAGEBASIC
IMAGEKEY
JAVA/DEC
Kai's Power Tools 3
KAWA
LAN WORKGROUP
LAN WORKPLACE
▇▇▇▇▇▇ INSIGHT
LEAD TOOLS
LEXMARK TOOLKIT
LISTCONV
LOTUS 1-2-3 V4.0
LOTUS 1-2-3 V5.0
LWP PRO 95/NT
MacLink Plus 9.7.1 through 11
Macromedia Dreamweaver 3 and 4
Macromedia Fireworks 3
Macromedia Flash 4 and 5
Macromedia Fontographer 4.1.5
Macromedia Freehand 8.01 and 9
MAILSTREAM
MCAFEE VIRUS SCAN
MEDIAMAX
MICRO FOCUS COBOL
MICRO FOCUS COBOL\DEC
MICROSOFT ACCESS
MICROSOFT EXCEL
MICROSOFT FOXPRO
MICROSOFT FRONTPAGE
Microsoft Internet Explorer 5
MICROSOFT OFFICE 2000
Microsoft Office 98 for Mac
MICROSOFT OFFICE PRO
MICROSOFT OFFICE97
MICROSOFT OFFICE97
Microsoft Outlook Exchange 8.2.1
Microsoft Outlook Express 5
MICROSOFT PROJECT
MICROSOFT PUBLISHER
MICROSOFT VB
MICROSOFT VFOXPRO
MICROSOFT VISSTUDIO
MICROSOFT WIN 2000
Microsoft Windows Media Player
MICROSOFT WORD
MICRPSOFT POWERPNT
3.
123
MITEK ICR/OCR
MS IIS
MS INTERNET EXPLORER
Netscape Communicator 4.7 and 6
NETWARE
NFS Maestro
Norton AntiVirus 5 and 6
Norton Utilities 4 and 5
ODBC FOR OS/2
ODBC FOR WINDOWS
ORACLE/NT
ORACLE/DEC
OS/2 LAN REQUESTER
OS/2 LAN SERVER
PAGEMAKER
PARADOX
PcAnywhere
PHOTOSHOP
PIXTOOLS/EZ
PIXTOOLS/IMAGE PROC
PKZIP/PKUNZIP
Pocket Ethernet Adapter III
PowerBuilder Desktop
PowerBuilder Professional
PowerPoint
PPI Modem Utilities
Project
PROMIX
ProtoView
PROXY
PVCS DEC
PVCS TRAKKER
PVCS Version Manager
PVCS\PC Columbia
PVCS\PC New York
QA Plus
QA Plus
QBAL
Quark Express 3.32
Quick Xpense
Quicken ExpensAble
QuickLink II Fax
QuickLink II Windows and DOS
Quancept CATI
Quanquest
Quantum
4.
124
Quanvert
Quanvert DBA
Quicktime
Quinput
Quinput DOS
REELBACKUP
REELIBRARIAN
REFLECTIONS FOR HP
ReFox
Removable Cartridge Disk Utilities
Roadmap to Developer Products and Services
ROBO HELP
ROBOT
ROLM CBXII
ROLM PHONEMAIL
RTPatch for InstallShield Professional
SALES TAX
Sanyo Boot Floppy
SAS
SAVEU2
SCO Unix Driver for AHA
SCSI Interface Kit
SCSI Network Manager
SCSI Pro!
SDK's, DDK's, and Operating Systems
SEAGATE CRYSTAL REPT
Serv-U FTP Server
Sheridan Developer's Toolkit
SideBar Try-n-Buy
Sidekick
SMARTGATE
SmartSuite 97
SmartSuite ATM Program Disk
SMAX
Solutions Development Kit
Sound Blaster 16 Software
Special Enhancements R410
Spread
SPSS
SQLNET
SQLNET FOR OS/2
SQLPLUS
SQZ!
Stacker
Stacker
Stacker
5.
125
Stacker
Stealth 64
Stealth 64 DRAM
Stealth 64 Video
Stealth II S220
Stealth II S220 Game Sampler CD
Stealth VRAM
Stonefield Database Toolkit
Superdisk for EtherCard
SYLVAN MAPS
SYNCSORT
SYSTEM COMMANDER
T4900 Reference Manual
Tab Pro
TCP/IP
TCP/IP DOS
TCP/IP OS2
Tech Net
TELEMATE
TELETHENA
Test
TEXTPAD
ThinkPad Bundle
Tools and Systems
TOTAL ACCESS STATS
Track for Windows
TrackMate
TRU64 UNIX DEC
TRUE DB GRID PRO 5.0
True DBGrid Pro
True DBGrid Pro VC++
UNIFACE
VBAssist
Vibra 16
Video for Windows Runtime
View for Windows
Viper V330
Viper VLB
VISIO
VISIO NETWORK EQ 2000
Visio Professional
Visio2000 Professional
Vistacom
VISUAL BASIC
Visual Basic Professional
Visual C++
6.
126
Visual C++ Power Tools
Visual C++ Subscription
Visual Components
Visual FoxPro
Visual FoxPro Professional Edition
Visual FoxPro Professional Training Series
Visual FoxPro Windows Professional
Visual FoxPro Windows Standard
Visual J++ Technology Preview 2
Visual Studio 97 Service Pack 3
Visual Studio Enterprise Edition
Visual Studio MSDN Library
Visual Studio Professional Edition
Visual Studio Professional Edition Licenses
Visual Test
VSFlexGrid Pro
VS-OCX
WEBBASE
Windows
WINDOWS 3.51
WINDOWS 95
Windows 95
Windows 95, Win32 SDK
Windows 95, Win32 SDK and Windows NT
Windows 95, Win32 SDK, Backoffice 1.5 SDK
Windows 98
Windows for Workgroups/DOS
WINDOWS NT 4.0 Clients
WINDOWS NT 4.0 Servers
WINDOWS NT 4.0 W/S
Windows NT Server
Windows NT Server
Windows NT Workstation
Windows NT Workstation, Win32 SDK, Windows
NT
DDK
Windows Sound System
Winfax Lite
Winfax Pro
Winfax Pro Patch
WinLib Wizard
WinList for Windows
Winstone 94
Winzip
Wordperfect
Workgroup Add-On for Windows
7.
127
XTree Gold
XTree Gold
zip Install
zip tools 100
(e) None.
(f) None.
(g) Material Software owned and used by Arbitron:
(i) Maximi$er/MediaProfessional (owned by Arbitron);
performs research and sales analysis using respondent-level radio
audience estimate data.
(ii) Tapscan (owned by Arbitron); processes respondent-level
and summary-level radio audience estimate data.
(iii) Qualitap (owned by Arbitron); processes qualitative
data.
(iv) TV Qualitap (owned by Arbitron and licensed to Tapscan
Inc. for its exclusive use in the television and cable industries in the
U.S.); processes qualitative data.
(v) TVScan software (owned by Tapscan Inc. and licensed to
Arbitron for its exclusive use in the radio, agency and advertising
industries worldwide and the television and cable industries outside the
U.S.)
Note: Copyright registration applications were filed on Form TX in the U.S.
Copyright Office for Maximi$er (a/k/a MediaProfessional), Tapscan, TVScan and
Qualitap on December 18, 2000. Copyright registration applications were filed on
December 28, 2000 for Borrower's internal software used to produce its ratings
data..
8.
128
SCHEDULE 5.19
EMPLOYMENT AGREEMENTS
There is currently an employment agreement with ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇.
Borrower's policy for its Arbitron division prior to the Spin-Off Consummation
Date is that members of the Arbitron Executive Staff are generally eligible to
receive up to one year's salary as severance in the event of termination of
employment for reasons other than for cause. It is expected that change of
control agreements will be entered into with members of the Executive Staff of
Arbitron Inc. after the Spin-Off Consummation Date.
1.
129
SCHEDULE 5.21
CAPITALIZATION; SUBSIDIARIES
Information as of the Effectiveness Date
1. Borrower's capitalization as of the Effectiveness Date:
No. shares authorized: 500,000,000
No. shares issued: 161,685,596
No. shares outstanding: 145,681,462
Please note that the shares listed above are subject to a
reverse stock split at a ratio of one-for-five. The reverse stock split will be
effective immediately after the Spin-Off Consummation Date.
2. Following is a list of Borrower's Subsidiaries as of the
Effectiveness Date:
-------------------------------------- ---------------------- --------------------- --------------
NO. OF
PERCENTAGE OF SHARES
STATE OR OTHER VOTING SECURITIES AUTHORIZED/
JURISDICTION OF OWNED BY IMMEDIATE ISSUED &
SUBSIDIARY ORGANIZATION PARENT OUTSTANDING
-------------------------------------- ---------------------- --------------------- --------------
Arbitron Holdings Inc. (First Tier Delaware 100% 1000/1000
Arbitron subsidiary) formed in
October 2000
-------------------------------------- ---------------------- --------------------- --------------
CSW Research Ltd. (Second Tier United Kingdom 100% 410,000/
Subsidiary of Arbitron Holdings,
Inc.) 405,000
-------------------------------------- ---------------------- --------------------- --------------
Euro-Fieldswork Ltd. (First Tier United Kingdom 100% No shares yet
Arbitron Subsidiary) authorized nor
issued
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Infotech (India) Private India 100% 8,400,000/
Limited (First Tier Arbitron
Subsidiary) 1,712,374
-------------------------------------- ---------------------- --------------------- --------------
ABR Information Services, Inc. Florida 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
ABR Employer Services, Inc. Florida 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
ABR Properties, Inc. Florida 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
BMC Consultants, Inc. Colorado 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
1.
130
-------------------------------------- ---------------------- --------------------- --------------
NO. OF
PERCENTAGE OF SHARES
STATE OR OTHER VOTING SECURITIES AUTHORIZED/
JURISDICTION OF OWNED BY IMMEDIATE ISSUED &
SUBSIDIARY ORGANIZATION PARENT OUTSTANDING
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Benefits Services, Inc. Florida 100% N/A
(f/k/a ABR Benefits Services,
Inc.)
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Retirement Plan Florida 100% N/A
Services, Inc.
(f/k/a ABR Retirement Plan
Services, Inc.)
-------------------------------------- ---------------------- --------------------- --------------
Charing Company, Inc. Wisconsin 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
▇▇▇▇▇▇▇▇, Ltd. Wisconsin 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
The Barrington Group Wisconsin 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Associates,
Ltd. Arizona 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
MidAtlantic 401(k) Services, Inc. Virginia 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Western Pension Service California 100% N/A
Corporation
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Investors Advisors, Florida 100% N/A
Inc.
(f/k/a ABR Investment
Advisors, Inc.)
-------------------------------------- ---------------------- --------------------- --------------
Arbat Middle East E.C. (held in Bahrain 100% N/A
trust) (inactive)
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Canada Holdings, Inc. Delaware 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Canada Ltd. Canada 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
33444651 Canada Ltd. Canada 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Performance Partners Canada 100% N/A
Ltd.
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Holdings U.K. Limited United Kingdom 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Centrefile Limited United Kingdom 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Centrefile APS Limited United Kingdom 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Centrefile (Mauritius) Ltd. Mauritius 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Performance Partners United Kingdom 100% N/A
Limited
-------------------------------------- ---------------------- --------------------- --------------
Usertech UK Limited United Kingdom 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
2.
131
-------------------------------------- ---------------------- --------------------- --------------
NO. OF
PERCENTAGE OF SHARES
STATE OR OTHER VOTING SECURITIES AUTHORIZED/
JURISDICTION OF OWNED BY IMMEDIATE ISSUED &
SUBSIDIARY ORGANIZATION PARENT OUTSTANDING
-------------------------------------- ---------------------- --------------------- --------------
Ceridian Tax Services, Inc. California 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Comdata Network, Inc. Maryland 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Comdata Network Inc. of California 100% N/A
California
-------------------------------------- ---------------------- --------------------- --------------
Comdata Telecommunications Delaware 100% N/A
Services, Inc.
-------------------------------------- ---------------------- --------------------- --------------
International Automated Energy Florida 100% N/A
Systems, Inc.
-------------------------------------- ---------------------- --------------------- --------------
Permicom Permits Services, Inc. Canada 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Stored Value Systems, Inc. Delaware 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Computing Devices International Delaware 100% N/A
Satellite Services, Inc.
-------------------------------------- ---------------------- --------------------- --------------
Partnership Group, Inc., The Pennsylvania 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
Plan ▇▇▇▇ Inc. (inactive) Pennsylvania 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
▇▇▇▇▇▇▇▇.▇▇▇ INC. New Jersey 100% N/A
(f/k/a Ceridian Small Business
Solutions, Inc.)
-------------------------------------- ---------------------- --------------------- --------------
User Technology Services, Inc. New York 100% N/A
-------------------------------------- ---------------------- --------------------- --------------
3. Following is a list of Borrower's Arbitron Subsidiaries as of the
Effectiveness Date:
------------------------------------------------- ------------------------------------------------
SUBSIDIARY STATE OR OTHER JURISDICTION OF ORGANIZATION
------------------------------------------------- ------------------------------------------------
------------------------------------------------- ------------------------------------------------
Arbitron Holdings Inc. Delaware
------------------------------------------------- ------------------------------------------------
CSW Research Limited
United Kingdom
------------------------------------------------- ------------------------------------------------
Euro-Fieldwork Limited
United Kingdom
------------------------------------------------- ------------------------------------------------
Ceridian Infotech (India) Private Limited India
------------------------------------------------- ------------------------------------------------
3.
132
4. Following is a list of Borrower's Material Subsidiaries as of the
Effectiveness Date:
------------------------------------------------- -----------------------------------------------
MATERIAL SUBSIDIARIES STATE OR OTHER JURISDICTION OF ORGANIZATION
------------------------------------------------- -----------------------------------------------
ABR Information Services, Inc. Florida
------------------------------------------------- -----------------------------------------------
Comdata Network, Inc. Maryland
------------------------------------------------- -----------------------------------------------
Information as of the Spin-Off Consummation Date
1. Following is a list of Borrower's Arbitron Subsidiaries after the
Spin-Off Consummation Date:
------------------------------- --------------------------- --------------------- ---------------
PERCENTAGE OF NO. OF SHARES
STATE OR OTHER VOTING SECURITIES AUTHORIZED/
JURISDICTION OF OWNED BY IMMEDIATE ISSUED &
SUBSIDIARY ORGANIZATION PARENT OUTSTANDING
------------------------------- --------------------------- --------------------- ---------------
Arbitron Holdings Inc. Delaware 100% 1000/1000
------------------------------- --------------------------- --------------------- ---------------
CSW Research Limited 410,000/
United Kingdom 100% 405,000
------------------------------- --------------------------- --------------------- ---------------
Euro-Fieldwork Limited No shares yet
United Kingdom 100% authorized
nor issued
------------------------------- --------------------------- --------------------- ---------------
8,400,000/
Ceridian Infotech (India)
Private Limited India 100% 1,712,374
------------------------------- --------------------------- --------------------- ---------------
2. There will not be any Material Subsidiaries of the Borrower as of the
Spin-Off Consummation Date.
4.
133
SCHEDULE 5.23
BROKERS' FEES AND RELATED EXPENSES
None.
1.
134
SCHEDULE 5.25
THIRD PARTY CONSENTS
None.
1.
135
SCHEDULE 7.01
PERMITTED LIENS
None.
1.
136
SCHEDULE 7.02(b)
PERMITTED TRANSACTIONS
1. Sale of assets of Ceridian Infotech (India) Private, Limited
2. Sale of assets of CSW Research Limited
3. Dissolution of Euro-Fieldword Limited
3. Separation ("Spin-off") of Ceridian Corporation into two publicly traded
companies to be known as Ceridian Corporation and Arbitron Inc., respectively,
pursuant to Spin-off documents.
1.
137
SCHEDULE 7.06(b)
PERMITTED INVESTMENTS
1. The following is a list of the Investments of the Borrower and its
Subsidiaries (other than Investments in Subsidiaries) as of the Effectiveness
Date:
------------------------------ ------------------ ----------------------- -----------------------
STATE OR OTHER
JURISDICTION OF PERCENTAGE OF VOTING
COMPANY INCORPORATION SECURITIES OWNED ARBITRON INVESTMENT
------------------------------ ------------------ ----------------------- -----------------------
▇▇▇▇▇▇▇ Technology, Inc. Texas 9.9% 0
------------------------------ ------------------ ----------------------- -----------------------
Buyers' Health Care Action Minnesota 9.3% 0
Group, Inc.
------------------------------ ------------------ ----------------------- -----------------------
▇▇▇▇▇▇▇.▇▇▇, Ltd. Delaware 1.4% 0
------------------------------ ------------------ ----------------------- -----------------------
Revelation Technologies, Inc. Delaware 7.4% 0
------------------------------ ------------------ ----------------------- -----------------------
TruckersB2B, Inc. Delaware 800,000 shares 0
------------------------------ ------------------ ---------------------- ------------------------
Delaware 13.75% 1994: $2,000,000
1995: $1,000,000
ADcom Information Services, 1996: $1,585,000
------------------
Inc. Total: $4,585,000
------------------------------ ------------------ ---------------------- ------------------------
The Center for Online
Learning, Inc. Florida 2.8% 2000: $2,000
------------------------------ ------------------ ---------------------- ------------------------
Symmetrical Holdings, Inc. Florida 7.5% 1997: $900,000
(f/k/a Symmetrical Resources 1998: $500,000
------------------
Corporation) Total: $1,400,000
------------------------------ ------------------ ---------------------- ------------------------
2. The following is a list of the Investments of the Borrower and its
Subsidiaries (other than Investments in Subsidiaries) as of the Spin-Off
Consummation Date:
------------------------------------------ ------------------------------------------------------
COMPANY STATE OR OTHER JURISDICTION OF INCORPORATION
------------------------------------------ ------------------------------------------------------
ADcom Information Services, Inc. Delaware
------------------------------------------ ------------------------------------------------------
The Center for Online Learning, Inc. Florida
------------------------------------------ ------------------------------------------------------
Symmetrical Holdings, Inc. Florida
(f/k/a Symmetrical Resources Corporation)
------------------------------------------ ------------------------------------------------------
1.
138
SCHEDULE 10.02
EURODOLLAR AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
CERIDIAN CORPORATION
Arbitron Company
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Controller
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
Website: ▇▇▇.▇▇▇▇▇▇▇▇.▇▇▇
BANK OF AMERICA, as Administrative Agent
Administrative Agent--Lending and Administrative Notices
(for payments and Requests for Credit Extensions):
Bank of America, N.A.
Credit Services
Mail Code: NC1-001-15-04
One Independence Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Acct. No. 1366212250600
ABA #: ▇▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With copy to:
Bank of America, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chitt Swamidasan
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
1.
139
L/C Issuer:
----------
Bank of America, N.A.
Trade Operations-Los Angeles #22621
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Mail Code: CA9-703-19-23
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Facsimile: 213.345.6694
Email: ▇▇▇▇▇▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Other Notices as a Lender:
-------------------------
Bank of America, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chitt Swamidasan
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
THE BANK OF NEW YORK
Requests for Credit Extensions:
------------------------------
The Bank of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇/8634
Email: None
Notices (other than Requests for Credit Extensions):
--------------------------------------------------
The Bank of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
2.
140
BEAR ▇▇▇▇▇▇▇ CORPORATE LENDING INC.
Requests for Credit Extensions:
------------------------------
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
Notices (other than Requests for Credit Extensions):
--------------------------------------------------
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
With copy to:
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
BNP PARIBAS
Requests for Credit Extensions:
------------------------------
BNP Paribas
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇
3.
141
Notices (other than Requests for Credit Extensions):
--------------------------------------------------
BNP Paribas
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇
4.
▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ BANK
Requests for Credit Extensions:
------------------------------
The Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
Notices (other than Requests for Credit Extensions):
---------------------------------------------------
The Chase ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
With a copy to:
--------------
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇.▇▇▇▇@▇▇▇▇▇.▇▇▇
CITIZENS BANK OF MASSACHUSETTS
Requests for Credit Extensions:
------------------------------
Citizens Bank of Massachusetts
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
5.
143
Notices (other than Requests for Credit Extensions):
--------------------------------------------------
Citizens Bank of Massachusetts
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
FLEET NATIONAL BANK, as Syndication Agent
Requests for Credit Extensions:
Fleet National Bank
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mailcode: MADE 10009B
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Notices (other than Requests for Credit Extensions):
---------------------------------------------------
Fleet National Bank
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mailcode: MADE 10009D
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇_▇_▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
6.
▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ PLC
Requests for Credit Extensions:
------------------------------
The Royal Bank of Scotland plc
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: None
Notices (other than Requests for Credit Extensions):
--------------------------------------------------
The Royal Bank of Scotland plc
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: ▇▇▇.▇▇▇▇▇@▇▇▇▇.▇▇▇
U.S. BANK NATIONAL ASSOCIATION
Requests for Credit Extensions:
------------------------------
U.S. Bank National Association
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: None
7.
145
Notices (other than Requests for Credit Extensions):
--------------------------------------------------
U.S. Bank National Association
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Email: None
8.
146
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
CERIDIAN CORPORATION, as Borrower
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Title: Executive Vice President of Finance
------------------------------------
and Planning of Arbitron and
Vice President of Ceridian
S-1.
▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇.▇., as
Administrative Agent, a Lender and L/C Issuer
By: /s/ CHITT SWAMIDASAN
--------------------------------------
Name: CHITT SWAMIDASAN
-------------------------------------
Title: Principal
-------------------------------------
S-2.
148
FLEET NATIONAL BANK, AS A LENDER
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Assistant Vice President
------------------------------------
S-3.
149
U.S. BANK NATIONAL ASSOCIATION, AS
A LENDER
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Senior Vice President
------------------------------------
S-5.
150
THE CHASE MANHATTAN BANK, AS A LENDER
By: /s/ ▇▇▇▇▇ ▇. KORUBLUTH
--------------------------------------
Name: ▇▇▇▇▇ ▇. Korubluth
-------------------------------------
Title: Vice President
------------------------------------
S-4.
▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇, AS A LENDER
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
------------------------------------
S-6.
152
BNP PARIBAS, AS A LENDER
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Title: Head of Asset Management
------------------------------------
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Title: Director
------------------------------------
S-7.
153
BEAR ▇▇▇▇▇▇▇ CORPORATE LENDING INC.,
AS A LENDER
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Title: Sr. Managing Director
------------------------------------
S-8.
154
THE ROYAL BANK OF SCOTLAND PLC,
AS A LENDER
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Title: Vice President
------------------------------------
S-10.
155
CITIZENS BANK OF MASSACHUSETTS, AS A LENDER
By: [SIG]
--------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Title: V.P.
------------------------------------
S-9.
156
EXHIBIT A
FORM OF LOAN NOTICE
Date: ___________, _____
To: BANK OF AMERICA, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement, dated as of January
31, 2001 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "Credit Agreement;" the terms defined therein
being used herein as therein defined), among CERIDIAN CORPORATION, a Delaware
corporation (the "Borrower"), the Lenders from time to time party thereto, and
Bank of America, N.A., as the administrative agent for such Lenders (in such
capacity, the "Administrative Agent").
The undersigned hereby requests (select one):
[ ] A Borrowing of Loans [ ] A conversion or continuation of Loans
1. On (a Business Day).
-----------------------------------------
2. In the amount of $ .
-----------------------------------
3. Comprised of .
----------------------------------------
[Type of Loan requested]
4. For Eurodollar Rate Loans: with an Interest Period of ____
months.
The foregoing request complies with the requirements of Section 2.01 of
the Credit Agreement. Other than in connection with a conversion or continuation
of Loans, the undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the above date, before and after
giving effect to the Borrowing or conversion or continuation of Loans requested
above:
(a) The representations and warranties made by the Borrower in the
Credit Agreement, or which are contained in any certificate, document or
financial or other statement furnished at any time under or in connection
therewith, are and will be correct on and as of the date of the Borrowing or
conversion or continuation of Loans requested above, except to the extent that
such representations and warranties specifically refer to any earlier date; and
A-1
157
(b) no Default or Event of Default has occurred and is continuing on
the date hereof or after giving effect to the Borrowing or conversion or
continuation of Loans requested above.
CERIDIAN CORPORATION
By:
-----------------------------------------------
Name:
---------------------------------------------
Title:
--------------------------------------------
A-2
158
EXHIBIT B
FORM OF LOAN NOTE
$
----------------------- -----------------------
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises to
pay to the order of _____________________________ (the "Lender"), on the
Maturity Date (as defined in the Credit Agreement referred to below) the
principal amount of __________________Dollars ($____________), or such lesser
principal amount of Loans (as defined in such Credit Agreement) due and payable
by the Borrower to the Lender on the Maturity Date under that certain Credit
Agreement, dated as of January 31, 2001 (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, the "Credit
Agreement;" the terms defined therein being used herein as therein defined),
among the Borrower, the Lenders from time to time party thereto, and BANK OF
AMERICA, N.A., as the administrative agent for such Lenders (in such capacity,
the "Administrative Agent").
The Borrower promises to pay interest on the unpaid principal amount of
each Loan from the date of such Loan until such principal amount is paid in
full, at such interest rates, and at such times as are specified in the Credit
Agreement. All payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in Dollars in immediately
available funds at the Administrative Agent's Office. If any amount is not paid
in full when due hereunder, such unpaid amount shall bear interest, to be paid
upon demand, from the due date thereof until the date of actual payment (and
before as well as after judgment) computed at the per annum rate set forth in
the Credit Agreement.
This Loan Note is one of the Loan Notes referred to in the Credit
Agreement, is entitled to the benefits thereof and is subject to optional and
mandatory prepayment in whole or in part as provided therein. This Loan Note is
also entitled to the benefits of the Guaranty. Upon the occurrence of one or
more of the Events of Default specified in the Credit Agreement, all amounts
then remaining unpaid on this Loan Note shall become, or may be declared to be,
immediately due and payable all as provided in the Credit Agreement. Loans made
by the Lender shall be evidenced by one or more loan accounts or records
maintained by the Lender in the ordinary course of business. The Lender may also
attach schedules to this Loan Note and endorse thereon the date, amount and
maturity of its Loans and payments with respect thereto.
The Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Loan Note.
B-1
159
THIS LOAN NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
CERIDIAN CORPORATION
By:
------------------------------------------------
Name:
---------------------------------------------
Title:
--------------------------------------------
B-2
160
LOANS AND PAYMENTS WITH RESPECT THERETO
AMOUNT OF OUTSTANDING
TYPE OF PRINCIPAL PRINCIPAL
LOAN AMOUNT OF END OF OR INTEREST BALANCE NOTATION
DATE MADE LOAN MADE INTEREST PAID THIS THIS DATE MADE BY
PERIOD DATE
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
-------- -------- -------- --------- -------- -------- --------
B-3
161
EXHIBIT C
FORM OF COMPLIANCE CERTIFICATE
Financial Statement Date: ,
----------
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement, dated as of January
31, 2001 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "Credit Agreement;" the terms defined therein
being used herein as therein defined), among CERIDIAN CORPORATION, a Delaware
corporation (the "Borrower"), the Lenders from time to time party thereto, and
BANK OF AMERICA, N.A., as the administrative agent for such Lenders (in such
capacity, the "Administrative Agent").
The undersigned Responsible Officer hereby certifies as of the date
hereof that he/she is the _______________________________________________ of the
Borrower, and that, as such, he/she is authorized to execute and deliver this
Certificate to the Administrative Agent on the behalf of the Borrower, and that:
[Use following for fiscal year-end financial statements]
1. Attached hereto as Schedule 1 are the year-end audited financial
statements required by Section 6.01(a) of the Credit Agreement for the fiscal
year of the Borrower ended as of the above date, together with the report and
opinion of an independent certified public accountant required by such section.
[Use following for fiscal quarter-end financial statements]
1. Attached hereto as Schedule 1 are the unaudited financial
statements required by Section 6.01(b) of the Agreement for the fiscal quarter
of the Borrower ended as of the above date. Such financial statements fairly
present the financial condition, results of operations and cash flows of the
Borrower and its Subsidiaries in accordance with GAAP as at such date and for
such period, subject only to normal year-end audit adjustments and the absence
of footnotes.
2. The undersigned has reviewed and is familiar with the terms of the
Credit Agreement and has made, or has caused to be made under his/her
supervision, a detailed review of the transactions and condition (financial or
otherwise) of the Borrower during the accounting period covered by the attached
financial statements.
3. A review of the activities of the Borrower during such fiscal
period has been made under the supervision of the undersigned with a view to
determining whether during such fiscal period the Borrower performed and
observed all its Obligations under the Loan Documents, and
C-1
162
[select one:]
[to the best knowledge of the undersigned during such fiscal period, the
Borrower performed and observed each covenant and condition of the Loan
Documents applicable to it.]
--or--
[the following covenants or conditions have not been performed or
observed and the following is a list of each such Default or Event of Default
and its nature and status:]
4. The financial covenant analyses and information set forth on
Schedule 2 attached hereto are true and accurate on and
as of the date of this Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
_____________, _________.
CERIDIAN CORPORATION
By:
---------------------------------------------
Name:
-------------------------------------------
Title:
------------------------------------------
C-2
163
For The Quarter/Year Ended _________________________________(Statement Date")
SCHEDULE 2
to the Compliance Certificate
($ in 000's)
I. SECTION 7.10 - LEVERAGE RATIO
A. Consolidated Funded Indebtedness of the Borrower and its
Subsidiaries as of the Statement Date:
1. All obligations for borrowed money of the Borrower and its
Subsidiaries on a consolidated basis at the Statement
Date: $
-------------------------
2. All obligations of the Borrower and its Subsidiaries as
evidenced by bonds, debentures, notes and loan agreements
on a consolidated basis at the Statement Date:
$
-------------------------
3. All obligations of the Borrower and its Subsidiaries in
respect of letters of credit, surety bonds, bankers'
acceptances or similar instruments on a consolidated basis
at the Statement Date: $
-------------------------
4. All obligations of the Borrower and its Subsidiaries to pay
the deferred purchase price of property or services (other
than trade payables entered into in the Ordinary Course of
Business pursuant to ordinary terms and paid within the
specified time) on a consolidated basis at the Statement
Date: $
-------------------------
5. The capitalized amount of all Capital Leases of the
Borrower and its Subsidiaries that would appear on a
balance sheet of such Persons prepared as of the Statement
Date in accordance with GAAP and the capitalized amount of
the remaining lease payments under any Synthetic Lease
Obligations incurred by the Borrower or any of its
Subsidiaries which would appear on a balance sheet of such
Persons prepared as of the Statement Date in accordance
with GAAP if such lease were accounted for as a Capital
Lease: $
-------------------------
Schedule 2-1
164
6. All guaranty obligations of the Borrower and its
Subsidiaries in respect of obligations of any Person in the
nature of the obligations referenced in Lines I.A.1 through
I.A.4 above: $
-------------------------
7. Consolidated Funded Indebtedness as of the Statement Date
[Line I.A.1 + I.A.2 + I.A.3 + I.A.4 + I.A.5 +
I.A.6]: $
-------------------------
B. Consolidated EBITDA of the Borrower and its Subsidiaries for the
period of the four fiscal quarters ending on the Statement Date
("Test Period"):
1. Net income of the Borrower and its Subsidiaries on a
consolidated basis for the Test Period, as determined in
accordance with GAAP: $
-------------------------
2. All extraordinary non-cash losses and non-cash gains, and
non-cash losses and non-cash gains from discontinued
operations of the Borrower and its Subsidiaries on a
consolidated basis for the Test Period:
$
-------------------------
3. All cash payments made by the Borrower and its Subsidiaries
during the Test Period in respect of non-cash charges
listed on Line I.B.2 of Schedule 2 attached to any
Compliance Certificate delivered to the Administrative
Agent prior to the Statement Date hereof:
$
-------------------------
4. All interest, premium payments, fees, charges and related
expenses of the Borrower and its Subsidiaries in connection
with borrowed money (including capitalized interest) or in
connection with the deferred purchase price of assets, in
each case to the extent treated as interest in accordance
with GAAP for the Test Period, but excluding any fees,
charges and expenses of the Borrower and its Subsidiaries
arising from the negotiation, execution, closing and
consummation of the Spin-Off Documents, the Loan Documents,
the Private Placement Documents and any Specified Swap
Contracts: $
-------------------------
Schedule 2-2
165
5. The portion of all rent expense of the Borrower and its
Subsidiaries for the Test Period under Capital Leases that
is treated as interest in accordance with GAAP on a
consolidated basis: $
-------------------------
6. The amount of taxes of the Borrower and its Subsidiaries on
a consolidated basis for the Test Period, based on or
measured by income used or included in the determination of
Line I.B.1: $
-------------------------
7. All depreciation expense and amortization expense of the
Borrower and its Subsidiaries on a consolidated basis for
the Test Period: $
-------------------------
8. All interest income of the Borrower and its Subsidiaries on
a consolidated basis for the Test Period:
$
-------------------------
9. Consolidated EBITDA for the Test Period [Line I.B.1 +/-
I.B.2 (if the amount in Line I.B.2 constitutes a loss, it
should be added; if it constitutes a gain, it should be
subtracted) - I.B.3 + I.B.4 + I.B.5 + I.B.6 + I.B.7 -
I.B.8]: $
-------------------------
C. Leverage Ratio [Line I.A.7 / I.B.9]: _________ to 1
D. Maximum permitted Leverage Ratio at the Statement Date (See
Section 7.10 of the Agreement for ratio applicable to the
Statement Date): _________ to 1
COMPLIANCE WITH COVENANT (YES / NO)
II. SECTION 7.11 - FIXED CHARGE COVERAGE RATIO
A. Consolidated EBITDA for the Test Period [Line I.B.9]:
$
-------------------------
B. Taxes actually paid by the Borrower and its Subsidiaries on a
consolidated basis in cash or Cash Equivalents for the Test
Period:
$
-------------------------
C. Capital expenditures plus (without duplication) PPM Expenditures
of the Borrower and its Subsidiaries on a consolidated basis for
the Test Period: $
-------------------------
Schedule 2-3
166
D. Consolidated Interest Expense of the Borrower and its Subsidiaries
on a consolidated basis for the Test Period [Line I.B.4 + I.B.5]:
$
-------------------------
E. Current Portion of Long-Term Debt for the Test Period of the
Borrower and its Subsidiaries on a consolidated basis:
$
-------------------------
F. Fixed Charge Coverage Ratio
[(Line II.A - II.B - II.C) /(Line II.D + II.E)]:
__________ to 1
G. Minimum permitted Fixed Charge Ratio (See Section 7.11 of the
Agreement for ratio applicable to the Statement Date):
___________to 1
COMPLIANCE WITH COVENANT (YES / NO)
Schedule 2-4
167
EXHIBIT D
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Credit Agreement, dated as of
January 31, 2001 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Credit Agreement;" the terms defined
therein being used herein as therein defined), among CERIDIAN CORPORATION, a
Delaware corporation (the "Borrower"), the Lenders from time to time party
thereto, and BANK OF AMERICA, N.A., as the administrative agent for such Lenders
(in such capacity, the "Administrative Agent").
The assignor identified on the signature page hereto (the
"Assignor") and the assignee identified on the signature page hereto (the
"Assignee") agree as follows:
1. (a) Subject to paragraph 11, effective as of the date
specified on Schedule 1 hereto (the "Effective Date"), the Assignor hereby
irrevocably sells and assigns to the Assignee without recourse to the Assignor,
and the Assignee hereby irrevocably purchases and assumes from the Assignor
without recourse to the Assignor, the interest described on Schedule 1 hereto
(the "Assigned Interest") in and to the Assignor's rights and obligations under
the Credit Agreement.
(b) From and after the Effective Date, (i) the Assignee shall be a
party under the Credit Agreement and will have all the rights and obligations of
a Lender for all purposes under the Loan Documents to the extent of the Assigned
Interest and be bound by the provisions thereof, and (ii) the Assignor shall
relinquish its rights and be released from its obligations under the Credit
Agreement to the extent of the Assigned Interest. The Assignor and/or the
Assignee, as agreed by the Assignor and the Assignee, shall deliver, in
immediately available funds, any applicable assignment fee required under
Section 10.07(b) of the Credit Agreement.
2. On the Effective Date, the Assignee shall pay to the Assignor, in
immediately available funds, an amount equal to the purchase price of the
Assigned Interest as agreed upon by the Assignor and the Assignee.
3. From and after the Effective Date, the Administrative Agent shall
make all payments under the Credit Agreement and the Loan Notes, if any, in
respect of the Assigned Interest (including all payments of principal, interest
and fees with respect thereto) to the Assignee. The Assignor and the Assignee
shall make all appropriate adjustments in payments under the Credit Agreement
and such Loan Notes, if any, for periods prior to the Effective Date directly
between themselves.
4. The Assignor represents and warrants to the Assignee that:
(a) The Assignor is the legal and beneficial owner of the Assigned
Interest, and the Assigned Interest is free and clear of any adverse claim;
▇-▇
▇▇▇
(▇) the Assigned Interest listed on Schedule 1 accurately and
completely sets forth the Outstanding Amount of all Loans and L/C Obligations
relating to the Assigned Interest as of the Effective Date;
(c) it has the power and authority and the legal right to make,
deliver and perform, and has taken all necessary action, to authorize the
execution, delivery and performance of this Assignment and Acceptance, and any
and all other documents delivered by it in connection herewith and to fulfill
its obligations under, and to consummate the transactions contemplated by, this
Assignment and Acceptance and the Loan Documents, and no consent or
authorization of, filing with, or other act by or in respect of any Governmental
Authority, is required in connection in connection herewith or therewith; and
(d) this Assignment and Acceptance constitutes the legal, valid and
binding obligation of the Assignor.
The Assignor makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or any of
its Affiliates or the performance by the Borrower or any of its Affiliates of
their respective obligations under the Loan Documents, and assumes no
responsibility with respect to any statements, warranties or representations
made under or in connection with any Loan Document or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of any Loan Document
other than as expressly set forth above.
5. The Assignee represents and warrants to the Assignor and the
Administrative Agent that:
(a) it is an Eligible Assignee;
(b) it has the full power and authority and the legal right to make,
deliver and perform, and has taken all necessary action, to authorize the
execution, delivery and performance of this Assignment and Acceptance, and any
and all other documents delivered by it in connection herewith and to fulfill
its obligations under, and to consummate the transactions contemplated by, this
Assignment and Acceptance and the Loan Documents, and no consent or
authorization of, filing with, or other act by or in respect of any Governmental
Authority, is required in connection in connection herewith or therewith;
(c) this Assignment and Acceptance constitutes the legal, valid and
binding obligation of the Assignee;
(d) under applicable Laws no tax will be required to be withheld by
the Administrative Agent or the Borrower with respect to any payments to be made
to the Assignee hereunder or under any Loan Document, and unless otherwise
indicated in the space opposite the Assignee's signature below, no tax forms
described in Section 10.15 of the Credit Agreement are required to be delivered
by the Assignee; and
(e) the Assignee has received a copy of the Credit Agreement, together
with copies of the most recent financial statements of the Borrower delivered
pursuant thereto, and such other
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169
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance. The Assignee
has independently and without reliance upon the Assignor or the Administrative
Agent and based on such information as the Assignee has deemed appropriate, made
its own credit analysis and decision to enter into this Assignment and
Acceptance. The Assignee will, independently and without reliance upon the
Administrative Agent or any Lender, and based upon such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement.
6. The Assignee appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under the Credit Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto as are delegated to
the Administrative Agent by the terms thereof, together with such powers as are
incidental thereto.
7. If either the Assignee or the Assignor desires a Loan Note to
evidence its Loans, it shall request the Administrative Agent to procure a Loan
Note from the Borrower.
8. The Assignor and the Assignee agree to execute and deliver such
other instruments, and take such other action, as either party may reasonably
request in connection with the transactions contemplated by this Assignment and
Acceptance.
9. This Assignment and Acceptance shall be binding upon and inure to
the benefit of the parties and their respective successors and assigns;
provided, however, that the Assignee shall not assign its rights or obligations
hereunder without the prior written consent of the Assignor and any purported
assignment, absent such consent, shall be void.
10. This Assignment and Acceptance may be executed by facsimile
signatures with the same force and effect as if manually signed and may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument. This
Assignment and Acceptance shall be governed by and construed in accordance with
the laws of the state specified in the Section of the Credit Agreement entitled
"Governing Law."
11. The effectiveness of the assignment described herein is subject
to:
(a) if such consent is required by the Credit Agreement, receipt by
the Assignor and the Assignee of the consent of the Administrative Agent and/or
the Borrower to the assignment described herein. By delivering a duly executed
and delivered copy of this Assignment and Acceptance to the Administrative
Agent, the Assignor and the Assignee hereby request any such required consent
and request that the Administrative Agent register the Assignee as a Lender
under the Credit Agreement effective as of the Effective Date; and
(b) receipt by the Administrative Agent of (or other arrangements
acceptable to the Administrative Agent with respect to) any applicable
assignment fee referred to in Section 10.07(b) of the Agreement and any tax
forms required by Section 10.15 of the Credit Agreement.
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170
By signing below, the Administrative Agent agrees to register the
Assignee as a Lender under the Credit Agreement, effective as of the Effective
Date with respect to the Assigned Interest, and will adjust the registered Pro
Rata Share of the Assignor under the Credit Agreement to reflect the assignment
of the Assigned Interest.
12. Attached hereto as Schedule 2 is all contact, address, account and
other administrative information relating to the Assignee.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
and Acceptance to be executed as of the date first above written by their
respective duly authorized officers.
ASSIGNOR:
[NAME OF ASSIGNOR]
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
[ ] Tax forms required by ASSIGNEE:
Section 10.15 of the [NAME OF ASSIGNEE]
Credit Agreement
included
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
(Signatures continue)
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171
In accordance with and 10.07 of the
Credit Agreement, the undersigned
consent to the foregoing assignment
as of the Effective Date:
CERIDIAN CORPORATION
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
BANK OF AMERICA, N.A.,
as Administrative Agent and L/C Issuer
By:
-----------------------------
Title:
--------------------------
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SCHEDULE 1
to Assignment and Acceptance
The Assigned Interest
Effective Date:
----------------------
TYPE AND AMOUNT OF OUTSTANDING OBLIGATIONS ASSIGNED PRO RATA
ASSIGNED COMMITMENT ASSIGNED SHARE
$ [type] $ %
--------------------------- ---------------------------------- -------------------------
Schedule 1-1
173
SCHEDULE 2
to Assignment and Acceptance
Administrative Details
(Assignee to list names of credit contacts, addresses, phone and facsimile
numbers, electronic mail addresses and account and payment information)
Schedule 2-1
174
EXHIBIT E
FORM OF NEW CERIDIAN GUARANTY
THIS GUARANTY (this "Guaranty"), dated as of January 31, 2001, is made by
NEW CERIDIAN CORPORATION, a Delaware corporation (the "Guarantor"), in favor of
(a) the financial institutions (the "Lenders" and, individually, a "Lender")
from time to time party to that certain Credit Agreement dated as of January 31,
2001 (as renewed, extended, modified, amended or restated from time to time, the
"Credit Agreement"), among CERIDIAN CORPORATION, a Delaware corporation (the
"Borrower"), the Lenders and BANK OF AMERICA, N.A., as the administrative agent
for such Lenders (in such capacity, the "Administrative Agent"), (b) the "Swap
Provider" (as defined herein), and (c) the Note Holders party from time to time
to the Note Purchase Agreement (collectively, the "Guaranteed Parties" and each,
individually, a "Guaranteed Party").
RECITALS
WHEREAS, it is a requirement under the Credit Agreement and the Note
Purchase Agreement that Guarantor shall be bound by the terms and conditions of
this Guaranty pending the Spin-Off Consummation Date; and
WHEREAS, the Guarantor will derive substantial direct and indirect
benefits from the credit extensions to the Borrower pursuant to the Credit
Agreement and the Note Purchase Agreement together with the amendments,
restatements, extensions and continuations contemplated therein, and from the
Spin-Off Transaction, which benefits are hereby acknowledged by the Guarantor;
WHEREAS, the Guarantor will derive substantial direct and indirect
benefits from the Borrower being party to the Specified Swap Contracts, which
benefits are hereby acknowledged;
NOW, THEREFORE, in consideration of the Administrative Agent and Lenders
entering into the Credit Agreement, the Guarantor hereby agrees as follows:
SECTION 1 Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms used in
this Guaranty and not otherwise defined herein shall have the meanings assigned
to them in the Credit Agreement.
(b) Certain Defined Terms. As used in this Guaranty, the following
terms shall have the following meanings:
"Collateral Agent" means Bank of America, N.A. in its capacity as
"Collateral Agent" under, and as defined in, the Intercreditor Agreement (or
such replacement Collateral Agent as may be appointed from time to time pursuant
thereto) on behalf and for the benefit of, (a) Bank of America, N.A., in its
capacity as Administrative Agent for the benefit of itself and the other Lenders
from time to time party to the Credit Agreement, and the L/C Issuer; (b) the
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Note Holders from time to time party to the Note Purchase Agreement; and (c) the
Swap Provider.
"Credit Documents" means, collectively, the Loan Documents, the Swap
Documents, and the Note Purchase Documents.
"Guaranteed Obligations" has the meaning set forth in Section 2(a).
"Guaranteed Parties" and "Guaranteed Party" have the meanings assigned to
them in the first paragraph hereof.
"Guarantor Documents" means this Guaranty, and all other certificates,
documents, agreements and instruments delivered to the Guaranteed Parties under
or in connection with this Guaranty.
"Indemnified Liabilities" has the meaning set forth in Section 15(b).
"Indemnified Person" has the meaning set forth in Section 15(b).
"Intercreditor Agreement" means that Intercreditor Agreement dated as of
January 31, 2001 among the Collateral Agent, the Administrative Agent, the Swap
Provider, and the Note Holders.
"Note Holder Collateral Documents" means, collectively, (a) the Security
Agreements and the Pledge Agreements (as such terms are defined in the Credit
Agreement, but to the extent entered into by the parties thereto for the benefit
of, and as modified, extended or otherwise changed in respect of, the Note
Holders), (b) all Account Control Agreements executed by any Loan Party under
any Note Holder Document, (c) all documents executed by any Loan Party to
accomplish cash collateralization pursuant to any Note Holder Document, and (d)
all licenses, UCC financing statements, notices and other documents executed
from time to time or in connection with any of the foregoing.
"Note Holder Documents" means, collectively, the Note Purchase Agreement,
the Note Holder Collateral Documents and the Note Holder Guaranties.
"Note Holder Guaranties" means the Guaranties under and as defined in the
Credit Agreement, but to the extent entered into by the Guarantors thereunder
for the benefit of, and as modified, extended or otherwise changed in respect
of, the Note Holders.
"Note Holder" means a "Note Holder" under, and as defined in, the Note
Purchase Agreement.
"Note Purchase Agreement" means that Note Purchase Agreement dated as of
January 31, 2001 among the Borrower and the Note Holders party thereto.
"Solvent" means, as to any Person at any time, that (a) the fair value of
the property of such Person is greater than the amount of such Person's
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities
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evaluated for purposes of Section 101(32) of the Bankruptcy Code and, in the
alternative, for purposes of the New York Uniform Fraudulent Conveyance Act; (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 liability of such Person on
its debts as they become absolute and matured; (c) such Person is able to
realize upon its property and pay its debts and other liabilities (including
disputed, contingent and unliquidated liabilities) as they mature in the normal
course of business; (d) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person's ability to pay as
such debts and liabilities mature; and (e) such Person is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Person's property would constitute unreasonably
small capital.
"Specified Swap Agreement" means any ISDA(R) Master Agreement (including
any schedule and confirmation relating thereto) entered into between the
Borrower and the Swap Provider as swap counterparties.
"Specified Swap Contract" means any interest rate swap entered into
between the Borrower and the Swap Provider as swap counterparties constituting a
"Specified Swap Contract" as defined in the Credit Agreement.
"Subordinated Debt" has the meaning set forth in Section 7(a).
"Subordinated Debt Payments" has the meaning set forth in Section 7(b).
"Swap Collateral Documents" means, collectively, (i) the Security
Agreements and the Pledge Agreements (as such terms are defined in the Credit
Agreement, but to the extent entered into by the parties thereto for the benefit
of, and as modified, extended or otherwise changed in respect of, the Swap
Provider), (ii) all Account Control Agreements executed by any Loan Party under
any Swap Document, (iii) all documents executed by any Loan Party to accomplish
cash collateralization pursuant to any Swap Document, and (iv) all licenses, UCC
financing statements, notices and other documents executed from time to time or
in connection with any of the foregoing.
"Swap Documents" means, collectively, (a) any Specified Swap Agreement,
(b) the Swap Collateral Documents, and (c) the Swap Guaranties.
"Swap Guaranties" means the Guaranties under and as defined in the Credit
Agreement, but to the extent entered into by the Guarantors thereunder for the
benefit of, and as modified, extended or otherwise changed in respect of, the
Swap Provider.
"Swap Provider" has the meaning specified in the Intercreditor Agreement.
(c) Interpretation. The rules of interpretation set forth in Section
1.02 of the Credit Agreement shall be applicable to this Guaranty and are
incorporated herein by this reference.
SECTION 2 Guaranty.
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(a) Guaranty. The Guarantor hereby unconditionally and irrevocably
guarantees to each of the Guaranteed Parties, and their respective successors,
endorsees, transferees and assigns, the full and prompt payment when due
(whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise) and performance of the indebtedness, liabilities and other
obligations of the Borrower to each such Guaranteed Party, whether created
under, arising out of or in connection with any of the Credit Documents,
including all Obligations (as independently defined in each of the Credit
Agreement and the Note Purchase Agreement); and any obligations under any
Specified Swap Agreement to the extent arising out of any one or more Specified
Swap Contracts. The terms "indebtedness," "liabilities" and "obligations" are
used herein in their most comprehensive sense and include any and all advances,
debts, obligations and liabilities, now existing or hereafter arising, whether
voluntary or involuntary and whether due or not due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, and whether recovery
upon such indebtedness, liabilities and obligations may be or hereafter becomes
unenforceable or shall be an allowed or disallowed claim under the Bankruptcy
Code or other applicable law. The foregoing indebtedness, liabilities and other
obligations of the Borrower, and all other indebtedness, liabilities and
obligations to be paid or performed by the Guarantor in connection with this
Guaranty (including any and all amounts due under Section 15), shall hereinafter
be collectively referred to as the "Guaranteed Obligations."
(b) Limitation of Guaranty. To the extent that any court of competent
jurisdiction shall impose by final judgment under applicable law (including the
New York Fraudulent Conveyance Act and Sections 544 and 548 of the Bankruptcy
Code) any limitations on the amount of the Guarantor's liability with respect to
any of the Guaranteed Obligations which any of the Guaranteed Parties can
enforce under this Guaranty, such Guaranteed Parties by their acceptance hereof
accept such limitation on the amount of the Guarantor's liability hereunder to
the extent needed to make this Guaranty and the Guarantor Documents fully
enforceable and nonavoidable.
SECTION 3 Liability of Guarantor. The liability of the Guarantor under
this Guaranty shall be irrevocable, absolute, independent and unconditional, and
shall not be affected by any circumstance which might constitute a discharge of
a surety or guarantor other than the indefeasible payment and performance in
full of all Guaranteed Obligations. In furtherance of the foregoing and without
limiting the generality thereof, the Guarantor agrees as follows:
(i) the Guarantor's liability hereunder shall be the immediate,
direct, and primary obligation of the Guarantor and shall not be contingent upon
the Guaranteed Parties' exercise or enforcement of any remedy it may have
against the Borrower or any other Person, or against any collateral now or
hereafter securing any of the Guaranteed Obligations;
(ii) this Guaranty is a guaranty of payment when due and not merely of
collectibility;
(iii) the Guarantor's payment of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge the
Guarantor's liability for any portion of the Guaranteed Obligations remaining
unsatisfied; and
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(iv) the Guarantor's liability with respect to the Guaranteed
Obligations shall remain in full force and effect without regard to, and shall
not be impaired or affected by, nor shall the Guarantor be exonerated or
discharged by, any of the following events:
(A) any proceeding under any Debtor Relief Laws with respect to
the Borrower, any other guarantor or any other Person;
(B) any limitation, discharge, or cessation of the liability of
the Borrower, any other guarantor or any other Person for any Guaranteed
Obligations due to any statute, regulation or rule of law, or any invalidity or
unenforceability in whole or in part of any of the Guaranteed Obligations or the
Loan Documents;
(C) subject to Section 24 hereof, any merger, acquisition,
consolidation or change in structure of the Borrower, the Guarantor or any other
guarantor or Person, or any sale, lease, transfer or other disposition of any or
all of the assets or shares of the Borrower, the Guarantor, any other guarantor
or other Person;
(D) any assignment or other transfer, in whole or in part, of
any of the Guaranteed Parties' interests in and rights under this Guaranty or
the other Credit Documents, including the Guaranteed Parties' right to receive
payment of the Guaranteed Obligations;
(E) any claim, defense, counterclaim or setoff, other than that
of prior performance, that the Borrower, the Guarantor, any other guarantor or
other Person may have or assert, including any defense of incapacity or lack of
corporate or other authority to execute any of the Credit Documents;
(F) the Guaranteed Parties' or any Lender's amendment,
modification, renewal, extension, cancellation or surrender of any Credit
Document;
(G) the Guaranteed Parties' vote, claim, distribution,
election, acceptance, action or inaction in any proceeding under any Debtor
Relief Laws related to the Guaranteed Obligations;
(H) any impairment or invalidity of any collateral securing any
of the Guaranteed Obligations or any failure to perfect any of the Liens of the
Guaranteed Parties thereon or therein; and
(I) any other guaranty, whether by the Guarantor or any other
Person, of all or any part of the Guaranteed Obligations or any other
indebtedness, obligations or liabilities of the Borrower to the Guaranteed
Parties.
SECTION 4 Consents of Guarantor. The Guarantor hereby
unconditionally consents and agrees that, without notice to or further assent
from the Guarantor:
(i) the principal or other amount of the Guaranteed Obligations
in respect of any of the Guaranteed Parties may be increased or decreased as to
such Guaranteed Parties and additional indebtedness or obligations of the
Borrower under the Credit Documents may be
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incurred, by one or more amendments, modifications, renewals or extensions of
any such Credit Documents;
(ii) the time, manner, place or terms of any payment under any
of the Credit Documents may be extended or changed, including by an increase or
decrease in the interest rate on any Guaranteed Obligation or any fee or other
amount payable under such Credit Documents, by an amendment, modification or
renewal of any Credit Documents or otherwise;
(iii) the time for the Borrower's (or any other Person's)
performance of or compliance with any term, covenant or agreement on its part to
be performed or observed under any Credit Documents may be extended, or such
performance or compliance waived, or failure in or departure from such
performance or compliance consented to, all in such manner and upon such terms
as any of the Guaranteed Parties may deem proper;
(iv) any of the Guaranteed Parties may discharge or release, in
whole or in part, any other guarantor or any other Person liable for the payment
and performance of all or any part of the Guaranteed Obligations owing to such
Guaranteed Parties, and may permit or consent to any such action or any result
of such action, and shall not be obligated to demand or enforce payment upon any
collateral, nor shall the Guaranteed Parties be liable to the Guarantor for any
failure to collect or enforce payment or performance of the Guaranteed
Obligations from any Person or to realize on any collateral therefor;
(v) the Guaranteed Parties may take and hold other security
(legal or equitable) of any kind, at any time, as collateral for the Guaranteed
Obligations, and may, from time to time, in whole or in part, exchange, sell,
surrender, release, subordinate, modify, waive, rescind, compromise or extend
such security and may permit or consent to any such action or the result of any
such action, and may apply such security and direct the order or manner of sale
thereof;
(vi) the Guaranteed Parties may request and accept other
guaranties of the Guaranteed Obligations and any other indebtedness, obligations
or liabilities of the Borrower to the Guaranteed Parties and may, from time to
time, in whole or in part, surrender, release, subordinate, modify, waive,
rescind, compromise or extend any such guaranty and may permit or consent to any
such action or the result of any such action; and
(vii) the Guaranteed Parties may exercise, or waive or otherwise
refrain from exercising, any other right, remedy, power or privilege (including
the right to accelerate the maturity of any Loan and any power of sale) granted
by any Credit Document or other security document or agreement, or otherwise
available to the Guaranteed Parties, with respect to the Guaranteed Obligations
or any collateral, even if the exercise of such right, remedy, power or
privilege affects or eliminates any right of subrogation or any other right of
the Guarantor against the Borrower;
all as the Guaranteed Parties (or the Collateral Agent on their
behalf) may deem advisable, and all without impairing, abridging, releasing or
affecting this Guaranty.
SECTION 5 Guarantor's Waivers.
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(a) Certain Waivers. The Guarantor waives and agrees not to assert:
(i) any right to require any of the Guaranteed Parties to
marshal assets in favor of the Borrower, the Guarantor, any other guarantor or
any other Person, to proceed against the Borrower, any other guarantor or any
other Person, to proceed against or exhaust any of the Collateral, to give
notice of the terms, time and place of any public or private sale of personal
property security constituting the Collateral or other collateral for the
Guaranteed Obligations or comply with any other provisions of Section 9-504 of
the New York UCC (or any equivalent provision of any other applicable law) or to
pursue any other right, remedy, power or privilege of the Guaranteed Parties
whatsoever;
(ii) the defense of the statute of limitations in any action
hereunder or for the collection or performance of the Guaranteed Obligations;
(iii) any defense arising by reason of any lack of corporate or
other authority or any other defense of the Borrower, the Guarantor or any other
Person;
(iv) any defense based upon the Guaranteed Parties' errors or
omissions in the administration of the Guaranteed Obligations;
(v) any rights to set-offs and counterclaims;
(vi) any defense based upon an election of remedies (including,
if available, an election to proceed by nonjudicial foreclosure) which destroys
or impairs the subrogation rights of the Guarantor or the right of the Guarantor
to proceed against the Borrower or any other obligor of the Guaranteed
Obligations for reimbursement; and
(vii) without limiting the generality of the foregoing, to the
fullest extent permitted by law, any defenses or benefits that may be derived
from or afforded by applicable law limiting the liability of or exonerating
guarantors or sureties, or which may conflict with the terms of this Guaranty,
including any and all benefits that otherwise might be available to the
Guarantor under New York Laws. This means, among other things: (A) the
Guaranteed Parties may collect from the Guarantor without first foreclosing on
any real or personal property collateral pledged by the Borrower; and (B) if the
Guaranteed Parties forecloses on any real property collateral pledged by the
Borrower: (1) the amount of the debt may be reduced only by the price for which
that collateral is sold at the foreclosure sale, even if the collateral is worth
more than the sale price, and (2) the Guaranteed Parties may collect from the
Guarantor even if the Administrative Agent, by foreclosing on the real property
collateral, has destroyed any right the Guarantor may have to collect from the
Borrower. This is an unconditional and irrevocable waiver of any rights and
defenses the Guarantor may have because the Borrower's debt is secured by real
property.
(b) Additional Waivers. The Guarantor waives any and all notice
of the acceptance of this Guaranty, and any and all notice of the creation,
renewal, modification, extension or accrual of the Guaranteed Obligations, or
the reliance by the Guaranteed Parties upon this Guaranty, or the exercise of
any right, power or privilege hereunder. The Guaranteed Obligations shall
conclusively be deemed to have been created, contracted, incurred and
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permitted to exist in reliance upon this Guaranty. The Guarantor waives
promptness, diligence, presentment, protest, demand for payment, notice of
default, dishonor or nonpayment and all other notices to or upon the Borrower,
the Guarantor or any other Person with respect to the Guaranteed Obligations.
(c) Independent Obligations. The obligations of the Guarantor
hereunder are independent of and separate from the obligations of the Borrower
and any other guarantor. Upon the occurrence and during the continuance of any
Event of Default, a separate action or actions may be brought against the
Guarantor, whether or not the Borrower or any such other guarantor is joined
therein or a separate action or actions are brought against the Borrower or any
such other guarantor.
(d) Financial Condition of Borrower. The Guarantor shall not
have any right to require the Guaranteed Parties to obtain or disclose any
information with respect to: (i) the financial condition or character of the
Borrower or the ability of the Borrower to pay and perform the Guaranteed
Obligations; (ii) the Guaranteed Obligations; (iii) the existence or
nonexistence of any other guarantees of all or any part of the Guaranteed
Obligations; (iv) any action or inaction on the part of the Guaranteed Parties
or any other Person; or (v) any other matter, fact or occurrence whatsoever.
SECTION 6 Subrogation. Until the Guaranteed Obligations shall be
satisfied in full and the Commitments shall be terminated, the Guarantor shall
not have, and shall not directly or indirectly exercise, (i) any rights that it
may acquire by way of subrogation under this Guaranty, by any payment hereunder
or otherwise, (ii) any rights of contribution, indemnification, reimbursement or
similar suretyship claims arising out of this Guaranty or (iii) any other right
which it might otherwise have or acquire (in any way whatsoever) which could
entitle it at any time to share or participate in any right, remedy or security
of the Guaranteed Parties as against the Borrower or other guarantors, whether
in connection with this Guaranty, any of the other Credit Documents or
otherwise. If any amount shall be paid to the Guarantor on account of the
foregoing rights at any time when all the Guaranteed Obligations shall not have
been paid in full, such amount shall be held in trust for the benefit of the
Guaranteed Parties and shall forthwith be paid to the Guaranteed Parties (or the
Collateral Agent on their behalf) to be credited and applied to the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms of the
Credit Documents and subject to the Intercreditor Agreement.
SECTION 7 Subordination.
(a) Subordination to Payment of Guaranteed Obligations. All
payments on account of all indebtedness, liabilities and other obligations of
the Borrower to the Guarantor, whether created under, arising out of or in
connection with any documents or instruments evidencing any credit extensions to
the Borrower or otherwise, including all principal on any such credit
extensions, all interest accrued thereon, all fees and all other amounts payable
by the Borrower to the Guarantor in connection therewith, whether now existing
or hereafter arising, and whether due or to become due, absolute or contingent,
liquidated or unliquidated, determined or undetermined (the "Subordinated Debt")
shall be subject, subordinate and junior in right of
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payment and exercise of remedies, to the extent and in the manner set forth
herein, to the prior payment in full in cash or cash equivalents of the
Guaranteed Obligations.
(b) No Payments. Other than arising out of the
consummation of the Spin-Off Transaction, as long as any of the Guaranteed
Obligations shall remain outstanding and unpaid, the Guarantor shall not accept
or receive any payment or distribution by or on behalf of the Borrower, directly
or indirectly, of assets of the Borrower of any kind or character, whether in
cash, property or securities, including on account of the purchase, redemption
or other acquisition of Subordinated Debt, as a result of any collection, sale
or other disposition of collateral, or by setoff, exchange or in any other
manner, for or on account of the Subordinated Debt ("Subordinated Debt
Payments"), except that if no Event of Default exists and no notice described
below has been received by the Guarantor, the Guarantor shall be entitled to
accept and receive any and all payments. During the existence of an Event of
Default (or if any Event of Default would exist immediately after the making of
a Subordinated Debt Payment), and upon receipt by the Borrower of notice from
the Guaranteed Parties (or the Collateral Agent on their behalf) of such
Default, and until such Event of Default is cured or waived, pursuant to the
terms of the applicable Credit Documents, the Borrower shall not make, accept or
receive any Subordinated Debt Payment. In the event that, notwithstanding the
provisions of this Section 7, any Subordinated Debt Payments shall be received
in contravention of this Section 7 by the Guarantor before all Guaranteed
Obligations are paid in full in cash or cash equivalents, such Subordinated Debt
Payments shall be held in trust for the benefit of the Guaranteed Parties and
shall be paid over or delivered to the Guaranteed Parties (or the Collateral
Agent on their behalf) for application to the payment in full in cash or cash
equivalents of all Guaranteed Obligations remaining unpaid to the extent
necessary to give effect to this Section 7, after giving effect to any
concurrent payments or distributions to the Guaranteed Parties in respect of the
Guaranteed Obligations.
(c) Subordination of Remedies. As long as any Guaranteed
Obligations shall remain outstanding and unpaid, the Guarantor shall not,
without the prior written consent of the Guaranteed Parties (or the Collateral
Agent on their behalf):
(i) accelerate or bring suit or institute any other
actions or proceedings to enforce its rights or interests under or in respect of
the Subordinated Debt;
(ii) exercise any rights under or with respect to (A) any
guaranties of the Subordinated Debt, or (B) any collateral held by it, including
causing or compelling the pledge or delivery of any collateral, any attachment
of, levy upon, execution against, foreclosure upon or the taking of other action
against or institution of other proceedings with respect to any collateral held
by it, notifying any account debtors of the Borrower or asserting any claim or
interest in any insurance with respect to any collateral, or attempt to do any
of the foregoing;
(iii) exercise any rights to set-offs and counterclaims in
respect of any indebtedness, liabilities or obligations of the Guarantor to the
Borrower against any of the Subordinated Debt; or
▇-▇
▇▇▇
(▇▇) commence, or cause to be commenced, or join with any
creditor other than the Guaranteed Parties in commencing, any proceeding under
any Debtor Relief Laws as against Borrower.
(d) Subordination Upon Any Distribution of Assets of the
Borrower. In the event of any payment or distribution of assets of the Borrower
of any kind or character, whether in cash, property or securities, upon any
proceeding under any Debtor Relief Laws with respect to or involving the
Borrower, (i) all amounts owing on account of the Guaranteed Obligations,
including all interest accrued thereon at the contract rate both before and
after the initiation of any such proceeding, whether or not an allowed claim in
any such proceeding, shall first be paid in full in cash, or payment provided
for in cash or in cash equivalents, before any Subordinated Debt Payment is
made; and (ii) to the extent permitted by applicable law, any Subordinated Debt
Payment to which the Guarantor would be entitled except for the provisions
hereof, shall be paid or delivered by the trustee in bankruptcy, receiver,
assignee for the benefit of creditors or other liquidating agent making such
payment or distribution directly to the Guaranteed Parties (or the Collateral
Agent acting on their behalf) for application to the payment of the Guaranteed
Obligations in accordance with clause (i), after giving effect to any concurrent
payment or distribution or provision therefor to the Guaranteed Parties in
respect of such Guaranteed Obligations.
(e) Authorization to Guaranteed Parties. If, while any
Subordinated Debt is outstanding, any proceeding under any Debtor Relief Laws is
commenced by or against the Borrower or its property:
(i) the Guaranteed Parties are hereby irrevocably
authorized and empowered (in the name of the Guaranteed Parties, in the name of
the Guarantor or otherwise), but shall have no obligation, to demand, ▇▇▇ for,
collect and receive every payment or distribution in respect of the Subordinated
Debt and give acquittance therefor and to file claims and proofs of claim and
take such other action (including voting the Subordinated Debt) as they may deem
necessary or advisable for the exercise or enforcement of any of the rights or
interests of the Guaranteed Parties; and
(ii) the Guarantor shall promptly take such action as any
of the Guaranteed Parties may reasonably request (A) to collect the Subordinated
Debt for the account of the Guaranteed Parties and to file appropriate claims or
proofs of claim in respect of the Subordinated Debt, (B) to execute and deliver
to the Guaranteed Parties (or the Collateral Agent acting on their behalf), such
powers of attorney, assignments and other instruments as they may request to
enable them to enforce any and all claims with respect to the Subordinated Debt,
and (C) to collect and receive any and all Subordinated Debt Payments.
SECTION 8 Continuing Guaranty; Reinstatement.
(a) Continuing Guaranty. This Guaranty is a continuing guaranty
and agreement of subordination and shall continue in effect and be binding upon
the Guarantor until the payment and performance in full of all Guaranteed
Obligations.
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(b) Reinstatement. This Guaranty shall continue to be effective
or shall be reinstated and revived, as the case may be, if, for any reason, any
payment of the Guaranteed Obligations by or on behalf of the Borrower (or
receipt of any proceeds of collateral) shall be rescinded, invalidated, declared
to be fraudulent or preferential, set aside, voided or otherwise required to be
repaid to the Borrower, its estate, trustee, receiver or any other Person
(including under any Debtor Relief Laws or other state or federal law), or must
otherwise be restored by the Guaranteed Parties, whether as a result of
proceedings under any Debtor Relief Laws or otherwise. To the extent any payment
is so rescinded, set aside, voided or otherwise repaid or restored, the
Guaranteed Obligations shall be revived in full force and effect without
reduction or discharge for such payment. All losses, damages, costs and expenses
that the Guaranteed Parties may suffer or incur as a result of any voided or
otherwise set aside payments shall be specifically covered by the indemnity in
favor of the Guaranteed Parties contained in Section 15.
SECTION 9 Payments. The Guarantor hereby agrees, in furtherance of
the foregoing provisions of this Guaranty and not in limitation of any other
right which the Guaranteed Parties or any other Person may have against the
Guarantor by virtue hereof, upon the failure of the Borrower 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), the Guarantor shall forthwith
pay, or cause to be paid, in cash, to the Guaranteed Parties (or the Collateral
Agent on their behalf) an amount equal to the amount of the Guaranteed
Obligations then due as aforesaid (including interest which, but for the filing
of a petition in any proceeding under any Debtor Relief Laws with respect to the
Borrower, would have accrued on such Guaranteed Obligations, whether or not a
claim is allowed against the Borrower for such interest in any such proceeding
under any Debtor Relief Laws). The Guarantor shall make each payment hereunder,
unconditionally in full without set-off, counterclaim or other defense, or
deduction for any Taxes, on the day when due in Dollars and in same day or
immediately available funds, to the Collateral Agent at such office or account
of any Guaranteed Party as any of the Guaranteed Parties (or the Collateral
Agent on their behalf) may direct. All such payments shall be promptly applied
from time to time by the Guaranteed Parties as provided in the Credit Documents.
SECTION 10 Representations and Warranties. The Guarantor
represents and warrants to the Guaranteed Parties that:
(a) Organization and Powers. The Guarantor is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, is qualified to do business and
is in good standing in each jurisdiction in which the failure so to qualify or
be in good standing would have a Material Adverse Effect and has all requisite
power and authority: (i) to own its assets and carry on its business, and (ii)
to execute, deliver and perform its obligations under the Guarantor Documents
and Spin-Off Documents.
(b) Authorization; No Conflict. The execution, delivery and
performance by the Guarantor of this Guaranty and all other Guarantor Documents
and Spin-Off Documents, and the Spin-Off Transaction, have been duly authorized
by all necessary corporate action of the Guarantor, and do not and will not: (i)
contravene the terms of the Guarantor's organization documents or (ii) conflict
with or result in any breach or contravention of, or the creation of any
▇-▇▇
▇▇▇
▇▇▇▇ under, any document evidencing any material Contractual Obligation to which
the Guarantor is a party or any order, injunction, writ or decree of any
Governmental Authority to which the Guarantor or its property is subject, or
(iii) violate any Laws.
(c) Binding Obligation. This Guaranty and the other Guarantor
Documents constitute the legal, valid and binding obligation of the Guarantor,
enforceable against the Guarantor in accordance with their respective terms,
except as enforceability may be limited by applicable bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability.
(d) Governmental Consents. No authorization, consent, approval,
license, exemption of, or filing or registration with, any Governmental
Authority, or approval or consent of any other Person, except as have been
obtained on or before the Closing Date, is required for (i) the due execution,
delivery or performance by, or enforcement against, the Guarantor of the
Guarantor Documents, (ii) the execution, delivery or performance by or
enforcement against the Guarantor of the Spin-Off Documents or (iii) the
consummation of the Spin-Off Transaction.
(e) No Prior Assignment. The Guarantor has not previously
assigned any interest in the Subordinated Debt or any collateral relating
thereto, no Person other than the Guarantor owns an interest in the Subordinated
Debt or any such collateral (whether as joint holders of the Subordinated Debt,
participants or otherwise), and the entire Subordinated Debt is owing only to
the Guarantor.
(f) Solvency. Immediately prior to and after and giving effect
to (i) the incurrence of the Guarantor's obligations under this Guaranty, and
(ii) the Spin-Off Transaction, the Guarantor will be Solvent.
(g) Consideration. The Guarantor has received at least
"reasonably equivalent value" (as such phrase is used in Section 548 of the
Bankruptcy Code) and "fair consideration" (as such phrase is used in Section 272
of the New York Debtor & Creditor Laws and in comparable provisions of other
applicable law) and more than sufficient consideration to support its
obligations hereunder in respect of the Guaranteed Obligations to which it is a
party.
(h) Independent Investigation. The Guarantor hereby
acknowledges that it has undertaken its own independent investigation of the
financial condition of the Borrower and all other matters pertaining to this
Guaranty and further acknowledges that it is not relying in any manner upon any
representation or statement of the Guaranteed Parties with respect thereto. The
Guarantor represents and warrants that it has received and reviewed copies of
the Credit Documents and that it is in a position to obtain, and it hereby
assumes full responsibility for obtaining, any additional information concerning
the financial condition of the Borrower and any other matters pertinent hereto
that the Guarantor may desire. The Guarantor is not relying upon or expecting
the Guaranteed Parties to furnish to the Guarantor any information now or
hereafter in the Guaranteed Parties' possession concerning the financial
condition of the Borrower or any other matter.
SECTION 11 Reporting Covenant. So long as any Guaranteed
Obligations shall remain unsatisfied or any Lender shall have any Commitment,
the Guarantor agrees that it shall
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furnish to the Guaranteed Parties such information respecting the operations,
properties, business or condition (financial or otherwise) of the Guarantor or
its Subsidiaries as any of the Guaranteed Parties may from time to time
reasonably request.
SECTION 12 Additional Covenants. So long as any Guaranteed
Obligations shall remain unsatisfied or any Lender shall have any Commitment,
the Guarantor agrees that:
(a) Preservation of Existence, Etc. The Guarantor shall, and
shall cause each of its Subsidiaries to, maintain and preserve (i) its legal
existence and (ii) its rights to transact business and all other rights,
franchises and privileges necessary or desirable in the normal course of its
business and operations and the ownership of its properties, except in the case
of this clause (ii) where the non-preservation could not reasonably be expected
to have a Material Adverse Effect.
(b) Further Assurances and Additional Acts. The Guarantor shall
execute, acknowledge, deliver, file, notarize and register at its own expense
all such further agreements, instruments, certificates, documents and assurances
and perform such acts as any of the Guaranteed Parties shall deem reasonably
necessary or appropriate to effectuate the purposes of this Guaranty and the
other Guarantor Documents, and promptly provide the Guaranteed Parties with
evidence of the foregoing satisfactory in form and substance to the Guaranteed
Parties.
SECTION 13 Notices. All notices, requests or other communications
hereunder shall be given in the manner and to the addresses specified in the
Credit Agreement; except that (a) any notices to the Swap Provider shall be
delivered to Fleet National Bank (or to such replacement Swap Provider may be
appointed from time to time consistent with the Intercreditor Agreement),
according to the information listed in Schedule 10.02 of the Credit Agreement
for such party as a Lender and (b) any notice to the Note Holders shall be
delivered to the address specified for such Persons in the Note Purchase
Agreement (or to such replacement Note Holders as may be appointed from time to
time consistent with the Intercreditor Agreement). Notices to the Guarantor
shall be sent or delivered to the address set forth in the Credit Agreement for
the Borrower. All such notices, requested and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon receipt by the addressee, or if
delivered, upon delivery.
SECTION 14 No Waiver; Cumulative Remedies. No failure on the part
of any Guaranteed Party to exercise, and no delay in exercising on the part of
any Guaranteed Party, any right, remedy, power or privilege hereunder or under
any other Guarantor Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, remedy, power or privilege
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
SECTION 15 Costs and Expenses; Indemnification.
(a) Costs and Expenses. The Guarantor shall:
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(i) whether or not the transactions contemplated hereby
are consummated, pay or reimburse each of the Guaranteed Parties for all costs
and expenses incurred by them in connection with the development, preparation,
delivery, administration and execution of, and any amendment, supplement, waiver
or modification to (in each case, whether or not consummated), this Guaranty,
any other Guarantor Document and any other documents prepared in connection
herewith or therewith and the consummation of the transactions contemplated
hereby and thereby; and
(ii) pay or reimburse the Guaranteed Parties for all
costs and expenses (including Attorney Costs) incurred by them in connection
with the enforcement, attempted enforcement, or preservation of any rights or
remedies under this Guaranty or any other Guarantor Document during the
existence of an Event of Default or after acceleration of the Loans (including
in connection with any "workout" or restructuring regarding the Loans, and
including in any proceeding under any Debtor Relief Laws or appellate
proceeding).
(b) Indemnification. The Borrower shall indemnify, defend and
hold each of the Guaranteed Parties and each Lender and Note Holder and each of
its respective officers, directors, employees, counsel, agents and
attorneys-in-fact (each, an "Indemnified Person") harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suites, costs, charges, expenses and disbursements (including
Attorney Costs) of any kind or nature whatsoever which may at any time be
imposed on, incurred by or asserted against any such Person in favor of any
third-party in any way relating to or arising out of this Guaranty or any
document contemplated by or referred to herein, or the transactions contemplated
hereby, or any action taken or omitted by any such Person under or in connection
with any of the foregoing, including with respect to any investigation,
litigation or proceeding (including any proceeding under any Debtor Relief Laws
or appellate proceeding) related to or arising out of this Guaranty or relating
to the Collateral, whether or not any Indemnified Person is a party thereto (the
"Indemnified Liabilities"); provided that the Guarantor shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities
resulting from the gross negligence or willful misconduct of such Indemnified
Person.
(c) Defense. At the election of any Indemnified Person, the
Guarantor shall defend such Indemnified Person using legal counsel satisfactory
to such Indemnified Person in such Person's sole discretion, at the sole cost
and expense of the Guarantor.
(d) Interest. Any amounts payable to the Guaranteed Parties
under this Section 15 if not paid upon demand shall bear interest from the date
of such demand until paid in full, at the Default Rate.
SECTION 16 Right of Set-Off. In addition to any rights and
remedies of the Guaranteed Parties and the Lenders provided by law, if an Event
of Default exists or any reimbursement or payment obligation under any of the
Credit Documents has been accelerated, each of the Guaranteed Parties and
Lenders is hereby authorized at any time and from time to time, upon notice to
the other Guaranteed Parties as prescribed in the Intercreditor Agreement, but
without notice to the Guarantor (any such notice being expressly waived by the
Guarantor), to set off and apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other indebtedness at any
time owing by such Person to or for the credit or
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the account of the Guarantor against any and all of the obligations of the
Guarantor then due and owing, irrespective of whether or not such Person shall
have made any demand upon the Borrower or the Guarantor under any of the Credit
Documents. Each Lender and the Guaranteed Parties shall promptly notify the
Guarantor (through the Collateral Agent) after any such set-off and application
made by it; provided, however, that the failure to give such notice shall not
affect the validity of such setoff and application. The rights of the Lenders
and Guaranteed Parties under this Section 16 are in addition to other rights and
remedies (including other rights of set-off) which such Persons may have.
SECTION 17 Marshalling; Payments Set Aside. None of the Lenders,
the Note Holders, or the Guaranteed Parties shall be under any obligation to
marshal any assets in favor of the Guarantor or any other Person or against or
in payment of any or all of the Guaranteed Obligations. To the extent that the
Guarantor makes a payment to the Guaranteed Parties, or the Guaranteed Parties
exercise their right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Guaranteed Parties in their discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Laws or otherwise, then (a) to the extent of
such recovery the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such set-off had not occurred, and (b) each Lender severally
agrees to pay to the Collateral Agent upon demand its pro rata share of any
amount so recovered from or repaid by the Collateral Agent.
SECTION 18 Benefits of Guaranty. This Guaranty is entered into for
the sole protection and benefit of the Lenders, the Note Holders, the Guaranteed
Parties, and their respective successors and assigns, and no other Person (other
than any Indemnified Person specified herein) shall be a direct or indirect
beneficiary of, or shall have any direct or indirect cause of action or claim in
connection with, this Guaranty. The Guaranteed Parties, by their acceptance of
this Guaranty, shall not have any obligations under this Guaranty to any Person
other than the Guarantor, and such obligations shall be limited to those
expressly stated herein.
SECTION 19 Binding Effect; Assignment.
(a) Successors and Assigns. The provisions of this Guaranty
shall be binding upon and insure to the benefit of the parties hereto and their
respective successors and assigns.
(b) Assignment. The Guarantor shall not have the right to
assign or transfer its rights and obligations hereunder or under any other
Guarantor Documents without the prior written consent of the Required Lenders.
Each of the Guaranteed Parties, the Note Holders and the Lenders may, without
notice to or consent by the Guarantor, sell, assign, transfer or grant
participations in all or any portion of such Person's rights and obligations
hereunder and under the other Guarantor Documents in connection with any sale,
assignment, transfer or grant of a participation by such Person in accordance
with Section 10.07 of the Credit Agreement or in its rights and obligations
thereunder and under any of the other Credit Documents. The Guarantor agrees
that in connection with any such sale, assignment, transfer or grant by any
Lender, such Lender may deliver to the prospective participant or assignee
financial statements and other relevant information relating to the Guarantor
and its Subsidiaries.
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SECTION 20 Governing Law and Jurisdiction.
(a) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE GUARANTEED
PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER COLLATERAL DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE GUARANTOR AND THE GUARANTEED PARTIES
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE GUARANTOR AND THE GUARANTEED PARTIES
IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN ANY FEDERAL COURT OR STATE
COURT SITTING IN NEW YORK IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT
RELATED THERETO. THE GUARANTOR AND THE GUARANTEED PARTIES WAIVE PERSONAL SERVICE
OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.
SECTION 21 Waiver of Right to Jury Trial. EACH PARTY TO THIS
GUARANTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS GUARANTY OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO THIS GUARANTY, ANY CREDIT DOCUMENT, OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS GUARANTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
SECTION 22 Entire Agreement; Amendments. This Guaranty, together
with the other Guarantor Documents, embodies the entire agreement of the
Guarantor with respect to the matters set forth herein for the benefit of each
Guaranteed Party, and supersedes all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof. Subject to Section 23, this Guaranty shall be amended
only by written agreement between the Guarantor and the Guaranteed Party to whom
such
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amendment relates. Any such amendment shall not effect any guaranty of the
Guarantor granted hereunder to any other Guaranteed Party.
SECTION 23 Independence. This Guaranty sets forth independent and
separate guaranties of the Guarantor in favor of each Guaranteed Party in
respect of the Guaranteed Obligations owing to each such Guaranteed Party. The
illegality or unenforceability of any provision of this Guaranty or any
instrument or agreement required hereunder with respect to any Guaranteed Party
shall not in any way affect or impair the legality or enforceability of that or
any other provision of this Guaranty or any instrument or agreement required
hereunder in respect of any other Guaranteed Party. The parties acknowledge that
this Guaranty has, solely for reasons of convenience, been prepared and executed
as a single document, but that the legal effect shall be in all respects as
thought the Guarantor had executed separate guaranties, in favor of each
Guaranteed Party. Any provision of this Agreement and the other Credit Documents
to which the Grantor is a party that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions thereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 24 Termination. This Guaranty shall terminate in all
respects on the Spin-Off Consummation Date, provided, that (i) as of the
Spin-Off Consummation Date, there exists no Default or Event of Default, and
(ii) all of the representations and warranties of the Borrower contained in
Article V of the Credit Agreement, or which were contained in any Loan Document
or Spin-Off Documents furnished prior to the Spin-Off Consummation Date are true
and correct on and as of the Spin-Off Consummation Date, except to the extent
that such representations and warranties specifically refer to any earlier date,
in which case they shall be true and correct as of such earlier date, and (iii)
the Administrative Agent shall have received a certificate of a Responsible
Officer of the Borrower, dated as of the Spin-Off Consummation Date, certifying
that (A) the Spin-Off Consummation Date has occurred, (B) as of the Spin-Off
Consummation Date there exists no Default or Event of Default, and (C) all of
the representations and warranties of the Borrower contained in Article V of the
Credit Agreement, or which were contained in any Loan Documents or Spin-Off
Documents furnished prior to the Spin-Off Consummation Date, are true and
correct on and as of the Spin-Off Consummation Date, except to the extent that
such representations and warranties specifically refer to an earlier date, in
which case they shall be certified as being true and correct as of such earlier
date.
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IN WITNESS WHEREOF, the Guarantor has executed this Guaranty, as
of the date first above written.
NEW CERIDIAN CORPORATION
By:
------------------------
Title:
---------------------
Address:
New Ceridian Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
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EXHIBIT F
FORM OF SUBSIDIARY GUARANTY
THIS GUARANTY (this "Guaranty"), dated as of January 31, 2001, is
made by each of the Subsidiaries listed on Schedule 1 hereto (collectively, the
"Guarantor"), in favor (a) of the financial institutions (each a "Lender" and,
collectively, the "Lenders") from time to time party to that certain Credit
Agreement dated as of January 31, 2001 (as renewed, extended, modified, amended
or restated from time to time, the "Credit Agreement"), among CERIDIAN
CORPORATION, a Delaware corporation (the "Borrower"), the Lenders and BANK OF
AMERICA, N.A., as administrative agent for such Lenders (in such capacity, the
"Administrative Agent"), (b) the "Swap Provider" (as defined herein); and (c)
the Note Holders (as defined herein) (collectively, the "Guaranteed Parties" and
each, individually, a "Guaranteed Party").
RECITALS
WHEREAS, it is a requirement under of the Credit Agreement and the
Note Purchase Agreement that Guarantor shall be bound by the terms and
conditions of this Guaranty pending the Spin-Off Consummation Date; and
WHEREAS, the Guarantor will derive substantial direct and indirect
benefits from the credit extensions to the Borrower pursuant to the Credit
Agreement and the Note Purchase Agreement together with the amendments,
restatements, extensions and continuations contemplated therein, and from the
Spin-Off Transaction, which benefits are hereby acknowledged by the Guarantor;
WHEREAS, the Guarantor will derive substantial direct and indirect
benefits from the Borrower being party to the Specified Swap Contracts, which
benefits are hereby acknowledged;
NOW, THEREFORE, in consideration of the Administrative Agent and
Lenders entering into the Credit Agreement, the Guarantor hereby agrees as
follows:
SECTION 1 Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms
used in this Guaranty and not otherwise defined herein shall have the meanings
assigned to them in the Credit Agreement.
(b) Certain Defined Terms. As used in this Guaranty, the
following terms shall have the following meanings:
"Collateral Agent" means Bank of America, N.A. in its capacity as
"Collateral Agent" under, and as defined in, the Intercreditor Agreement (or
such replacement Collateral Agent as may be appointed from time to time pursuant
thereto) on behalf and for the benefit of, (a) Bank of America, N.A., in its
capacity as Administrative Agent for the benefit of itself and
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the other Lenders from time to time party to the Credit Agreement, and the L/C
Issuer; (b) the Note Holders for the benefit of itself and the other Note
Holders from time to time party to the Note Purchase Agreement; and (c) the Swap
Provider.
"Credit Documents" means, collectively, the Loan Documents, the
Swap Documents, and the Note Purchase Documents.
"Guaranteed Obligations" has the meaning set forth in Section
2(a).
"Guaranteed Parties" and "Guaranteed Party" have the meanings
assigned to them in the first paragraph hereof.
"Guarantor Documents" means this Guaranty, and all other
certificates, documents, agreements and instruments delivered to the Guaranteed
Parties under or in connection with this Guaranty.
"Indemnified Liabilities" has the meaning set forth in Section
15(b).
"Indemnified Person" has the meaning set forth in Section 15(b).
"Intercreditor Agreement" means that Intercreditor Agreement dated
as of January ___, 2001 among the Collateral Agent, the Administrative Agent,
the Swap Provider, and the Note Holders Agent.
"Note Holder Collateral Documents" means, collectively, (a) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or otherwise changed in respect of, the
Note Holders), (b) all Account Control Agreements executed by any Loan Party
under any Note Holder Document, (c) all documents executed by any Loan Party to
accomplish cash collateralization pursuant to any Note Holder Document, and (d)
all licenses, UCC financing statements, notices and other documents executed
from time to time or in connection with any of the foregoing.
"Note Holder Documents" means, collectively, the Note Purchase
Agreement, the Note Holder Collateral Documents and the Note Holder Guaranties.
"Note Holder Guaranties" means the Guaranties under and as defined
in the Credit Agreement, but to the extent entered into by the Guarantors
thereunder for the benefit of, and as modified, extended or otherwise changed in
respect of, the Note Holders.
"Note Holder" means a "Note Holder" under, and as defined in, the
Note Purchase Agreement.
"Note Purchase Agreement" means that Note Purchase Agreement dated
as of January 31, 2001 among the Borrower, the Note Holders and the other Note
Holders party thereto.
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"Solvent" means, as to any Person at any time, that (a) the fair
value of the property of such Person is greater than the amount of such Person's
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities evaluated for purposes of Section
101(32) of the Bankruptcy Code and, in the alternative, for purposes of the New
York Uniform Fraudulent Conveyance Act; (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 liability of such Person on its debts as they become absolute
and matured; (c) such Person is able to realize upon its property and pay its
debts and other liabilities (including disputed, contingent and unliquidated
liabilities) as they mature in the normal course of business; (d) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature; and (e) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person's
property would constitute unreasonably small capital.
"Specified Swap Agreement" means any ISDA(R) Master Agreement
(including any schedule and confirmation relating thereto) entered into between
the Borrower and the Swap Provider as swap counterparties.
"Specified Swap Contract" means any interest rate swap entered
into between the Borrower and the Swap Provider as swap counterparties
constituting a "Specified Swap Contract" as defined in the Credit Agreement.
"Subordinated Debt" has the meaning set forth in Section 7(a).
"Subordinated Debt Payments" has the meaning set forth in Section
7(b).
"Swap Collateral Documents" means, collectively, (i) the Security
Agreements and the Pledge Agreements (as such terms are defined in the Credit
Agreement, but to the extent entered into by the parties thereto for the benefit
of, and as modified, extended or otherwise changed in respect of, the Swap
Provider), (ii) all Account Control Agreements executed by any Loan Party under
any Swap Document, (iii) all documents executed by any Loan Party to accomplish
cash collateralization pursuant to any Swap Document, and (iv) all licenses, UCC
financing statements, notices and other documents executed from time to time or
in connection with any of the foregoing.
"Swap Documents" means, collectively, (a) any Specified Swap
Agreement, (b) the Swap Collateral Documents, and (c) the Swap Guaranties.
"Swap Guaranties" means the Guaranties under and as defined in the
Credit Agreement, but to the extent entered into by the Guarantors thereunder
for the benefit of, and as modified, extended or otherwise changed in respect
of, the Swap Provider.
"Swap Provider" has the meaning specified in the Intercreditor
Agreement.
(c) Interpretation. The rules of interpretation set forth in
Section 1.02 of the Credit Agreement shall be applicable to this Guaranty and
are incorporated herein by this reference.
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SECTION 2 Guaranty.
(a) Guaranty. The Guarantor hereby unconditionally and
irrevocably guarantees to the Guaranteed Parties, and their respective
successors, endorsees, transferees and assigns, the full and prompt payment when
due (whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise) and performance of the indebtedness,
liabilities and other obligations of the Borrower to each such Guaranteed Party,
whether created under, arising out of or in connection with any of the Credit
Documents, including all Obligations (as independently defined in each of the
Credit Agreement and the Note Purchase Agreement); and any obligations under any
Specified Swap Agreement to the extent arising out of any one or more Specified
Swap Contracts. The terms "indebtedness," "liabilities" and "obligations" are
used herein in their most comprehensive sense and include any and all advances,
debts, obligations and liabilities, now existing or hereafter arising, whether
voluntary or involuntary and whether due or not due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, and whether recovery
upon such indebtedness, liabilities and obligations may be or hereafter becomes
unenforceable or shall be an allowed or disallowed claim under the Bankruptcy
Code or other applicable law. The foregoing indebtedness, liabilities and other
obligations of the Borrower, and all other indebtedness, liabilities and
obligations to be paid or performed by the Guarantor in connection with this
Guaranty (including any and all amounts due under Section 15), shall hereinafter
be collectively referred to as the "Guaranteed Obligations."
(b) Limitation of Guaranty. To the extent that any court of
competent jurisdiction shall impose by final judgment under applicable law
(including the New York Fraudulent Conveyance Act and Sections 544 and 548 of
the Bankruptcy Code) any limitations on the amount of the Guarantor's liability
with respect to any of the Guaranteed Obligations which any of the Guaranteed
Parties can enforce under this Guaranty, such Guaranteed Parties by their
acceptance hereof accept such limitation on the amount of the Guarantor's
liability hereunder to the extent needed to make this Guaranty and the Guarantor
Documents fully enforceable and nonavoidable.
SECTION 3 Liability of Guarantor. The liability of the Guarantor
under this Guaranty shall be irrevocable, absolute, independent and
unconditional, and shall not be affected by any circumstance which might
constitute a discharge of a surety or guarantor other than the indefeasible
payment and performance in full of all Guaranteed Obligations. In furtherance of
the foregoing and without limiting the generality thereof, the Guarantor agrees
as follows:
(i) the Guarantor's liability hereunder shall be the immediate,
direct, and primary obligation of the Guarantor and shall not be contingent upon
the Guaranteed Parties' exercise or enforcement of any remedy it may have
against the Borrower or any other Person, or against any collateral now or
hereafter securing any of the Guaranteed Obligations;
(ii) this Guaranty is a guaranty of payment when due and not
merely of collectibility;
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(iii) the Guarantor's payment of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge the
Guarantor's liability for any portion of the Guaranteed Obligations remaining
unsatisfied; and
(iv) the Guarantor's liability with respect to the Guaranteed
Obligations shall remain in full force and effect without regard to, and shall
not be impaired or affected by, nor shall the Guarantor be exonerated or
discharged by, any of the following events:
(A) any proceeding under any Debtor Relief Laws with
respect to the Borrower, any other guarantor or any other Person;
(B) any limitation, discharge, or cessation of the
liability of the Borrower, any other guarantor or any other Person for any
Guaranteed Obligations due to any statute, regulation or rule of law, or any
invalidity or unenforceability in whole or in part of any of the Guaranteed
Obligations or the Loan Documents;
(C) any merger, acquisition, consolidation or change in
structure of the Borrower, the Guarantor or any other guarantor or Person, or
any sale, lease, transfer or other disposition of any or all of the assets or
shares of the Borrower, the Guarantor, any other guarantor or other Person;
(D) any assignment or other transfer, in whole or in
part, of any of the Guaranteed Parties' interests in and rights under this
Guaranty or the other Credit Documents, including the Guaranteed Parties' right
to receive payment of the Guaranteed Obligations;
(E) any claim, defense, counterclaim or setoff, other
than that of prior performance, that the Borrower, the Guarantor, any other
guarantor or other Person may have or assert, including any defense of
incapacity or lack of corporate or other authority to execute any of the Credit
Documents;
(F) the Guaranteed Parties' amendment, modification,
renewal, extension, cancellation or surrender of any Credit Document;
(G) the Guaranteed Parties' vote, claim, distribution,
election, acceptance, action or inaction in any proceeding under any Debtor
Relief Laws related to the Guaranteed Obligations;
(H) any impairment or invalidity of any collateral
securing any of the Guaranteed Obligations or any failure to perfect any of the
Liens of the Guaranteed Parties thereon or therein; and
(I) any other guaranty, whether by the Guarantor or any
other Person, of all or any part of the Guaranteed Obligations or any other
indebtedness, obligations or liabilities of the Borrower to the Guaranteed
Parties.
SECTION 4 Consents of Guarantor. The Guarantor hereby
unconditionally consents and agrees that, without notice to or further assent
from the Guarantor:
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(i) the principal amount of the Guaranteed Obligations in
respect of any of the Guaranteed Parties may be increased or decreased as to
such Guaranteed Party and additional indebtedness or obligations of the Borrower
under the Credit Documents may be incurred, by one or more amendments,
modifications, renewals or extensions of any such Credit Document;
(ii) the time, manner, place or terms of any payment under any
Credit Documents may be extended or changed, including by an increase or
decrease in the interest rate on any Guaranteed Obligation or any fee or other
amount payable under such Credit Documents, by an amendment, modification or
renewal of any Credit Documents or otherwise;
(iii) the time for the Borrower's (or any other Person's)
performance of or compliance with any term, covenant or agreement on its part to
be performed or observed under any Credit Documents may be extended, or such
performance or compliance waived, or failure in or departure from such
performance or compliance consented to, all in such manner and upon such terms
as any of the Guaranteed Parties may deem proper;
(iv) any of the Guaranteed Parties may discharge or release, in
whole or in part, any other guarantor or any other Person liable for the payment
and performance of all or any part of the Guaranteed Obligations owing to such
Guaranteed Parties, and may permit or consent to any such action or any result
of such action, and shall not be obligated to demand or enforce payment upon any
collateral, nor shall the Guaranteed Parties be liable to the Guarantor for any
failure to collect or enforce payment or performance of the Guaranteed
Obligations from any Person or to realize on any collateral therefor;
(v) the Guaranteed Parties may take and hold other security
(legal or equitable) of any kind, at any time, as collateral for the Guaranteed
Obligations, and may, from time to time, in whole or in part, exchange, sell,
surrender, release, subordinate, modify, waive, rescind, compromise or extend
such security and may permit or consent to any such action or the result of any
such action, and may apply such security and direct the order or manner of sale
thereof;
(vi) the Guaranteed Parties may request and accept other
guaranties of the Guaranteed Obligations and any other indebtedness, obligations
or liabilities of the Borrower to the Guaranteed Parties and may, from time to
time, in whole or in part, surrender, release, subordinate, modify, waive,
rescind, compromise or extend any such guaranty and may permit or consent to any
such action or the result of any such action; and
(vii) the Guaranteed Parties may exercise, or waive or otherwise
refrain from exercising, any other right, remedy, power or privilege (including
the right to accelerate the maturity of any Loan and any power of sale) granted
by any Credit Document or other security document or agreement, or otherwise
available to the Guaranteed Parties, with respect to the Guaranteed Obligations
or any collateral, even if the exercise of such right, remedy, power or
privilege affects or eliminates any right of subrogation or any other right of
the Guarantor against the Borrower;
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all as the Guaranteed Parties (or the Collateral Agent on their
behalf) may deem advisable, and all without impairing, abridging, releasing or
affecting this Guaranty.
SECTION 5 Guarantor's Waivers.
(a) Certain Waivers. The Guarantor waives and agrees not to
assert:
(i) any right to require any of the Guaranteed Parties
to marshal assets in favor of the Borrower, the Guarantor, any other guarantor
or any other Person, to proceed against the Borrower, any other guarantor or any
other Person, to proceed against or exhaust any of the Collateral, to give
notice of the terms, time and place of any public or private sale of personal
property security constituting the Collateral or other collateral for the
Guaranteed Obligations or comply with any other provisions of Section 9-504 of
the New York UCC (or any equivalent provision of any other applicable law) or to
pursue any other right, remedy, power or privilege of the Guaranteed Parties
whatsoever;
(ii) the defense of the statute of limitations in any
action hereunder or for the collection or performance of the Guaranteed
Obligations;
(iii) any defense arising by reason of any lack of
corporate or other authority or any other defense of the Borrower, the Guarantor
or any other Person;
(iv) any defense based upon the Guaranteed Parties' or
any Lender's errors or omissions in the administration of the Guaranteed
Obligations;
(v) any rights to set-offs and counterclaims;
(vi) any defense based upon an election of remedies
(including, if available, an election to proceed by nonjudicial foreclosure)
which destroys or impairs the subrogation rights of the Guarantor or the right
of the Guarantor to proceed against the Borrower or any other obligor of the
Guaranteed Obligations for reimbursement; and
(vii) without limiting the generality of the foregoing, to
the fullest extent permitted by law, any defenses or benefits that may be
derived from or afforded by applicable law limiting the liability of or
exonerating guarantors or sureties, or which may conflict with the terms of this
Guaranty, including any and all benefits that otherwise might be available to
the Guarantor under New York Laws. This means, among other things: (A) the
Guaranteed Parties may collect from the Guarantor without first foreclosing on
any real or personal property collateral pledged by the Borrower; and (B) if the
Guaranteed Parties forecloses on any real property collateral pledged by the
Borrower: (1) the amount of the debt may be reduced only by the price for which
that collateral is sold at the foreclosure sale, even if the collateral is worth
more than the sale price, and (2) the Guaranteed Parties may collect from the
Guarantor even if the Administrative Agent, by foreclosing on the real property
collateral, has destroyed any right the Guarantor may have to collect from the
Borrower. This is an unconditional and irrevocable waiver of any rights and
defenses the Guarantor may have because the Borrower's debt is secured by real
property.
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(b) Additional Waivers. The Guarantor waives any and all notice
of the acceptance of this Guaranty, and any and all notice of the creation,
renewal, modification, extension or accrual of the Guaranteed Obligations, or
the reliance by the Guaranteed Parties upon this Guaranty, or the exercise of
any right, power or privilege hereunder. The Guaranteed Obligations shall
conclusively be deemed to have been created, contracted, incurred and permitted
to exist in reliance upon this Guaranty. The Guarantor waives promptness,
diligence, presentment, protest, demand for payment, notice of default, dishonor
or nonpayment and all other notices to or upon the Borrower, the Guarantor or
any other Person with respect to the Guaranteed Obligations.
(c) Independent Obligations. The obligations of the Guarantor
hereunder are independent of and separate from the obligations of the Borrower
and any other guarantor. Upon the occurrence and during the continuance of any
Event of Default, a separate action or actions may be brought against the
Guarantor, whether or not the Borrower or any such other guarantor is joined
therein or a separate action or actions are brought against the Borrower or any
such other guarantor.
(d) Financial Condition of Borrower. The Guarantor shall not
have any right to require the Guaranteed Parties to obtain or disclose any
information with respect to: (i) the financial condition or character of the
Borrower or the ability of the Borrower to pay and perform the Guaranteed
Obligations; (ii) the Guaranteed Obligations; (iii) the existence or
nonexistence of any other guarantees of all or any part of the Guaranteed
Obligations; (iv) any action or inaction on the part of the Guaranteed Parties
or any other Person; or (v) any other matter, fact or occurrence whatsoever.
SECTION 6 Subrogation. Until the Guaranteed Obligations shall be
satisfied in full and the Commitments shall be terminated, the Guarantor shall
not have, and shall not directly or indirectly exercise, (i) any rights that it
may acquire by way of subrogation under this Guaranty, by any payment hereunder
or otherwise, (ii) any rights of contribution, indemnification, reimbursement or
similar suretyship claims arising out of this Guaranty or (iii) any other right
which it might otherwise have or acquire (in any way whatsoever) which could
entitle it at any time to share or participate in any right, remedy or security
of the Guaranteed Parties as against the Borrower or other guarantors, whether
in connection with this Guaranty, any of the other Credit Documents or
otherwise. If any amount shall be paid to the Guarantor on account of the
foregoing rights at any time when all the Guaranteed Obligations shall not have
been paid in full, such amount shall be held in trust for the benefit of the
Guaranteed Parties and shall forthwith be paid to the Guaranteed Parties (or the
Collateral Agent on their behalf) to be credited and applied to the Guaranteed
Obligations, whether matured or unmatured, in accordance with the terms of the
Credit Documents (and subject to the Intercreditor Agreement).
SECTION 7 Subordination.
(a) Subordination to Payment of Guaranteed Obligations. All
payments on account of all indebtedness, liabilities and other obligations of
the Borrower to the Guarantor, whether created under, arising out of or in
connection with any documents or instruments
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evidencing any credit extensions to the Borrower or otherwise, including all
principal on any such credit extensions, all interest accrued thereon, all fees
and all other amounts payable by the Borrower to the Guarantor in connection
therewith, whether now existing or hereafter arising, and whether due or to
become due, absolute or contingent, liquidated or unliquidated, determined or
undetermined (the "Subordinated Debt") shall be subject, subordinate and junior
in right of payment and exercise of remedies, to the extent and in the manner
set forth herein, to the prior payment in full in cash or cash equivalents of
the Guaranteed Obligations.
(b) No Payments. As long as any of the Guaranteed Obligations
shall remain outstanding and unpaid, the Guarantor shall not accept or receive
any payment or distribution by or on behalf of the Borrower, directly or
indirectly, of assets of the Borrower of any kind or character, whether in cash,
property or securities, including on account of the purchase, redemption or
other acquisition of Subordinated Debt, as a result of any collection, sale or
other disposition of collateral, or by setoff, exchange or in any other manner,
for or on account of the Subordinated Debt ("Subordinated Debt Payments"),
except that if no Event of Default exists and no notice described below has been
received by the Guarantor, the Guarantor shall be entitled to accept and receive
any and all payments. During the existence of an Event of Default (or if any
Event of Default would exist immediately after the making of a Subordinated Debt
Payment), and upon receipt by the Borrower of notice from the Guaranteed Parties
(or the Collateral Agent on their behalf) of such Default, and until such Event
of Default is cured or waived, pursuant to the terms of the applicable Credit
Documents, the Borrower shall not make, accept or receive any Subordinated Debt
Payment. In the event that, notwithstanding the provisions of this Section 7,
any Subordinated Debt Payments shall be received in contravention of this
Section 7 by the Guarantor before all Guaranteed Obligations are paid in full in
cash or cash equivalents, such Subordinated Debt Payments shall be held in trust
for the benefit of the Guaranteed Parties and shall be paid over or delivered to
the Guaranteed Parties (or the Collateral Agent on their behalf) for application
to the payment in full in cash or cash equivalents of all Guaranteed Obligations
remaining unpaid to the extent necessary to give effect to this Section 7, after
giving effect to any concurrent payments or distributions to the Guaranteed
Parties in respect of the Guaranteed Obligations.
(c) Subordination of Remedies. As long as any Guaranteed
Obligations shall remain outstanding and unpaid, the Guarantor shall not,
without the prior written consent of the Guaranteed Parties (or the Collateral
Agent on their behalf):
(i) accelerate or bring suit or institute any other
actions or proceedings to enforce its rights or interests under or in respect of
the Subordinated Debt;
(ii) exercise any rights under or with respect to (A) any
guaranties of the Subordinated Debt, or (B) any collateral held by it, including
causing or compelling the pledge or delivery of any collateral, any attachment
of, levy upon, execution against, foreclosure upon or the taking of other action
against or institution of other proceedings with respect to any collateral held
by it, notifying any account debtors of the Borrower or asserting any claim or
interest in any insurance with respect to any collateral, or attempt to do any
of the foregoing;
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(iii) exercise any rights to set-offs and counterclaims in
respect of any indebtedness, liabilities or obligations of the Guarantor to the
Borrower against any of the Subordinated Debt; or
(iv) commence, or cause to be commenced, or join with any
creditor other than the Guaranteed Parties in commencing, any proceeding under
any Debtor Relief Laws as against Borrower.
(d) Subordination Upon Any Distribution of Assets of the
Borrower. In the event of any payment or distribution of assets of the Borrower
of any kind or character, whether in cash, property or securities, upon any
proceeding under any Debtor Relief Laws with respect to or involving the
Borrower, (i) all amounts owing on account of the Guaranteed Obligations,
including all interest accrued thereon at the contract rate both before and
after the initiation of any such proceeding, whether or not an allowed claim in
any such proceeding, shall first be paid in full in cash, or payment provided
for in cash or in cash equivalents, before any Subordinated Debt Payment is
made; and (ii) to the extent permitted by applicable law, any Subordinated Debt
Payment to which the Guarantor would be entitled except for the provisions
hereof, shall be paid or delivered by the trustee in bankruptcy, receiver,
assignee for the benefit of creditors or other liquidating agent making such
payment or distribution directly to the Guaranteed Parties (or the Collateral
Agent acting on their behalf) for application to the payment of the Guaranteed
Obligations in accordance with clause (i), after giving effect to any concurrent
payment or distribution or provision therefor to the Guaranteed Parties in
respect of such Guaranteed Obligations.
(e) Authorization to Guaranteed Parties. If, while any
Subordinated Debt is outstanding, any proceeding under any Debtor Relief Laws is
commenced by or against the Borrower or its property:
(i) the Guaranteed Parties are hereby irrevocably
authorized and empowered (in the name of the Guaranteed Parties, in the name of
the Guarantor or otherwise), but shall have no obligation, to demand, ▇▇▇ for,
collect and receive every payment or distribution in respect of the Subordinated
Debt and give acquittance therefor and to file claims and proofs of claim and
take such other action (including voting the Subordinated Debt) as they may deem
necessary or advisable for the exercise or enforcement of any of the rights or
interests of the Guaranteed Parties; and
(ii) the Guarantor shall promptly take such action as any
of the Guaranteed Parties may reasonably request (A) to collect the Subordinated
Debt for the account of the Guaranteed Parties and to file appropriate claims or
proofs of claim in respect of the Subordinated Debt, (B) to execute and deliver
to the Guaranteed Parties (or the Collateral Agent acting on their behalf), such
powers of attorney, assignments and other instruments as they may request to
enable them to enforce any and all claims with respect to the Subordinated Debt,
and (C) to collect and receive any and all Subordinated Debt Payments.
SECTION 8 Continuing Guaranty; Reinstatement.
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(a) Continuing Guaranty. This Guaranty is a continuing guaranty
and agreement of subordination and shall continue in effect and be binding upon
the Guarantor until the payment and performance in full of all Guaranteed
Obligations.
(b) Reinstatement. This Guaranty shall continue to be effective
or shall be reinstated and revived, as the case may be, if, for any reason, any
payment of the Guaranteed Obligations by or on behalf of the Borrower (or
receipt of any proceeds of collateral) shall be rescinded, invalidated, declared
to be fraudulent or preferential, set aside, voided or otherwise required to be
repaid to the Borrower, its estate, trustee, receiver or any other Person
(including under any Debtor Relief Laws or other state or federal law), or must
otherwise be restored by the Guaranteed Parties, whether as a result of
proceedings under any Debtor Relief Laws or otherwise. To the extent any payment
is so rescinded, set aside, voided or otherwise repaid or restored, the
Guaranteed Obligations shall be revived in full force and effect without
reduction or discharge for such payment. All losses, damages, costs and expenses
that the Guaranteed Parties may suffer or incur as a result of any voided or
otherwise set aside payments shall be specifically covered by the indemnity in
favor of the Guaranteed Parties contained in Section 15.
SECTION 9 Payments. The Guarantor hereby agrees, in furtherance of
the foregoing provisions of this Guaranty and not in limitation of any other
right which the Guaranteed Parties or any other Person may have against the
Guarantor by virtue hereof, upon the failure of the Borrower 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), the Guarantor shall forthwith
pay, or cause to be paid, in cash, to the Guaranteed Parties (or the Collateral
Agent on their behalf) an amount equal to the amount of the Guaranteed
Obligations then due as aforesaid (including interest which, but for the filing
of a petition in any proceeding under any Debtor Relief Laws with respect to the
Borrower, would have accrued on such Guaranteed Obligations, whether or not a
claim is allowed against the Borrower for such interest in any such proceeding
under any Debtor Relief Laws). The Guarantor shall make each payment hereunder,
unconditionally in full without set-off, counterclaim or other defense, or
deduction for any Taxes, on the day when due in Dollars and in same day or
immediately available funds, to the Collateral Agent at such office or account
of any Guaranteed Party as any of the Guaranteed Parties (or the Collateral
Agent on their behalf) may direct. All such payments shall be promptly applied
from time to time by the Guaranteed Parties as provided in the Intercreditor
Documents.
SECTION 10 Representations and Warranties. The Guarantor
represents and warrants to the Guaranteed Parties that:
(a) Organization and Powers. The Guarantor is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, is qualified to do business and
is in good standing in each jurisdiction in which the failure so to qualify or
be in good standing would have a Material Adverse Effect and has all requisite
power and authority: (i) to own its assets and carry on its business, and (ii)
to execute, deliver and perform its obligations under the Guarantor Documents
and Spin-Off Documents.
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(b) Authorization; No Conflict. The execution, delivery and
performance by the Guarantor of this Guaranty and all other Guarantor Documents
and Spin-Off Documents, and the Spin-Off Transaction, have been duly authorized
by all necessary corporate action of the Guarantor, and do not and will not: (i)
contravene the terms of the Guarantor's organization documents or (ii) conflict
with or result in any breach or contravention of, or the creation of any Lien
under, any document evidencing any material Contractual Obligation to which the
Guarantor is a party or any order, injunction, writ or decree of any
Governmental Authority to which the Guarantor or its property is subject, or
(iii) violate any Laws.
(c) Binding Obligation. This Guaranty and the other Guarantor
Documents constitute the legal, valid and binding obligation of the Guarantor,
enforceable against the Guarantor in accordance with their respective terms,
except as enforceability may be limited by applicable bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability.
(d) Governmental Consents. No authorization, consent, approval,
license, exemption of, or filing or registration with, any Governmental
Authority, or approval or consent of any other Person, except as have been
obtained on or before the Closing Date, is required for (i) the due execution,
delivery or performance by, or enforcement against, the Guarantor of the
Guarantor Documents, (ii) the execution, delivery or performance by or
enforcement against the Guarantor of the Spin-Off Documents or (iii) the
consummation of the Spin-Off Transaction.
(e) The Guarantor has not previously assigned any interest in
the Subordinated Debt or any collateral relating thereto, no Person other than
the Guarantor owns an interest in the Subordinated Debt or any such collateral
(whether as joint holders of the Subordinated Debt, participants or otherwise),
and the entire Subordinated Debt is owing only to the Guarantor.
(f) Solvency. Immediately prior to and after and giving effect
to (i) the incurrence of the Guarantor's obligations under this Guaranty, and
(ii) the Spin-Off Transaction, the Guarantor will be Solvent.
(g) Consideration. The Guarantor has received at least
"reasonably equivalent value" (as such phrase is used in Section 548 of the
Bankruptcy Code) and "fair consideration" (as such phrase is used in Section 272
of the New York Debtor & Creditor Laws and in comparable provisions of other
applicable law) and more than sufficient consideration to support its
obligations hereunder in respect of the Guaranteed Obligations to which it is a
party.
(h) Independent Investigation. The Guarantor hereby
acknowledges that it has undertaken its own independent investigation of the
financial condition of the Borrower and all other matters pertaining to this
Guaranty and further acknowledges that it is not relying in any manner upon any
representation or statement of the Guaranteed Parties with respect thereto. The
Guarantor represents and warrants that it has received and reviewed copies of
the Credit Documents and that it is in a position to obtain, and it hereby
assumes full responsibility for obtaining, any additional information concerning
the financial condition of the Borrower and any other matters pertinent hereto
that the Guarantor may desire. The Guarantor is not relying upon
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or expecting the Guaranteed Parties to furnish to the Guarantor any information
now or hereafter in the Guaranteed Parties' possession concerning the financial
condition of the Borrower or any other matter.
SECTION 11 Reporting Covenant. So long as any Guaranteed
Obligations shall remain unsatisfied or any Lender shall have any Commitment,
the Guarantor agrees that it shall furnish to the Guaranteed Parties such
information respecting the operations, properties, business or condition
(financial or otherwise) of the Guarantor or its Subsidiaries as any of the
Guaranteed Parties may from time to time reasonably request.
SECTION 12 Additional Covenants. So long as any Guaranteed
Obligations shall remain unsatisfied or any Lender shall have any Commitment,
the Guarantor agrees that:
(a) Preservation of Existence, Etc. The Guarantor shall,
and shall cause each of its Subsidiaries to, maintain and preserve (i) its legal
existence and (ii) its rights to transact business and all other rights,
franchises and privileges necessary or desirable in the normal course of its
business and operations and the ownership of its properties, except in the case
of this clause (ii) where the non-preservation could not reasonably be expected
to have a Material Adverse Effect.
(b) Further Assurances and Additional Acts. The Guarantor shall
execute, acknowledge, deliver, file, notarize and register at its own expense
all such further agreements, instruments, certificates, documents and assurances
and perform such acts as any of the Guaranteed Parties shall deem reasonably
necessary or appropriate to effectuate the purposes of this Guaranty and the
other Guarantor Documents, and promptly provide the Guaranteed Parties with
evidence of the foregoing satisfactory in form and substance to the Guaranteed
Parties.
SECTION 13 Notices. All notices, requests or other communications
hereunder shall be given in the manner and to the addresses specified in the
Credit Agreement; except that (a) any notices to the Swap Provider shall be
delivered to Fleet National Bank (or such replacement Swap Provider as the Swap
Provider may direct in writing), according to the information listed in Schedule
10.02 of the Credit Agreement for such party as a Lender and (b) any notice to
the Note Holders be delivered to the address specified for such Persons in the
Note Purchase Agreement (or to such replacement Note Holders as may be appointed
from time to time consistent with the Intercreditor Agreement). Notices to the
Guarantor shall be sent or delivered to the address set forth in the Credit
Agreement for the Borrower. All such notices, requested and communications
shall, when transmitted by overnight delivery, or faxed, be effective when
delivered for overnight (next-day) delivery, or transmitted in legible form by
facsimile machine, respectively, or if mailed, upon receipt by the addressee, or
if delivered, upon delivery.
SECTION 14 No Waiver; Cumulative Remedies. No failure on the part
of any Guaranteed Parties to exercise, and no delay in exercising on the part of
any Guaranteed Parties, any right, remedy, power or privilege hereunder or under
any other Guarantor Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, remedy, power or privilege
preclude any other or further exercise thereof or the exercise of any other
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right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
SECTION 15 Costs and Expenses; Indemnification.
(a) Costs and Expenses. The Guarantor shall:
(i) whether or not the transactions contemplated hereby
are consummated, pay or reimburse each of the Guaranteed Parties for all costs
and expenses incurred by them in connection with the development, preparation,
delivery, administration and execution of, and any amendment, supplement, waiver
or modification to (in each case, whether or not consummated), this Guaranty,
any other Guarantor Document and any other documents prepared in connection
herewith or therewith and the consummation of the transactions contemplated
hereby and thereby; and
(ii) pay or reimburse the Guaranteed Parties for all
costs and expenses (including Attorney Costs) incurred by them in connection
with the enforcement, attempted enforcement, or preservation of any rights or
remedies under this Guaranty or any other Guarantor Document during the
existence of an Event of Default or after acceleration of the Loans (including
in connection with any "workout" or restructuring regarding the Loans, and
including in any proceeding under any Debtor Relief Laws or appellate
proceeding).
(b) Indemnification. The Borrower shall indemnify, defend and
hold each of the Guaranteed Parties, and each Lender and Note Holder and each of
its respective officers, directors, employees, counsel, agents and
attorneys-in-fact (each, an "Indemnified Person") harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suites, costs, charges, expenses and disbursements (including
Attorney Costs) of any kind or nature whatsoever which may at any time be
imposed on, incurred by or asserted against any such Person in favor of any
third-party in any way relating to or arising out of this Guaranty or any
document contemplated by or referred to herein, or the transactions contemplated
hereby, or any action taken or omitted by any such Person under or in connection
with any of the foregoing, including with respect to any investigation,
litigation or proceeding (including any proceeding under any Debtor Relief Laws
or appellate proceeding) related to or arising out of this Guaranty or relating
to the Collateral, whether or not any Indemnified Person is a party thereto (the
"Indemnified Liabilities"); provided that the Guarantor shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities
resulting from the gross negligence or willful misconduct of such Indemnified
Person.
(c) Defense. At the election of any Indemnified Person, the
Guarantor shall defend such Indemnified Person using legal counsel satisfactory
to such Indemnified Person in such Person's sole discretion, at the sole cost
and expense of the Guarantor.
(d) Interest. Any amounts payable to the Guaranteed Parties
under this Section 15 if not paid upon demand shall bear interest from the date
of such demand until paid in full, at the Default Rate.
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(e) Survival. The agreements in this Section shall survive
payment of all other Guaranteed Obligations.
SECTION 16 Right of Set-Off. In addition to any rights and
remedies of the Guaranteed Parties and the Lenders provided by law, if an Event
of Default exists or any reimbursement or payment obligation under any of the
Credit Documents has been accelerated, each Guaranteed Parties and Lenders is
hereby authorized at any time and from time to time, upon notice to the other
Guaranteed Parties as prescribed in the Intercreditor Agreement, but without
notice to the Guarantor (any such notice being expressly waived by the
Guarantor), to set off and apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other indebtedness at any
time owing by such Person to or for the credit or the account of the Guarantor
against any and all of the obligations of the Guarantor then due and owing,
irrespective of whether or not such Person shall have made any demand upon the
Borrower or the Guarantor under any of the Credit Documents. Each Lender and the
Guaranteed Parties shall promptly notify the Guarantor (through the Collateral
Agent) after any such set-off and application made by it; provided, however,
that the failure to give such notice shall not affect the validity of such
setoff and application. The rights of the Lenders and Guaranteed Parties under
this Section 16 are in addition to other rights and remedies (including other
rights of set-off) which the such parties may have.
SECTION 17 Marshalling; Payments Set Aside. None of the Lenders,
the Note Holders, or the Guaranteed Parties shall be under any obligation to
marshal any assets in favor of the Guarantor or any other Person or against or
in payment of any or all of the Guaranteed Obligations. To the extent that the
Guarantor makes a payment to the Guaranteed Parties, or the Guaranteed Parties
exercise their right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Guaranteed Parties in their discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Laws or otherwise, then (a) to the extent of
such recovery the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such set-off had not occurred, and (b) each Lender severally
agrees to pay to the Collateral Agent upon demand its pro rata share of any
amount so recovered from or repaid by the Collateral Agent.
SECTION 18 Benefits of Guaranty. This Guaranty is entered into for
the sole protection and benefit of the Lenders, the Note Holders, the Guaranteed
Parties, and their respective successors and assigns, and no other Person (other
than the Collateral Agent and any Indemnified Person specified herein) shall be
a direct or indirect beneficiary of, or shall have any direct or indirect cause
of action or claim in connection with, this Guaranty. The Guaranteed Parties, by
their acceptance of this Guaranty, shall not have any obligations under this
Guaranty to any Person other than the Guarantor, and such obligations shall be
limited to those expressly stated herein.
SECTION 19 Binding Effect; Assignment.
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(a) Successors and Assigns. The provisions of this Guaranty
shall be binding upon and insure to the benefit of the parties hereto and their
respective successors and assigns.
(b) Assignment. The Guarantor shall not have the right to
assign or transfer its rights and obligations hereunder or under any other
Guarantor Documents without the prior written consent of the Required Lenders.
Each of the Guaranteed Parties, the Note Holders, and the Lenders may, without
notice to or consent by the Guarantor, sell, assign, transfer or grant
participations in all or any portion of such Person's rights and obligations
hereunder and under the other Guarantor Documents in connection with any sale,
assignment, transfer or grant of a participation by such Person in accordance
with Section 10.07 of the Credit Agreement in its rights and obligations
thereunder and under any of the Credit Documents. The Guarantor agrees that in
connection with any such sale, assignment, transfer or grant by any Lender, such
Lender may deliver to the prospective participant or assignee financial
statements and other relevant information relating to the Guarantor and its
Subsidiaries.
SECTION 20 Governing Law and Jurisdiction.
(a) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE GUARANTEED
PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER COLLATERAL DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE GUARANTOR AND THE GUARANTEED PARTIES
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE GUARANTOR AND THE GUARANTEED PARTIES
IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN ANY FEDERAL COURT OR STATE
COURT SITTING IN NEW YORK IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT
RELATED THERETO. THE GUARANTOR AND THE GUARANTEED PARTIES WAIVE PERSONAL SERVICE
OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.
SECTION 21 Waiver of Right to Jury Trial. EACH PARTY TO THIS
GUARANTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS GUARANTY OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO
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THIS GUARANTY, ANY CREDIT DOCUMENT, OR THE TRANSACTIONS RELATED HERETO OR
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED
BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS GUARANTY MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.
SECTION 22 Entire Agreement; Amendments. This Guaranty, together
with the other Guarantor Documents, embodies the entire agreement of the
Guarantor with respect to the matters set forth herein for the benefit of each
Guaranteed Party, and supersedes all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof. Subject to Section 23, this Guaranty shall be amended
only by written agreement between the Guarantor and the Guaranteed Party to whom
such amendment relates. Any such amendment shall not effect any guaranty of the
Guarantor granted hereunder to any other Guaranteed Party.
SECTION 23 Independence. This Guaranty sets forth independent and
separate guaranties of the Guarantor in favor of each Guaranteed Party in
respect of the Guaranteed Obligations owing to each such Guaranteed Party. The
illegality or unenforceability of any provision of this Guaranty or any
instrument or agreement required hereunder with respect to any Guaranteed Party
shall not in any way affect or impair the legality or enforceability of that or
any other provision of this Guaranty or any instrument or agreement required
hereunder in respect of any other Guaranteed Party. The parties acknowledge that
this Guaranty has, solely for reasons of convenience, been prepared and executed
as a single document, but that the legal effect shall be in all respects as
thought the Guarantor had executed separate guaranties, in favor of each
Guaranteed Party. Any provision of this Agreement and the other Credit Documents
to which the Grantor is a party that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions thereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 24 Multiple Guarantors; Joint and Several Liability. When
this Guaranty is executed by more than one Guarantor, the word "Guarantor" shall
mean all and any one or more of them, and the obligations of all Persons signing
this Guaranty shall be joint and several.
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IN WITNESS WHEREOF, the Guarantor has executed this Guaranty, as
of the date first above written.
[NAME OF SUBSIDIARY]
By:
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SCHEDULE 1
to the Subsidiary Guaranty
SUBSIDIARIES
Schedule 1-1
211
EXHIBIT G
[BORROWER] SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement"), dated as of February
__, 2001, is made by and among CERIDIAN CORPORATION, a Delaware corporation (the
"Grantor") in favor of the "Collateral Agent" (as defined herein) for the
benefit of: (a) BANK OF AMERICA, N.A., as the administrative agent (in such
capacity, the "Administrative Agent") for itself and the financial institutions
(the "Lenders" and, individually, a "Lender") from time to time party to that
certain Credit Agreement dated as of January 31, 2001 (as renewed, extended,
modified, amended or restated from time to time, the "Credit Agreement"), (b)
the "Swap Provider" (as defined herein); and (c) the Note Holders party from
time to time to the Note Purchase Agreement.
RECITALS
WHEREAS, it is a condition precedent to the borrowings under the
Credit Agreement and the Note Purchase Agreement that the Grantor enter into
this Agreement and grant to the Collateral Agent, for the ratable benefit of the
Credit Agents, the security interests hereinafter provided to secure the
obligations of the Grantor described below.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1 Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms
used herein and not otherwise defined shall have the meanings assigned to them,
respectively, in the Credit Agreement.
(b) Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Account Control Agreement" means any account control agreement,
deposit account control agreement, lockbox or other agreement with any
securities intermediary or depository granting control with respect to any
investment property or deposit account for purposes of Article 9 of the UCC or
applicable law.
"Accounts" means any and all accounts of Grantor, whether now
existing or hereafter acquired or arising, and in any event includes all
accounts receivable, contract rights, royalties, Rights to Payment and other
obligations of any kind owed to Grantor arising out of or in connection with the
sale, lease, license or other transfer of Intellectual Property, merchandise,
goods or commodities or the rendering of services or arising from any other
transaction, however evidenced, and whether or not earned by performance, all
guaranties, indemnities and security with respect to the foregoing, and all
letters of credit relating thereto, in each case whether now existing or
hereafter acquired or arising.
G-1
212
"Arbitron Databases" means any and all of Grantor's collections or
compilations of data, stored in such a way as to permit selective search and
retrieval using electronic, electromagnetic, manual or mechanical methods, which
relate to Grantor's business, and wherever maintained, collected or accessed.
"Books" means all books, records and other written, electronic or
other documentation in whatever form maintained now or hereafter by or for
Grantor in connection with the ownership of its assets or the conduct of its
business or evidencing or containing information relating to the Collateral,
including: (i) ledgers; (ii) records indicating, summarizing, or evidencing
Grantor's assets (including Inventory and Rights to Payment), business
operations or financial condition; (iii) computer programs and software; (iv)
computer discs, tapes, files, manuals, spreadsheets; (v) computer printouts and
output of whatever kind; (vi) any other computer prepared or electronically
stored, collected or reported information and equipment of any kind; and (vii)
any and all other rights now or hereafter arising out of any contract or
agreement between Grantor and any service bureau, computer or data processing
company or other Person charged with preparing or maintaining any of Grantor's
books or records or with credit reporting, including with regard to Grantor's
Accounts.
"Chattel Paper" means all writings of whatever sort which evidence
a monetary obligation and a security interest in or lease of specific goods,
whether now existing or hereafter arising.
"Collateral" has the meaning set forth in Section 2.
"Collateral Agent" means Bank of America, N.A. in its capacity as
"Collateral Agent" (as defined in the Intercreditor Agreement; or such
replacement Collateral Agent as may be appointed from time to time thereunder)
on behalf and for the benefit of, (a) Bank of America, N.A. in its capacity as
the Administrative Agent for the benefit of itself and the other Lenders from
time to time party to the Credit Agreement, and the L/C Issuer; (b) the Note
Holders from time to time party to the Note Purchase Agreement; and (c) the Swap
Provider.
"Copyright Office" means the United States Copyright Office.
"Credit Agents" and each, individually, a "Credit Agent" means (a)
the Administrative Agent (for the benefit of itself and the other Lenders, and
the L/C Issuer), (b) the Note Holders and (c) the Swap Provider.
"Credit Documents" means, collectively, the Loan Documents, the
Note Holder Documents and the Swap Documents.
"Credit Parties" and each, individually, a "Credit Party" means
the Credit Agents and the Debt Participants.
"Database Copyright Filing" has the meaning specified in Section
5(q)(v)(A).
"Debt Participant" means a "Debt Participant" under, and as
defined in, the Intercreditor Agreement.
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213
"Deposit Account" means any demand, time, savings, passbook or
like account now or hereafter maintained by or for the benefit of Grantor with a
bank, savings and loan association, credit union or like organization (including
Bank of America) and all funds and amounts therein, whether or not restricted or
designated for a particular purpose.
"Documents" means any and all documents of title, bills of lading,
dock warrants, dock receipts, warehouse receipts and other documents of Grantor,
whether or not negotiable, and includes all other documents which purport to be
issued by a bailee or agent and purport to cover goods in any bailee's or
agent's possession which are either identified or are fungible portions of an
identified mass, including such documents of title made available to Grantor for
the purpose of ultimate sale or exchange of goods or for the purpose of loading,
unloading, storing, shipping, transshipping, manufacturing, processing or
otherwise dealing with goods in a manner preliminary to their sale or exchange,
in each case whether now existing or hereafter acquired or arising.
"Equipment" means all now existing or hereafter acquired equipment
of Grantor in all of its forms, wherever located, and in any event includes any
and all machinery, furniture, equipment, furnishings and fixtures in which
Grantor now or hereafter acquires any right, and all other goods and tangible
personal property (other than Inventory), including tools, parts and supplies,
automobiles, trucks, tractors and other vehicles, computer and other electronic
data processing equipment and other office equipment, computer programs and
related data processing software, and all additions, substitutions,
replacements, parts, accessories, and accessions to and for the foregoing, now
owned or hereafter acquired, and including any of the foregoing which are or are
to become fixtures on real property.
"Filing Offices" has the meaning set forth in Section 3(a).
"General Intangibles" means all general intangibles of Grantor,
now existing or hereafter acquired or arising, and in any event includes: (i)
all tax and other refunds, rebates or credits of every kind and nature to which
Grantor is now or hereafter may become entitled; (ii) all good will, choses in
action and causes of action, whether legal or equitable, whether in contract or
tort and however arising; (iii) all Intellectual Property; (iv) all rights of
stoppage in transit, replevin and reclamation; (v) all licenses, permits,
consents, indulgences and rights of whatever kind issued in favor of or
otherwise recognized as belonging to Grantor by any Governmental Authority; (vi)
all indemnity agreements, guaranties, insurance policies and other contractual,
equitable and legal rights of whatever kind or nature; and (vii) all rights to
receive payment and other rights arising under any Swap Contracts; in each case
whether now existing or hereafter acquired or arising.
"Grantor" has the meaning set forth in the first paragraph hereof.
"Instructing Group" means "Instructing Group" under, and as
defined in, the Intercreditor Agreement.
"Instruments" means any and all negotiable instruments and every
other writing which evidences a right to the payment of money, wherever located
and whether now existing or hereafter acquired.
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"Intellectual Property" means the following properties and assets
owned or held by Grantor or in which Grantor otherwise has any interest, now
existing or hereafter acquired or arising:
(i) all patents and patent applications, domestic or foreign,
all licenses relating to any of the foregoing and all income and royalties with
respect to any licenses (including such patents, patent applications and patent
licenses as described in Schedule 2), all rights to ▇▇▇ for past, present or
future infringement thereof, all rights arising in connection with any of the
foregoing and pertaining thereto and all reissues, divisions, continuations,
renewals, extensions and continuations-in-part thereof; all copyrights and
applications for copyright (including with respect to the Arbitron Databases and
the Material Arbitron Software), domestic or foreign, together with the
underlying works of authorship (including titles), whether or not the underlying
works of authorship have been published and whether said copyrights are
statutory or arise under the common law, and all other rights and works of
authorship (including the copyrights and copyright applications described in
Schedule 2), all rights, claims and demands in any way relating to any such
copyrights or works, including royalties and rights to ▇▇▇ for past, present or
future infringement, and all rights of renewal and extension of copyright;
(ii) all state (including common law), federal and foreign
trademarks, service marks and trade names, and applications for registration of
such trademarks, service marks and trade names, all licenses relating to any of
the foregoing and all income and royalties with respect to any licenses
(including such marks, names, applications and licenses as described in Schedule
2), whether registered or unregistered and wherever registered, all rights to
▇▇▇ for past, present or future infringement or unconsented use thereof, all
rights arising therefrom and pertaining thereto and all reissues, extensions and
renewals thereof;
(iii) all trade secrets, trade dress, trade styles, logos, other
source of business identifiers, mask-works, mask-work registrations, mask-work
applications, software (including all Material Arbitron Software and Material
Software Additions), confidential information, customer lists, license rights,
advertising materials, operating manuals, methods, processes, know-how,
algorithms, formulae, databases (including all Arbitron Databases), quality
control procedures, product, service and technical specifications, operating,
production and quality control manuals, sales literature, drawings,
specifications, blue prints, descriptions, inventions, name plates and catalogs;
(iv) the entire goodwill of or associated with the businesses
now or hereafter conducted by Grantor connected with and symbolized by any of
the aforementioned properties and assets; and
(v) all intellectual property rights and property of the
Grantor now existing or hereafter arising, covered by any Supplemental IP
Security Agreement executed by Grantor from time to time in accordance with
Section 3(c).
"Intercreditor Agreement" means that Intercreditor Agreement dated
as of January _____, 2001 among the Collateral Agent, the Administrative Agent,
the Swap Provider, and the "Note Holders" (as defined therein).
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"Inventory" means any and all of Grantor's inventory in all of its
forms, wherever located, whether now owned or hereafter acquired, and in any
event includes all goods (including goods in transit) which are held for sale,
lease or other disposition, including those held for display or demonstration or
out on lease or consignment or to be furnished under a contract of service, or
which are raw materials, work in process, finished goods or materials used or
consumed in Grantor's business, and the resulting product or mass, and all
repossessed, returned, rejected, reclaimed and replevied goods, together with
all parts, components, supplies packing, and other materials used or usable in
connection with the manufacture, production, packing, shipping, advertising,
selling or furnishing of such goods; and all other items hereafter acquired by
Grantor by way of substitution, replacement, return, repossession or otherwise,
and all additions and accessions thereto, and any Document representing or
relating to any of the foregoing at any time.
"Investment Property" means any and all investment property of
Grantor, including all securities, whether certificated or uncertificated,
security entitlements, securities accounts, commodity contracts and commodity
accounts, and all financial assets held in any securities account or otherwise,
wherever located, and whether now existing or hereafter acquired or arising.
"Letter of Credit Proceeds" means any and all proceeds of written
letters of credit.
"Material Arbitron Software" means all computer operation and
application programs of Grantor listed on Schedule 2.
"Material Software Addition" means any update, release, version,
patch, debugging program, compilation, or beta in respect of Material Arbitron
Software, and any and all computer operation and application programs, including
all object and source code and all copies and encodings thereof, purchased,
created or otherwise acquired by Grantor after the Closing Date.
"Note Holder Collateral Documents" means, collectively, (i) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or other wise changed in respect of, the
Note Holders), (ii) all Account Control Agreements executed by any Loan Party
under any Note Holder Document, (iii) all documents executed by any Loan Party
to accomplish cash collateralization pursuant to any Note Holder Document, and
(iv) all licenses, UCC financing statements, notices and other documents
executed from time to time or in connection with any of the foregoing.
"Note Holder Documents" means, collectively, the Note Purchase
Agreement, the Note Holder Collateral Documents and the Note Holder Guaranties.
"Note Holder Guaranties" means the Guaranties under and as defined
in the Credit Agreement, but to the extent entered into by the Guarantors
thereunder for the benefit of, and as modified, extended or otherwise changed in
respect of, the Note Holders.
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"Note Holder" means a "Note Holder" under, and as defined in, the
Note Purchase Agreement.
"Note Purchase Agreement" means that Note Purchase Agreement dated
as of January 31, 2001 among the Borrower, the Note Holders party thereto.
"Partnership Collateral" means any and all limited and general
partnership interests and limited liability company interests of any type or
nature, whether now existing or hereafter acquired or arising.
"Patent and Trademark Office" means the United States Patent and
Trademark Office.
"Proceeds" means whatever is receivable or received from or upon
the sale, lease, license, collection, use, exchange or other disposition,
whether voluntary or involuntary, of any Collateral or other assets of Grantor,
including "proceeds" as defined at UCC Section 9306, any and all proceeds of any
insurance, indemnity, warranty or guaranty payable to or for the account of
Grantor from time to time with respect to any of the Collateral, any and all
payments (in any form whatsoever) made or due and payable to Grantor from time
to time in connection with any requisition, confiscation, condemnation, seizure
or forfeiture of all or any part of the Collateral by any Governmental Authority
(or any Person acting under color of Governmental Authority), any and all other
amounts from time to time paid or payable under or in connection with any of the
Collateral or for or on account of any damage or injury to or conversion of any
Collateral by any Person, any and all other tangible or intangible property
received upon the sale or disposition of Collateral, and all proceeds of
proceeds.
"Rights to Payment" means all Accounts and any and all rights and
claims to the payment or receipt of money or other forms of consideration of any
kind in, to and under all Chattel Paper, Documents, General Intangibles,
Instruments, Investment Property and Proceeds.
"Secured Obligations" means all indebtedness, liabilities and
other obligations of the Grantor to the Collateral Agent, any of the Credit
Agents and any Debt Participant, whether now existing or hereafter arising, and
whether due or to become due, absolute or contingent, liquidated or
unliquidated, determined or undetermined, now or hereafter created under,
arising out of, or in connection with any of the Credit Documents, including all
Obligations (as independently defined in each of the Credit Agreement and the
Note Purchase agreement), and any obligations under any of the Swap Documents.
"Software Copyright Filing" has the meaning specified in Section
5(q)(v)(B).
"Specified Swap Agreement" means any ISDA(R) Master Agreement
(including any schedule and confirmation relating thereto) entered into between
the Grantor and the Swap Provider as swap counterparties.
"Specified Swap Contract" means any interest rate swap entered
into between the Grantor and the Swap Provider as swap counterparties
constituting a "Specified Swap Contract" as defined in the Credit Agreement.
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"Supplemental IP Security Agreement" means a Supplemental IP
Security Agreement substantially in the form of Exhibit I of the Credit
Agreement, executed pursuant to Section 3(c) hereof and Section 6.16 of the
Credit Agreement, and the terms and conditions of which may derive from, and be
incorporated by reference to, this Agreement.
"Swap Collateral Documents" means, collectively, (a) the Security
Agreements and the Pledge Agreements (as such terms are defined in the Credit
Agreement, but to the extent entered into by the parties thereto for the benefit
of, and as modified, extended or otherwise changed in respect of, the Swap
Provider, (b) all Account Control Agreements executed by any Loan Party under
any Swap Document, (c) any documents executed by any Loan Party to accomplish
cash collateralization pursuant to any Swap Document, and (d) all licenses, UCC
financing statements, notices and other documents executed from time to time in
connection with any of the foregoing.
"Swap Documents" means, collectively, any Specified Swap
Agreement, the Swap Collateral Documents and the Swap Guaranties.
"Swap Guaranties" means the Guaranties under and as defined in the
Credit Agreement, but to the extent entered into by the Guarantors thereunder
for the benefit of, and as modified, extended or otherwise changed in respect
of, the Swap Provider.
"Swap Provider" has the meaning specified in the Intercreditor
Agreement.
"UCC" means the Uniform Commercial Code as the same may, from time
to time, be in effect in the State of New York; provided, however, in the event
that, by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the security interest in any Collateral is governed by
the Uniform Commercial Code as in effect in a jurisdiction other than the State
of New York, the term "UCC" shall mean the Uniform Commercial Code as in effect
in such other jurisdiction for purposes of the provisions hereof relating to
such attachment, perfection or priority and for purposes of definitions related
to such provisions.
"UCC Financing Statements" has the meaning specified in Section
4(f).
(c) Terms Defined in UCC. Where applicable and except as
otherwise defined herein, terms used in this Agreement shall have the meanings
assigned to them in the UCC.
(d) Interpretation. The rules of interpretation set forth in
Sections 1.02, 1.03, 1.04 and 1.05 of the Credit Agreement shall be applicable
to this Agreement and are incorporated herein by this reference.
SECTION 2 Security Interest.
(a) Grant of Security Interest. As security for the payment and
performance of the Secured Obligations, Grantor hereby pledges, assigns,
transfers, hypothecates and sets over to the Collateral Agent (for the benefit
of the Credit Agents, and each of them), and hereby
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grants to the Collateral Agent (for the benefit of the Credit Agents, and each
of them), a security interest in all of Grantor's right, title and interest in,
to and under the following property, wherever located and whether now existing
or owned or hereafter acquired or arising (collectively, the "Collateral"):
(i) all Accounts;
(ii) all Chattel Paper;
(iii) all Deposit Accounts;
(iv) all Documents;
(v) all Equipment;
(vi) all General Intangibles;
(vii) all Inventory;
(viii) all Books;
(ix) all products and Proceeds of any and all of the
foregoing; and
(x) all Letter of Credit Proceeds.
Notwithstanding the foregoing provisions of this Section 2(a), such grant of
security interest shall not extend to, and the term "Collateral" shall not
include, any Intellectual Property which is now held or hereafter held by
Grantor as licensee, lessee or otherwise, to the extent such Intellectual
Property consists of: (i) ordinary shrinkwrap licenses governing software
products that Grantor purchased for use in the Ordinary Course of Business; or
(ii) licenses listed on Schedule 5.17 of the Credit Agreement.
(b) Grantor Remains Liable. Anything herein to the contrary
notwithstanding, (i) Grantor shall remain liable under any contracts, agreements
and other documents included in the Collateral, to the extent set forth therein,
to perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (ii) the exercise by the Collateral Agent
of any of the rights hereunder shall not release Grantor from any of its duties
or obligations under such contracts, agreements and other documents included in
the Collateral, and (iii) none of the Collateral Agent or any Credit Party shall
have any obligation or liability under any contracts, agreements and other
documents included in the Collateral by reason of this Agreement, nor shall any
such Person be obligated to perform any of the obligations or duties of Grantor
thereunder or to take any action to collect or enforce any such contract,
agreement or other document included in the Collateral hereunder.
(c) Continuing Security Interest. Grantor agrees that this
Agreement shall create continuing security interests in the Collateral which
shall remain in effect until terminated in accordance with Section 23.
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SECTION 3 Perfection Procedures. Grantor shall duly complete,
execute and deliver to the Collateral Agent and each of the Credit Agents
concurrently with the execution of this Agreement, and at any time and from time
to time, all Supplemental IP Security Agreements, financing statements,
continuation statements, termination statements, security agreements, chattel
mortgages, assignments, patent, copyright and trademark collateral assignments,
fixture filings, warehouse receipts, Account Control Agreements, documents of
title, affidavits, reports, notices, schedules of account, letters of authority
and all other documents and instruments, in form satisfactory to the
Administrative Agent, and take all other action, as the Collateral Agent (upon
instruction of the Instructing Group) may request, to perfect and continue
perfected, maintain the priority of or provide notice of the Collateral Agent's
security interests in the Collateral for the benefit of each of the Credit
Agents and to accomplish the purposes of this Agreement. Without limiting the
generality of the foregoing, Grantor shall from time to time take the following
actions:
(a) Filing of Security Agreements; Financing Statements. On or
prior to the Closing Date Grantor shall execute, notarize and deliver (i) an
original of this Agreement, (ii) such original UCC Financing Statements and
(iii) such original Supplemental IP Security Agreements as the Collateral Agent
at the instruction of the Instructing Group may reasonably request; all duly
completed and in final form for recordation at the offices described in Schedule
3 (the "Filing Offices"), and after the Closing Date the Grantor shall execute,
notarize and deliver original completed UCC Financing Statements for filing or
recording in the appropriate filing office or offices in any state identified by
a Grantor in a notice delivered pursuant to Section 5(e).
(b) Deposit Accounts. On or prior to the Closing Date Grantor
shall execute such Account Control Agreements, notices, and shall take such
other action, as the Collateral Agent at the instruction of the Instructing
Group may reasonably request, to perfect and continue perfected, maintain the
priority of or provide notice of the Collateral Agent's security interests in
Collateral for the benefit of each of the Credit Agents consisting of Deposit
Accounts and to accomplish the purposes of this Agreement.
(c) Intellectual Property Collateral.
(i) Patents; etc. Promptly following any submission, filing or
recordation required pursuant to subsection (iv) of Section 5(q) (except as
provided in subsection (c)(ii) with respect to certain copyrights), record such
duly completed, signed and notarized Supplemental IP Security Agreement with the
Patent and Trademark Office or Copyright Office, as applicable, and take such
other action as may be necessary, or as the Collateral Agent at the instruction
of the Instructing Group may reasonably request, to perfect or protect the
Collateral Agent's security interests in such Intellectual Property for the
benefit of each of the Credit Agents. Grantor shall promptly, but in any event
not later than ten days after any such recordation, deliver to the Collateral
Agent and each Credit Agent true and complete copies of all file-stamped
applications, disclosure documents and amendments, and all file-stamped
Supplemental IP Security Agreements recorded at the Patent and Trademark Office.
(ii) Copyrights. Grantor shall:
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(A) Promptly following any submission, filing or recordation
required pursuant to subsection (v) of Section 5(q), duly complete, execute,
notarize and record a Supplemental IP Security Agreement at the Copyright Office
and take such other actions as may be necessary or appropriate in the discretion
of the Collateral Agent at the instruction of the Instructing Group to perfect
or protect the Collateral Agent's security interests in (I) all Database
Copyright Filings for such quarter, and (II) all Software Copyright Filings made
since the most recently filed Supplemental IP Security Agreement; and
(B) take such other action as may be necessary, or the Collateral
Agent may reasonably request, to perfect or protect the Collateral Agent's
security interests in the Intellectual Property.
(iii) The Grantor hereby authorizes the Collateral Agent to
modify, amend or supplement the Schedules hereto and to reexecute this Agreement
and any Supplemental IP Security Agreement from time to time on the Grantor's
behalf and as its attorney-in-fact to include any such future Collateral and to
cause to such reexecuted Agreement, Supplemental IP Security Agreement or such
modified, amended or supplemented Schedules to be filed with the Copyright
Office or the Patent and Trademark Office.
(d) Documents, Etc. Within five calendar days after receipt,
Grantor shall deliver to the Collateral Agent, or an agent designated by it, for
the benefit of the Credit Agents, appropriately endorsed or accompanied by
appropriate instruments of transfer or assignment, all Documents and Chattel
Paper, and all other Rights to Payment at any time evidenced by promissory
notes, trade acceptances or other instruments, not already delivered hereunder
pursuant to this Section 3; provided, however, that unless an Event of Default
shall have occurred and be continuing, Grantor shall not be required to deliver
any Document, Chattel Paper, promissory note, trade acceptance or other
instrument having a face amount not in excess of $100,000. Upon the request of
the Collateral Agent, Grantor shall ▇▇▇▇ all Documents and Chattel Paper with
such legends as the Collateral Agent shall reasonably specify.
SECTION 4 Representations and Warranties. In addition to the
representations and warranties of the Grantor set forth in the Credit Agreement,
which are incorporated and restated herein by this reference, and which are true
and correct as of the date hereof, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, Grantor further
represents and warrants to each Credit Party that:
(a) Location of Chief Executive Office and Collateral.
Grantor's chief executive office and principal place of business is located at
the address set forth in Schedule 1, and all other locations where Grantor
conducts business or Collateral is kept are set forth in Schedule 1.
(b) Locations of Books. All locations where Books pertaining to
the Rights to Payment are kept, including all equipment necessary for accessing
such Books and the names and addresses of all service bureaus, computer or data
processing companies and other Persons keeping any Books or collecting Rights to
Payment for Grantor, are set forth in Schedule 1.
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(c) Trade Names and Trade Styles. All trade names and trade
styles under which Grantor presently conducts the Arbitron Business operations
are set forth in Schedule 1, and, except as set forth in Schedule 1 and in
connection with the Transaction, Grantor has not, at any time in the past year:
(i) been known as or used any other corporate, trade or fictitious name; (ii)
changed its name; (iii) been the surviving or resulting corporation in a merger
or consolidation; or (iv) acquired through asset purchase or otherwise any
business of any Person.
(d) Ownership of Collateral. Grantor is, and, subject to
Section 5(i), will continue to be, the sole and complete owner of the
Collateral, or has a valid and enforceable leasehold or licensee's interest in
such Collateral as set forth in Schedule 2 and in accordance with subsection (i)
of this Section 4 (or, in the case of after-acquired Collateral, at the time
Grantor acquires rights in such Collateral, will be the sole and complete owner
thereof, or will have a valid and enforceable leasehold or licensee's interest
in such Collateral, to the extent permitted hereunder or under the Credit
Agreement), free from any Lien other than Permitted Liens.
(e) Enforceability; Priority of Security Interest. (i) This
Agreement together with such Supplemental IP Security Agreements as have been
executed by Grantor and filed at the Copyright Office or Patent and Trademark
Office in respect of the Intellectual Property create security interests which
are enforceable against the Collateral in which Grantor now has rights and will
create security interests which are enforceable against any Collateral in which
Grantor hereafter acquires rights at the time Grantor acquires any such rights.
(ii) The Collateral Agent has a perfected and first priority
security interest in the Collateral in which Grantor now has rights, and will
have a perfected and first priority security interest in the Collateral in which
Grantor hereafter acquires rights at the time Grantor acquires any such rights,
in each case for the Credit Agent's benefit and, subject only to Permitted
Liens, securing the payment and performance of the Secured Obligations.
(f) Other Financing Statements. Other than (i) financing
statements or other filings naming the owner of the asset to which such Lien
relates as debtor, under the UCC, copyright, patent, or trademark or any
comparable law ("UCC Financing Statements") disclosed to the Administrative
Agent prior to the Effective Date and listed on Schedule 5.17 of the Credit
Agreement, and (ii) UCC Financing Statements in favor of the Collateral Agent
for itself and the Credit Agents pursuant to the Credit Documents, no effective
UCC Financing Statement naming Grantor as debtor, assignor, grantor, mortgagor,
pledgor or the like or covering all or any part of the Collateral is on file in
any filing or recording office in any jurisdiction, except in connection with
Permitted Liens.
(g) Rights to Payment.
(i) The Rights to Payment represent valid, binding and
enforceable obligations of the account debtors or other Persons obligated
thereon, representing undisputed, bona fide transactions completed in accordance
with the terms and provisions contained in any documents related thereto, and
are and will be genuine, free from Liens, and not subject to any adverse claims,
counterclaims, setoffs, defaults, disputes, defenses, discounts, retainages,
holdbacks or conditions precedent of any kind of character, except to the extent
reflected by the
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Grantor's reserves for uncollectible Rights to Payment or to the extent, if any,
that such account debtors or other Persons may be entitled to normal and
ordinary course trade discounts, returns, adjustments and allowances in
accordance with Section 5(m), or as otherwise disclosed to the Credit Agents in
writing or occurring in the ordinary course of business;
(ii) to the best of Grantor's knowledge, all account debtors and
other obligors on Rights to Payment are solvent and generally paying their debts
as they come due, except to the extent that Grantor has established adequate
reserves therefor in accordance with GAAP;
(iii) all Rights to Payment comply in all material respects with
all applicable laws concerning form, content and manner of preparation and
execution, including where applicable any federal or state consumer credit laws;
(iv) Grantor has not assigned any of its rights under the Rights
to Payment except as provided in this Agreement or as set forth in the other
Credit Documents;
(v) all statements made, all unpaid balances and all other
information in the Books and other documentation relating to the Rights to
Payment in all material respects are true and correct and what they purport to
be; and
(vi) Grantor has no knowledge of any fact or circumstance which
would materially impair the validity or collectibility of any of such Rights to
Payment, except to the extent that Grantor has established adequate reserves
therefor in accordance with GAAP;
(h) Inventory. No Inventory is stored with any bailee,
warehouseman or similar Person or on any premises leased to Grantor, nor has any
Inventory been consigned to Grantor or consigned by Grantor to any Person or is
held by Grantor for any Person under any "▇▇▇▇ and hold" or other arrangement,
except at locations listed in Schedule 1.
(i) Intellectual Property.
(i) As of the Closing Date, except as set forth in Schedule 2,
(A) Grantor (directly or through any Subsidiary) does not own, possess or use
under any licensing arrangement (other than ordinary shrinkwrap licenses
governing software products that Grantor purchased for use in the Ordinary
Course of Business) Intellectual Property materially related to the Arbitron
Business, and (B) Grantor (directly or through any Subsidiary) has no
registrations or applications therefor pending before any Governmental
Authority, that are or may be materially related to the Arbitron Business, for
any (I) patents or trademarks, (II) copyrights in respect of Material Arbitron
Software, Material Software Additions or Arbitron Databases for which any such
application was submitted after December 31, 1998, (III) copyrights in respect
of "Radio Market Reports" of Grantor for which any such application was
submitted after December 1, 2000, or (IV) any other copyrights for which such
application was submitted after December 31, 1999.
(ii) All Grantor's Intellectual Property is subsisting and has
not been adjudged invalid or unenforceable in whole or in part.
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(iii) All maintenance fees required to be paid by Grantor on
account of any of its patents have been timely paid for maintaining such patents
in force, and, to the best of Grantor's knowledge, each of such patents is valid
and enforceable.
(iv) To the best of Grantor's knowledge, no infringement or
unauthorized use presently is being made of any Intellectual Property by any
Person that could reasonably be expected to have a Material Adverse Effect.
(v) Grantor is the owner or licensee of its Intellectual
Property and the past, present and contemplated future use of such Intellectual
Property by Grantor has not, does not and will not infringe or violate any
right, privilege or license agreement of or with any other Person in any
material respect.
(vi) Grantor owns, has material rights under, is a party to, or
an assignee of a party to all Intellectual Property necessary and appropriate to
continue to conduct the Arbitron Business.
(vii) The Arbitron Databases purchased developed or otherwise
acquired by Grantor since December 31, 1998 are protected under current, valid
and enforceable copyright registrations (or applications therefor) at the
Copyright Office and under the U.S. copyright laws.
(viii) The Material Arbitron Software is protected under current,
valid and enforceable copyright registrations (or applications therefor) at the
Copyright Office and under the U.S. copyright laws.
(ix) Grantor's Intellectual Property consisting of patents are
protected under current, valid and enforceable patents or applications therefor
issued by the Patent and Trademark Office and under the U.S. patent laws (except
with respect to such patents that have expired of their own terms, and not as
the result of any abandonment, dispute or settlement).
(j) Equipment. As of the Closing Date, none of the Equipment is
leased from any Person, except as set forth in UCC record searches delivered to
the Collateral Agent or as otherwise disclosed to the Administrative Agent and
the other Credit Agents.
(k) Deposit Accounts. The names and addresses of all financial
institutions at which Grantor maintains its Deposit Accounts, and the account
numbers and account names of such Deposit Accounts, are set forth in Schedule 1.
No Deposit Account Control Agreements exist with respect to any Investment
Property other than any Deposit Account Control Agreements in favor of the
Collateral Agent for the benefit of the Credit Agents.
(l) Instruments. (i) Grantor has not previously assigned any
interest in any Instruments (other than such interests as will be released on or
before the date hereof), (ii) no Person other than Grantor owns an interest in
the Instruments (whether as joint holders, participants or otherwise), (iii) all
Instruments are owing only to Grantor, and (iv) no material default exists under
or in respect of the Instruments.
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(m) Other Investment Property. All securities accounts of the
Grantor and other Investment Property of the Grantor are set forth in Schedule
1. No Account Control Agreements exist with respect to any Investment Property
other than any Account Control Agreements in favor of the Collateral Agent for
the benefit of the Credit Agents.
SECTION 5 Covenants. In addition to the covenants of the Grantor
set forth in the Credit Agreement, which are incorporated herein by this
reference, so long as any of the Secured Obligations remain unsatisfied, Grantor
agrees that:
(a) Defense of Collateral. Grantor shall appear in and defend
any action, suit or proceeding which may affect to a material extent its title
to, or right or interest in, or the Collateral Agent's rights or interest in,
the Collateral.
(b) Preservation of Collateral. Grantor shall do and perform
all reasonable acts that may be necessary and appropriate to maintain, preserve
and protect the Collateral.
(c) Compliance with Laws, Etc. Grantor shall comply in all
material respects with all laws, regulations and ordinances (including with
respect to the Fair Labor Standards Act), and with all policies of insurance,
relating in a material way to the possession, operation, maintenance and control
of the Collateral.
(d) Location of Books and Chief Executive Office. Grantor
shall: (i) keep all Books pertaining to the Rights to Payment at the locations
set forth in Schedule 1; and (ii) give at least 30 days' prior written notice to
the Collateral Agent and each Credit Agent of (A) any changes in any such
location where Books pertaining to the Rights to Payment are kept, including any
change of name or address of any service bureau, computer or data processing
company or other Person preparing or maintaining any Books or collecting Rights
to Payment for Grantor or (B) any changes in the location of Grantor's chief
executive office or principal place of business.
(e) Location of Collateral. If any Collateral of Grantor shall
be physically relocated to, or otherwise be physically located in, a state of
the United States in which a financing statement has not already been filed with
respect to such Collateral, Grantor shall give the Collateral Agent and each
Credit Agent prompt notice thereof (and in any event not later than one Business
Day after becoming aware thereof).
(f) Change in Name, Identity or Structure. Grantor shall give
at least 30 days' prior written notice to the Collateral Agent and each Credit
Agent of (i) any change in its name, (ii) any change of its jurisdiction of
incorporation or the location of its chief executive offices, (iii) any changes
in, additions to or other modifications of its trade names used as the name of
Grantor set forth in Schedule 1, and (iv) any changes in its identity or
structure in any manner which might make any financing statement filed hereunder
incorrect or misleading.
(g) Maintenance of Records. Grantor shall keep accurate and
complete Books with respect to the Collateral, disclosing the Collateral Agent's
security interests hereunder for the benefit of the Credit Agents.
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(h) Invoicing of Sales. The Grantor will invoice all of its
sales upon forms customary in the industry and to maintain proof of delivery and
customer acceptance of goods.
(i) Disposition of Collateral. Grantor shall not surrender or
lose possession of (other than to a Credit Agent), sell, lease, rent, or
otherwise dispose of or transfer any of the Collateral or any right or interest
therein, except to the extent expressly permitted by the Credit Agreement.
(j) Liens. (i) Grantor shall keep the Collateral free of all
Liens except Permitted Liens.
(ii) Notwithstanding any other provision contained herein or in
the Credit Agreement, no Disposition of any assets of the Grantor shall be
deemed a transfer of goods free of the Collateral Agent's security interests
under Section 9307 UCC, except that Dispositions expressly permitted by Sections
7.04(b)(i), 7.04(b)(ii), 7.04(b)(viii), 7.04(b)(x), 7.06(e), 7.06(i) and 7.06(j)
thereof shall be free of such security interests. Accordingly, all non-excluded
Dispositions shall be subject at all times to the Liens of the Collateral Agent.
(k) Expenses. The Grantor will pay all expenses of protecting,
storing, warehousing, insuring, handling and shipping the Collateral.
(l) Leased Premises. At the Collateral Agent's request, Grantor
shall obtain from each Person from whom Grantor leases any premises at which any
Collateral is at any time present such subordination, waiver, consent and
estoppel agreements as the Administrative Agent may reasonably require, in form
and substance satisfactory to the Administrative Agent.
(m) Rights to Payment. Grantor shall:
(i) with such frequency as the Collateral Agent may reasonably
require, furnish to the Collateral Agent (A) master customer listings, including
all names and addresses, together with copies or originals (as requested by the
Administrative Agent) of documents, customer statements, repayment histories and
present status reports relating to the Accounts; (B) accurate records and
summaries of Accounts, including detailed agings specifying the name, face value
and date of each invoice, and listings of Accounts that are disputed or have
been cancelled; and (C) such other information relating to the Accounts as the
Collateral Agent shall from time to time reasonably request;
(ii) give only normal discounts, allowances and credits as to
Accounts and other Rights to Payment, in the Ordinary Course of Business,
according to normal trade practices, and enforce all Accounts and other Rights
to Payment strictly in accordance with their terms or pursuant to Grantor's
Ordinary Course of Business, and during the existence of an Event of Default,
take all such action to such end as may from time to time be reasonably
requested by the Collateral Agent, except that Grantor may at any time grant any
extension of the time for payment or enter into any agreement to make a rebate
or otherwise to reduce the amount owing on or with respect to, or compromise or
settle for less than the full amount thereof, any Account or other Right to
Payment, in the Ordinary Course of Business, according to normal trade
practices;
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(iii) if any discount, allowance, credit, extension of time for
payment, agreement to make a rebate or otherwise to reduce the amount owing on,
or compromise or settle, an Account or other Right to Payment exists or occurs,
or if, to the knowledge of Grantor, any dispute, setoff, claim, counterclaim or
defense exists or has been asserted or threatened with respect to an Account or
other Right to Payment, disclose such fact to the Collateral Agent in the Books
relating to such Account or other Right to Payment when such Books are requested
for inspection by the Collateral Agent, and in connection with any invoice or
report furnished by Grantor to the Collateral Agent relating to such Account or
other Right to Payment;
(iv) if Accounts in an amount in excess of $500,000 for any and
all such Accounts arise from contracts with the United States or any department,
agency or instrumentality thereof, promptly notify the Collateral Agent thereof
and execute any documents and instruments and take any other steps reasonably
requested by the Collateral Agent in order that all monies due and to become due
thereunder shall be assigned to the Collateral Agent and notice thereof given to
the federal authorities under the Federal Assignment of Claims Act (provided
that such assignment and notice shall not be required if the applicable contract
prohibits assignment);
(v) in accordance with its sound business judgment perform and
comply in all material respects with its obligations in respect of the Accounts
and other Rights to Payment;
(vi) subject to Section 7, upon the request of the Collateral
Agent (A) at any time, notify all or any designated portion of the account
debtors and other obligors on the Rights to Payment of the security interests
hereunder, and (B) if there exists any Default or Event of Default, notify the
account debtors and other obligors on the Rights to Payment or any designated
portion thereof that payment shall be made directly to the Collateral Agent or
to such other Person or location as the Collateral Agent shall specify; and
(vii) if there exists any Default or Event of Default, establish
such lockbox or similar arrangements for the payment of the Accounts and other
Rights to Payment as the Administrative Agent shall require.
(n) Deposit Accounts and Securities Accounts. Grantor shall
give the Collateral Agent immediate notice of the establishment of any new
Deposit Account and any new securities account with respect to any Investment
Property.
(o) Inventory. Grantor shall:
(i) at such times as the Collateral Agent shall reasonably
request, prepare and deliver to the Collateral Agent a report of all Inventory,
in form and substance reasonably satisfactory to the Collateral Agent ;
(ii) upon the request of the Collateral Agent, take a physical
listing of the Inventory and promptly deliver a copy of such physical listing to
the Collateral Agent; and
(iii) not store any Inventory with a bailee, warehouseman or
similar Person or on premises leased to Grantor, nor dispose of any Inventory on
a ▇▇▇▇-and-hold, guaranteed sale,
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sale and return, sale on approval, consignment or similar basis, nor acquire any
Inventory from any Person on any such basis, except in the ordinary course of
business and in accordance with its normal practices.
(p) Equipment. Grantor shall, upon the Collateral Agent's
request, deliver to the Collateral Agent a report of each item of Equipment, in
form and substance reasonably satisfactory to the Collateral Agent.
(q) Intellectual Property Collateral. Grantor shall:
(i) not allow or suffer any Intellectual Property to become
abandoned, nor any registration thereof to be terminated, forfeited, expired or
dedicated to the public, except for Intellectual Property having negligible
commercial value;
(ii) not enter into any agreements or transactions (including
any license, sublicense or royalty agreement) pertaining to any Intellectual
Property outside of the ordinary course of business, or enter into any exclusive
license or sublicense of any Intellectual Property, except in a transaction
permitted under the Credit Documents;
(iii) promptly give the Collateral Agent notice of any rights
Grantor may obtain to any new patentable inventions, copyrightable works or
other new Intellectual Property, prior to the registration or recordation
thereof (including pursuant to this Section 5(q)) as to which Grantor (a) has
received gross royalty or license payments from any and all third parties in an
aggregate amount excess of $1,000,000 during any of the five fiscal years
preceding such time or (b) reasonably projects that it will receive gross
royalty or license payments from any and all third parties in an aggregate
amount excess of $1,000,000 during the any of the subsequent five fiscal years;
provided that Grantor shall have no obligation to provide notice under this
subsection (iii) to the extent that Grantor has satisfied, or within the
immediately following three calendar months will satisfy, subsection (iv) or
(v), as applicable, of this Section 5(q);
(iv) not less frequently than once every three calendar months
and, additionally, upon the purchase, creation or other acquisition of any
Material Software Addition, diligently record, register or prosecute, as
applicable, all applications for patents, copyrights and trademarks, and
diligently record, register and prosecute, as applicable, any and all
continuations, continuations-in-part, applications for reissue, applications for
certificate of correction and like matters in respect of Grantor's Intellectual
Property as shall be reasonable and appropriate in accordance with prudent
business practice, and promptly and timely pay any and all maintenance, license,
registration and other fees, taxes and expenses incurred in connection with any
Intellectual Property; and, without limiting the generality of the foregoing,
(v) (A) not less frequently than once every three calendar months,
submit such duly completed, signed and notarized copyright registration forms to
the Copyright Office and take such other actions as necessary to register under
the U.S. copyright laws any and all additions, modifications or other changes to
the Arbitron Databases (each, a "Database Copyright Filing") since the Closing
Date; and (B) not less frequently than once every three calendar months and,
additionally, promptly after any purchase, creation or other acquisition of any
Material Software Addition, submit such duly completed, signed and notarized
copyright
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registration forms to the Copyright Office and take such other actions as
necessary to register under the U.S. copyright laws each Material Software
Addition (each, a "Software Copyright Filing"); and
(vi) not less frequently than once ever three calendar months, and
promptly but in any event not later than ten days after any and all recordations
described in subsections (iv) and (v) of this Section 5(q), and after any and
all recordations described in Section 3(c), deliver to the Collateral Agent and
each Credit Agent all such duly completed, file-stamped (or otherwise
certificated or acknowledged) and recorded documents together with such other
documents and information as the Collateral Agent or any Credit Agent may
reasonably request.
(r) Notices, Reports and Information. Subject to Section 3(c),
Grantor shall (i) notify the Collateral Agent and each Credit Agent of any
material claim made or asserted against the Collateral by any Person and of any
change in the composition of the Collateral or other event which could
materially adversely affect the value of the Collateral or the Lien thereon in
favor of the Collateral Agent (for the benefit of the Credit Agents); (ii)
furnish to the Collateral Agent and each Credit Agent such statements and
schedules further identifying and describing the Collateral and such other
reports and other information in connection with the Collateral as the
Collateral Agent at the instruction of the Instructing Group may reasonably
request, all in reasonable detail; and (iii) upon reasonable request of the
Collateral Agent or any Credit Agent make such demands and requests for
information and reports as Grantor is entitled to make in respect of the
Collateral.
(s) Insurance. (i) Grantor shall carry and maintain in full
force and effect, at the expense of the Grantor and with financially sound and
reputable insurance companies, insurance for itself and the Collateral Agent for
the benefit of the Credit Agents, with respect to the Collateral in such
amounts, with such deductibles and covering such risks as shall be specified in
the Credit Agreement. Upon the request of the Collateral Agent, at the
instruction of the Instructing Group, and in any event not less often than
annually, Grantor shall furnish the Collateral Agent and each Credit Agent with
full information as to the insurance carried by it and, if so requested, copies
of all such insurance policies. All insurance policies required under this
subsection (s) shall provide that they shall not be terminated or cancelled nor
shall any such policy be materially changed without at least 30 days' prior
written notice to the Grantor and the Collateral Agent (or 10 days' prior
written notice if the Collateral Agent consents to such shorter notice). Receipt
of notice of termination or cancellation of any such insurance policies or
reduction of coverages or amounts thereunder shall entitle the Collateral Agent
to renew any such policies, cause the coverages and amounts thereof to be
maintained at levels required pursuant to the first sentence of this subsection
(s) or otherwise to obtain similar insurance in place of such policies, in each
case at the expense of the Grantor.
(ii) If Collateral of Grantor with a value exceeding $1,000,000
(the "Settlement Consent Threshold") shall be materially damaged or destroyed,
in whole or in part, by fire or other casualty, Grantor shall give prompt notice
thereof to the Collateral Agent and each Credit Agent. No settlement on account
of any loss on any Collateral covered by insurance shall be made for less than
insured value without the consent of the Collateral Agent (with the consent of
the Instructing Group), unless, so long as there exists no Default or Event of
Default, the total value of each such loss or series of related losses so
compromised does not exceed the
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Settlement Consent Threshold. Unless there exists any Default or Event of
Default, the Collateral Agent (upon instruction of the Instructing Group) shall
promptly execute such necessary consents, waivers and endorsements to permit
Grantor to settle losses the total aggregate value of which is in an amount less
than the Settlement Consent Threshold, and to receive payment therefor, as
reasonably requested by Grantor. After the occurrence and during the continuance
of an Event of Default, or as otherwise required under any of the Credit
Documents, all sums payable to Grantor by any insurer with respect to a casualty
relating to all or any part of the Collateral shall be paid to the Collateral
Agent (upon instruction of the Instructing Group). If Grantor shall receive any
insurance proceeds which are to be paid to the Collateral Agent pursuant to the
previous sentence, Grantor shall hold such proceeds in trust for the Collateral
Agent and shall segregate such proceeds from other funds of Grantor, and shall
immediately forward such proceeds in the form received to the Collateral Agent
(appropriately indorsed by Grantor to the order of the Collateral Agent or in
such other manner as shall be satisfactory to the Collateral Agent, upon
instruction of the Instructing Group). All such insurance proceeds may be
retained by the Collateral Agent as part of Collateral hereunder and held in the
Proceeds Account, applied by the Collateral Agent toward payment of all or part
of the Secured Obligations in such order as is provided herein, or released to
Grantor upon its request with the consent of the Instructing Group.
(t) Other Swap Obligations. Grantor shall not enter into any
swap contract under or subject to a Specified Swap Agreement, other than a
Specified Swap Contract.
SECTION 6 Administration of the Rights to Payment.
(a) Collection of Rights to Payment. Until the Collateral Agent
exercises its rights hereunder to collect Rights to Payment, Grantor shall
endeavor in the first instance diligently to collect all amounts due or to
become due on or with respect to the Rights to Payment. At the request of the
Collateral Agent, upon instruction of the Instructing Group, if there exists at
such time any Event of Default, all remittances received by Grantor shall be
held in trust for the Collateral Agent and, in accordance with the Collateral
Agent's instructions, remitted to the Collateral Agent or deposited to an
account with the Collateral Agent in the form received (with any necessary
endorsements or instruments of assignment or transfer).
(b) Investment Property and Instruments. At the request of the
Collateral Agent, upon instruction of the Instructing Group, if there exists at
such time any Event of Default, the Collateral Agent shall be entitled, subject
to the Intercreditor Agreement, to receive all distributions and payments of any
nature with respect to any Investment Property or Instruments, and all such
distributions or payments received by Grantor shall be held in trust for the
Collateral Agent and, in accordance with any of the its instructions (with the
consent of the Instructing Group), remitted to the Collateral Agent or deposited
to an account with the Administrative Agent in the form received (with any
necessary endorsements or instruments of assignment or transfer). If there
exists any Default or Event of Default any such distributions and payments with
respect to any Investment Property held in any securities account shall be held
and retained in such securities account, in each case as part of the Collateral
hereunder. Additionally, the Collateral Agent shall have the right, if there
exists any Default or Event of Default, following prior written notice to
Grantor, to vote and to give consents, ratifications and waivers with respect to
any Investment Property and Instruments, and to exercise all rights of
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conversion, exchange, subscription or any other rights, privileges or options
pertaining thereto, as if the Collateral Agent was the absolute owner thereof;
provided that the Collateral Agent shall have no duty to exercise any of the
foregoing rights afforded to it and shall not be responsible to Grantor or any
other Person for any failure to do so or delay in doing so.
(e) Distributions to Be Held for Administrative Agent.
Distributions and other payments which are received by the Grantor but which it
is not entitled to retain as a result of the operation of this Section 6 shall
be held in trust for the benefit of the Collateral Agent and be segregated from
the other property or funds of Grantor, and be forthwith paid over or delivered
to the Collateral Agent in the same form as so received.
SECTION 7 Authorization; Appointment as Attorney-in-Fact. The
Collateral Agent shall have the right to, in the name of Grantor, or in the name
of any of the Credit Parties or otherwise, without notice to or assent by
Grantor, and Grantor hereby constitutes and appoints the Collateral Agent (and
any officers or employees or agents designated by the Collateral Agent) as
Grantor's true and lawful attorney-in-fact, with full power and authority to:
(i) sign any of the financing statements and Supplemental IP
Security Agreements which must be executed or filed to perfect or continue
perfected, maintain the priority of or provide notice of the security interests
in the Collateral of the Collateral Agent (for the benefit of the Credit Agents)
and file any such financing statements and Supplemental IP Security Agreements
by electronic means with or without a signature as authorized or required by
applicable law or filing procedures;
(ii) take possession of and endorse any notes, acceptances,
checks, drafts, money orders or other forms of payment or security and collect
any Proceeds of any Collateral;
(iii) sign and endorse any invoice or ▇▇▇▇ of lading relating to
any of the Collateral, warehouse or storage receipts, drafts against customers
or other obligors, assignments, notices of assignment, verifications and notices
to customers or other obligors;
(iv) notify the U.S. Postal Service and other postal authorities
to change the address for delivery of mail addressed to Grantor to such address
as Collateral Agent may designate (provided that the Collateral Agent agrees it
will promptly deliver over to Grantor any mail that does not relate to the
Collateral); and, without limiting the generality of the foregoing, establish
with any Person lockbox or similar arrangements for the payment of the Rights to
Payment;
(v) receive, open and dispose of all mail addressed to Grantor
(provided that the Collateral Agent agrees it will promptly deliver over to
Grantor any mail that does not relate to the Collateral);
(vi) send requests for verification of Rights to Payment to the
customers or other obligors of Grantor;
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(vii) contact, or direct Grantor to contact, all account debtors
and other obligors on the Rights to Payment and instruct such account debtors
and other obligors to make all payments directly to the Collateral Agent;
(viii) assert, adjust, ▇▇▇ for, compromise or release any claims
under any policies of insurance;
(ix) exercise dominion and control over, and refuse to permit
further withdrawals from, Deposit Accounts maintained with Bank of America or
any other bank, financial institution or other Person;
(x) notify each Person maintaining lockbox or similar
arrangements for the payment of the Rights to Payment to remit all amounts
representing collections on the Rights to Payment directly to the Collateral
Agent;
(xi) ask, demand, collect, receive and give acquittances and
receipts for any and all Rights to Payment, enforce payment or any other rights
in respect of the Rights to Payment and other Collateral, grant consents, agree
to any amendments, modifications or waivers of the agreements and documents
governing the Rights to Payment and other Collateral, and otherwise file any
claims, take any action or institute, defend, settle or adjust any actions,
suits or proceedings with respect to the Collateral, as the Collateral Agent
(upon instruction of the Instructing Group) may deem necessary or desirable to
maintain, preserve and protect the Collateral, to collect the Collateral or to
enforce the rights of the Collateral Agent with respect to the Collateral;
(xii) execute any and all applications, documents, papers and
instruments necessary for the Collateral Agent to use the Intellectual Property
and grant or issue any exclusive or non-exclusive license or sublicense with
respect to any Intellectual Property;
(xiii) execute any and all endorsements, assignments or other
documents and instruments necessary to sell, lease, assign, convey or otherwise
transfer title in or dispose of the Collateral;
(xiv) execute and deliver to any securities intermediary or other
Person any entitlement order, Account Control Agreement or other notice,
document or instrument which the Collateral Agent (upon instruction of the
Instructing Group) may deem necessary or advisable (A) to realize upon the
Collateral, and (B) to maintain, protect and preserve the Investment Property
and the security interest of the Collateral therein; and
(xv) execute any and all such other documents and instruments,
and do any and all acts and things for and on behalf of Grantor, which the
Collateral Agent (upon instruction of the Instructing Group) may deem necessary
or advisable (A) to realize upon the Collateral, and (B) to maintain, protect
and preserve the Collateral and security interests of the Collateral Agent
therein and to accomplish the purposes of this Agreement.
The Collateral Agent agrees that, unless there exists any Default or Event of
Default, it shall not exercise the power of attorney, or any rights granted to
the Collateral Agent pursuant to clauses
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(ii) through (xiii), (xiv)(A) and (xv)(A). The foregoing power of attorney is
coupled with an interest and irrevocable so long as any of the Secured
Obligations has not been paid and performed in full. Grantor hereby ratifies, to
the extent permitted by law, any and all acts that the Collateral Agent shall
lawfully and in good faith do or cause to be done by virtue of and in compliance
with this Section 7.
SECTION 8 Performance of Grantor Obligations. The Collateral Agent
may perform or pay any obligation which Grantor has agreed to perform or pay
under or in connection with this Agreement, and which Grantor has failed to
perform or pay as and when due, and Grantor shall reimburse the Collateral Agent
on demand for any amounts paid by the Collateral Agent pursuant to this Section
8.
SECTION 9 Collateral Agent's Duties. Notwithstanding any provision
contained in this Agreement, the Collateral Agent shall have no duty to exercise
any of the rights, privileges or powers afforded to such party and shall not be
responsible to Grantor or any other Person for any failure to do so or delay in
doing so. Beyond the exercise of reasonable care to assure the safe custody of
Collateral in the Collateral Agent's possession, and the accounting for moneys
actually received by the Collateral Agent hereunder, the Collateral Agent shall
have no duty or liability to exercise or preserve any rights, privileges or
powers pertaining to the Collateral.
SECTION 10. Remedies.
(a) Remedies. If there exists any Default or Event of Default,
the Collateral Agent shall have, in addition to all other rights and remedies
granted to in this Agreement, the Credit Agreement or any other Credit Document,
all rights and remedies of a secured party under the UCC and other applicable
laws. Without limiting the generality of the foregoing, Grantor agrees that:
(i) The Collateral Agent may peaceably and without notice enter
any premises of Grantor; take possession of any Collateral; remove, prohibit
access to or use of, or dispose of all or part of the Collateral on any premises
of Grantor or elsewhere; or, in the case of Equipment, render it nonfunctional,
and otherwise collect, receive, appropriate and realize upon all or any part of
the Collateral, and demand, give receipt for, settle, renew, extend, exchange,
compromise, adjust, or ▇▇▇ for all or any part of the Collateral, as the
Collateral Agent (upon instruction of the Instructing Group) may determine.
(ii) The Collateral Agent may require Grantor to assemble all or
any part of the Collateral and make it available to the Collateral Agent, at any
place and time designated by the Collateral Agent.
(iii) The Collateral Agent may use or transfer any of Grantor's
rights and interests in any Intellectual Property, by license, by sublicense (to
the extent permitted by an applicable license) or otherwise, on such conditions
and in such manner as the Collateral Agent (upon instruction of the Instructing
Group) may determine.
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(iv) The Collateral Agent may secure the appointment of a
receiver of the Collateral or any part thereof (to the extent and in the manner
provided by applicable law).
(v) The Collateral Agent may withdraw (or cause to be
withdrawn) any and all funds from any Deposit Accounts or securities accounts.
(vi) The Collateral Agent may sell, resell, lease, use, assign,
transfer or otherwise dispose of any or all of the Collateral in its then
condition or following any commercially reasonable preparation or processing
(utilizing in connection therewith any of Grantor's assets, without charge or
liability to the Collateral agent or any of the Credit Parties therefor) at
public or private sale, by one or more contracts, in one or more parcels, at the
same or different times, for cash or credit or for future delivery without
assumption of any credit risk, all as the Collateral Agent (upon instruction of
the Instructing Group) deem advisable; provided, however, that Grantor shall be
credited with the net proceeds of sale only when such proceeds are finally
collected by the Collateral Agent. The Collateral Agent shall have the right
upon any such public sale, and, to the extent permitted by law, upon any such
private sale, to purchase the whole or any part of the Collateral so sold, free
of any right or equity of redemption, which right or equity of redemption
Grantor hereby releases, to the extent permitted by law. Grantor hereby agrees
that the sending of notice by ordinary mail, postage prepaid, to the address of
Grantor set forth in the Credit Agreement, of the place and time of any public
sale or of the time after which any private sale or other intended disposition
is to be made, shall be deemed reasonable notice thereof if such notice is sent
ten days prior to the date of such sale or other disposition or the date on or
after which such sale or other disposition may occur, provided that the
Collateral Agent may provide Grantor shorter notice or no notice, to the extent
permitted by the UCC or other applicable law.
(b) License. For the purpose of enabling the Collateral Agent
to exercise its rights and remedies under this Section 10 or otherwise in
connection with this Agreement, Grantor hereby grants to Collateral Agent for
the benefit of the Credit Agents an irrevocable, non-exclusive and assignable
license (exercisable without payment or royalty or other compensation to
Grantor) to use, license or sublicense any Intellectual Property.
(c) Proceeds Account. To the extent that any of the Secured
Obligations may be contingent, unmatured or unliquidated at such time as there
may exist an Event of Default (including with respect to undrawn amounts under
any Letter of Credit or contingent amounts due under any Specified Swap
Agreement arising from any Specified Swap Contract), the Collateral Agent, at
its election, (i) retain the proceeds of any sale, collection, disposition or
other realization upon the Collateral (or any portion thereof) in a special
purpose non-interest-bearing restricted deposit account (the "Proceeds Account")
created and maintained by the Collateral Agent for the benefit of the Credit
Agents for such purpose (which shall constitute a Deposit Account included
within the Collateral hereunder) until such time as the Collateral Agent may
elect to apply such proceeds to the Secured Obligations, and Grantor agrees that
such retention of such proceeds by the Collateral Agent shall not be deemed
strict foreclosure with respect thereto; (ii) in any manner elected by the
Collateral Agent (upon instruction of the Instructing Group), estimate the
liquidated amount of any such contingent, unmatured or unliquidated claims and
apply the proceeds of the Collateral against such amount; or (iii) otherwise
proceed in any manner permitted by applicable law. Grantor agrees that the
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Proceeds Account shall be a blocked account and that upon the irrevocable
deposit of funds into the Proceeds Account, Grantor shall not have any right of
withdrawal with respect to such funds. Accordingly, Grantor irrevocably waives
until the termination of the security interests granted under this Agreement in
accordance with Section 23 the right to make any withdrawal from the Proceeds
Account and the right to instruct the Collateral Agent or any of the Credit
Parties to honor drafts against the Proceeds Account.
(d) Application of Proceeds. Subject to subsection (c), cash
proceeds actually received from the sale or other disposition or collection of
Collateral, and any other amounts received in respect of the Collateral the
application of which is not otherwise provided for herein, shall be applied
(after payment of any amounts payable to the applicable Credit Parties or the
Collateral Agent pursuant to Section 8 or Section 14) in whole or in part by the
applicable Credit Parties or the Collateral Agent against all or any part of the
Secured Obligations in the manner and to the extent set forth in the
Intercreditor Agreement.
SECTION 11 Certain Waivers. Grantor waives, to the fullest extent
permitted by law, (i) any right of redemption with respect to the Collateral,
whether before or after sale hereunder, and all rights, if any, of marshalling
of the Collateral or other collateral or security for the Secured Obligations;
(ii) any right to require the Collateral Agent, or any of the Credit Parties (A)
to proceed against any Person, (B) to exhaust any other collateral or security
for any of the Secured Obligations, (C) to pursue any remedy, or (D) to make or
give any presentments, demands for performance, notices of nonperformance,
protests, notices of protests or notices of dishonor in connection with any of
the Collateral; and (iii) all claims, damages, and demands against the
Collateral Agent, or any of the Credit Parties arising out of the repossession,
retention, sale or application of the proceeds of any sale of the Collateral.
SECTION 12 Notices. All notices or other communications hereunder
shall be given in the manner and to the addresses specified in, and shall be
effective as provided in, the Credit Agreement; provided, however, that notices
hereunder to (a) the Swap Provider shall be delivered to Fleet National Bank
using the information listed in Schedule 10.02 of the Credit Agreement for such
party as a Lender or such replacement Swap Provider as may be appointed from
time to time pursuant to the terms of the Intercreditor Agreement, and (b) the
Note Holders shall be delivered to such Persons at the address specified in the
Note Purchase Agreement, or to such replacement Note Holders as may be appointed
from time to time consistent with the terms of the Intercreditor Agreement.
SECTION 13 No Waiver; Cumulative Remedies. No failure on the part
of the Collateral Agent, or any of the Credit Parties to exercise, and no delay
in exercising, any right, remedy, power or privilege hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right,
remedy, power or privilege preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights and remedies
under this Agreement are cumulative and not exclusive of any rights, remedies,
powers and privileges that may otherwise be available to the Collateral Agent,
or any of the Credit Parties.
SECTION 14 Indemnification; Other Charges.
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(a) Indemnification. The Grantor hereby agrees to indemnify the
Collateral Agent and the Credit Parties, and the other Lenders, and their
respective directors, officers, employees, agents, counsel and other advisors
(each an "Indemnified Person") against, and hold each of them harmless from, any
and all liabilities, obligations, losses, claims, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever, including the reasonable fees and disbursements of counsel to an
Indemnified Person (including allocated costs of internal counsel), which may be
imposed on, incurred by, or asserted against any Indemnified Person, in any way
relating to or arising out of this Agreement or the transactions contemplated
hereby or any action taken or omitted to be taken by it hereunder (the
"Indemnified Liabilities"); provided that Grantor shall not be liable to any
Indemnified Person with respect to Indemnified Liabilities resulting from such
Indemnified Person's gross negligence or willful misconduct. If and to the
extent that the foregoing indemnification is for any reason held unenforceable,
Grantor agrees to make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under applicable
law.
(b) Other Charges. The Grantor agrees to indemnify the
Collateral Agent and the Credit Parties against and hold each of them harmless
from any and all present and future stamp, transfer, documentary and other such
taxes, levies, fees, assessments and other charges made by any jurisdiction by
reason of the execution, delivery, performance and enforcement of this
Agreement.
(c) Interest. Any amounts payable to the any Indemnified Person
under this Section 14 or otherwise under this Agreement if not paid upon demand
shall bear interest from the date of such demand until paid in full, at the
applicable rate, (a) for the Administrative Agent and any Lender, as set forth
in Section 2.08(b) of the Credit Agreement, (b) for the Swap Provider, as set
forth in the Specified Swap Agreement, and (c) for the Note Holders as set forth
in Section 2.08(b) of the Note Purchase Agreement.
SECTION 15 Binding Effect. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by Grantor, each Indemnified Person
referred to in Section 14 and their respective successors and assigns.
SECTION 16 Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE COLLATERAL
AGENT AND EACH CREDIT PARTY SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF THE
UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
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PARTY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE GRANTOR, THE COLLATERAL AGENT AND EACH OF THE
CREDIT PARTIES IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY
NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN ANY FEDERAL
COURT OR STATE COURT SITTING IN NEW YORK IN RESPECT OF ANY LOAN DOCUMENT OR
OTHER DOCUMENT RELATED THERETO. THE GRANTOR, THE COLLATERAL AGENT AND EACH OF
THE CREDIT PARTIES WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH
STATE.
SECTION 17 Waiver of Right to Jury Trial. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO THIS AGREEMENT, ANY CREDIT DOCUMENT, OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
SECTION 18 Entire Agreement; Amendment. This Agreement, together
with the other Credit Documents, embodies the entire agreement and understanding
among the Grantor and the Collateral Agent (for the benefit of the Credit
Agents), and supersedes all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof. Subject to Section 19, this Agreement shall be
amended only by written agreement with the written consent of the Instructing
Group; provided, however, that any amendment having the effect of causing a
release of all or substantially all of the Collateral must be consented to in
writing by the Collateral Agent and each of the Credit Agents.
SECTION 19 Independence. This Agreement sets forth independent and
separate security interests of the Grantor in favor of the Collateral Agent in
respect of the Secured Obligations owing to the Collateral Agent for the benefit
of each Credit Agent. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder with respect to
any Credit Agent shall not in any way affect or impair the legality or
enforceability of that or any other provision of this Agreement or any
instrument or agreement required hereunder in respect to any other Credit Agent.
The parties acknowledge that this Agreement has, solely for reasons of
convenience, been prepared and executed as a single document, but that the legal
effect shall be in all respects as though the Grantor had executed separate
security interests, for the benefit of each of the Credit Agents. Any provision
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of this Agreement and the other Credit Documents to which the Grantor is a party
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions thereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 20 Counterparts. This Agreement may be executed in any
number of separate counterparts, each of which, when so executed, shall be
deemed an original, and all of said counterparts taken together shall be deemed
to constitute but one and the same instrument. Each of the parties hereto
understands and agrees that this Agreement may be delivered by any party hereto
or thereto either in the form of an executed original or an executed original
sent by facsimile transmission to be followed promptly by mailing of a hard copy
original, and that receipt by the Collateral Agent or any Credit Agent of a
facsimile transmitted document purportedly bearing the signature of a Grantor
shall bind Grantor with the same force and effect as the delivery of a hard copy
original. Any failure by the Collateral Agent or any Credit Agent to receive the
hard copy executed original of such document shall not diminish the binding
effect of receipt of the facsimile transmitted executed original of such
document of the party whose hard copy page was not received by the Collateral
Agent or such Credit Party.
SECTION 21 Incorporation of Provisions of the Credit Agreement. To
the extent the Credit Agreement contains provisions of general applicability to
the Credit Documents, including any such provisions contained in Article X
thereof, such provisions are incorporated herein by this reference.
SECTION 22 No Inconsistent Requirements. Grantor acknowledges that
this Agreement and the other Credit Documents may contain covenants and other
terms and provisions variously stated regarding the same or similar matters, and
agrees that all such covenants, terms and provisions are cumulative and all
shall be performed and satisfied in accordance with their respective terms.
SECTION 23 Termination; Releases. (i) Upon the termination of the
Commitments of the Lenders, the surrender of any Letters of Credit issued for
the account of Grantor under the Credit Agreement and payment and performance in
full of all Secured Obligations, the security interests granted under this
Agreement shall terminate and the Collateral Agent and all Credit Agents shall
promptly execute and deliver to Grantor such documents and instruments
reasonably requested by Grantor as shall be necessary to evidence termination of
all security interests given by Grantor to the Collateral Agent hereunder;
provided, however, that the obligations of Grantor under Section 14 shall
survive such termination.
(ii) Concurrently with any permitted disposition of Collateral
under the Credit Documents, the security interests hereunder shall automatically
be released from the Collateral so disposed of, subject to Section 5(j);
provided, however, that the security interests shall continue in the Proceeds
thereof. Upon satisfaction to all conditions precedent to any permitted
disposition set forth herein or in the other Credit Documents, the Collateral
Agent and all Credit Agents shall execute and deliver any releases or other
documents reasonably requested by the relevant Grantor to accomplish or confirm
the release of Collateral provided by this Section. Any such release shall
specifically describe the portion of the Collateral to be released, shall be
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expressed to be unconditional and shall be without recourse or warranty (other
than a warranty that the Collateral Agent and the Credit Agents have not
assigned their rights and interests to any other Person).
SECTION 24 Assumption. Upon execution and delivery to the
Administrative Agent of an Subsidiary Security Agreement by a Subsidiary of the
Grantor as provided in Section 6.14 of the Credit Agreement, effective as of the
effective date of such Subsidiary Security Agreement, such Subsidiary shall be
deemed a Grantor party hereto, and this Agreement shall be deemed amended to
include any amendments to the Schedules provided by such Subsidiary in
connection therewith.
SECTION 25 Intercreditor Agreement. Notwithstanding anything set
forth in this Agreement, any inconsistency between this Agreement and the
Intercreditor Agreement in respect of the rights and obligations of the
Collateral Agent and the Credit Agents owing to and among each other (but not
including in respect of the obligations of the Grantor to the Collateral Agent
or Credit Agents hereunder) shall be resolved in favor of the Intercreditor
Agreement.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered in San Francisco, California by their proper
and duly authorized officers as of the day and year first above written.
CERIDIAN CORPORATION
Grantor
By:
-------------------------------
Name:
Title:
BANK OF AMERICA, N.A.,
as Collateral
By:
-------------------------------
Name:
Title:
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SCHEDULE 1
to the Security Agreement
1. LOCATIONS OF CHIEF EXECUTIVE OFFICE AND OTHER LOCATIONS, INCLUDING OF
COLLATERAL
a. Chief Executive Office and Principal Place of Business:
b. Other locations where Grantor conducts business or Collateral is
kept:
2. LOCATIONS OF BOOKS PERTAINING TO RIGHTS TO PAYMENT
3. TRADE NAMES AND TRADE STYLES; OTHER CORPORATE, TRADE OR FICTITIOUS
NAMES; ETC.
4. DEPOSIT ACCOUNTS
SCHEDULE 1-1
241
5. INVESTMENT PROPERTY
6. INSTRUMENTS
7. LEASED EQUIPMENT
8. MATERIAL SOFTWARE
SCHEDULE 1-2
Exhibits to Arbitron Credit Agreement
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SCHEDULE 2
to the Security Agreement
(a) ISSUED PATENTS OF GRANTOR
Grantor Patent No. Issue Date Inventors Title Agent
------- ---------- ---------- --------- ----- -----
(b) PENDING PATENT APPLICATIONS OF GRANTOR
Grantor Application No. Filing Date Inventors Title
------- --------------- ----------- --------- -----
(c) TRADEMARKS OF GRANTOR
Registration Registration Registered
Grantor No. Date Filing Date Owner ▇▇▇▇
------- --- ---- ----------- ----- ----
(d) PENDING TRADEMARK APPLICATIONS OF GRANTOR
Application
Grantor No. Filing Date Applicant ▇▇▇▇
------- --- ----------- --------- ----
(e) COPYRIGHTS OF GRANTOR
Grantor Copyright Title Reg. No. Date of Issue
------- --------------- -------- -------------
SCHEDULE 2-1
Exhibits to Arbitron Credit Agreement
243
(f) COPYRIGHT APPLICATIONS OF GRANTOR
Grantor Title Date of Application
------- ----- -------------------
(g) COPYRIGHT LICENSES OF GRANTOR
Grantor Title Copyright Owner Reg. No. Date of Issue
------- ----- --------------- -------- -------------
SCHEDULE 2-2
Exhibits to Arbitron Credit Agreement
244
SCHEDULE 3
to the Security Agreement
FILING OFFICES
SCHEDULE 3-1
Exhibits to Arbitron Credit Agreement
245
EXHIBIT H
[SUBSIDIARY] SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this "Agreement"), dated as of February __,
2001, is made by and among _____________ (the "Grantor") in favor of the
"Collateral Agent" (as defined herein) for the benefit of: (a) BANK OF AMERICA,
N.A., as the administrative agent (in such capacity, the "Administrative Agent")
for itself and the financial institutions (the "Lenders" and, individually, a
"Lender") from time to time party to that certain Credit Agreement dated as of
January 31, 2001 (as renewed, extended, modified, amended or restated from time
to time, the "Credit Agreement"), (b) the "Swap Provider" (as defined in
herein); and (c) the Note Holders party from time to time to the Note Purchase
Agreement.
RECITALS
WHEREAS, it is a condition precedent to the borrowings under the
Credit Agreement and the Note Purchase Agreement that the Grantor enter into
this Agreement and grant to the Collateral Agent, for the ratable benefit of the
Credit Agents, the security interests hereinafter provided to secure the
obligations of the Grantor described below.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1 Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms
used herein and not otherwise defined shall have the meanings assigned to
them, respectively, in the Credit Agreement.
(b) Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Account Control Agreement" means any account control agreement,
deposit account control agreement, lockbox or other agreement with any
securities intermediary or depository granting control with respect to any
investment property or deposit accounts for purposes of Article 9 of the UCC or
applicable law.
"Accounts" means any and all accounts of Grantor, whether now
existing or hereafter acquired or arising, and in any event includes all
accounts receivable, contract rights, royalties, Rights to Payment and other
obligations of any kind owed to Grantor arising out of or in connection with the
sale, lease, license or other transfer of Intellectual Property, merchandise,
goods or commodities or the rendering of services or arising from any other
transaction, however evidenced, and whether or not earned by performance, all
guaranties, indemnities and security with respect to the foregoing, and all
letters of credit relating thereto, in each case whether now existing or
hereafter acquired or arising.
"Arbitron Databases" means any and all of Grantor's collections or
compilations of data, stored in such way as to permit selective search and
retrieval using electronic,
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Exhibits to Arbitron Credit Agreement
246
electromagnetic, manual or mechanical methods, which relate to Grantor's
business, and wherever maintained, collected or accessed.
"Books" means all books, records and other written, electronic or
other documentation in whatever form maintained now or hereafter by or for
Grantor in connection with the ownership of its assets or the conduct of its
business or evidencing or containing information relating to the Collateral,
including: (i) ledgers; (ii) records indicating, summarizing, or evidencing
Grantor's assets (including Inventory and Rights to Payment), business
operations or financial condition; (iii) computer programs and software; (iv)
computer discs, tapes, files, manuals, spreadsheets; (v) computer printouts and
output of whatever kind; (vi) any other computer prepared or electronically
stored, collected or reported information and equipment of any kind; and (vii)
any and all other rights now or hereafter arising out of any contract or
agreement between Grantor and any service bureau, computer or data processing
company or other Person charged with preparing or maintaining any of Grantor's
books or records or with credit reporting, including with regard to Grantor's
Accounts.
"Borrower" has the meaning specified in the Credit Agreement.
"Chattel Paper" means all writings of whatever sort which evidence a
monetary obligation and a security interest in or lease of specific goods,
whether now existing or hereafter arising.
"Collateral" has the meaning set forth in Section 2.
"Collateral Agent" means Bank of America, N.A. in its capacity as
"Collateral Agent" (as defined in the Intercreditor Agreement; or such
replacement Collateral Agent as may be appointed from time to time thereunder)
on behalf and for the benefit of, (a) Bank of America, N.A. in its capacity as
the Administrative Agent for the benefit of itself and the other Lenders from
time to time party to the Credit Agreement, and the L/C Issuer; (b) the Note
Holders from time to time party to the Note Purchase Agreement; and (c) the Swap
Provider.
"Credit Agents" and each, individually, a "Credit Agent" means (a)
the Administrative Agent (for the benefit of itself and the other Lenders, and
the L/C Issuer), (b) the Note Holders and (c) the Swap Provider.
"Credit Documents" means, collectively, the Loan Documents, the Note
Holder Documents and the Swap Documents.
"Credit Parties" and each, individually, a "Credit Party" means the
Credit Agents and the Debt Participants.
"Database Copyright Filing" has the meaning set forth in Section
5(q)(v)(A).
"Debt Participant" means a "Debt Participant" under, and as defined
in, the Intercreditor Agreement.
"Deposit Account" means any demand, time, savings, passbook or like
account now or hereafter maintained by or for the benefit of Grantor with a
bank, savings and loan
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Exhibits to Arbitron Credit Agreement
247
association, credit union or like organization (including Bank of America) and
all funds and amounts therein, whether or not restricted or designated for a
particular purpose.
"Documents" means any and all documents of title, bills of lading,
dock warrants, dock receipts, warehouse receipts and other documents of Grantor,
whether or not negotiable, and includes all other documents which purport to be
issued by a bailee or agent and purport to cover goods in any bailee's or
agent's possession which are either identified or are fungible portions of an
identified mass, including such documents of title made available to Grantor for
the purpose of ultimate sale or exchange of goods or for the purpose of loading,
unloading, storing, shipping, transshipping, manufacturing, processing or
otherwise dealing with goods in a manner preliminary to their sale or exchange,
in each case whether now existing or hereafter acquired or arising.
"Equipment" means all now existing or hereafter acquired equipment
of Grantor in all of its forms, wherever located, and in any event includes any
and all machinery, furniture, equipment, furnishings and fixtures in which
Grantor now or hereafter acquires any right, and all other goods and tangible
personal property (other than Inventory), including tools, parts and supplies,
automobiles, trucks, tractors and other vehicles, computer and other electronic
data processing equipment and other office equipment, computer programs and
related data processing software, and all additions, substitutions,
replacements, parts, accessories, and accessions to and for the foregoing, now
owned or hereafter acquired, and including any of the foregoing which are or are
to become fixtures on real property.
"Filing Offices" has the meaning set forth in Section 3(a).
"General Intangibles" means all general intangibles of Grantor, now
existing or hereafter acquired or arising, and in any event includes: (i) all
tax and other refunds, rebates or credits of every kind and nature to which
Grantor is now or hereafter may become entitled; (ii) all good will, choses in
action and causes of action, whether legal or equitable, whether in contract or
tort and however arising; (iii) all Intellectual Property; (iv) all rights of
stoppage in transit, replevin and reclamation; (v) all licenses, permits,
consents, indulgences and rights of whatever kind issued in favor of or
otherwise recognized as belonging to Grantor by any Governmental Authority; (vi)
all indemnity agreements, guaranties, insurance policies and other contractual,
equitable and legal rights of whatever kind or nature; and (vii) all rights to
receive payment and other rights under any Swap Contracts; in each case whether
now existing or hereafter acquired or arising.
"Grantor" has the meaning set forth in the first paragraph hereof.
"Instructing Group" means "Instructing Group" under, and as defined
in, the Intercreditor Agreement.
"Instruments" means any and all negotiable instruments and every
other writing which evidences a right to the payment of money, wherever located
and whether now existing or hereafter acquired.
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Exhibits to Arbitron Credit Agreement
248
"Intellectual Property" means the following properties and assets
owned or held by Grantor or in which Grantor otherwise has any interest, now
existing or hereafter acquired or arising:
(i) all patents and patent applications, domestic or foreign, all
licenses relating to any of the foregoing and all income and royalties with
respect to any licenses (including such patents, patent applications and patent
licenses as described in Schedule 2), all rights to ▇▇▇ for past, present or
future infringement thereof, all rights arising in connection with any of the
foregoing and pertaining thereto and all reissues, divisions, continuations,
renewals, extensions and continuations-in-part thereof; all copyrights and
applications for copyright (including with respect to the Arbitron Databases and
the Material Arbitron Software), domestic or foreign, together with the
underlying works of authorship (including titles), whether or not the underlying
works of authorship have been published and whether said copyrights are
statutory or arise under the common law, and all other rights and works of
authorship (including the copyrights and copyright applications described in
Schedule 2), all rights, claims and demands in any way relating to any such
copyrights or works, including royalties and rights to ▇▇▇ for past, present or
future infringement, and all rights of renewal and extension of copyright;
(ii) all state (including common law), federal and foreign
trademarks, service marks and trade names, and applications for registration of
such trademarks, service marks and trade names, all licenses relating to any of
the foregoing and all income and royalties with respect to any licenses
(including such marks, names, applications and licenses as described in Schedule
2), whether registered or unregistered and wherever registered, all rights to
▇▇▇ for past, present or future infringement or unconsented use thereof, all
rights arising therefrom and pertaining thereto and all reissues, extensions and
renewals thereof;
(iii) all trade secrets, trade dress, trade styles, logos, other
source of business identifiers, mask-works, mask-work registrations, mask-work
applications, software (including all Material Arbitron Software and all
Material Software Additions), confidential information, customer lists, license
rights, advertising materials, operating manuals, methods, processes, know-how,
algorithms, formulae, databases (including all Arbitron Databases), quality
control procedures, product, service and technical specifications, operating,
production and quality control manuals, sales literature, drawings,
specifications, blue prints, descriptions, inventions, name plates and catalogs;
and
(iv) the entire goodwill of or associated with the businesses now or
hereafter conducted by Grantor connected with and symbolized by any of the
aforementioned properties and assets; and
(v) all intellectual property rights and property of the Grantor now
existing or hereafter arising, covered by any Supplemental IP Security Agreement
executed by Grantor from time to time in accordance with Section 3(c).
"Intercreditor Agreement" means that Intercreditor Agreement dated
as of January 31, 2001 among the Collateral Agent, the Administrative Agent, the
Swap Provider, and the "Note Holders" (as defined therein).
H-4
Exhibits to Arbitron Credit Agreement
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"Inventory" means any and all of Grantor's inventory in all of its
forms, wherever located, whether now owned or hereafter acquired, and in any
event includes all goods (including goods in transit) which are held for sale,
lease or other disposition, including those held for display or demonstration or
out on lease or consignment or to be furnished under a contract of service, or
which are raw materials, work in process, finished goods or materials used or
consumed in Grantor's business, and the resulting product or mass, and all
repossessed, returned, rejected, reclaimed and replevied goods, together with
all parts, components, supplies packing, and other materials used or usable in
connection with the manufacture, production, packing, shipping, advertising,
selling or furnishing of such goods; and all other items hereafter acquired by
Grantor by way of substitution, replacement, return, repossession or otherwise,
and all additions and accessions thereto, and any Document representing or
relating to any of the foregoing at any time.
"Investment Property" means any and all investment property of
Grantor, including all securities, whether certificated or uncertificated,
security entitlements, securities accounts, commodity contracts and commodity
accounts, and all financial assets held in any securities account or otherwise,
wherever located, and whether now existing or hereafter acquired or arising.
"Letter of Credit Proceeds" means any and all proceeds of written
letters of credit.
"Material Arbitron Software" means all computer operation and
application programs of Grantor listed on Schedule 2.
"Material Software Addition" means any update, release, version,
patch, debugging program, compilation, or beta in respect of Material Arbitron
Software, and any and all computer operation and application programs, including
all object and source code and all copies and encodings thereof, purchased,
created or otherwise acquired by Grantor after the Closing Date.
"Note Holder Collateral Documents" means, collectively, (i) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or other wise changed in respect of, the
Note Holders), (ii) all Account Control Agreements executed by any Loan Party
under any Note Holder Document, (iii) all documents executed by any Loan Party
to accomplish cash collateralization pursuant to any Note Holder Document, and
(iv) all licenses, UCC financing statements, notices and other documents
executed from time to time or in connection with any of the foregoing.
"Note Holder Documents" means, collectively, the Note Purchase
Agreement, the Note Holder Collateral Documents and the Note Holder Guaranties.
"Note Holder Guaranties" means the Guaranties under and as defined
in the Credit Agreement, but to the extent entered into by the Guarantors
thereunder for the benefit of, and as modified, extended or otherwise changed in
respect of, the Note Holders.
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Exhibits to Arbitron Credit Agreement
250
"Note Holder" means a "Note Holder" under, and as defined in, the
Note Purchase Agreement.
"Note Purchase Agreement" means that Note Purchase Agreement dated
as of January 31, 2001 among the Borrower, the Note Holders party thereto.
"Partnership Collateral" means any and all limited and general
partnership interests and limited liability company interests of any type or
nature, whether now existing or hereafter acquired or arising.
"Patent and Trademark Office" means the United States Patent and
Trademark Office.
"Proceeds" means whatever is receivable or received from or upon the
sale, lease, license, collection, use, exchange or other disposition, whether
voluntary or involuntary, of any Collateral or other assets of Grantor,
including "proceeds" as defined at UCC Section 9306, any and all proceeds of any
insurance, indemnity, warranty or guaranty payable to or for the account of
Grantor from time to time with respect to any of the Collateral, any and all
payments (in any form whatsoever) made or due and payable to Grantor from time
to time in connection with any requisition, confiscation, condemnation, seizure
or forfeiture of all or any part of the Collateral by any Governmental Authority
(or any Person acting under color of Governmental Authority), any and all other
amounts from time to time paid or payable under or in connection with any of the
Collateral or for or on account of any damage or injury to or conversion of any
Collateral by any Person, any and all other tangible or intangible property
received upon the sale or disposition of Collateral, and all proceeds of
proceeds.
"Rights to Payment" means all Accounts and any and all rights and
claims to the payment or receipt of money or other forms of consideration of any
kind in, to and under all Chattel Paper, Documents, General Intangibles,
Instruments, Investment Property and Proceeds.
"Secured Obligations" means all indebtedness, liabilities and other
obligations of the Grantor to the Collateral Agent, any of the Credit Agents and
any Debt Participant whether now existing or hereafter arising, and whether due
or to become due, absolute or contingent, liquidated or unliquidated, determined
or undetermined, now or hereafter created under, arising out of or in connection
with any of the Credit Documents, including all Obligations (as independently
defined in each of the Credit Agreement and the Note Purchase Agreement), and
any obligations under any of the Swap Documents.
"Software Copyright Filing" has the meaning set forth in Section
5(q)(v)(B).
"Specified Swap Agreement" means any ISDA(R) Master Agreement
(including any schedule and confirmation relating thereto) entered into between
the Borrower and the Swap Provider as swap counterparties.
"Specified Swap Contract" means any interest rate swap entered into
between the Borrower and the Swap Provider as swap counterparties constituting a
"Specified Swap Contract" as defined in the Credit Agreement.
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Exhibits to Arbitron Credit Agreement
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"Supplemental IP Security Agreement" means a Supplemental IP
Security Agreement substantially in the form of Exhibit I of the Credit
Agreement, executed pursuant to Section 3(c) hereof and Section 6.16 of the
Credit Agreement, and the terms and conditions of which may derive from, and be
incorporated by reference to, this Agreement.
"Swap Collateral Documents" means, collectively, (a) the Security
Agreements and the Pledge Agreements (as such terms are defined in the Credit
Agreement, but to the extent entered into by the parties thereto for the benefit
of, and as modified, extended or otherwise changed in respect of, the Swap
Provider, (b) all Account Control Agreements executed by any Loan Party under
any Swap Document, (c) any documents executed by any Loan Party to accomplish
cash collateralization pursuant to any Swap Document, and (d) all licenses, UCC
financing statements, notices and other documents executed from time to time in
connection with any of the foregoing.
"Swap Documents" means, collectively, any Specified Swap Agreement,
the Swap Collateral Documents and the Swap Guaranties.
"Swap Guaranties" means the Guaranties under and as defined in the
Credit Agreement, but to the extent entered into by the Guarantors thereunder
for the benefit of, and as modified, extended or otherwise changed in respect
of, the Swap Provider.
"Swap Provider" has the meaning specified in the Intercreditor
Agreement.
"UCC" means the Uniform Commercial Code as the same may, from time
to time, be in effect in the State of New York; provided, however, in the event
that, by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the security interest in any Collateral is governed by
the Uniform Commercial Code as in effect in a jurisdiction other than the State
of New York, the term "UCC" shall mean the Uniform Commercial Code as in effect
in such other jurisdiction for purposes of the provisions hereof relating to
such attachment, perfection or priority and for purposes of definitions related
to such provisions.
"UCC Financing Statements" has the meaning specified in Section
4(f).
(c) Terms Defined in UCC. Where applicable and except as otherwise
defined herein, terms used in this Agreement shall have the meanings assigned to
them in the UCC.
(d) Interpretation. The rules of interpretation set forth in
Sections 1.02, 1.03, 1.04 and 1.05 of the Credit Agreement shall be applicable
to this Agreement and are incorporated herein by this reference.
SECTION 2 Security Interest.
(a) Grant of Security Interest. As security for the payment and
performance of the Secured Obligations, Grantor hereby pledges, assigns,
transfers, hypothecates and sets over to the Collateral Agent (for the benefit
of the Credit Agents, and each of them), and hereby
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grants to the Collateral Agent (for the benefit of the Credit Agents, and each
of them), a security interest in all of Grantor's right, title and interest in,
to and under the following property, wherever located and whether now existing
or owned or hereafter acquired or arising (collectively, the "Collateral"):
(i) all Accounts;
(ii) all Chattel Paper;
(iii) all Deposit Accounts;
(iv) all Documents;
(v) all Equipment;
(vi) all General Intangibles;
(vii) all Inventory;
(viii) all Books;
(ix) all products and Proceeds of any and all of the foregoing;
and
(x) all Letter of Credit Proceeds.
Notwithstanding the foregoing provisions of this Section 2(a), such grant of
security interest shall not extend to, and the term "Collateral" shall not
include, Intellectual Property which is now or hereafter held by Grantor as
licensee, lessee or otherwise, to the extent such Intellectual Property consists
of: (i) ordinary shrinkwrap licenses governing software products that Grantor
purchased for use in the Ordinary Course of Business; or (ii) licenses listed on
Schedule 5.17 of the Credit Agreement.
(b) Grantor Remains Liable. Anything herein to the contrary
notwithstanding, (i) Grantor shall remain liable under any contracts, agreements
and other documents included in the Collateral, to the extent set forth therein,
to perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (ii) the exercise by the Collateral Agent
of any of the rights hereunder shall not release Grantor from any of its duties
or obligations under such contracts, agreements and other documents included in
the Collateral, and (iii) none of the Collateral Agent or any Credit Party shall
have any obligation or liability under any contracts, agreements and other
documents included in the Collateral by reason of this Agreement, nor shall any
such Person be obligated to perform any of the obligations or duties of Grantor
thereunder or to take any action to collect or enforce any such contract,
agreement or other document included in the Collateral hereunder.
(c) Continuing Security Interest. Grantor agrees that this Agreement
shall create continuing security interests in the Collateral which shall remain
in effect until terminated in accordance with Section 23.
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SECTION 3 Perfection Procedures. Grantor shall duly complete,
execute and deliver to the Collateral Agent and each of the Credit Agents
concurrently with the execution of this Agreement, and at any time and from time
to time, all Supplemental IP Security Agreements, financing statements,
continuation statements, termination statements, security agreements, chattel
mortgages, assignments, patent, copyright and trademark collateral assignments,
fixture filings, warehouse receipts, Account Control Agreements, documents of
title, affidavits, reports, notices, schedules of account, letters of authority
and all other documents and instruments, in form satisfactory to the
Administrative Agent, and take all other action, as the Collateral Agent may
request, to perfect and continue perfected, maintain the priority of or provide
notice of the Collateral Agent's security interest in the Collateral for the
benefit of each of the Credit Agents and to accomplish the purposes of this
Agreement. Without limiting the generality of the foregoing, Grantor shall from
time to time take the following actions:
(a) Filing of Security Agreements; Financing Statements. On or prior
to the Closing Date Grantor shall execute, notarize and deliver (i) an original
of this Agreement; (ii) such original UCC Financing Statements and (iii) such
original Supplemental IP Security Agreements as the Collateral Agent at the
instruction of the Instructing Group may reasonably request; all duly completed
and in final form for recordation at the offices described in Schedule 3 (the
"Filing Offices"), and after the Closing Date the Grantor shall execute,
notarize and deliver completed UCC Financing Statements for filing or recording
in the appropriate filing or recording office or offices in any state identified
by a Grantor in a notice delivered to the Administrative Agent pursuant Section
5(e).
(b) Deposit Accounts. On or prior to the Closing Date, Grantor shall
execute such Account Control Agreements, notices, and shall take such other
action, as the Collateral Agent at the instruction of the Instructing Group may
reasonably request, to perfect and continue perfected, maintain the priority of
or provide notice of the Collateral Agent's security interests in Collateral for
the benefit of each of the Credit Agents consisting of Deposit Accounts and to
accomplish the purposes of this Agreement.
(c) Intellectual Property Collateral.
(i) Patents, Etc. Promptly following any submission, filing or
recordation required pursuant to subsection (iv) of Section 5(q) (except as
provided in subsection (c)(ii) with respect to certain copyrights), record such
duly completed, signed and notarized Supplemental IP Security Agreement with the
Patent and Trademark Office or Copyright Office, as applicable, and take such
other action as may be necessary, or as the Collateral Agent at the instruction
of the Instructing Group may reasonably request, to perfect or protect the
Collateral Agent's security interests in such Intellectual Property for the
benefit of each of the Credit Agents. Grantor shall promptly, but in any event
not later than ten days after any such recordation, deliver to the Collateral
Agent and each Credit Agent true and complete copies of all file-stamped
applications, disclosure documents and amendments, and all file-stamped
Supplemental IP Security Agreements recorded at the Patent and Trademark Office.
(ii) Copyrights. Grantor shall:
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(A) Promptly following any submission, filing or recordation
required pursuant to subsection (v) of Section 5(q), duly complete, execute,
notarize and record a Supplemental IP Security Agreement at the Copyright Office
and take such other actions as may be necessary or appropriate in the discretion
of the Collateral Agent at the instruction of the Instructing Group to perfect
or protect the Collateral Agent's security interests in (I) all Database
Copyright Filings for such quarter, and (II) all Software Copyright Filings made
since the most recently filed Supplemental IP Security Agreement; and
(B) take such other action as may be necessary, or as the Collateral
Agent may reasonably request, to perfect or protect the Collateral Agent's
security interests in the Intellectual Property for the benefit of the Credit
Agents.
(iii) The Grantor hereby authorizes the Collateral Agent to modify,
amend or supplement the Schedules hereto and to reexecute this Agreement and any
Supplemental IP Security Agreement from time to time on the Grantor's behalf and
as its attorney-in-fact to include any such future Collateral and to cause to
such reexecuted Agreement, Supplemental IP Security Agreement or such modified,
amended or supplemented Schedules to be filed with the Copyright Office or the
Patent and Trademark Office.
(d) Documents, Etc. Within five calendar days after receipt, Grant
shall deliver to the Collateral Agent, or an agent designated by it, for the
benefit of the Credit Agents, appropriately endorsed or accompanied by
appropriate instruments of transfer or assignment, all Documents and Chattel
Paper, and all other Rights to Payment at any time evidenced by promissory
notes, trade acceptances or other instruments, not already delivered hereunder
pursuant to this Section 3; provided, however, that unless an Event of Default
shall have occurred and be continuing, Grantor shall not be required to deliver
any Document, Chattel Paper, promissory note, trade acceptance or other
instrument having a face amount not in excess of $100,000. Upon the request of
the Collateral Agent, Grantor shall ▇▇▇▇ all Documents and Chattel Paper with
such legends as the Collateral Agent shall reasonably specify.
SECTION 4 Representations and Warranties. In addition to the
representations and warranties of the Grantor set forth in the Credit Agreement,
which are incorporated and restated herein by this reference, and which are true
and correct as of the date hereof, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, Grantor further
represents and warrants to each Credit Party that:
(a) Location of Chief Executive Office and Collateral. Grantor's
chief executive office and principal place of business is located at the address
set forth in Schedule 1, and all other locations where Grantor conducts business
or Collateral is kept are set forth in Schedule 1.
(b) Locations of Books. All locations where Books pertaining to the
Rights to Payment are kept, including all equipment necessary for accessing such
Books and the names and addresses of all service bureaus, computer or data
processing companies and other Persons keeping any Books or collecting Rights to
Payment for Grantor, are set forth in Schedule 1.
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(c) Trade Names and Trade Styles. All trade names and trade styles
under which Grantor presently conducts the Arbitron Business operations are set
forth in Schedule 1, and, except as set forth in Schedule 1 and in connection
with the Transaction, Grantor has not, at any time in the past year: (i) been
known as or used any other corporate, trade or fictitious name; (ii) changed its
name; (iii) been the surviving or resulting corporation in a merger or
consolidation; or (iv) acquired through asset purchase or otherwise any business
of any Person.
(d) Ownership of Collateral. Grantor is, and, subject to Section
5(i), will continue to be, the sole and complete owner of the Collateral, or has
a valid and enforceable leasehold or licensee's interest in such Collateral as
set forth in Schedule 2 and in accordance with subsection (i) of this Section 4
(or, in the case of after-acquired Collateral, at the time Grantor acquires
rights in such Collateral, will be the sole and complete owner thereof, or will
have a valid and enforceable leasehold or licensee's interest in such
Collateral, to the extent permitted hereunder or under the Credit Agreement),
free from any Lien other than Permitted Liens.
(e) Enforceability; Priority of Security Interest.
(i) This Agreement together with such Supplemental IP Security
Agreements as have been executed by Grantor and filed at the Copyright Office or
the Patent and Trademark Office in respect of the Intellectual Property create
security interests which are enforceable against the Collateral in which Grantor
now has rights and will create security interests which are enforceable against
the Collateral in which Grantor hereafter acquires rights at the time Grantor
acquires any such rights.
(ii) The Collateral Agent has a perfected and first priority
security interest in the Collateral in which Grantor now has rights, and will
have a perfected and first priority security interest in the Collateral in which
Grantor now has rights and will create a security interest in any Collateral in
which Grantor hereafter acquires rights at the time Grantor acquires any such
rights, in each case for the Credit Agents' benefit and, subject only to
Permitted Liens, securing the payment and performance of the Secured
Obligations.
(f) Other Financing Statements. Other than (i) financing statements
or similar filings naming the owner of the asset to which such Lien relates as
debtor, under the UCC, copyright, patent, trademark or any comparable law ("UCC
Financing Statements") disclosed to the Administrative Agent prior to the
Effective Date and (i) UCC Financing Statements in favor of the Collateral Agent
for itself and the Credit Agents pursuant to the Credit Documents, no effective
UCC Financing Statement naming Grantor as debtor, assignor, grantor, mortgagor,
pledgor or the like or covering all or any part of the Collateral is on file in
any filing or recording office in any jurisdiction, except in connection with
Permitted Liens.
(g) Rights to Payment.
(i) The Rights to Payment represent valid, binding and enforceable
obligations of the account debtors or other Persons obligated thereon,
representing undisputed, bona fide transactions completed in accordance with the
terms and provisions contained in any documents related thereto, and are and
will be genuine, free from Liens, and not subject to any
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adverse claims, counterclaims, setoffs, defaults, disputes, defenses, discounts,
retainages, holdbacks or conditions precedent of any kind of character, except
to the extent reflected by the Grantor's reserves for uncollectible Rights to
Payment or to the extent, if any, that such account debtors or other Persons may
be entitled to normal and ordinary course trade discounts, returns, adjustments
and allowances in accordance with Section 5(m), or as otherwise disclosed to the
Credit Agents in writing or occurring in the ordinary course of business;
(ii) to the best of Grantor's knowledge, all account debtors and
other obligors on Rights to Payment are solvent and generally paying their debts
as they come due, except to the extent that Grantor has established adequate
reserves therefor in accordance with GAAP;
(iii) all Rights to Payment comply in all material respects with all
applicable laws concerning form, content and manner of preparation and
execution, including where applicable any federal or state consumer credit laws;
(iv) Grantor has not assigned any of its rights under the Rights to
Payment except as provided in this Agreement or as set forth in the other Credit
Documents;
(v) all statements made, all unpaid balances and all other
information in the Books and other documentation relating to the Rights to
Payment in all material respects are true and correct and what they purport to
be; and
(vi) Grantor has not any knowledge of any fact or circumstance which
would materially impair the validity or collectibility of any of such Rights to
Payment, except to the extent that Grantor has established adequate reserves
therefor in accordance with GAAP;
(h) Inventory. No Inventory is stored with any bailee, warehouseman
or similar Person or on any premises leased to Grantor, nor has any Inventory
been consigned to Grantor or consigned by Grantor to any Person or is held by
Grantor for any Person under any "▇▇▇▇ and hold" or other arrangement, except at
locations listed in Schedule 1.
(i) Intellectual Property.
(i) As of the Closing Date, except as set forth in Schedule 2, (A)
Grantor (directly or through any Subsidiary) does not own, possess or use under
any licensing arrangement (other than ordinary shrinkwrap licenses governing
software products that Grantor purchased for use in the Ordinary Course of
Business) Intellectual Property materially related to the Arbitron Business, and
(B) Grantor (directly or through any Subsidiary) has no registrations or
applications therefor pending before any Governmental Authority, that are or may
be materially related to the Arbitron Business, for any (I) patents or
trademarks, (II) copyrights in respect of Material Arbitron Software, Material
Software Additions or Arbitron Databases for which any such application was
submitted after December 31, 1998, (III) copyrights in respect of "Radio Market
Reports" of Grantor for which any such application was submitted after December
1, 2000, or (IV) any other copyrights for which such application was submitted
after December 31, 1999.
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(ii) All Grantor's Intellectual Property is subsisting and has not
been adjudged invalid or unenforceable in whole or in part.
(iii) All maintenance fees required to be paid by Grantor on account
of any of its patents have been timely paid for maintaining such patents in
force, and, to the best of Grantor's knowledge, each of such patents is valid
and enforceable.
(iv) To the best of Grantor's knowledge, no infringement or
unauthorized use presently is being made of any Intellectual Property by any
Person that could reasonably be expected to have a Material Adverse Effect.
(v) Grantor is the owner or licensee of its Intellectual Property
and the past, present and contemplated future use of such Intellectual Property
by Grantor has not, does not and will not infringe or violate any right,
privilege or license agreement of or with any other Person in any material
respect.
(vi) Grantor owns, licenses, has material rights under, is a party
to, or an assignee of a party to all other Intellectual Property necessary and
appropriate to continue to conduct the Arbitron Business.
(vii) The Arbitron Databases are protected under current, valid
and enforceable copyright registrations (or applications therefor) at the
Copyright Office and under the U.S. copyright laws.
(viii) The Material Arbitron Software is protected under
current, valid and enforceable copyright registrations (or applications
therefor) at the Copyright Office and under the U.S. copyright laws.
(ix) Grantor's Intellectual Property consisting of patents are
protected under current, valid and enforceable patents or applications therefor
issued by the Patent and Trademark Office and under the U.S. patent laws (except
with respect to such patents that have expired of their own terms, and not as
the result of any abandonment, dispute or settlement).
(j) Equipment. As of the Closing Date, none of the Equipment is
leased from any Person, except as set forth in UCC record searches delivered to
the Collateral Agent or as otherwise disclosed to the Administrative Agent and
the other Credit Agents.
(k) Deposit Accounts. The names and addresses of all financial
institutions at which Grantor maintains its Deposit Accounts, and the account
numbers and account names of such Deposit Accounts, are set forth in Schedule 1.
No Deposit Account Control Agreements exist with respect to any Investment
Property other than any Deposit Account Control Agreements in favor of the
Collateral Agent for the benefit of the Collateral Agent for the benefit of the
Credit Agents.
(l) Instruments. (i) Grantor has not previously assigned any
interest in any Instruments (other than such interests as will be released on or
before the date hereof), (ii) no Person other than Grantor owns an interest in
the Instruments (whether as joint holders,
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participants or otherwise), (iii) all Instruments are owing only to Grantor, and
(iv) no material default exists under or in respect of the Instruments.
(m) Other Investment Property. All securities accounts of the
Grantor and other Investment Property of the Grantor are set forth in Schedule
1. No Account Control Agreements exist with respect to any Investment Property
other than any Account Control Agreements in favor of the Collateral Agent for
the benefit of the Credit Agents.
SECTION 5 Covenants. In addition to the covenants of the Grantor set
forth in the Credit Agreement, which are incorporated herein by this reference,
so long as any of the Secured Obligations remain unsatisfied, Grantor agrees
that:
(a) Defense of Collateral. Grantor shall appear in and defend any
action, suit or proceeding which may affect to a material extent its title to,
or right or interest in, or the Collateral Agent's right or interest in, the
Collateral.
(b) Preservation of Collateral. Grantor shall do and perform all
reasonable acts that may be necessary and appropriate to maintain, preserve and
protect the Collateral.
(c) Compliance with Laws, Etc. Grantor shall comply in all material
respects with all laws, regulations and ordinances (including with respect to
the Fair Labor Standards Act), and with all policies of insurance, relating in a
material way to the possession, operation, maintenance and control of the
Collateral.
(d) Location of Books and Chief Executive Office. Grantor shall: (i)
keep all Books pertaining to the Rights to Payment at the locations set forth in
Schedule 1; and (ii) give at least 30 days' prior written notice to the
Collateral Agent and each Credit Agent of (A) any changes in any such location
where Books pertaining to the Rights to Payment are kept, including any change
of name or address of any service bureau, computer or data processing company or
other Person preparing or maintaining any Books or collecting Rights to Payment
for Grantor or (B) any changes in the location of Grantor's chief executive
office or principal place of business.
(e) Location of Collateral. If any Collateral of Grantor shall be
physically relocated to, or otherwise be physically located in, a state of the
United States in which a financing statement has not already been filed with
respect to such Collateral, Grantor shall give the Collateral Agent and each
Credit Agent prompt notice thereof (and in any event not later than one Business
Day after becoming aware thereof).
(f) Change in Name, Identity or Structure. Grantor shall give at
least 30 days' prior written notice to the Collateral Agent and each Credit
Agent of (i) any change in its name, (ii) any change of its jurisdiction of
incorporation or the location of its chief executive offices, (iii) any changes
in, additions to or other modifications of its trade names used as the name of
Grantor set forth in Schedule 1, and (iv) any changes in its identity or
structure in any manner which might make any financing statement filed hereunder
incorrect or misleading.
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(g) Maintenance of Records. Grantor shall keep accurate and complete
Books with respect to the Collateral, disclosing the Collateral Agent's security
interests hereunder for the benefit of the Credit Agents.
(h) Invoicing of Sales. The Grantor will invoice all of its sales
upon forms customary in the industry and to maintain proof of delivery and
customer acceptance of goods.
(i) Disposition of Collateral. Grantor shall not surrender or lose
possession of (other than to a Credit Agent), sell, lease, rent, or otherwise
dispose of or transfer any of the Collateral or any right or interest therein,
except to the extent expressly permitted by the Credit Documents.
(j) Liens.
(i) Grantor shall keep the Collateral free of all Liens except
Permitted Liens.
(ii) Notwithstanding any other provision contained herein or in the
Credit Agreement, no Disposition of any assets of the Grantor shall be deemed a
transfer of goods free of the Collateral Agent's security interests under
Section 9307 UCC, except that Dispositions expressly permitted by Sections
7.04(b)(i), 7.04(b)(ii), 7.04(b)(viii), 7.04(b)(x), 7.06(e), 7.06(i) and 7.06(j)
thereof shall be free of such security interests. Accordingly, all non-excluded
Dispositions shall be subject at all times to the Liens of the Collateral Agent
for the benefit of the Credit Agents.
(k) Expenses. The Grantor will pay all expenses of protecting,
storing, warehousing, insuring, handling and shipping the Collateral.
(l) Leased Premises. At the Collateral Agent's request, Grantor
shall obtain from each Person from whom Grantor leases any premises at which any
Collateral is at any time present such subordination, waiver, consent and
estoppel agreements as the Collateral Agent may reasonably require, in form and
substance satisfactory to the Collateral Agent.
(m) Rights to Payment. Grantor shall:
(i) with such frequency as the Collateral Agent for the benefit of
the Credit Agents may reasonably require, furnish to the Collateral Agent and
each Credit Agent (A) master customer listings, including all names and
addresses, together with copies or originals (as requested by the Collateral
Agent or any Credit Agent) of documents, customer statements, repayment
histories and present status reports relating to the Accounts; (B) accurate
records and summaries of Accounts, including detailed agings specifying the
name, face value and date of each invoice, and listings of Accounts that are
disputed or have been cancelled; and (C) such other information relating to the
Accounts as any of the Credit Agents shall from time to time reasonably request;
(ii) give only normal discounts, allowances and credits as to
Accounts and other Rights to Payment, in the Ordinary Course of Business,
according to normal trade practices, and enforce all Accounts and other Rights
to Payment strictly in accordance with their
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terms or pursuant to Grantor's Ordinary Course of Business, and during the
existence of an Event of Default, take all such action to such end as may from
time to time be reasonably requested by Collateral Agent, except that Grantor
may at any time grant any extension of the time for payment or enter into any
agreement to make a rebate or otherwise to reduce the amount owing on or with
respect to, or compromise or settle for less than the full amount thereof, any
Account or other Right to Payment, in the Ordinary Course of Business, according
to normal trade practices;
(iii) if any discount, allowance, credit, extension of time for
payment, agreement to make a rebate or otherwise to reduce the amount owing on,
or compromise or settle, an Account or other Right to Payment exists or occurs,
or if, to the knowledge of Grantor, any dispute, setoff, claim, counterclaim or
defense exists or has been asserted or threatened with respect to an Account or
other Right to Payment, disclose such fact to the Collateral Agent and the
Credit Parties in the Books relating to such Account or other Right to Payment
when such Books are requested for inspection by the Collateral Agent, and in
connection with any invoice or report furnished by Grantor to the Collateral
Agent relating to such Account or other Right to Payment;
(iv) if Accounts in an amount in excess of $500,000 for any and all
such Accounts arise from contracts with the United States or any department,
agency or instrumentality thereof, promptly notify the Collateral Agent and the
Credit Parties thereof and execute any documents and instruments and take any
other steps reasonably requested by the Collateral Agent in order that all
monies due and to become due thereunder shall be assigned to the Collateral
Agent and notice thereof given to the federal authorities under the Federal
Assignment of Claims Act (provided that such assignment and notice shall not be
required if the applicable contract prohibits assignment);
(v) in accordance with its sound business judgment perform and
comply in all material respects with its obligations in respect of the Accounts
and other Rights to Payment;
(vi) subject to Section 7, upon the request of the Collateral Agent
(A) at any time, notify all or any designated portion of the account debtors and
other obligors on the Rights to Payment of the security interests hereunder, and
(B) if there exists any Default or Event of Default, notify the account debtors
and other obligors on the Rights to Payment or any designated portion thereof
that payment shall be made directly to the Collateral Agent or to such other
Person or location as the Collateral Agent shall specify; and
(vii) if there exists any Default or Event of Default, establish
such lockbox or similar arrangements for the payment of the Accounts and other
Rights to Payment as the Collateral Agent (upon instruction of the Instructing
Group) shall require.
(n) Deposit Accounts and Securities Accounts. Grantor shall give the
Collateral Agent and the Credit Parties immediate notice of the establishment of
any new Deposit Account and any new securities account with respect to any
Investment Property.
(o) Inventory. Grantor shall:
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(i) at such times as the Collateral Agent or any Credit Agent shall
reasonably request, prepare and deliver to the Collateral Agent and each Credit
Agent a report of all Inventory, in form and substance reasonably satisfactory
to the Collateral Agent and each Credit Agent;
(ii) upon the request of the Collateral Agent or any Credit Agent,
take a physical listing of the Inventory and promptly deliver a copy of such
physical listing to the Collateral Agent and each Credit Agent; and
(iii) not store any Inventory with a bailee, warehouseman or similar
Person or on premises leased to Grantor, nor dispose of any Inventory on a
▇▇▇▇-and-hold, guaranteed sale, sale and return, sale on approval, consignment
or similar basis, nor acquire any Inventory from any Person on any such basis,
except in the ordinary course of business and in accordance with its normal
practices.
(p) Equipment. Grantor shall, upon the Collateral Agent or any
Credit Agent request, deliver to the Collateral Agent and each Credit Agent a
report of each item of Equipment, in form and substance reasonably satisfactory
to the Collateral Agent and each Credit Agent.
(q) Intellectual Property Collateral. Grantor shall:
(i) not allow or suffer any Intellectual Property to become
abandoned, nor any registration thereof to be terminated, forfeited, expired or
dedicated to the public, except for Intellectual Property having negligible
commercial value;
(ii) not enter into any agreements or transactions (including any
license, sublicense or royalty agreement) pertaining to any Intellectual
Property outside of the ordinary course of business, or enter into any exclusive
license or sublicense of any Intellectual Property, except in a transaction
permitted under the Credit Documents;
(iii) promptly give the Collateral Agent and each Credit Agent
notice of any rights Grantor may obtain to any new patentable inventions,
copyrightable works or other new Intellectual Property, prior to the
registration or recordation thereof (including pursuant to this Section 5(q)) as
to which Grantor (a) has received gross royalty or license payments from any and
all third parties in an aggregate amount excess of $1,000,000 during any of the
five fiscal years preceding such time or (b) reasonably projects that it will
receive gross royalty or license payments from any and all third parties in an
aggregate amount excess of $1,000,000 during the any of the subsequent five
fiscal years; provided that Grantor shall have no obligation to provide notice
under this subsection (iii) to the extent that Grantor has satisfied, or within
the immediately following three calendar months will satisfy, subsection (iv) or
(v), as applicable, of this Section 5(q);
(iv) not less frequently than once every three calendar months and,
additionally, upon the purchase, creation or other acquisition of any Material
Software Addition, diligently record, register or prosecute, as applicable, all
applications for patents, copyrights and trademarks, and diligently record,
register and prosecute, as applicable, any and all
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continuations, continuations-in-part, applications for reissue, applications for
certificate of correction and like matters in respect of Grantor's Intellectual
Property as shall be reasonable and appropriate in accordance with prudent
business practice, and promptly and timely pay any and all maintenance, license,
registration and other fees, taxes and expenses incurred in connection with any
Intellectual Property; and, without limiting the generality of the foregoing,
(v) (A) not less frequently than once every three calendar months,
submit such duly completed, signed and notarized copyright registration forms to
the Copyright Office and take such other actions as necessary to register under
the U.S. copyright laws any and all additions, modifications or other changes to
the Arbitron Databases (each, a "Database Copyright Filing") since the Closing
Date; and (B) not less frequently than once every three calendar months and,
additionally, promptly after any purchase, creation or other acquisition of any
Material Software Addition, submit such duly completed, signed and notarized
copyright registration forms to the Copyright Office and take such other actions
as necessary to register under the U.S. copyright laws each Material Software
Addition (each, a "Software Copyright Filing");
(vi) not less frequently than once every three calendar months, and
promptly but in any event not later than ten days after any and all recordations
described in subsections (iv) and (v) of this Section 5(q), and after any and
all recordations described in Section 3(c), deliver to the Collateral Agent and
each Credit Agent all such duly completed, file-stamped (other otherwise
certificated or acknowledged) and recorded documents together with such other
documents and information as the Collateral Agent or any Credit Agent may
reasonably request.
(r) Notices, Reports and Information. Subject to Section 3(c),
Grantor shall (i) notify the Collateral Agent and each Credit Agent of any
material claim made or asserted against the Collateral by any Person and of any
change in the composition of the Collateral or other event which could
materially adversely affect the value of the Collateral or the Lien thereon in
favor of the Collateral Agent (for the benefit of the Credit Agents); (ii)
furnish to the Collateral Agent and each Credit Agent such statements and
schedules further identifying and describing the Collateral and such other
reports and other information in connection with the Collateral as the
Collateral Agent at the instruction of the Instructing Group may reasonably
request, all in reasonable detail; and (iii) upon reasonable request of the
Collateral Agent of any Credit Agent make such demands and requests for
information and reports as Grantor is entitled to make in respect of the
Collateral.
(s) Insurance. (i) Grantor shall carry and maintain in full force
and effect, at the expense of the Grantor and with financially sound and
reputable insurance companies, insurance for itself and the Collateral Agent for
the benefit of the Credit Agents, with respect to the Collateral in such
amounts, with such deductibles and covering such risks as shall be specified in
the Credit Agreement. Upon the request of any of the Credit Agents, and in any
event not less often than annually, Grantor shall furnish the Collateral Agent
and each Credit Agent with full information as to the insurance carried by it
and, if so requested, copies of all such insurance policies. All insurance
policies required under this subsection (s) shall provide that they shall not be
terminated or cancelled nor shall any such policy be materially changed without
at least 30 days' prior written notice to the Grantor and the Collateral Agent
(or 10 days' prior written notice if the Collateral Agent consents to such
shorter notice). Receipt of notice of
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termination or cancellation of any such insurance policies or reduction of
coverages or amounts thereunder shall entitle the Collateral Agent to renew any
such policies, cause the coverages and amounts thereof to be maintained at
levels required pursuant to the first sentence of this subsection (s) or
otherwise to obtain similar insurance in place of such policies, in each case at
the expense of the Grantor.
(ii) If Collateral of Grantor with a value exceeding $1,000,000 (the
"Settlement Consent Threshold") shall be materially damaged or destroyed, in
whole or in part, by fire or other casualty, Grantor shall give prompt notice
thereof to the Collateral Agent and each Credit Agent. No settlement on account
of any loss on any Collateral covered by insurance shall be made for less than
insured value without the consent of the Collateral Agent (with the consent of
the Instructing Group), unless, so long as there exists no Default or Event of
Default, the total value of each such loss or series of related losses so
compromised does not exceed the Settlement Consent Threshold. Unless there
exists any Default or Event of Default, the Collateral Agent (upon instruction
of the Instructing Group) shall promptly execute such necessary consents,
waivers and endorsements to permit Grantor to settle losses the total aggregate
value of which is in an amount less than the Settlement Consent Threshold, and
to receive payment therefor, as reasonably requested by Grantor. After the
occurrence and during the continuance of an Event of Default, or as otherwise
required under any of the Credit Documents, all sums payable to Grantor by any
insurer with respect to a casualty relating to all or any part of the Collateral
shall be paid to the Collateral Agent (upon instruction of the Instructing
Group). If Grantor shall receive any insurance proceeds which are to be paid to
the Collateral Agent pursuant to the previous sentence, Grantor shall hold such
proceeds in trust for the Collateral Agent and shall segregate such proceeds
from other funds of Grantor, and shall immediately forward such proceeds in the
form received to the Collateral Agent (appropriately indorsed by Grantor to the
order of the Collateral Agent or in such other manner as shall be satisfactory
to the Collateral Agent, upon instruction of the Instructing Group). All such
insurance proceeds may be retained by the Collateral Agent as part of Collateral
hereunder and held in the Proceeds Account, applied by the Collateral Agent
toward payment of all or part of the Secured Obligations in such order as is
provided herein, or released to Grantor upon its request with the consent of the
Instructing Group.
SECTION 6 Administration of the Rights to Payment.
(a) Collection of Rights to Payment. Until the Collateral Agent
exercises its rights hereunder to collect Rights to Payment, Grantor shall
endeavor in the first instance diligently to collect all amounts due or to
become due on or with respect to the Rights to Payment. At the request of the
Collateral Agent, if there exists at such time any Event of Default, all
remittances received by Grantor shall be held in trust for the Collateral Agent
and, in accordance with the Collateral Agent's instructions (upon instruction
from the Instructing Group), remitted to the Collateral Agent or deposited in an
account with the Collateral Agent in the form received (with any necessary
endorsements or instruments of assignment or transfer).
(b) Investment Property and Instruments. At the request of the
Collateral Agent (at the request of the Instructing Group), if there exists at
such time any Event of Default, the Collateral Agent shall be entitled, subject
to the Intercreditor Agreement, to receive all distributions and payments of any
nature with respect to any Investment Property or Instruments,
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and all such distributions or payments received by Grantor shall be held in
trust for the Collateral Agent and, in accordance with its instructions (with
the consent of the Instructing Group), remitted to the Collateral Agent or
deposited to an account with the Collateral Agent in the form received (with any
necessary endorsements or instruments of assignment or transfer). If there
exists any Default or Event of Default any such distributions and payments with
respect to any Investment Property held in any securities account shall be held
and retained in such securities account, in each case as part of the Collateral
hereunder. Additionally, the Collateral Agent shall have the right, if there
exists any Default or Event of Default, following prior written notice to
Grantor, to vote and to give consents, ratifications and waivers with respect to
any Investment Property and Instruments, and to exercise all rights of
conversion, exchange, subscription or any other rights, privileges or options
pertaining thereto, as if the Collateral Agent were the absolute owner thereof;
provided that the Collateral Agent shall have no duty to exercise any of the
foregoing rights afforded to it and shall not be responsible to Grantor or any
other Person for any failure to do so or delay in doing so.
(e) Distributions to Be Held for Administrative Agent. Distributions
and other payments which are received by the Grantor but which it is not
entitled to retain as a result of the operation of this Section 6 shall be held
in trust for the benefit of the Collateral Agent, be segregated from the other
property or funds of Grantor, and be forthwith paid over or delivered to the
Collateral Agent in the same form as so received.
SECTION 7 Authorization; Appointed Attorney-in-Fact. The Collateral
Agent shall have the right to, in the name of Grantor, or in the name of the any
of the Credit Parties or otherwise, without notice to or assent by Grantor, and
Grantor hereby constitutes and appoints the Collateral Agent (and any of the
officers or employees or agents designated by the Collateral Agent) as Grantor's
true and lawful attorney-in-fact, with full power and authority to:
(i) sign any of the financing statements and Supplemental IP
Security Agreements which must be executed or filed to perfect or continue
perfected, maintain the priority of or provide notice of the security interests
and in the Collateral of the Collateral Agent (for the benefit of the Credit
Agents) and file any such financing statements and Supplemental IP Security
Agreements by electronic means with or without a signature as authorized or
required by applicable law or filing procedures;
(ii) take possession of and endorse any notes, acceptances, checks,
drafts, money orders or other forms of payment or security and collect any
Proceeds of any Collateral;
(iii) sign and endorse any invoice or ▇▇▇▇ of lading relating to any
of the Collateral, warehouse or storage receipts, drafts against customers or
other obligors, assignments, notices of assignment, verifications and notices to
customers or other obligors;
(iv) notify the U.S. Postal Service and other postal authorities to
change the address for delivery of mail addressed to Grantor to such address the
Collateral Agent may designate (provided that the Collateral Agent agrees it
will promptly deliver over to Grantor any mail that does not relate to the
Collateral); and, without limiting the generality of the foregoing, establish
with any Person lockbox or similar arrangements for the payment of the Rights to
Payment;
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(v) receive, open and dispose of all mail addressed to Grantor
(provided that the Collateral Agent agrees it will promptly deliver over to
Grantor any mail that does not relate to the Collateral);
(vi) send requests for verification of Rights to Payment to the
customers or other obligors of Grantor;
(vii) contact, or direct Grantor to contact, all account debtors and
other obligors on the Rights to Payment and instruct such account debtors and
other obligors to make all payments directly to the Collateral Agent;
(viii) assert, adjust, ▇▇▇ for, compromise or release any
claims under any policies of insurance;
(ix) exercise dominion and control over, and refuse to permit
further withdrawals from, Deposit Accounts maintained with Bank of America or
any other bank, financial institution or other Person;
(x) notify each Person maintaining lockbox or similar arrangements
for the payment of the Rights to Payment to remit all amounts representing
collections on the Rights to Payment directly to the Collateral Agent;
(xi) ask, demand, collect, receive and give acquittances and
receipts for any and all Rights to Payment, enforce payment or any other rights
in respect of the Rights to Payment and other Collateral, grant consents, agree
to any amendments, modifications or waivers of the agreements and documents
governing the Rights to Payment and other Collateral, and otherwise file any
claims, take any action or institute, defend, settle or adjust any actions,
suits or proceedings with respect to the Collateral, as the Collateral Agent
(upon instruction of the Instructing Group) may deem necessary or desirable to
maintain, preserve and protect the Collateral, to collect the Collateral or to
enforce the rights of the Collateral Agent with respect to the Collateral;
(xii) execute any and all applications, documents, papers and
instruments necessary for the Collateral Agent to use the Intellectual Property
and grant or issue any exclusive or non-exclusive license or sublicense with
respect to any Intellectual Property;
(xiii) execute any and all endorsements, assignments or other
documents and instruments necessary to sell, lease, assign, convey or otherwise
transfer title in or dispose of the Collateral;
(xiv) execute and deliver to any securities intermediary or other
Person any entitlement order, Account Control Agreement or other notice,
document or instrument which the Collateral Agent (upon instruction of the
Instructing Group) may deem necessary or advisable (A) to realize upon the
Collateral, and (B) to maintain, protect and preserve the Investment Property
and the security interests of the Collateral Agent therein; and
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(xv) execute any and all such other documents and instruments, and
do any and all acts and things for and on behalf of Grantor, which the
Collateral Agent (upon instruction from the Instructing Group) may deem
necessary or advisable (A) to realize upon the Collateral, and (B) to maintain,
protect and preserve the Collateral and the security interests of the Collateral
Agent therein and to accomplish the purposes of this Agreement.
The Collateral Agent agrees that, unless there exists any Default or Event of
Default, it shall not exercise the power of attorney, or any rights granted to
the Collateral Agent, pursuant to clauses (ii) through (xiii), (xiv)(A) and
(xv)(A). The foregoing power of attorney is coupled with an interest and
irrevocable so long as any of the Secured Obligations has not been paid and
performed in full. Grantor hereby ratifies, to the extent permitted by law, any
and all acts that the Collateral Agent shall lawfully and in good faith do or
cause to be done by virtue of and in compliance with this Section 7.
SECTION 8 Performance of Grantor Obligations. The Collateral Agent
may perform or pay any obligation which Grantor has agreed to perform or pay
under or in connection with this Agreement, and which Grantor has failed to
perform or pay as and when due, and Grantor shall reimburse the Collateral Agent
on demand for any amounts paid by the Collateral Agent pursuant to this Section
8.
SECTION 9 Collateral Agent's Duties. Notwithstanding any provision
contained in this Agreement, the Collateral Agent shall have no duty to exercise
any of the rights, privileges or powers afforded to such party and shall not be
responsible to Grantor or any other Person for any failure to do so or delay in
doing so. Beyond the exercise of reasonable care to assure the safe custody of
Collateral in the Collateral Agent's possession, and the accounting for moneys
actually received by the Collateral Agent hereunder, the Collateral Agent shall
have no duty or liability to exercise or preserve any rights, privileges or
powers pertaining to the Collateral.
SECTION 10 Remedies.
(a) Remedies. If there exists any Default or Event of Default, the
Collateral Agent shall have, in addition to all other rights and remedies
granted to it in this Agreement, the Credit Agreement or any other Credit
Document, all rights and remedies of a secured party under the UCC and other
applicable laws. Without limiting the generality of the foregoing, Grantor
agrees that:
(i) The Collateral Agent may peaceably and without notice enter any
premises of Grantor, take possession of any Collateral, remove, prohibit access
to or use of, or dispose of all or part of the Collateral on any premises of
Grantor or elsewhere; or, in the case of Equipment, render it nonfunctional, and
otherwise collect, receive, appropriate and realize upon all or any part of the
Collateral, and demand, give receipt for, settle, renew, extend, exchange,
compromise, adjust, or ▇▇▇ for all or any part of the Collateral, as the
Collateral Agent (upon instruction of the Instructing Group) may determine.
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(ii) The Collateral Agent may require Grantor to assemble all or any
part of the Collateral and make it available to the Collateral Agent, at any
place and time designated by the Collateral Agent.
(iii) The Collateral Agent may use or transfer any of Grantor's
rights and interests in any Intellectual Property, by license, by sublicense (to
the extent permitted by an applicable license) or otherwise, on such conditions
and in such manner as the Collateral Agent (upon instruction of the Instructing
Group) may determine.
(iv) The Collateral Agent may secure the appointment of a receiver
of the Collateral or any part thereof (to the extent and in the manner provided
by applicable law).
(v) The Collateral Agent may withdraw (or cause to be withdrawn) any
and all funds from any Deposit Accounts or securities accounts.
(vi) The Collateral Agent may sell, resell, lease, use, assign,
transfer or otherwise dispose of any or all of the Collateral in its then
condition or following any commercially reasonable preparation or processing
(utilizing in connection therewith any of Grantor's assets, without charge or
liability to the Collateral Agent or any of the Credit Parties therefor) at
public or private sale, by one or more contracts, in one or more parcels, at the
same or different times, for cash or credit or for future delivery without
assumption of any credit risk, all as the Collateral Agent (upon instruction of
the Instructing Group) deem advisable; provided, however, that Grantor shall be
credited with the net proceeds of sale only when such proceeds are finally
collected by the Collateral Agent. The Collateral Agent shall have the right
upon any such public sale, and, to the extent permitted by law, upon any such
private sale, to purchase the whole or any part of the Collateral so sold, free
of any right or equity of redemption, which right or equity of redemption
Grantor hereby releases, to the extent permitted by law. Grantor hereby agrees
that the sending of notice by ordinary mail, postage prepaid, to the address of
Grantor set forth in the Credit Agreement, of the place and time of any public
sale or of the time after which any private sale or other intended disposition
is to be made, shall be deemed reasonable notice thereof if such notice is sent
ten days prior to the date of such sale or other disposition or the date on or
after which such sale or other disposition may occur, provided that the
Collateral Agent may provide Grantor shorter notice or no notice, to the extent
permitted by the UCC or other applicable law.
(b) License. For the purpose of enabling the Collateral Agent to
exercise its rights and remedies under this Section 10 or otherwise in
connection with this Agreement, Grantor hereby grants to the Collateral Agent
for the benefit of the Credit Agents an irrevocable, non-exclusive and
assignable license (exercisable without payment or royalty or other compensation
to Grantor) to use, license or sublicense any Intellectual Property.
(c) Proceeds Account. To the extent that any of the Secured
Obligations may be contingent, unmatured or unliquidated at such time as there
may exist an Event of Default (including with respect to undrawn amounts under
any Letter of Credit or contingent amounts due under any Specified Swap
Agreement arising from any Specified Swap Contract), the Collateral Agent for
the benefit of the Credit Agents may, at their election, (i) retain the proceeds
of any sale, collection, disposition or other realization upon the Collateral
(or any portion
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thereof) in a special purpose non-interest-bearing restricted deposit account
(the "Proceeds Account") created and maintained by the Collateral Agent for the
benefit of the Credit Agents for such purpose (which shall constitute a Deposit
Account included within the Collateral hereunder) until such time as the
Collateral Agent may elect to apply such proceeds to the Secured Obligations,
and Grantor agrees that such retention of such proceeds by the Collateral Agent
shall not be deemed strict foreclosure with respect thereto; (ii) in any manner
elected by the Collateral Agent (upon instruction of the Instructing Group),
estimate the liquidated amount of any such contingent, unmatured or unliquidated
claims and apply the proceeds of the Collateral against such amount; or (iii)
otherwise proceed in any manner permitted by applicable law. Grantor agrees that
the Proceeds Account shall be a blocked account and that upon the irrevocable
deposit of funds into the Proceeds Account, Grantor shall not have any right of
withdrawal with respect to such funds. Accordingly, Grantor irrevocably waives
until the termination of the security interests granted under this Agreement in
accordance with Section 23 the right to make any withdrawal from the Proceeds
Account and the right to instruct the Collateral Agent, or any of the Credit
Parties to honor drafts against the Proceeds Account.
(d) Application of Proceeds. Subject to subsection (c), cash
proceeds actually received from the sale or other disposition or collection of
Collateral, and any other amounts received in respect of the Collateral the
application of which is not otherwise provided for herein, shall be applied
(after payment of any amounts payable to the applicable Credit Parties or the
Collateral Agent pursuant to Section 8 or Section 14) in whole or in part by the
applicable Credit Parties or the Collateral Agent against all or any part of the
Secured Obligations in the manner and to the extent set forth in the
Intercreditor Agreement.
SECTION 11 Certain Waivers. Grantor waives, to the fullest extent
permitted by law, (i) any right of redemption with respect to the Collateral,
whether before or after sale hereunder, and all rights, if any, of marshalling
of the Collateral or other collateral or security for the Secured Obligations;
(ii) any right to require the Collateral Agent, or any of the Credit Parties (A)
to proceed against any Person, (B) to exhaust any other collateral or security
for any of the Secured Obligations, (C) to pursue any remedy, or (D) to make or
give any presentments, demands for performance, notices of nonperformance,
protests, notices of protests or notices of dishonor in connection with any of
the Collateral; and (iii) all claims, damages, and demands against the
Collateral Agent, or any of the Credit Parties arising out of the repossession,
retention, sale or application of the proceeds of any sale of the Collateral.
SECTION 12 Notices. All notices or other communications hereunder
shall be given in the manner and to the addresses specified in, and shall be
effective as provided in, the Credit Agreement; provided, however, that notices
hereunder to (a) the Swap Provider shall be delivered to Fleet National Bank
using the information listed in Schedule 10.02 of the Credit Agreement for such
party as a Lender or such replacement Swap Provider as may be appointed from
time to time pursuant to the terms of the Intercreditor Agreement, and (b) the
Note Holders shall be delivered to such persons at the address specified in the
Note Purchase Agreement, or to such replacement Note Holders as may be appointed
from time to time consistent with the terms of the Intercreditor Agreement.
SECTION 13 No Waiver; Cumulative Remedies. No failure on the part of
the Collateral Agent, or any of the Credit Parties to exercise, and no delay in
exercising, any right,
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remedy, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, remedy, power or
privilege preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege. The rights and remedies under this
Agreement are cumulative and not exclusive of any rights, remedies, powers and
privileges that may otherwise be available to the Collateral Agent, or any of
the Credit Parties.
SECTION 14 Indemnification; Other Charges.
(a) Indemnification. The Grantor hereby agrees to indemnify the
Collateral Agent and the Credit Parties, and their respective directors,
officers, employees, agents, counsel and other advisors (each an "Indemnified
Person") against, and hold each of them harmless from, any and all liabilities,
obligations, losses, claims, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever, including the
reasonable fees and disbursements of counsel to an Indemnified Person (including
allocated costs of internal counsel), which may be imposed on, incurred by, or
asserted against any Indemnified Person, in any way relating to or arising out
of this Agreement or the transactions contemplated hereby or any action taken or
omitted to be taken by it hereunder (the "Indemnified Liabilities"); provided
that Grantor shall not be liable to any Indemnified Person with respect to
Indemnified Liabilities resulting from such Indemnified Person's gross
negligence or willful misconduct. If and to the extent that the foregoing
indemnification is for any reason held unenforceable, Grantor agrees to make the
maximum contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
(b) Other Charges. The Grantor agrees to indemnify the Collateral
Agent and the Credit Parties against and hold each of them harmless from any and
all present and future stamp, transfer, documentary and other such taxes,
levies, fees, assessments and other charges made by any jurisdiction by reason
of the execution, delivery, performance and enforcement of this Agreement.
(c) Interest. Any amounts payable to any Indemnified Person under
this Section 14 or otherwise under this Agreement if not paid upon demand shall
bear interest from the date of such demand until paid in full, at the applicable
rate, (a) for the Administrative Agent and any Lender, as set forth in Section
2.08(b) of the Credit Agreement, (b) for the Swap Provider, as set forth in the
Specified Swap Agreement, and (c) for the Note Holders as set forth in Section
2.08(b) of the Note Purchase Agreement.
SECTION 15 Binding Effect. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by Grantor, each of the Credit
Parties, the Collateral Agent, each Indemnified Person referred to in Section 14
and their respective successors and assigns.
SECTION 16 Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE;
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PROVIDED THAT THE COLLATERAL AGENT AND EACH CREDIT PARTY SHALL RETAIN ALL RIGHTS
ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF THE UNITED STATES
FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT PARTY CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS. THE GRANTOR, THE COLLATERAL AGENT AND EACH OF THE CREDIT PARTIES
IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN ANY FEDERAL COURT OR STATE
COURT SITTING IN NEW YORK IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT
RELATED THERETO. THE GRANTOR, THE COLLATERAL AGENT AND EACH OF THE CREDIT
PARTIES WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
SECTION 17 Waiver of Right to Jury Trial. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO THIS AGREEMENT, ANY CREDIT DOCUMENT, OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
SECTION 18 Entire Agreement; Amendment. This Agreement, together
with the other Credit Documents, embodies the entire agreement and understanding
among the Grantor and the Collateral Agent (for the benefit of the Credit
Agents), and supersedes all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof. Subject to Section 19, this Agreement shall be
amended only by written agreement with the written consent of the Instructing
Group; provided, however, that any amendment having the effect of causing a
release of all or substantially all of the Collateral must be consented to in
writing by the Collateral Agent and each of the Credit Agents.
SECTION 19 Independence. This Agreement sets forth independent and
separate security interests of the Grantor in favor of the Collateral Agent in
respect of the
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Secured Obligations owing to the Collateral Agent for the benefit of each Credit
Agent. The illegality or unenforceability of any provision of this Agreement or
any instrument or agreement required hereunder with respect to any Credit Agent
shall not in any way affect or impair the legality or enforceability of that or
any other provision of this Agreement or any instrument or agreement required
hereunder in respect to any other Credit Agent. The parties acknowledge that
this Agreement has, solely for reasons of convenience, been prepared and
executed as a single document, but that the legal effect shall be in all
respects as though the Grantor had executed separate security interests, for the
benefit of each of the Credit Agents. Any provision of this Agreement and the
other Credit Documents to which the Grantor is a party that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions thereof, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
SECTION 20 Counterparts. This Agreement may be executed in any
number of separate counterparts, each of which, when so executed, shall be
deemed an original, and all of said counterparts taken together shall be deemed
to constitute but one and the same instrument. Each of the parties hereto
understands and agrees that this Agreement may be delivered by any party hereto
or thereto either in the form of an executed original or an executed original
sent by facsimile transmission to be followed promptly by mailing of a hard copy
original, and that receipt by the Collateral Agent or any Credit Agent of a
facsimile transmitted document purportedly bearing the signature of a Grantor
shall bind Grantor with the same force and effect as the delivery of a hard copy
original. Any failure by the Collateral Agent or any Credit Agent to receive the
hard copy executed original of such document shall not diminish the binding
effect of receipt of the facsimile transmitted executed original of such
document of the party whose hard copy page was not received by the Collateral
Agent or such Credit Party.
SECTION 21 Incorporation of Provisions of the Credit Agreement. To
the extent the Credit Agreement contains provisions of general applicability to
the Credit Documents, including any such provisions contained in Article X
thereof, such provisions are incorporated herein by this reference.
SECTION 22 No Inconsistent Requirements. Grantor acknowledges that
this Agreement and the other Credit Documents may contain covenants and other
terms and provisions variously stated regarding the same or similar matters, and
agrees that all such covenants, terms and provisions are cumulative and all
shall be performed and satisfied in accordance with their respective terms.
SECTION 23 Termination; Releases. (i) Upon the termination of the
Commitments of the Lenders, the surrender of any Letters of Credit issued for
the account of Borrower under the Credit Agreement and payment and performance
in full of all Secured Obligations, the security interests granted under this
Agreement shall terminate and the Collateral Agent and all Credit Agents shall
promptly execute and deliver to Grantor such documents and instruments
reasonably requested by Grantor as shall be necessary to evidence termination of
all security interests given by Grantor to the Collateral Agent hereunder;
provided, however, that the obligations of Grantor under Section 14 shall
survive such termination.
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(ii) Concurrently with any permitted disposition of Collateral under
the Credit Documents, the security interests hereunder shall automatically be
released from the Collateral so disposed of, subject to Section 5(j); provided,
however, that the security interests shall continue in the Proceeds thereof.
Upon satisfaction to all conditions precedent to any permitted disposition set
forth herein or in the other Credit Documents, the Collateral Agent and all
Credit Agents shall execute and deliver any releases or other documents
reasonably requested by the relevant Grantor to accomplish or confirm the
release of Collateral provided by this Section. Any such release shall
specifically describe the portion of the Collateral to be released, shall be
expressed to be unconditional and shall be without recourse or warranty (other
than a warranty that the Collateral Agent and the Credit Agents have not
assigned their rights and interests to any other Person).
SECTION 24 Assumption. Upon execution and delivery to the
Administrative Agent of an Subsidiary Security Agreement by a Subsidiary of the
Grantor as provided in Section 6.14 of the Credit Agreement, effective as of the
effective date of such Subsidiary Security Agreement, such Guarantor shall be
deemed a Grantor party hereto, and this Agreement shall be deemed amended to
include any amendments to the Schedules provided by such Subsidiary in
connection therewith.
SECTION 25 Intercreditor Agreement. Notwithstanding anything set
forth in this Agreement, any inconsistency between this Agreement and the
Intercreditor Agreement in respect of the rights and obligations of the
Collateral Agent and the Credit Agents owing to and among each other (but not
including in respect of the obligations of the Grantor to the Collateral Agent
or Credit Agents hereunder) shall be resolved in favor of the Intercreditor
Agreement.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in San Francisco, California by their proper and
duly authorized officers as of the day and year first above written.
[_________________] CORPORATION
Grantor
By:
---------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.,
as Collateral Agent
By:
---------------------------------------
Name:
Title:
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SCHEDULE 1
to the Security Agreement
1. LOCATIONS OF CHIEF EXECUTIVE OFFICE AND OTHER LOCATIONS, INCLUDING OF
COLLATERAL
a. Chief Executive Office and Principal Place of Business:
b. Other locations where Grantor conducts business or Collateral is
kept:
2. LOCATIONS OF BOOKS PERTAINING TO RIGHTS TO PAYMENT
3. TRADE NAMES AND TRADE STYLES; OTHER CORPORATE, TRADE OR FICTITIOUS NAMES;
ETC.
4. DEPOSIT ACCOUNTS
Schedule 1-1
Exhibits to Arbitron Credit Agreement
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5. INVESTMENT PROPERTY
6. INSTRUMENTS
7. LEASED EQUIPMENT
Schedule 1-2
Exhibits to Arbitron Credit Agreement
276
SCHEDULE 2
to the Security Agreement
(a) ISSUED PATENTS OF GRANTOR
Grantor Patent No. Issue Date Inventors Title Agent
------- ---------- ---------- --------- ----- -----
(b) PENDING PATENT APPLICATIONS OF GRANTOR
Grantor Application No. Filing Date Inventors Title
------- --------------- ----------- --------- -----
(c) TRADEMARKS OF GRANTOR
Registration Registration Registered
Grantor No. Date Filing Date Owner ▇▇▇▇
------- --- ---- ----------- ----- ----
(d) PENDING TRADEMARK APPLICATIONS OF GRANTOR
Application
Grantor No. Filing Date Applicant ▇▇▇▇
------- --- ----------- --------- ----
(e) COPYRIGHTS OF GRANTOR
Grantor Copyright Title Reg. No. Date of Issue
------- --------------- -------- -------------
Schedule 2-1
Exhibits to Arbitron Credit Agreement
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(f) COPYRIGHT APPLICATIONS OF GRANTOR
Grantor Title Date of Application
------- ----- -------------------
(g) COPYRIGHT LICENSES OF GRANTOR
Grantor Title Copyright Owner Reg. No. Date of Issue
------- ----- --------------- -------- -------------
Schedule 2-2
Exhibits to Arbitron Credit Agreement
278
SCHEDULE 3
to the Security Agreement
FILING OFFICES
Schedule 3-1
Exhibits to Arbitron Credit Agreement
279
EXHIBIT I
SUPPLEMENTAL IP SECURITY AGREEMENT
THIS SUPPLEMENTAL IP SECURITY AGREEMENT (this "Agreement"), dated as
of _________ __, 2001, is made by and among [____________________], a [________]
corporation (the "Grantor") in favor of BANK OF AMERICA, N.A., as the Collateral
Agent for the benefit of: (a) BANK OF AMERICA, N.A., as the administrative agent
(in such capacity, the "Administrative Agent") for itself and the financial
institutions (the "Lenders" and, individually, a "Lender") from time to time
party to that certain Credit Agreement dated as of January 31, 2001 (as renewed,
extended, modified, amended or restated from time to time, the "Credit
Agreement"); (b) the "Swap Provider" (as defined in the Security Agreement); and
(c) the Note Holders party from time to time to the Note Purchase Agreement.
RECITALS
WHEREAS, it is a covenant the satisfaction of which permits
borrowings under the Credit Agreement and the Note Purchase Agreement that the
Grantor enter into this Agreement and grant to the Collateral Agent for the
benefit of the Credit Parties the security interests hereinafter provided to
secure the obligations of the Grantor described below.
WHEREAS, the Grantor is party to that Security Agreement dated as of
February __, 2001 by and among Grantor[, other Subsidiaries of the Borrower
party thereto] and the Collateral Agent for the benefit of the Credit Parties
(the "Security Agreement").
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1 Definitions; Interpretation. All capitalized terms used
herein and not otherwise defined shall have the meanings assigned to them,
respectively, in subsections (a), (b) and (c) of Section 1 of the Security
Agreement. The rules of interpretation set forth in subsection (d) of Section 1
of the Security Agreement shall be applicable to this Agreement and are
incorporated herein by this reference.
SECTION 2 Grant of Security Interest.
(a) As a continuing security for the payment and performance of the
Secured Obligations, the Grantor hereby pledges, assigns, transfers,
hypothecates and sets over to the Collateral Agent (for the benefit of the
Credit Parties, and each of them), and hereby grants to the Collateral Agent
(for the benefit of the Credit Parties, and each of them), a security interest
in all of Grantor's right, title and interest in, to and under the Intellectual
Property, wherever located and whether now existing or owned or hereafter
acquired or arising, including without limitation such Intellectual Property
described and set forth on Schedule 1 hereto.
(b) Notwithstanding the foregoing provisions of this Section 2, the
grant of a security interest as provided herein shall not extend to, and the
term "Intellectual Property" shall not include, Intellectual Property which is
now or hereafter held by Grantor as licensee, lessee or otherwise to the extent
such Intellectual Property consists of: (i) ordinary shrinkwrap licenses
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governing software products that Grantor purchased in the Ordinary Course of
Business; or (ii) licenses listed on Schedule 5.17 of the Credit Agreement.
SECTION 3 Further Assurances; Appointment of Collateral Agent as
Attorney-in-Fact. The Grantor at its expense shall execute and deliver, or cause
to be executed and delivered, to the Collateral Agent any and all documents and
instruments, in form and substance satisfactory to the Collateral Agent (upon
instruction of the Instructing Group), and take any and all action, which the
Collateral Agent (upon instruction of the Instructing Group) may request from
time to time, to perfect and continue perfected, maintain the priority of or
provide notice of the security interest of the Collateral Agent in the
Intellectual Property Collateral and to accomplish the purposes of this
Agreement. The Collateral Agent shall have the right, in the name of the
Grantor, or in the name of the Collateral Agent or any of the Credit Parties or
otherwise, upon notice to but without the requirement of assent by the Grantor,
and the Grantor hereby constitutes and appoints the Collateral Agent (and any of
the Collateral Agent's officers or employees or agents designated by the
Collateral Agent) as the Grantor's true and lawful attorney-in-fact with full
power and authority, to: (i) sign any financing statements and any other
documents and instruments which the Collateral Agent (upon instruction of the
Instructing Group) deems necessary or advisable to perfect or continue
perfected, maintain the priority of or provide notice of the Collateral Agent's
security interest in the Intellectual Property; (ii) assert, adjust, ▇▇▇ for,
compromise or release any claims under any policies of insurance; and (iii)
execute any and all such other documents and instruments, and do any and all
acts and things for and on behalf of the Grantor, which the Collateral Agent
(upon instruction of the Instructing Group) may deem necessary or advisable to
maintain, protect, realize upon and preserve the Intellectual Property and the
Collateral Agent's security interest therein and to accomplish the purposes of
this Agreement, including (A) to defend, settle, adjust or institute any action,
suit or proceeding with respect to the Intellectual Property, (B) to assert or
retain any rights under any license agreement for any of the Intellectual
Property, including without limitation any rights of the Grantor arising under
Section 365(n) of the Bankruptcy Code, and (C) to execute any and all
applications, documents, papers and instruments for the Collateral Agent to use
the Intellectual Property, to grant or issue any exclusive or non-exclusive
license or sub-license with respect to any Intellectual Property and to assign,
convey or otherwise transfer title in or dispose of the Intellectual Property;
provided, however, that the Collateral Agent agrees that, except upon and during
the continuance of an Event of Default, it shall not exercise the power of
attorney pursuant to clauses (ii) and (iii). The power of attorney set forth in
this Section 3, being coupled with an interest, is irrevocable so long as this
Agreement shall not have terminated.
SECTION 4 Collateral Agent's Duties. Notwithstanding any provision
contained in this Agreement, the Collateral Agent shall have no duty to exercise
any of the rights, privileges or powers afforded to such party and shall not be
responsible to Grantor or any other Person for any failure to do so or delay in
doing so. Beyond the exercise of reasonable care to assure the safe custody of
Collateral in the Collateral Agent's possession, and the accounting for moneys
actually received by the Collateral Agent hereunder, the Collateral Agent shall
have no duty or liability to exercise or preserve any rights, privileges or
powers pertaining to the Collateral.
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SECTION 5 Credit Parties' Rights and Remedies.
(a) Upon and during the continuation of a Default, the Collateral
Agent shall have all rights and remedies available to it under this Agreement,
the Security Agreement and applicable law with respect to the security interests
in any of the Intellectual Property. Grantor agrees that such rights and
remedies include, but are not limited to, the right of the Collateral Agent as a
secured party to sell or otherwise dispose of the Intellectual Property pursuant
to the UCC.
(b) The cash proceeds actually received from the sale or other
disposition or collection of Intellectual Property, and any other amounts
received in respect of the Intellectual Property Collateral the application of
which is not otherwise provided for herein, shall be applied as provided in the
Security Agreement.
SECTION 6 Security Agreement. This Agreement is supplementary to and
entered into in support of the Security Agreement. The terms and provisions of
the Security Agreement are incorporated herein by reference and shall be applied
as if fully set forth herein. The Grantor acknowledges that the rights and
remedies of the Collateral Agent with respect to the security interests in the
Intellectual Property granted hereby are more fully set forth in the Security
Agreement and that all such rights and remedies are cumulative.
SECTION 7 Independence. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
all applicable Laws (including the UCC, patent law, trademark law and copyright
law) and regulations. If, however, any provision of this Agreement shall be
prohibited by or invalid under any such law or regulation in any jurisdiction,
it shall, as to such jurisdiction, be deemed modified to conform to the minimum
requirements of such law or regulation, or, if for any reason it is not deemed
so modified, it shall be ineffective and invalid only to the extent of such
prohibition or invalidity without affecting the remaining provisions of this
Agreement, or the validity or effectiveness of such provision in any other
jurisdiction.
SECTION 8 Representations and Warranties. The representations and
warranties of the Grantor set forth in the Section 4 of the Security Agreement
and incorporated herein by Section 6 hereof are true and correct as of the date
hereof, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case such representations and
warranties are true and correct as of such earlier date.
SECTION 9 Counterparts. This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute but one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered in San Francisco, California by their proper and
duly authorized officers as of the day and year first above written.
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CERIDIAN CORPORATION
Grantor
By:
---------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.,
as Administrative Agent
By:
---------------------------------------
Name:
Title:
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SCHEDULE 1
to the Supplemental IP Security Agreement
(a) NEW ISSUED PATENTS OF GRANTOR
Grantor Patent No. Issue Date Inventors Title Agent
------- ---------- ---------- --------- ----- -----
(b) PENDING PATENT APPLICATIONS OF GRANTOR
Grantor Application No. Filing Date Inventors Title
------- --------------- ----------- --------- -----
(c) NEW U.S. TRADEMARKS OF GRANTOR
Registration Registration Registered
Grantor No. Date Filing Date Owner ▇▇▇▇
------- --- ---- ----------- ----- ----
(d) PENDING TRADEMARK APPLICATIONS OF GRANTOR
Application
Grantor No. Filing Date Applicant ▇▇▇▇
------- --- ----------- --------- ----
(e) NEW COPYRIGHTS OF GRANTOR
Grantor Copyright Title Reg. No. Date of Issue
------- --------------- -------- -------------
Schedule 1-1
Exhibits to Arbitron Credit Agreement
284
(f) NEW COPYRIGHT APPLICATIONS OF GRANTOR
Grantor Title Application No. Date of Application
------- ----- --------------- -------------------
(g) NEW COPYRIGHT LICENSES OF GRANTOR
Grantor Title Copyright Owner Reg. No. Date of Issue
------- ----- --------------- -------- -------------
Schedule 1-2
Exhibits to Arbitron Credit Agreement
285
EXHIBIT J
FORM OF BORROWER PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (this "Agreement"), dated as of
February __, 2001, is made among CERIDIAN CORPORATION, a Delaware corporation
(the "Grantor"), and BANK OF AMERICA, N.A., as Collateral Agent for the benefit
of: (a) BANK OF AMERICA, N.A., in its capacity as administrative agent (in such
capacity, the "Administrative Agent") for the Lenders from time to time party to
the Credit Agreement, dated as of January 31, 2001 (the "Credit Agreement"), (b)
the "Swap Provider" (as defined herein), and (c) the Note Holders party from
time to time to the Note Purchase Agreement.
It is a condition precedent to the borrowings under each of the
Credit Agreement and the Note Purchase Agreement that the Grantor enter into
this Agreement and pledge to the Collateral Agent the shares of the capital
stock of each of the Subsidiaries set forth in Schedule 1 (collectively, the
"Subsidiaries"), owned by the Grantor, to secure the obligations of the Grantor
described below.
Accordingly, the parties hereto agree as follows:
SECTION 1 Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms
used herein and not otherwise defined shall have the meanings assigned to them,
respectively, in the Credit Agreement. The rules of interpretation set forth in
the Credit Agreement shall be applicable to this Agreement and are incorporated
herein by this reference.
(b) Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Additional Collateral" means any and all (i) additional capital
stock or other equity securities of the Subsidiaries, whether certificated or
uncertificated, (ii) warrants, options or other rights entitling the Grantor to
acquire any interest in the capital stock or other equity securities of the
Subsidiaries, (iii) securities, property, interest, dividends and other payments
and distributions issued as an addition to, in redemption of, in renewal or
exchange for, in substitution or upon conversion of, or otherwise on account of,
the Pledged Shares or such additional capital stock or other equity securities,
and (iv) cash and non-cash proceeds of the Pledged Shares and any of the
foregoing, in each case from time to time received or receivable by, or
otherwise paid or distributed to or acquired by, the Grantor.
"Collateral Agent" means Bank of America, N.A. in its capacity
as "Collateral Agent" (as defined in the Intercreditor Agreement; or such
replacement Collateral Agent as may be appointed from time to time thereunder)
on behalf and for the benefit of, (a) Bank of America, N.A. in its capacity as
the Administrative Agent for the benefit of itself and the other Lenders from
time to time party to the Credit Agreement, and the L/C Issuer; (b) the Note
Holders from time to time party to the Note Purchase Agreement; and (c) the Swap
Provider.
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"Credit Agents" and each, individually, a "Credit Agent" means
(a) the Administrative Agent (for the benefit of itself and the other Lenders,
and the L/C Issuer), (b) the Note Holders and (c) the Swap Provider.
"Credit Documents" means, collectively, the Loan Documents, the
Note Holder Documents and the Swap Documents.
"Credit Parties" and each, individually, a "Credit Party" means
the Credit Agents and the Debt Participants.
"Debt Participant" means a "Debt Participant" under, and as
defined in, the Intercreditor Agreement.
"Exchange Act" means the Securities Exchange Act of 1934.
"Instructing Group" means "Instructing Group" under, and as
defined in, the Intercreditor Agreement.
"Intercreditor Agreement" means that Intercreditor Agreement
dated as of January ___, 2001 among the Collateral Agent, the Administrative
Agent, the Swap Provider, and the Note Holders.
"Investment Property" means any and all investment property of
the Grantor, including all securities, whether certificated or uncertificated,
security entitlements, securities accounts, commodity contracts, commodity
accounts and all financial assets held in any securities account or otherwise,
wherever located and whether now existing or hereafter arising.
"Note Holder Collateral Documents" means, collectively, (i) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or other wise changed in respect of, the
Note Holders), (ii) all Account Control Agreements executed by any Loan Party
under any Note Holder Document, (iii) all documents executed by any Loan Party
to accomplish cash collateralization pursuant to any Note Holder Document, and
(iv) all licenses, UCC financing statements, notices and other documents
executed from time to time or in connection with any of the foregoing.
"Note Holder Documents" means, collectively, the Note Purchase
Agreement, the Note Holder Collateral Documents and the Note Holder Guaranties.
"Note Holder Guaranties" means the Guaranties under and as
defined in the Credit Agreement, but to the extent entered into by the
Guarantors thereunder for the benefit of, and as modified, extended or otherwise
changed in respect of, the Note Holders.
"Note Holder" means a "Note Holder" under, and as defined in,
the Note Purchase Agreement.
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"Note Purchase Agreement" means that Note Purchase Agreement
dated as of January 31, 2001 among the Borrower, the Note Holders party thereto.
"Pledged Collateral" has the meaning set forth in Section 2(a).
"Pledged Shares" means (a) all of the issued and outstanding
shares of capital stock, whether certificated or uncertificated, of the
Subsidiaries now owned by the Grantor (other than Ceridian Infotech (India)
Private Limited), as more specifically described in Schedule 2, provided,
however, that 65% (but no more than 65%) of the issued and outstanding capital
stock of any Subsidiary which is a Foreign Subsidiary, measured on a non-diluted
basis) shall constitute Pledged Shares hereunder, and (b) all Investment
Property.
"Secured Obligations" means all indebtedness, liabilities and
other obligations of the Grantor to the Collateral Agent (for the benefit of the
Credit Agents), whether now existing or hereafter arising, and whether due or to
become due, absolute or contingent, liquidated or unliquidated, determined or
undetermined, now or created under, arising out of or in connection with any of
the Credit Documents, including all Obligations (as independently defined in
each of the Credit Agreement and the Note Purchase Agreement), and any
obligations under any Specified Swap Agreement to the extent arising out of any
Specified Swap Contracts.
"Securities Act" means the Securities Act of 1933.
"Specified Swap Agreement" means any ISDA(R) Master Agreement
(including any schedule and confirmation relating thereto) entered into between
the Grantor and the Swap Provider as swap counterparties.
"Specific Swap Contract" means any interest rate swap entered
into between Grantor and the Swap Provider as swap counterparties constituting a
"Specified Swap Contract" as defined in the Credit Agreement.
"Swap Collateral Documents" means, collectively, (a) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or otherwise changed in respect of, the
Swap Provider, (b) all Account Control Agreements executed by any Loan Party
under any Swap Document, (c) any documents executed by any Loan Party to
accomplish cash collateralization pursuant to any Swap Document, and (d) all
licenses, UCC financing statements, notices and other documents executed from
time to time in connection with any of the foregoing.
"Swap Documents" means, collectively, any Specified Swap
Agreement, the Swap Collateral Documents and the Swap Guaranties.
"Swap Guaranties" means the Guaranties under and as defined in
the Credit Agreement, but to the extent entered into by the Guarantors
thereunder for the benefit of, and as modified, extended or otherwise changed in
respect of, the Swap Provider.
"Swap Provider" has the meaning specified in the Intercreditor
Agreement.
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"UCC" means the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of New York; provided, however, in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of the security interest in any Pledged
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term "UCC" shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such attachment, perfection or priority and
for purposes of definitions related to such provisions.
(c) Terms Defined in UCC. Where applicable and except as
otherwise defined herein, terms used in this Agreement shall have the meanings
assigned to them in the UCC.
(d) Interpretation. The rules of interpretation set forth in
Sections 1.02 and 1.05 of the Credit Agreement shall be applicable to this
Agreement and are incorporated herein by this reference.
SECTION 2 Security Interest.
(a) Grant of Security Interest. As security for the payment
and performance of the Secured Obligations, the Grantor hereby pledges, assigns,
transfers, hypothecates and sets over to the Collateral Agent, and hereby grants
to the Collateral Agent, a security interest in, all of the Grantor's right,
title and interest in, to and under (i) the Pledged Shares and the Additional
Collateral and any certificates and instruments now or hereafter representing
the Pledged Shares and the Additional Collateral, (ii) all rights, interests and
claims with respect to the Pledged Shares and Additional Collateral, including
under any and all related agreements, instruments and other documents, and (iii)
all books, records and other documentation of the Grantor related to the Pledged
Shares and Additional Collateral, in each case whether presently existing or
owned or hereafter arising or acquired and wherever located (collectively, the
"Pledged Collateral") provided, however, that Pledged Collateral shall not
include any of the shares of capital stock of Ceridian Infotech (India) Private
Limited, a Subsidiary of the Grantor organized and existing under the laws of
India.
(b) Delivery of Pledged Shares. The Grantor hereby agrees to
deliver to or for the account of the Collateral Agent, at the address and to the
Person to be designated by theAdministrative Agent, the certificates
representing the Pledged Shares, which shall be in suitable form for transfer by
delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to the Collateral
Agent (with the consent of the Instructing Group).
(c) Delivery of Additional Collateral. If the Grantor shall
become entitled to receive or shall receive any Additional Collateral, the
Grantor shall accept any such Additional Collateral as the agent for the
Collateral Agent, shall hold it in trust for the Collateral Agent, shall
segregate it from other property or funds of the Grantor, and shall deliver all
Additional Collateral and all certificates, instruments and other writings
representing such Additional Collateral forthwith to or for the account of the
Collateral Agent, at the address and to the Person
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to be designated by the Collateral Agent upon instruction from the Instructing
Group, which shall be in suitable form for transfer by delivery, or shall be
accompanied by duly executed instruments of transfer or assignment in blank, all
in form and substance satisfactory to the Collateral Agent (with consent of the
Instructing Group), as the Collateral Agent shall request, to be held by the
Collateral Agent subject to the terms hereof, as part of the Pledged Collateral.
Upon accepting any such Additional Collateral hereunder, the Collateral Agent
shall promptly send a notification to the Grantor describing the Additional
Collateral accepted and held as part of the Pledged Collateral hereunder, which
notification shall be deemed to be a Schedule to this Agreement and may be
attached hereto.
(d) Transfer of Security Interest Other Than by Delivery. If
for any reason Pledged Collateral cannot be delivered to or for the account of
the Collateral Agent as provided in subsections (b) and (c), the Grantor shall
promptly take such other steps as shall be requested from time to time by the
Collateral Agent (upon instruction of the Instructing Group) to effect a
transfer of a perfected first priority security interest in and pledge of the
Pledged Collateral to the Collateral Agent pursuant to the UCC. To the extent
practicable, the Grantor shall thereafter deliver the Pledged Collateral to or
for the account of the Collateral Agent as provided in subsections (b) and (c).
(e) Continuing Security Interest. The Grantor agrees that
this Agreement shall create continuing security interests in and pledge of the
Pledged Collateral which shall remain in effect until terminated in accordance
with Section 22.
SECTION 3 Representations and Warranties. In addition to the
representations and warranties of the Grantor made in the Credit Agreement,
which are incorporated, remade and reaffirmed herein by this reference, and
which are true, complete and accurate as of the date hereof except to the extent
such representations and warranties specifically refer to an earlier date, in
which case they are true and correct as of such earlier date, the Grantor
represents and warrants to the Collateral Agent and each of the Credit Parties
that:
(a) Valid Issuance of Pledged Collateral. All the Pledged
Shares have been, and upon issuance any Additional Collateral will be, duly and
validly issued, and are and will be fully paid and non-assessable.
(b) Ownership of Pledged Collateral. With respect to the
Pledged Shares the Grantor is, and with respect to any Additional Collateral the
Grantor will be, the legal record and beneficial owner thereof, and has and will
have good and marketable title thereto, subject to no Lien except for the pledge
and security interests created by this Agreement.
(c) Capitalization of the Subsidiary. The Pledged Shares
constitute 100% of the issued and outstanding shares of capital stock of the
Subsidiary, provided, however, that if the Company is a Foreign Subsidiary of
the Grantor, the Pledged Shares constitute no less than 65% of the issued and
outstanding capital stock of the Subsidiary, measured on a non-diluted basis.
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(d) Options, Warrants, Etc. Other than as set forth in
Schedule 2, no securities convertible into or exchangeable for any shares of
capital stock of the Subsidiary, or any options, warrants or other commitments
entitling any Person to purchase or otherwise acquire any shares of capital
stock of the Subsidiary, are issued and outstanding.
(e) Transfer Restrictions. There are no restrictions on the
transferability of the Pledged Collateral to the Collateral Agent or with
respect to the foreclosure, transfer or disposition thereof by the Collateral
Agent.
(f) Shareholders Agreements. There are no shareholders
agreements, voting trusts, proxy agreements or other agreements or
understandings which affect or relate to the voting or giving of written
consents with respect to any of the Pledged Collateral.
(g) No Violation of Securities Laws. None of the Pledged
Shares has been transferred in violation of the securities registration,
securities disclosure or similar laws of any jurisdiction to which such transfer
may be subject.
(h) Location of Chief Executive Office. The Grantor's chief
executive office and principal place of business, and all books and records
concerning the Pledged Collateral, are located at __________________, or such
other address as to which the Grantor has notified the Collateral Agent in
accordance with Section 4(e).
(i) Other Financing Statements. Other than (i) financing
statements disclosed to the Collateral Agent and (ii) financing statements in
favor of the Collateral Agent, no effective financing statement naming the
Grantor as debtor, assignor, grantor, mortgagor, pledgor or the like and
covering all or any part of the Pledged Collateral is on file in any filing or
recording office in any jurisdiction.
(j) Enforceability; Priority of Security Interest. This
Agreement (i) creates an enforceable perfected and first priority security
interest in and pledge of the Pledged Collateral upon delivery thereof pursuant
to Section 2(b), and (ii) will create an enforceable perfected and first
priority security interest in and pledge of the Additional Collateral upon
delivery thereof pursuant to Section 2(c) (or upon the taking of such other
action with respect thereto as may be requested by the Collateral Agent pursuant
to Section 2(d)), in each case securing the payment and performance of the
Secured Obligations.
The Grantor agrees that the foregoing representations and
warranties shall be deemed to have been made by it on the date of each delivery
of Pledged Collateral hereunder.
SECTION 4 Covenants. In addition to the covenants of the Grantor
set forth in the Credit Agreement, which are incorporated herein by this
reference, so long as any of the Secured Obligations remain unsatisfied or
unpaid, the Grantor agrees that:
(a) Defense of Pledged Collateral. The Grantor will, at its
own expense, appear in and defend any action, suit or proceeding which purports
to affect its title to, or right or interest in, the Pledged Collateral or the
security interests of the Collateral Agent therein and the pledge to the
Collateral Agent thereof.
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(b) Preservation of Collateral. The Grantor will do and
perform all reasonable acts that may be necessary and appropriate to maintain,
preserve and protect the Pledged Collateral.
(c) Compliance with Laws, Etc. The Grantor will comply with
all laws, regulations and ordinances relating in a material way to the
possession, maintenance and control of the Pledged Collateral.
(d) Location of Books and Chief Executive Office. The
Grantor will: (i) keep all books and records pertaining to the Pledged
Collateral at the location set forth in Section 3(h); and (ii) give at least 30
days' prior written notice to the Collateral Agent of (A) any changes in any
such location where books and records pertaining to the Pledged Collateral are
kept, or (B) any change in the location of the Grantor's chief executive office
or principal place of business.
(e) Change in Name, Identity or Structure. The Grantor will
give at least 30 days' prior written notice to the Collateral Agent of (i) any
change in its name, (ii) any changes in, additions to or other modifications of
its trade names used as the name of Grantor, and (iii) any changes in its
identity or structure in any manner which might make any financing statement
filed hereunder incorrect or misleading.
(f) Disposition of Pledged Collateral. Except as permitted
by the Credit Agreement, the Grantor will not surrender or lose possession of
(other than to the Collateral Agent or, with the prior consent of the Collateral
Agent, to a depositary or financial intermediary), exchange, sell, convey,
assign or otherwise dispose of or transfer the Pledged Collateral or any right,
title or interest therein.
(g) Liens. Except for Permitted Liens, the Grantor will not
create, incur or permit to exist any Liens upon or with respect to the Pledged
Collateral, other than the security interests of and pledge to the Collateral
Agent created by this Agreement for the benefit of the Credit Agents.
(h) Shareholders Agreements. The Grantor will not enter into
any shareholders agreement, voting trust, proxy agreement or other agreement or
understanding which affects or relates to the voting or giving of written
consents with respect to any of the Pledged Collateral.
(i) Issuance of Additional Shares. The Grantor will not
consent to or approve, or allow the Subsidiary to consent to or approve, the
issuance to any Person of any additional shares of any class of capital stock of
the Subsidiary, or of any securities convertible into or exchangeable for any
such shares, or any warrants, options or other rights to purchase or otherwise
acquire any such shares, except as permitted under the Credit Agreement.
(j) Notices. The Grantor will deliver promptly to the
Collateral Agent all reports and notices received by the Grantor from the
Subsidiary in respect of any of the Pledged Collateral.
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(k) Further Assurances. The Grantor will promptly, upon the
written request from time to time of the Collateral Agent, execute, acknowledge
and deliver, and file and record, all such financing statements and other
documents and instruments, and take all such action, as shall be reasonably
necessary to carry out the purposes of this Agreement.
SECTION 5 Administration of the Pledged Collateral.
(a) Distributions and Voting Prior to an Event of Default.
Unless there exists any Default or Event of Default: (i) the Grantor shall be
entitled to receive and retain for its own account any cash dividend on or other
cash distribution, if any, in respect of the Pledged Collateral; and (ii) the
Grantor shall have the right to vote the Pledged Collateral and to retain the
power to control the direction, management and policies of the Subsidiary to the
same extent as the Grantor would if the Pledged Collateral were not pledged to
the Collateral Agent pursuant to this Agreement; provided, however, that the
Grantor shall not be entitled to receive (A) cash paid, payable or otherwise
distributed in redemption of, or in exchange for or in substitution of, any
Pledged Collateral, or (B) dividends and other distributions paid or payable in
cash in respect of any Pledged Collateral in connection with a partial or total
liquidation or dissolution of the Subsidiary or in connection with a reduction
of capital, capital surplus or paid-in-surplus or any other type of
recapitalization involving the Subsidiary; and provided further, however, that
no vote shall be cast or consent, waiver or ratification given or action taken
which would have the effect of impairing the position or interest of the
Collateral Agent in respect of the Pledged Collateral or which would alter the
voting rights with respect to the stock of the Subsidiary or be inconsistent
with or violate any provision of this Agreement and other Credit Documents. If
applicable, the Grantor shall be deemed the beneficial owner of all Pledged
Collateral for purposes of Sections 13 and 16 of the Exchange Act and agrees to
file all reports required to be filed by beneficial owners of securities
thereunder. The Collateral Agent shall execute and deliver (or cause to be
executed and delivered) to the Grantor all such proxies and other instruments as
the Grantor may reasonably request for the purpose of enabling the Grantor to
exercise the voting and other rights which it is entitled to exercise pursuant
to this subsection (a) and to receive the distributions which it is authorized
to receive and retain pursuant to this subsection (a).
(b) General Authority upon an Event of Default. If there
exists any Default or Event of Default:
(i) the Collateral Agent shall be entitled to
receive all distributions and payments of any nature with respect to the Pledged
Collateral, to be held by the Collateral Agent as part of the Pledged
Collateral;
(ii) the Collateral Agent shall have the right
following prior written notice to the Grantor to vote or consent to take any
action with respect to the Pledged Shares and exercise all rights of conversion,
exchange, subscription or any other rights, privileges or options pertaining to
the Pledged Collateral as if the Collateral Agent were the absolute owner
thereof; and
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(iii) the Collateral Agent shall have the right, for
and in the name, place and stead of the Grantor, to execute endorsements,
assignments or other instruments of conveyance or transfer with respect to all
or any of the Pledged Collateral, to endorse any checks, drafts, money orders
and other instruments relating thereto, to ▇▇▇ for, collect, receive and give
acquittance for all moneys due or to become due in connection with the Pledged
Collateral and otherwise to file any claims, take any action or institute,
defend, settle or adjust any actions, suits or proceedings with respect to the
Pledged Collateral, execute any and all such other documents and instruments,
and do any and all such acts and things, as the Collateral Agent may deem
necessary or desirable to protect, collect, realize upon and preserve the
Pledged Collateral, to enforce the Collateral Agent's rights with respect to the
Pledged Collateral and to accomplish the purposes of this Agreement.
(c) Distributions to Be Held for Administrative Agent.
Distributions and other payments which are received by the Grantor but which it
is not entitled to retain as a result of the operation of subsection (a) or (b)
shall be held in trust for the benefit of the Collateral Agent, be segregated
from the other property or funds of the Grantor, and be forthwith paid over or
delivered to the Collateral Agent in the same form as so received.
(d) Certain Other Administrative Matters. At any time and
from time to time, the Collateral Agent may cause any of the Pledged Collateral
to be transferred into its name or into the name of its nominee or nominees
(subject to the revocable rights specified in subsection (a)). The Collateral
Agent shall at all times have the right to exchange uncertificated Pledged
Collateral for certificated Pledged Collateral, and to exchange certificated
Pledged Collateral for certificates of larger or smaller denominations, for any
purpose consistent with this Agreement.
(e) Appointment of Collateral Agent as Attorney-in-Fact. For
the purpose of enabling the Collateral Agent to exercise its rights under this
Section 5 or otherwise in connection with this Agreement, the Grantor hereby (i)
constitutes and appoints Collateral Agent (and any of the Collateral Agent's
officers, employees or agents designated by the Collateral Agent ) Grantor's
true and lawful attorney-in-fact, with full power and authority to execute any
notice, assignment, endorsement or other instrument or document, and to do any
and all acts and things for and on behalf of the Grantor, which the Collateral
Agent may deem necessary or desirable (with the consent of the Instructing
Group) to protect, collect, realize upon and preserve the Pledged Collateral, to
enforce the Collateral Agent's rights with respect to the Pledged Collateral and
to accomplish the purposes hereof, and (ii) revokes all previous proxies with
regard to the Pledged Collateral and appoints the Collateral Agent as its proxy
holder with respect to the Pledged Collateral to attend and vote at any and all
meetings of the shareholders of the Subsidiary held on or after the date of this
proxy and prior to the termination hereof, with full power of substitution to do
so and agrees, if so requested, to execute or cause to be executed appropriate
proxies therefor. Each such appointment is coupled with an interest and
irrevocable so long as any of the Secured Obligations have not been paid and
performed in full. The Grantor hereby ratifies, to the extent permitted by law,
all that the Collateral Agent shall lawfully and in good faith do or cause to be
done by virtue of and in compliance with this Section 5. The Collateral Agent
agrees that, unless there exists any Default or Event of Default, it shall not
exercise the power of attorney, or any rights granted to the Collateral Agent,
pursuant to this
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subsection (e). The foregoing power of attorney is coupled with an interest and
irrevocable so long as the Secured Obligations have not been paid and performed
in full. Grantor hereby ratifies, to the extent permitted by law, all that the
Collateral Agent shall lawfully and in good faith do or cause to be done by
virtue of and in compliance with this Section 5.
SECTION 6 Performance of Grantor Obligations. The Collateral
Agent may perform or pay any obligation which the Grantor has agreed to perform
or pay under or in connection with this Agreement, and the Grantor shall
reimburse the Collateral Agent on demand for any amounts paid by the Collateral
Agent pursuant to this Section 6.
SECTION 7 Collateral Agent's Duties. Notwithstanding any
provision contained in this Agreement, the Collateral Agent shall have no duty
to exercise any of the rights, privileges or powers afforded to it and shall not
be responsible to the Grantor or any other Person for any failure to do so or
delay in doing so. Beyond the exercise of reasonable care to assure the safe
custody of the Pledged Collateral while held hereunder and the accounting for
moneys actually received by the Collateral Agent hereunder, the Collateral Agent
shall have no duty or liability to exercise or preserve any rights, privileges
or powers pertaining to the Pledged Collateral.
SECTION 8 Remedies.
(a) Remedies. If there exists any Default or Event of
Default, the Collateral Agent shall have, in addition to all other rights and
remedies granted to it in this or any Credit Document, all rights and remedies
of a secured party under the UCC and other applicable laws. Without limiting the
generality of the foregoing, the Grantor agrees that any item of the Pledged
Collateral may be sold for cash or on credit or for future delivery without
assumption of any credit risk, in any number of lots at the same or different
times, at any exchange, brokers' board or elsewhere, by public or private sale,
and at such times and on such terms, as the Collateral Agent shall determine;
provided, however, that the Grantor shall be credited with the net proceeds of
sale only when such proceeds are finally collected by the Collateral Agent. The
Grantor hereby agrees that the sending of notice by ordinary mail, postage
prepaid, to the address of the Grantor set forth in the Credit Agreement, of the
place and time of any public sale or of the time after which any private sale or
other intended disposition is to be made, shall be deemed reasonable notice
thereof if such notice is sent ten days prior to the date of such sale or other
disposition or the date on or after which such sale or other disposition may
occur, provided that the Collateral Agent may provide the Grantor shorter notice
or no notice, to the extent permitted by the UCC or other applicable law. The
Grantor recognizes that the Collateral Agent may be unable to make a public sale
of any or all of the Pledged Collateral, by reason of prohibitions contained in
applicable securities laws or otherwise, and expressly agrees that a private
sale to a restricted group of purchasers for investment and not with a view to
any distribution thereof shall be considered a commercially reasonable sale. The
Collateral Agent and each Credit Party shall have the right upon any such public
sale, and, to the extent permitted by law, upon any such private sale, to
purchase the whole or any part of the Pledged Collateral so sold, free of any
right or equity of redemption, which right or equity of redemption the Grantor
hereby releases to the extent permitted by law.
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(b) Proceeds Account. To the extent that any of the Secured
Obligations may be contingent, unmatured or unliquidated (including with respect
to undrawn amounts under the Letters of Credit) at such time as there may exist
an Event of Default, the Collateral Agent may, upon instruction by the
Instructing Group, (i) retain the proceeds of any sale, collection, disposition
or other realization upon the Pledged Collateral (or any portion thereof) in a
special purpose non-interest-bearing restricted deposit account (the "Proceeds
Account") created and maintained by the Collateral Agent for such purpose (as to
which the Grantor hereby grants a security interest and which shall constitute
part of the Pledged Collateral hereunder) until such time as the Collateral
Agent may elect (with the consent of the Instructing Group) to apply such
proceeds to the Secured Obligations, and the Grantor agrees that such retention
of such proceeds by the Collateral Agent shall not be deemed strict foreclosure
with respect thereto; (ii) in any manner elected by the Collateral Agent (with
the consent of the Instructing Group), estimate the liquidated amount of any
such contingent, unmatured or unliquidated claims and apply the proceeds of the
Pledged Collateral against such amount; or (iii) otherwise proceed in any manner
permitted by applicable law. The Grantor agrees that the Proceeds Account shall
be a blocked account and that upon the irrevocable deposit of funds into the
Proceeds Account, the Grantor shall not have any right of withdrawal with
respect to such funds. Accordingly, the Grantor irrevocably waives until the
termination of this Agreement in accordance with Section 22 the right to make
any withdrawal from the Proceeds Account and the right to instruct the
Collateral Agent to honor drafts against the Proceeds Account.
(c) Application of Proceeds. Subject to subsection (b), cash
proceeds actually received from the sale or other disposition or collection of
Collateral, and any other amounts received in respect of the Collateral the
application of which is not otherwise provided for herein, shall be applied
(after payment of any amounts payable to the applicable Credit Parties or the
Collateral Agent pursuant to Section 6 or Section 13) in whole or in part by the
applicable Credit Parties or the Collateral Agent against all or any part of the
Secured Obligations in the manner and to the extent set forth in the
Intercreditor Agreement.
SECTION 9 Registration Rights.
(a) Registration of Pledged Collateral. If the Collateral
Agent at the request of the Instructing Group shall determine to exercise its
right to sell any or all of the Pledged Collateral pursuant to Section 8, and if
the Collateral Agent shall determine (with the consent of the Instructing Group)
that it is necessary or advisable to have the Pledged Collateral, or that
portion thereof to be sold, registered under the provisions of the Securities
Act, the Grantor shall execute and deliver, and shall cause the Subsidiary and
the Grantor's and the Subsidiary's respective directors and officers to execute
and deliver, all such instruments and documents, and to do or cause to be done
all such other acts and things as may, in the view of the Collateral Agent, be
advisable to register such Pledged Collateral under the provisions of the
Securities Act and to cause the registration statement relating thereto to
become effective and to remain effective for such period as prospectuses are
required by law to be furnished, and to make all amendments and supplements
thereto and to the related prospectus which, in the view of the Collateral Agent
(with the consent of the Instructing Group), are necessary or be necessary or
advisable, all in conformity with the requirements of the Securities and
Exchange Commission applicable thereto. The Grantor agrees to comply, and to
cause the Subsidiary to comply, with
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the provisions of the securities or "Blue Sky" laws of any jurisdiction which
the Collateral Agent shall designate, and to cause the Subsidiary to make
available to its security holders, as soon as practicable, an earnings statement
(which need not be audited) which shall satisfy the provisions of Section 11(a)
of the Securities Act. The Grantor shall cause to be furnished to the Collateral
Agent and each of the Credit Agents such number of copies of each preliminary
prospectus and prospectus, shall promptly notify the Collateral Agent of the
happening of any event (upon becoming aware thereof) as a result of which any
then effective prospectus includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of then existing
circumstances and shall cause the Collateral Agent and each Credit Agent to be
furnished with such number of copies as any such Person may reasonably request
of such supplement to or amendment of such prospectus as is necessary to
eliminate such untrue statement or correct such omission.
(b) No Obligation to Delay Private Sale. Neither the
Collateral Agent nor the Credit Parties shall be under any obligation to delay a
private sale of any of the Pledged Collateral (as contemplated by subsection
(a)) for the period of time necessary to permit the issuer thereof to register
such Pledged Collateral for public sale under the Securities Act, or under
applicable state securities laws, even if such issuer would agree to do so.
(c) Further Acts. The Grantor further agrees to do or to use
its best efforts to cause to be done all such other acts and things as may be
necessary to make any sales of all or any portion of the Pledged Collateral
pursuant to subsections (a) and (b) valid and binding and in compliance with any
and all applicable laws (including the Exchange Act), regulations, orders,
writs, injunctions, decrees or awards of any and all Governmental Authorities
having jurisdiction over any such sale or sales.
(d) Equitable Relief. The Grantor acknowledges that a breach
of any of the covenants contained in this Section 9 will cause irreparable
injury to the Collateral Agent and the Credit Parties, that the Collateral Agent
and Credit Parties have no adequate remedy at law in respect of such breach and,
as a consequence, agrees that each and every covenant contained in this Section
9 shall be specifically enforceable against the Grantor, and the Grantor hereby
waives and agrees not to assert any defenses against an action for specific
performance of such covenants except for a defense that no Event of Default has
occurred under the provisions of the Credit Agreement.
(e) Costs and Expenses. The Grantor shall bear all costs and
expenses of carrying out its obligations under this Section 9.
SECTION 10 Certain Waivers. The Grantor waives, to the fullest
extent permitted by law, (i) any right of redemption with respect to the Pledged
Collateral, whether before or after sale hereunder, and all rights, if any, of
marshalling of the Pledged Collateral or other collateral or security for the
Secured Obligations; (ii) any right to require the Collateral Agent (A) to
proceed against any Person, (B) to exhaust any other collateral or security for
any of the Secured Obligations, (C) to pursue any remedy in the Collateral
Agent's power, or (D) to make or give any presentments, demands for performance,
notices of nonperformance, protests,
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notices of protests or notices of dishonor in connection with any of the Pledged
Collateral; and (iii) all claims, damages, and demands against the Collateral
Agent arising out of the repossession, retention, sale or application of the
proceeds of any sale of the Pledged Collateral.
SECTION 11 Notices. All notices, requests or other
communications hereunder shall be given in the manner and to the addresses
specified in the Credit Agreement; provided, however, that notices hereunder (a)
to the Swap Provider shall be delivered to Fleet National Bank using the
information listed in Schedule 10.02 of the Credit Agreement for such party as a
Lender (or such replacement Swap Provider as may be appointed from time to time
consistent with the terms of the Intercreditor Agreement), and (b) to the Note
Holders as set forth in the Note Purchase Agreement (or such replacement Note
Holders as may be appointed from time to time consistent with the terms of the
Intercreditor Agreement). All such notices, requests and communications shall,
when transmitted by overnight delivery, or faxed, be effective when delivered
for overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon receipt by the addressee, or if
delivered, upon delivery.
SECTION 12 No Waiver; Cumulative Remedies. No failure on the
part of the Collateral Agent or any Credit Party to exercise, and no delay in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
remedy, power or privilege preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights and remedies
under this Agreement are cumulative and not exclusive of any rights, remedies,
powers and privileges that may otherwise be available to the Collateral Agent or
any Credit Party.
SECTION 13 Costs and Expenses; Indemnification; Other Charges.
(a) Costs and Expenses. The Grantor agrees to pay on demand:
(i) the out-of-pocket costs and expenses of the
Collateral Agent and any of the Credit Parties' attorney costs, in connection
with the negotiation, preparation, execution, delivery and administration of
this Agreement, and any amendments, modifications or waivers of the terms
thereof, and the custody of the Pledged Collateral;
(ii) all title, appraisal (including the allocated
cost of internal appraisal services), survey, audit, consulting, search,
recording, filing and similar costs, fees and expenses incurred or sustained by
the Collateral Agent or any Credit Party in connection with this Agreement or
the Pledged Collateral; and
(iii) all costs and expenses of the Collateral Agent
or any Credit Party, including Attorney Costs, in connection with the
enforcement or attempted enforcement of, and preservation of any rights or
interest under, this Agreement, any out-of-court workout or other refinancing or
restructuring or in any bankruptcy case, and the protection, sale or collection
of, or other realization upon, any of the Pledged Collateral, including any and
all losses, costs and expenses sustained by the Collateral Agent and any Credit
Party as a result of any failure by the Grantor to perform or observe its
obligations contained herein.
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(b) Indemnification. The Grantor shall indemnify, defend and
hold the Collateral Agent, Agent-Related Persons and each Credit Party and each
of its respective officers, directors, employees, counsel, agents and
attorneys-in-fact (each, an "Indemnified Person") harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, charges, expenses and disbursements (including Attorney
Costs) of any kind or nature whatsoever which may at any time be imposed on,
incurred by or asserted against any such Person in favor of any third-party in
any way relating to or arising out of this Agreement or any document
contemplated by or referred to herein, or the transactions contemplated hereby,
or any action taken or omitted by any such Person under or in connection with
any of the foregoing, including caused by, arising out of or by reason of any
alleged untrue statement of a material fact contained in any registration
statement (or any amendment thereto) or in any preliminary prospectus or
prospectus (or any amendment or supplement thereto) contemplated by Section
9(a), or any alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, except to
the extent that any such liabilities, obligations, losses, claims, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements are
caused by, arise solely out of or by reason of any such alleged untrue statement
made or such alleged omission to state a material fact included or excluded on
the written direction of any of the Collateral Agent or any Credit Party
(including information supplied by the Collateral Agent or any Credit Party),
and including with respect to any investigation, litigation or proceeding
(including any insolvency proceeding or appellate proceeding) related to or
arising out of this Agreement or relating to the Collateral, whether or not any
Indemnified Person is a party thereto (all of the foregoing, collectively, the
"Indemnified Liabilities"); provided that the Grantor shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities to
the extent they are found by a final decision of a court of competent
jurisdiction to have resulted solely from the gross negligence or willful
misconduct of such Indemnified Person. If and to the extent that the foregoing
indemnification is for any reason held unenforceable, the Grantor agrees to make
the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law.
(c) Other Charges. The Grantor agrees to indemnify the
Indemnified Persons against and hold each of them harmless from any and all
present and future stamp, transfer, documentary and other such taxes, levies,
fees, assessments and other charges made by any jurisdiction by reason of the
execution, delivery, performance and enforcement of this Agreement.
(d) Interest. Any amounts payable to the Collateral Agent or
any Credit Party under this Section 13 or otherwise under this Agreement if not
paid upon demand shall bear interest from the date of such demand until paid in
full, at the applicable rate of interest (a) for the Administrative Agent or any
Lender, as set forth in Section 2.08(b) of the Credit Agreement, (b) for the
Swap Provider, as set forth in the Specified Swap Agreement, and (c) for any
Note Holder, as set forth in Section 2.08(b) of the Note Purchase Agreement.
SECTION 14 Binding Effect. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by the Grantor, the Collateral Agent
and each Credit Party and their respective successors and assigns.
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SECTION 15 Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, EXCEPT AS REQUIRED BY MANDATORY
PROVISIONS OF LAW AND TO THE EXTENT THE VALIDITY OR PERFECTION OF THE SECURITY
INTERESTS HEREUNDER, OR THE REMEDIES HEREUNDER, IN RESPECT OF ANY COLLATERAL ARE
GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN NEW YORK, PROVIDED THAT THE
COLLATERAL AGENT AND EACH CREDIT PARTY SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER COLLATERAL DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
PARTY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
PARTY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN ANY FEDERAL COURT
OR STATE COURT SITTING IN NEW YORK IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
DOCUMENT RELATED THERETO. THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
PARTY WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
SECTION 16 Waiver of Right to Jury Trial. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO THIS AGREEMENT, ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
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SECTION 17 Entire Agreement; Amendment. This Agreement, together
with the other Credit Documents, embodies the entire agreement and understanding
among the Grantor and the Collateral Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof. Subject to Section
18, this Agreement shall be amended only by written agreement with the written
consent of the Instructing Group; provided, however, that any amendment having
the effect of causing a release of all or substantially all of the Collateral
must be consented to in writing by the Collateral Agent and each of the Credit
Agents.
SECTION 18 Independence. This Agreement sets forth independent
and separate security interests of the Grantor in favor of the Collateral Agent
in respect of the Secured Obligations owing to the Collateral Agent for the
benefit of each Credit Agent. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
with respect to any Credit Agent shall not in any way affect or impair the
legality or enforceability of that or any other provision of this Agreement or
any instrument or agreement required hereunder in respect to any other Credit
Agent. The parties acknowledge that this Agreement has, solely for reasons of
convenience, been prepared and executed as a single document, but that the legal
effect shall be in all respects as though the Grantor had executed separate
security interests, for the benefit of each of the Credit Agents. Any provision
of this Agreement and the other Credit Documents to which the Grantor is a party
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions thereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 19 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute but one and the same agreement.
SECTION 20 Incorporation of Provisions of the Credit Agreement.
To the extent the Credit Agreement contains provisions of general applicability
to the Loan Documents, including any such provisions contained in Article X
thereof, such provisions are incorporated herein by this reference.
SECTION 21 No Inconsistent Requirements. The Grantor
acknowledges that this Agreement, and the other Credit Documents may contain
covenants and other terms and provisions variously stated regarding the same or
similar matters, and agrees that all such covenants, terms and provisions are
cumulative and all shall be performed and satisfied in accordance with their
respective terms.
SECTION 22 Termination. Upon termination of the Commitments of
the Lenders, surrender of all Letters of Credit and payment and performance in
full of all Secured Obligations, this Agreement shall terminate and the
Collateral Agent shall (with the consent of the Instructing Group) promptly
redeliver to the Grantor any of the Pledged Collateral in its possession and
shall execute and deliver to the Grantor such documents and instruments
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301
reasonably requested by the Grantor as shall be necessary to evidence
termination of all security interests given by the Grantor to the Collateral
Agent hereunder; provided, however, that the obligations of the Grantor under
Sections 9(e) and 13 shall survive such termination. Upon satisfaction to all
conditions precedent to any permitted disposition set forth herein or in the
other Credit Documents, the Collateral Agent shall execute and deliver any
releases or other documents reasonably requested by the relevant Grantor to
accomplish or confirm the release of Pledged Shares provided by this Section.
SECTION 23 Intercreditor Agreement. Notwithstanding anything set
forth in this Agreement, any inconsistency between this Agreement and the
Intercreditor Agreement in respect of the rights and obligations of the
Collateral Agent and the Credit Agents owing to and among each other (but not
including in respect of the obligations of the Grantor to the Collateral Agent
or Credit Agents hereunder) shall be resolved in favor of the Intercreditor
Agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
CERIDIAN CORPORATION
THE GRANTOR
By:
----------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
THE COLLATERAL AGENT
By:
----------------------------------
Name:
Title:
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SCHEDULE 1
to the Stock Pledge Agreement
SUBSIDIARIES
SCHEDULE 1-1
304
SCHEDULE 2
to the Stock Pledge Agreement
PLEDGED SHARES
_______ stock of _________________ being represented by stock
certificates as follows:
Certificate No. Certificate Date No. of Shares
SCHEDULE 2-1
305
SCHEDULE 3
to the Stock Pledge Agreement
SECURITIES CONVERTIBLE INTO OR EXCHANGEABLE FOR SHARES
OF CAPITAL STOCK OF THE SUBSIDIARIES
SCHEDULE 3-1
306
EXHIBIT K
FORM OF SUBSIDIARY PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (this "Agreement"), dated as of
February __, 2001, is made among ___________________, a _______________
corporation (the "Grantor"), and BANK OF AMERICA, N.A., as Collateral Agent on
behalf of, and for the benefit of, (a) BANK OF AMERICA, N.A. in its capacity as
administrative agent (in such capacity, the "Administrative Agent") for the
Lenders from time to time party to the Credit Agreement dated as of January 31,
2001 (as amended, modified, renewed or extended from time to time, the "Credit
Agreement"), (b) the "Swap Provider" (as defined herein), and (c) the "Note
Holders" (as defined herein) party to the Note Purchase Agreement.
It is a condition precedent to the borrowings under each of the
Credit Agreement and the Note Purchase Agreement that the Grantor enter into
this Agreement and pledge to the Collateral Agent the shares of the capital
stock of ___________________________, a ____________ corporation (the
"Subsidiary"), owned by the Grantor, to secure the obligations of the Borrower
described below.
Accordingly, the parties hereto agree as follows:
SECTION 1 Definitions; Interpretation.
(a) Terms Defined in Credit Agreement. All capitalized terms
used herein and not otherwise defined shall have the meanings assigned to them,
respectively, in the Credit Agreement. The rules of interpretation set forth in
the Credit Agreement shall be applicable to this Agreement and are incorporated
herein by this reference.
(b) Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Additional Collateral" means any and all (i) additional capital
stock or other equity securities of the Subsidiary, whether certificated or
uncertificated, (ii) warrants, options or other rights entitling the Grantor to
acquire any interest in capital stock or other equity securities of the
Subsidiary, (iii) securities, property, interest, dividends and other payments
and distributions issued as an addition to, in redemption of, in renewal or
exchange for, in substitution or upon conversion of, or otherwise on account of,
the Pledged Shares or such additional capital stock or other equity securities,
and (iv) cash and non-cash proceeds of the Pledged Shares and any of the
foregoing, in each case from time to time received or receivable by, or
otherwise paid or distributed to or acquired by, the Grantor.
"Borrower" means CERIDIAN CORPORATION, a Delaware corporation.
"Credit Documents" means the Loan Documents together with the
Swap Documents.
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"Collateral Agent" means Bank of America, N.A. in its capacity
as "Collateral Agent" (as defined in the Intercreditor Agreement; or such
replacement Collateral Agent as may be appointed from time to time thereunder)
on behalf and for the benefit of, (a) Bank of America, N.A. in its capacity as
the Administrative Agent for the benefit of itself and the other Lenders from
time to time party to the Credit Agreement, and the L/C Issuer; (b) the Note
Holders from time to time party to the Note Purchase Agreement; and (c) the Swap
Provider.
"Credit Agents" and each, individually, a "Credit Agent" means
(a) the Administrative Agent (for the benefit of itself and the other Lenders,
and the L/C Issuer), (b) the Note Holders and (c) the Swap Provider.
"Credit Parties" and each, individually, a "Credit Party" means
the Credit Agents and the Debt Participants.
"Credit Documents" means, collectively, the Loan Documents, the
Note Holder Documents and the Swap Documents.
"Debt Participant" means a "Debt Participant" under, and as
defined in, the Intercreditor Agreement.
"Exchange Act" means the Securities and Exchange Act of 1934.
"Instructing Group" means "Instructing Group" under, and as
defined in, the Intercreditor Agreement.
"Intercreditor Agreement" means that Intercreditor Agreement
dated as of January 31, 2001 among the Collateral Agent, the Administrative
Agent, the Swap Provider and the Note Holders.
"Note Holder Collateral Documents" means, collectively, (i) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or other wise changed in respect of, the
Note Holders), (ii) all Account Control Agreements executed by any Loan Party
under any Note Holder Document, (iii) all documents executed by any Loan Party
to accomplish cash collateralization pursuant to any Note Holder Document, and
(iv) all licenses, UCC financing statements, notices and other documents
executed from time to time or in connection with any of the foregoing.
"Note Holder Documents" means, collectively, the Note Purchase
Agreement, the Note Holder Collateral Documents and the Note Holder Guaranties.
"Note Holder Guaranties" means the Guaranties under and as
defined in the Credit Agreement, but to the extent entered into by the
Guarantors thereunder for the benefit of, and as modified, extended or otherwise
changed in respect of, the Note Holders.
"Note Holder" means a "Note Holder" under, and as defined in,
the Note Purchase Agreement.
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"Note Purchase Agreement" means that Note Purchase Agreement
dated as of January 31, 2001 among the Borrower and the Note Holders party
thereto.
"Intercreditor Agreement" means that Intercreditor Agreement
dated as of __________ _____, 2001 among the Collateral Agent, the
Administrative Agent, the Swap Provider, and the Note Holders.
"Investment Property" means any and all investment property of
the Grantor, including all securities, whether certificated or uncertificated,
security entitlements, securities accounts, commodity contracts, commodity
accounts and all financial assets held in any securities account or otherwise,
wherever located and whether now existing or hereafter arising.
"Pledged Collateral" has the meaning set forth in Section 2(a).
"Pledged Shares" mean (a) all of the issued and outstanding
shares of capital stock, whether certificated or uncertificated, of the
Subsidiary now owned by the Grantor (other than Ceridian Infotech (India)
Private Limited), as more specifically described in Schedule 1, provided,
however, that if the Subsidiary is a Foreign Subsidiary of the Grantor, 65% (but
no more than 65%) of the issued and outstanding capital stock of the Subsidiary,
measured on a non-diluted basis, shall constitute Pledged Shares, and (b) all
Investment Property.
"Secured Obligations" means all indebtedness, liabilities and
other obligations of the Borrower to the Collateral Agent, whether now existing
or hereafter arising, and whether due to become due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, nor or created under,
arising out of or in connection with any of the Credit Documents, including all
Obligations (as independently defined in each of the Credit Agreement and the
Note Purchase Agreement), and any of the obligations under any Swap Documents.
"Securities Act" means the Securities Act of 1933.
"Specified Swap Agreement" means any ISDA(R) Master Agreement
(including any schedule and confirmation relating thereto) entered into between
the Borrower and the Swap Provider as swap counterparties.
"Specific Swap Contract" means any interest rate swap entered
into between the Borrower and the Swap Provider as swap counterparties
constituting a "Specified Swap Contract" as defined in the Credit Agreement.
"Swap Collateral Documents" means, collectively, (a) the
Security Agreements and the Pledge Agreements (as such terms are defined in the
Credit Agreement, but to the extent entered into by the parties thereto for the
benefit of, and as modified, extended or otherwise changed in respect of, the
Swap Provider, (b) all Account Control Agreements executed by any Loan Party
under any Swap Document, (c) any documents executed by any Loan Party to
accomplish cash collateralization pursuant to any Swap Document, and (d) all
licenses, UCC financing statements, notices and other documents executed from
time to time in connection with any of the foregoing.
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"Swap Documents" means, collectively, any Specified Swap
Agreement, the Swap Collateral Documents and the Swap Guaranties.
"Swap Guaranties" means the Guaranties under and as defined in
the Credit Agreement, but to the extent entered into by the Guarantors
thereunder for the benefit of, and as modified, extended or otherwise changed in
respect of, the Swap Provider.
"Swap Provider" has the meaning specified in the Intercreditor
Agreement.
"UCC" means the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of New York: provided, however, in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of the security interest in any Pledged
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term "UCC" shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such attachment, perfection or priority and
for purposes of definitions related to such provisions.
(c) Terms Defined in UCC. Where applicable and except as
otherwise defined herein, terms used in this Agreement shall have the meanings
assigned to them in the UCC.
(d) Interpretation. The rules of interpretation set forth in
Section 1.02 and 1.05 of the Credit Agreement shall be applicable to this
Agreement and are incorporated herein by this reference.
SECTION 2 Security Interest.
(a) Grant of Security Interest. As security for the payment
and performance of the Secured Obligations, the Grantor hereby pledges, assigns,
transfers, hypothecates and sets over to the Collateral Agent, and hereby grants
to the Collateral Agent, a security interest in, all of the Grantor's right,
title and interest in, to and under (i) the Pledged Shares and the Additional
Collateral and any certificates and instruments now or hereafter representing
the Pledged Shares and the Additional Collateral, (ii) all rights, interests and
claims with respect to the Pledged Shares and Additional Collateral, including
under any and all related agreements, instruments and other documents, and (iii)
all books, records and other documentation of the Grantor related to the Pledged
Shares and Additional Collateral, in each case whether presently existing or
owned or hereafter arising or acquired and wherever located (collectively, the
"Pledged Collateral") provided, however, that Pledged Collateral shall not
include any of the shares of capital stock of Ceridian Infotech (India) Private
Limited, a Subsidiary of the Grantor organized and existing under the laws of
India.
(b) Delivery of Pledged Shares. The Grantor hereby agrees to
deliver to or for the account of the Collateral Agent, at the address and to the
Person to be designated by theAdministrative Agent, the certificates
representing the Pledged Shares, which shall be in suitable form for transfer by
delivery, or shall be accompanied by duly executed instruments of
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310
transfer or assignment in blank, all in form and substance satisfactory to the
Collateral Agent (with the consent of the Instructing Group).
(c) Delivery of Additional Collateral. If the Grantor shall
become entitled to receive or shall receive any Additional Collateral, the
Grantor shall accept any such Additional Collateral as the agent for the
Collateral Agent, shall hold it in trust for the Collateral Agent, shall
segregate it from other property or funds of the Grantor, and shall deliver all
Additional Collateral and all certificates, instruments and other writings
representing such Additional Collateral forthwith to or for the account of the
Collateral Agent, at the address and to the Person to be designated by the
Collateral Agent upon instruction from the Instructing Group, which shall be in
suitable form for transfer by delivery, or shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
satisfactory to the Collateral Agent (with consent of the Instructing Group), as
the Collateral Agent shall request, to be held by the Collateral Agent subject
to the terms hereof, as part of the Pledged Collateral. Upon accepting any such
Additional Collateral hereunder, the Collateral Agent shall promptly send a
notification to the Grantor describing the Additional Collateral accepted and
held as part of the Pledged Collateral hereunder, which notification shall be
deemed to be a Schedule to this Agreement and may be attached hereto.
(d) Transfer of Security Interest Other Than by Delivery. If
for any reason Pledged Collateral cannot be delivered to or for the account of
the Collateral Agent as provided in subsections (b) and (c), the Grantor shall
promptly take such other steps as shall be requested from time to time by the
Collateral Agent (upon instruction of the Instructing Group) to effect a
transfer of a perfected first priority security interest in and pledge of the
Pledged Collateral to the Collateral Agent pursuant to the UCC. To the extent
practicable, the Grantor shall thereafter deliver the Pledged Collateral to or
for the account of the Collateral Agent as provided in subsections (b) and (c).
(e) Continuing Security Interest. The Grantor agrees that
this Agreement shall create continuing security interests in and pledge of the
Pledged Collateral which shall remain in effect until terminated in accordance
with Section 22.
SECTION 3 Representations and Warranties. In addition to the
representations and warranties of the Grantor made in the Credit Agreement,
which are incorporated, remade and reaffirmed herein by this reference, and
which are true, complete and accurate as of the date hereof except to the extent
such representations and warranties specifically refer to an earlier date, in
which case they are true and correct as of such earlier date, the Grantor
represents and warrants to the Collateral Agent and each of the Credit Parties
that:
(a) Valid Issuance of Pledged Collateral. All the Pledged
Shares have been, and upon issuance any Additional Collateral will be, duly and
validly issued, and are and will be fully paid and non-assessable.
(b) Ownership of Pledged Collateral. With respect to the
Pledged Shares the Grantor is, and with respect to any Additional Collateral the
Grantor will be, the legal record and
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beneficial owner thereof, and has and will have good and marketable title
thereto, subject to no Lien except for the pledge and security interests created
by this Agreement.
(c) Capitalization of the Subsidiary. The Pledged Shares
constitute 100% of the issued and outstanding shares of capital stock of the
Subsidiary, provided, however, that if the Company is a Foreign Subsidiary of
the Grantor, the Pledged Shares constitute no less than 65% of the issued and
outstanding capital stock of the Subsidiary, measured on a non-diluted basis.
(d) Options, Warrants, Etc. Other than as set forth in
Schedule 2, no securities convertible into or exchangeable for any shares of
capital stock of the Subsidiary, or any options, warrants or other commitments
entitling any Person to purchase or otherwise acquire any shares of capital
stock of the Subsidiary, are issued and outstanding.
(e) Transfer Restrictions. There are no restrictions on the
transferability of the Pledged Collateral to the Collateral Agent or with
respect to the foreclosure, transfer or disposition thereof by the Collateral
Agent.
(f) Shareholders Agreements. There are no shareholders
agreements, voting trusts, proxy agreements or other agreements or
understandings which affect or relate to the voting or giving of written
consents with respect to any of the Pledged Collateral.
(g) No Violation of Securities Laws. None of the Pledged
Shares has been transferred in violation of the securities registration,
securities disclosure or similar laws of any jurisdiction to which such transfer
may be subject.
(h) Location of Chief Executive Office. The Grantor's chief
executive office and principal place of business, and all books and records
concerning the Pledged Collateral, are located at __________________, or such
other address as to which the Grantor has notified the Collateral Agent in
accordance with Section 4(e).
(i) Other Financing Statements. Other than (i) financing
statements disclosed to the Collateral Agent and (ii) financing statements in
favor of the Collateral Agent, no effective financing statement naming the
Grantor as debtor, assignor, grantor, mortgagor, pledgor or the like and
covering all or any part of the Pledged Collateral is on file in any filing or
recording office in any jurisdiction.
(j) Enforceability; Priority of Security Interest. This
Agreement (i) creates an enforceable perfected and first priority security
interest in and pledge of the Pledged Collateral upon delivery thereof pursuant
to Section 2(b), and (ii) will create an enforceable perfected and first
priority security interest in and pledge of the Additional Collateral upon
delivery thereof pursuant to Section 2(c) (or upon the taking of such other
action with respect thereto as may be requested by the Collateral Agent pursuant
to Section 2(d)), in each case securing the payment and performance of the
Secured Obligations.
The Grantor agrees that the foregoing representations and
warranties shall be deemed to have been made by it on the date of each delivery
of Pledged Collateral hereunder.
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SECTION 4 Covenants. In addition to the covenants of the Grantor
set forth in the Credit Agreement, which are incorporated herein by this
reference, so long as any of the Secured Obligations remain unsatisfied or
unpaid, the Grantor agrees that:
(a) Defense of Pledged Collateral. The Grantor will, at its
own expense, appear in and defend any action, suit or proceeding which purports
to affect its title to, or right or interest in, the Pledged Collateral or the
security interests of the Collateral Agent therein and the pledge to the
Collateral Agent thereof.
(b) Preservation of Collateral. The Grantor will do and
perform all reasonable acts that may be necessary and appropriate to maintain,
preserve and protect the Pledged Collateral.
(c) Compliance with Laws, Etc. The Grantor will comply with
all laws, regulations and ordinances relating in a material way to the
possession, maintenance and control of the Pledged Collateral.
(d) Location of Books and Chief Executive Office. The
Grantor will: (i) keep all books and records pertaining to the Pledged
Collateral at the location set forth in Section 3(h); and (ii) give at least 30
days' prior written notice to the Collateral Agent of (A) any changes in any
such location where books and records pertaining to the Pledged Collateral are
kept, or (B) any change in the location of the Grantor's chief executive office
or principal place of business.
(e) Change in Name, Identity or Structure. The Grantor will
give at least 30 days' prior written notice to the Collateral Agent of (i) any
change in its name, (ii) any changes in, additions to or other modifications of
its trade names used as the name of Grantor, and (iii) any changes in its
identity or structure in any manner which might make any financing statement
filed hereunder incorrect or misleading.
(f) Disposition of Pledged Collateral. Except as permitted
by the Credit Agreement, the Grantor will not surrender or lose possession of
(other than to the Collateral Agent or, with the prior consent of the Collateral
Agent, to a depositary or financial intermediary), exchange, sell, convey,
assign or otherwise dispose of or transfer the Pledged Collateral or any right,
title or interest therein.
(g) Liens. Except for Permitted Liens, the Grantor will not
create, incur or permit to exist any Liens upon or with respect to the Pledged
Collateral, other than the security interests of and pledge to the Collateral
Agent created by this Agreement for the benefit of the Credit Agents.
(h) Shareholders Agreements. The Grantor will not enter into
any shareholders agreement, voting trust, proxy agreement or other agreement or
understanding which affects or relates to the voting or giving of written
consents with respect to any of the Pledged Collateral.
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(i) Issuance of Additional Shares. The Grantor will not
consent to or approve, or allow the Subsidiary to consent to or approve, the
issuance to any Person of any additional shares of any class of capital stock of
the Subsidiary, or of any securities convertible into or exchangeable for any
such shares, or any warrants, options or other rights to purchase or otherwise
acquire any such shares, except as permitted under the Credit Agreement.
(j) Notices. The Grantor will deliver promptly to the
Collateral Agent all reports and notices received by the Grantor from the
Subsidiary in respect of any of the Pledged Collateral.
(k) Further Assurances. The Grantor will promptly, upon the
written request from time to time of the Collateral Agent, execute, acknowledge
and deliver, and file and record, all such financing statements and other
documents and instruments, and take all such action, as shall be reasonably
necessary to carry out the purposes of this Agreement.
SECTION 5 Administration of the Pledged Collateral.
(a) Distributions and Voting Prior to an Event of Default.
Unless there exists any Default or Event of Default: (i) the Grantor shall be
entitled to receive and retain for its own account any cash dividend on or other
cash distribution, if any, in respect of the Pledged Collateral; and (ii) the
Grantor shall have the right to vote the Pledged Collateral and to retain the
power to control the direction, management and policies of the Subsidiary to the
same extent as the Grantor would if the Pledged Collateral were not pledged to
the Collateral Agent pursuant to this Agreement; provided, however, that the
Grantor shall not be entitled to receive (A) cash paid, payable or otherwise
distributed in redemption of, or in exchange for or in substitution of, any
Pledged Collateral, or (B) dividends and other distributions paid or payable in
cash in respect of any Pledged Collateral in connection with a partial or total
liquidation or dissolution of the Subsidiary or in connection with a reduction
of capital, capital surplus or paid-in-surplus or any other type of
recapitalization involving the Subsidiary; and provided further, however, that
no vote shall be cast or consent, waiver or ratification given or action taken
which would have the effect of impairing the position or interest of the
Collateral Agent in respect of the Pledged Collateral or which would alter the
voting rights with respect to the stock of the Subsidiary or be inconsistent
with or violate any provision of this Agreement and other Credit Documents. If
applicable, the Grantor shall be deemed the beneficial owner of all Pledged
Collateral for purposes of Sections 13 and 16 of the Exchange Act and agrees to
file all reports required to be filed by beneficial owners of securities
thereunder. The Collateral Agent shall execute and deliver (or cause to be
executed and delivered) to the Grantor all such proxies and other instruments as
the Grantor may reasonably request for the purpose of enabling the Grantor to
exercise the voting and other rights which it is entitled to exercise pursuant
to this subsection (a) and to receive the distributions which it is authorized
to receive and retain pursuant to this subsection (a).
(b) General Authority upon an Event of Default. If there
exists any Default or Event of Default:
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(i) the Collateral Agent shall be entitled to
receive all distributions and payments of any nature with respect to the Pledged
Collateral, to be held by the Collateral Agent as part of the Pledged
Collateral;
(ii) the Collateral Agent shall have the right
following prior written notice to the Grantor to vote or consent to take any
action with respect to the Pledged Shares and exercise all rights of conversion,
exchange, subscription or any other rights, privileges or options pertaining to
the Pledged Collateral as if the Collateral Agent were the absolute owner
thereof; and
(iii) the Collateral Agent shall have the right, for
and in the name, place and stead of the Grantor, to execute endorsements,
assignments or other instruments of conveyance or transfer with respect to all
or any of the Pledged Collateral, to endorse any checks, drafts, money orders
and other instruments relating thereto, to ▇▇▇ for, collect, receive and give
acquittance for all moneys due or to become due in connection with the Pledged
Collateral and otherwise to file any claims, take any action or institute,
defend, settle or adjust any actions, suits or proceedings with respect to the
Pledged Collateral, execute any and all such other documents and instruments,
and do any and all such acts and things, as the Collateral Agent may deem
necessary or desirable to protect, collect, realize upon and preserve the
Pledged Collateral, to enforce the Collateral Agent's rights with respect to the
Pledged Collateral and to accomplish the purposes of this Agreement.
(c) Distributions to Be Held for Administrative Agent.
Distributions and other payments which are received by the Grantor but which it
is not entitled to retain as a result of the operation of subsection (a) or (b)
shall be held in trust for the benefit of the Collateral Agent, be segregated
from the other property or funds of the Grantor, and be forthwith paid over or
delivered to the Collateral Agent in the same form as so received.
(d) Certain Other Administrative Matters. At any time and
from time to time, the Collateral Agent may cause any of the Pledged Collateral
to be transferred into its name or into the name of its nominee or nominees
(subject to the revocable rights specified in subsection (a)). The Collateral
Agent shall at all times have the right to exchange uncertificated Pledged
Collateral for certificated Pledged Collateral, and to exchange certificated
Pledged Collateral for certificates of larger or smaller denominations, for any
purpose consistent with this Agreement.
(e) Appointment of Collateral Agent as Attorney-in-Fact. For
the purpose of enabling the Collateral Agent to exercise its rights under this
Section 5 or otherwise in connection with this Agreement, the Grantor hereby (i)
constitutes and appoints Collateral Agent (and any of the Collateral Agent's
officers, employees or agents designated by the Collateral Agent ) Grantor's
true and lawful attorney-in-fact, with full power and authority to execute any
notice, assignment, endorsement or other instrument or document, and to do any
and all acts and things for and on behalf of the Grantor, which the Collateral
Agent may deem necessary or desirable (with the consent of the Instructing
Group) to protect, collect, realize upon and preserve the Pledged Collateral, to
enforce the Collateral Agent's rights with respect to the Pledged Collateral and
to accomplish the purposes hereof, and (ii) revokes all previous proxies with
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regard to the Pledged Collateral and appoints the Collateral Agent as its proxy
holder with respect to the Pledged Collateral to attend and vote at any and all
meetings of the shareholders of the Subsidiary held on or after the date of this
proxy and prior to the termination hereof, with full power of substitution to do
so and agrees, if so requested, to execute or cause to be executed appropriate
proxies therefor. Each such appointment is coupled with an interest and
irrevocable so long as any of the Secured Obligations have not been paid and
performed in full. The Grantor hereby ratifies, to the extent permitted by law,
all that the Collateral Agent shall lawfully and in good faith do or cause to be
done by virtue of and in compliance with this Section 5. The Collateral Agent
agrees that, unless there exists any Default or Event of Default, it shall not
exercise the power of attorney, or any rights granted to the Collateral Agent,
pursuant to this subsection (e). The foregoing power of attorney is coupled with
an interest and irrevocable so long as the Secured Obligations have not been
paid and performed in full. Grantor hereby ratifies, to the extent permitted by
law, all that the Collateral Agent shall lawfully and in good faith do or cause
to be done by virtue of and in compliance with this Section 5.
SECTION 6 Performance of Grantor Obligations. The Collateral
Agent may perform or pay any obligation which the Grantor has agreed to perform
or pay under or in connection with this Agreement, and the Grantor shall
reimburse the Collateral Agent on demand for any amounts paid by the Collateral
Agent pursuant to this Section 6.
SECTION 7 Collateral Agent's Duties. Notwithstanding any
provision contained in this Agreement, the Collateral Agent shall have no duty
to exercise any of the rights, privileges or powers afforded to it and shall not
be responsible to the Grantor or any other Person for any failure to do so or
delay in doing so. Beyond the exercise of reasonable care to assure the safe
custody of the Pledged Collateral while held hereunder and the accounting for
moneys actually received by the Collateral Agent hereunder, the Collateral Agent
shall have no duty or liability to exercise or preserve any rights, privileges
or powers pertaining to the Pledged Collateral.
SECTION 8 Remedies.
(a) Remedies. If there exists any Default or Event of
Default, the Collateral Agent shall have, in addition to all other rights and
remedies granted to it in this or any Credit Document, all rights and remedies
of a secured party under the UCC and other applicable laws. Without limiting the
generality of the foregoing, the Grantor agrees that any item of the Pledged
Collateral may be sold for cash or on credit or for future delivery without
assumption of any credit risk, in any number of lots at the same or different
times, at any exchange, brokers' board or elsewhere, by public or private sale,
and at such times and on such terms, as the Collateral Agent shall determine;
provided, however, that the Grantor shall be credited with the net proceeds of
sale only when such proceeds are finally collected by the Collateral Agent. The
Grantor hereby agrees that the sending of notice by ordinary mail, postage
prepaid, to the address of the Grantor set forth in the Credit Agreement, of the
place and time of any public sale or of the time after which any private sale or
other intended disposition is to be made, shall be deemed reasonable notice
thereof if such notice is sent ten days prior to the date of such sale or other
disposition or the date on or after which such sale or other disposition may
occur, provided that the Collateral Agent may provide the Grantor shorter notice
or no notice, to the extent permitted
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by the UCC or other applicable law. The Grantor recognizes that the Collateral
Agent may be unable to make a public sale of any or all of the Pledged
Collateral, by reason of prohibitions contained in applicable securities laws or
otherwise, and expressly agrees that a private sale to a restricted group of
purchasers for investment and not with a view to any distribution thereof shall
be considered a commercially reasonable sale. The Collateral Agent and each
Credit Party shall have the right upon any such public sale, and, to the extent
permitted by law, upon any such private sale, to purchase the whole or any part
of the Pledged Collateral so sold, free of any right or equity of redemption,
which right or equity of redemption the Grantor hereby releases to the extent
permitted by law.
(b) Proceeds Account. To the extent that any of the Secured
Obligations may be contingent, unmatured or unliquidated (including with respect
to undrawn amounts under the Letters of Credit) at such time as there may exist
an Event of Default, the Collateral Agent may, upon instruction by the
Instructing Group, (i) retain the proceeds of any sale, collection, disposition
or other realization upon the Pledged Collateral (or any portion thereof) in a
special purpose non-interest-bearing restricted deposit account (the "Proceeds
Account") created and maintained by the Collateral Agent for such purpose (as to
which the Grantor hereby grants a security interest and which shall constitute
part of the Pledged Collateral hereunder) until such time as the Collateral
Agent may elect (with the consent of the Instructing Group) to apply such
proceeds to the Secured Obligations, and the Grantor agrees that such retention
of such proceeds by the Collateral Agent shall not be deemed strict foreclosure
with respect thereto; (ii) in any manner elected by the Collateral Agent (with
the consent of the Instructing Group), estimate the liquidated amount of any
such contingent, unmatured or unliquidated claims and apply the proceeds of the
Pledged Collateral against such amount; or (iii) otherwise proceed in any manner
permitted by applicable law. The Grantor agrees that the Proceeds Account shall
be a blocked account and that upon the irrevocable deposit of funds into the
Proceeds Account, the Grantor shall not have any right of withdrawal with
respect to such funds. Accordingly, the Grantor irrevocably waives until the
termination of this Agreement in accordance with Section 22 the right to make
any withdrawal from the Proceeds Account and the right to instruct the
Collateral Agent to honor drafts against the Proceeds Account.
(c) Application of Proceeds. Subject to subsection (b), cash
proceeds actually received from the sale or other disposition or collection of
Collateral, and any other amounts received in respect of the Collateral the
application of which is not otherwise provided for herein, shall be applied
(after payment of any amounts payable to the applicable Credit Parties or the
Collateral Agent pursuant to Section 6 or Section 13) in whole or in part by the
applicable Credit Parties or the Collateral Agent against all or any part of the
Secured Obligations in the manner and to the extent set forth in the
Intercreditor Agreement.
SECTION 9 Registration Rights.
(a) Registration of Pledged Collateral. If the Collateral
Agent at the request of the Instructing Group shall determine to exercise its
right to sell any or all of the Pledged Collateral pursuant to Section 8, and if
the Collateral Agent shall determine (with the consent of the Instructing Group)
that it is necessary or advisable to have the Pledged Collateral, or that
portion thereof to be sold, registered under the provisions of the Securities
Act, the Grantor shall
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execute and deliver, and shall cause the Subsidiary and the Grantor's and the
Subsidiary's respective directors and officers to execute and deliver, all such
instruments and documents, and to do or cause to be done all such other acts and
things as may, in the view of the Collateral Agent, be advisable to register
such Pledged Collateral under the provisions of the Securities Act and to cause
the registration statement relating thereto to become effective and to remain
effective for such period as prospectuses are required by law to be furnished,
and to make all amendments and supplements thereto and to the related prospectus
which, in the view of the Collateral Agent (with the consent of the Instructing
Group), are necessary or be necessary or advisable, all in conformity with the
requirements of the Securities and Exchange Commission applicable thereto. The
Grantor agrees to comply, and to cause the Subsidiary to comply, with the
provisions of the securities or "Blue Sky" laws of any jurisdiction which the
Collateral Agent shall designate, and to cause the Subsidiary to make available
to its security holders, as soon as practicable, an earnings statement (which
need not be audited) which shall satisfy the provisions of Section 11(a) of the
Securities Act. The Grantor shall cause to be furnished to the Collateral Agent
and each of the Credit Agents such number of copies of each preliminary
prospectus and prospectus, shall promptly notify the Collateral Agent of the
happening of any event (upon becoming aware thereof) as a result of which any
then effective prospectus includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of then existing
circumstances and shall cause the Collateral Agent and each Credit Agent to be
furnished with such number of copies as any such Person may reasonably request
of such supplement to or amendment of such prospectus as is necessary to
eliminate such untrue statement or correct such omission.
(b) No Obligation to Delay Private Sale. Neither the
Collateral Agent nor the Credit Parties shall be under any obligation to delay a
private sale of any of the Pledged Collateral (as contemplated by subsection
(a)) for the period of time necessary to permit the issuer thereof to register
such Pledged Collateral for public sale under the Securities Act, or under
applicable state securities laws, even if such issuer would agree to do so.
(c) Further Acts. The Grantor further agrees to do or to use
its best efforts to cause to be done all such other acts and things as may be
necessary to make any sales of all or any portion of the Pledged Collateral
pursuant to subsections (a) and (b) valid and binding and in compliance with any
and all applicable laws (including the Exchange Act), regulations, orders,
writs, injunctions, decrees or awards of any and all Governmental Authorities
having jurisdiction over any such sale or sales.
(d) Equitable Relief. The Grantor acknowledges that a breach
of any of the covenants contained in this Section 9 will cause irreparable
injury to the Collateral Agent and the Credit Parties, that the Collateral Agent
and Credit Parties have no adequate remedy at law in respect of such breach and,
as a consequence, agrees that each and every covenant contained in this Section
9 shall be specifically enforceable against the Grantor, and the Grantor hereby
waives and agrees not to assert any defenses against an action for specific
performance of such covenants except for a defense that no Event of Default has
occurred under the provisions of the Credit Agreement.
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(e) Costs and Expenses. The Grantor shall bear all costs and
expenses of carrying out its obligations under this Section 9.
SECTION 10 Certain Waivers. The Grantor waives, to the fullest
extent permitted by law, (i) any right of redemption with respect to the Pledged
Collateral, whether before or after sale hereunder, and all rights, if any, of
marshalling of the Pledged Collateral or other collateral or security for the
Secured Obligations; (ii) any right to require the Collateral Agent (A) to
proceed against any Person, (B) to exhaust any other collateral or security for
any of the Secured Obligations, (C) to pursue any remedy in Collateral Agent's
power, or (D) to make or give any presentments, demands for performance, notices
of nonperformance, protests, notices of protests or notices of dishonor in
connection with any of the Pledged Collateral; and (iii) all claims, damages,
and demands against the Collateral Agent arising out of the repossession,
retention, sale or application of the proceeds of any sale of the Pledged
Collateral.
SECTION 11 Notices. All notices, requests or other
communications hereunder shall be given in the manner and to the addresses
specified in the Credit Agreement; provided, however, that notices hereunder (a)
to the Swap Provider shall be delivered to Fleet National Bank using the
information listed in Schedule 10.02 of the Credit Agreement for such party as a
Lender (or such replacement Swap Provider as may be appointed from time to time
consistent with the terms of the Intercreditor Agreement), and (b) to the Note
Holders as set forth in the Note Purchase Agreement (or such replacement Note
Holders as may be appointed from time to time consistent with the terms of the
Intercreditor Agreement). All such notices, requests and communications shall,
when transmitted by overnight delivery, or faxed, be effective when delivered
for overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon receipt by the addressee, or if
delivered, upon delivery.
SECTION 12 No Waiver; Cumulative Remedies. No failure on the
part of the Collateral Agent or any Credit Party to exercise, and no delay in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
remedy, power or privilege preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights and remedies
under this Agreement are cumulative and not exclusive of any rights, remedies,
powers and privileges that may otherwise be available to the Collateral Agent or
any Credit Party.
SECTION 13 Costs and Expenses; Indemnification; Other Charges.
(a) Costs and Expenses. The Grantor agrees to pay on demand:
(i) the out-of-pocket costs and expenses of the
Collateral Agent and any of the Credit Parties' attorney costs, in connection
with the negotiation, preparation, execution, delivery and administration of
this Agreement, and any amendments, modifications or waivers of the terms
thereof, and the custody of the Pledged Collateral;
(ii) all title, appraisal (including the allocated
cost of internal appraisal services), survey, audit, consulting, search,
recording, filing and similar costs, fees and expenses incurred or sustained by
the Collateral Agent or any Credit Party in connection with this Agreement or
the Pledged Collateral; and
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(iii) all costs and expenses of the Collateral Agent
or any Credit Party, including Attorney Costs, in connection with the
enforcement or attempted enforcement of, and preservation of any rights or
interest under, this Agreement, any out-of-court workout or other refinancing or
restructuring or in any bankruptcy case, and the protection, sale or collection
of, or other realization upon, any of the Pledged Collateral, including any and
all losses, costs and expenses sustained by the Collateral Agent and any Credit
Party as a result of any failure by the Grantor to perform or observe its
obligations contained herein.
(b) Indemnification. The Grantor shall indemnify, defend and
hold the Collateral Agent, Agent-Related Persons and each Credit Party and each
of its respective officers, directors, employees, counsel, agents and
attorneys-in-fact (each, an "Indemnified Person") harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, charges, expenses and disbursements (including Attorney
Costs) of any kind or nature whatsoever which may at any time be imposed on,
incurred by or asserted against any such Person in favor of any third-party in
any way relating to or arising out of this Agreement or any document
contemplated by or referred to herein, or the transactions contemplated hereby,
or any action taken or omitted by any such Person under or in connection with
any of the foregoing, including caused by, arising out of or by reason of any
alleged untrue statement of a material fact contained in any registration
statement (or any amendment thereto) or in any preliminary prospectus or
prospectus (or any amendment or supplement thereto) contemplated by Section
9(a), or any alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, except to
the extent that any such liabilities, obligations, losses, claims, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements are
caused by, arise solely out of or by reason of any such alleged untrue statement
made or such alleged omission to state a material fact included or excluded on
the written direction of any of the Collateral Agent or any Credit Party
(including information supplied by the Collateral Agent or any Credit Party),
and including with respect to any investigation, litigation or proceeding
(including any insolvency proceeding or appellate proceeding) related to or
arising out of this Agreement or relating to the Collateral, whether or not any
Indemnified Person is a party thereto (all of the foregoing, collectively, the
"Indemnified Liabilities"); provided that the Grantor shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities to
the extent they are found by a final decision of a court of competent
jurisdiction to have resulted solely from the gross negligence or willful
misconduct of such Indemnified Person. If and to the extent that the foregoing
indemnification is for any reason held unenforceable, the Grantor agrees to make
the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law.
(c) Other Charges. The Grantor agrees to indemnify the
Indemnified Persons against and hold each of them harmless from any and all
present and future stamp, transfer, documentary and other such taxes, levies,
fees, assessments and other charges made by any jurisdiction by reason of the
execution, delivery, performance and enforcement of this Agreement.
(d) Interest. Any amounts payable to the Collateral Agent or
any Credit Party under this Section 13 or otherwise under this Agreement if not
paid upon demand shall bear
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interest from the date of such demand until paid in full, at the applicable rate
of interest (a) for the Administrative Agent or any Lender, as set forth in
Section 2.08(b) of the Credit Agreement, (b) for the Swap Provider, as set forth
in the Specified Swap Agreement, and (c) for any Note Holder, as set forth in
Section 2.08(b) of the Note Purchase Agreement.
SECTION 14 Binding Effect. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by the Grantor, the Collateral Agent
and each Credit Party and their respective successors and assigns.
SECTION 15 Governing Law and Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, EXCEPT AS REQUIRED BY MANDATORY
PROVISIONS OF LAW AND TO THE EXTENT THE VALIDITY OR PERFECTION OF THE SECURITY
INTERESTS HEREUNDER, OR THE REMEDIES HEREUNDER, IN RESPECT OF ANY COLLATERAL ARE
GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN NEW YORK, PROVIDED THAT THE
COLLATERAL AGENT AND EACH CREDIT PARTY SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER COLLATERAL DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ SITTING IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
PARTY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
PARTY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH THEY MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN ANY FEDERAL COURT
OR STATE COURT SITTING IN NEW YORK IN RESPECT OF ANY LOAN DOCUMENT OR OTHER
DOCUMENT RELATED THERETO. THE GRANTOR, THE COLLATERAL AGENT AND EACH CREDIT
PARTY WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
SECTION 16 Waiver of Right to Jury Trial. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS AGREEMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR
ANY OF THEM WITH RESPECT TO THIS AGREEMENT, ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER
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ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
SECTION 17 Entire Agreement; Amendment. This Agreement, together
with the other Credit Documents, embodies the entire agreement and understanding
among the Grantor and the Collateral, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof. Subject to Section
18, this Agreement shall be amended only by written agreement with the written
consent of the Instructing Group; provided, however, that any amendment having
the effect of causing a release of all or substantially all of the Collateral
must be consented to in writing by the Collateral Agent and each of the Credit
Agents.
SECTION 18 Independence. This Agreement sets forth independent
and separate security interests of the Grantor in favor of the Collateral Agent
in respect of the Secured Obligations owing to the Collateral Agent for the
benefit of each Credit Agent. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
with respect to any Credit Agent shall not in any way affect or impair the
legality or enforceability of that or any other provision of this Agreement or
any instrument or agreement required hereunder in respect to any other Credit
Agent. The parties acknowledge that this Agreement has, solely for reasons of
convenience, been prepared and executed as a single document, but that the legal
effect shall be in all respects as though the Grantor had executed separate
security interests, for the benefit of each of the Credit Agents. Any provision
of this Agreement and the other Credit Documents to which the Grantor is a party
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions thereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 19 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute but one and the same agreement.
SECTION 20 Incorporation of Provisions of the Credit Agreement.
To the extent the Credit Agreement contains provisions of general applicability
to the Loan Documents, including any such provisions contained in Article X
thereof, such provisions are incorporated herein by this reference.
SECTION 21 No Inconsistent Requirements. The Grantor
acknowledges that this Agreement, and the other Credit Documents may contain
covenants and other terms and provisions variously stated regarding the same or
similar matters, and agrees that all such
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covenants, terms and provisions are cumulative and all shall be performed and
satisfied in accordance with their respective terms.
SECTION 22 Termination. Upon termination of the Commitments of
the Lenders, surrender of all Letters of Credit and payment and performance in
full of all Secured Obligations, this Agreement shall terminate and the
Collateral Agent shall (with the consent of the Instructing Group) promptly
redeliver to the Grantor any of the Pledged Collateral in its possession and
shall execute and deliver to the Grantor such documents and instruments
reasonably requested by the Grantor as shall be necessary to evidence
termination of all security interests given by the Grantor to the Collateral
Agent hereunder; provided, however, that the obligations of the Grantor under
Sections 9(e) and 13 shall survive such termination. Upon satisfaction to all
conditions precedent to any permitted disposition set forth herein or in the
other Credit Documents, the Collateral Agent shall execute and deliver any
releases or other documents reasonably requested by the relevant Grantor to
accomplish or confirm the release of Pledged Shares provided by this Section.
SECTION 23 Intercreditor Agreement. Notwithstanding anything set
forth in this Agreement, any inconsistency between this Agreement and the
Intercreditor Agreement in respect of the rights and obligations of the
Collateral Agent and the Credit Agents owing to and among each other (but not
including in respect of the obligations of the Grantor to the Collateral Agent
or Credit Agents hereunder) shall be resolved in favor of the Intercreditor
Agreement.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
[ ]
------------------------------------
THE GRANTOR
By:
-----------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
THE COLLATERAL AGENT
By:
-----------------------------------
Name:
Title:
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SCHEDULE 1
to the Stock Pledge Agreement
PLEDGED SHARES
_______ stock of _________________ being represented by stock
certificates as follows:
Certificate No. Certificate Date No. of Shares
SCHEDULE 1-1
325
SCHEDULE 2
to the Stock Pledge Agreement
SECURITIES CONVERTIBLE INTO OR EXCHANGEABLE FOR SHARES
OF CAPITAL STOCK OF THE SUBSIDIARIES
SCHEDULE 2-1
326
SCHEDULE 3
to the Stock Pledge Agreement
SECURITIES CONVERTIBLE INTO OR EXCHANGEABLE FOR SHARES
OF CAPITAL STOCK OF THE SUBSIDIARY
SCHEDULE 3-1
327
EXHIBIT L
FORM OF EFFECTIVENESS DATE OPINIONS OF COUNSEL
(CONTENT SUMMARY)
1. Each Loan Party is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware with the corporate power
and authority and all material governmental licenses, authorizations, consents
and approvals to own and operate (or lease, as the case may be) its properties
and to carry on its business as it is now conducted. Each Loan Party is
qualified as a foreign corporation, licensed and in good standing in each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification or license, except where the failure
to be so qualified, licensed or in good standing would not adversely affect the
business or operations of such Loan Party in any significant manner.
2. Each Loan Party has the corporate power and authority to enter into and
perform the Loan Documents to which it is a party, and has taken all necessary
corporate action to authorize the execution, delivery and performance of such
Loan Documents.
3. No authorization, consent, approval, license, exemption of, or filing or
registration with, any Governmental Authority, or approval or consent of any
other Person, is required for the due execution, delivery or performance by, or
enforcement against, any Loan Party of the Loan Documents to which it is a
party.
4. The Loan Documents to which each Loan Party is a party have been duly
executed and delivered by such Loan Party and constitute the legal, valid and
binding obligations of such Loan Party, enforceable against such Loan Party in
accordance with their respective terms.
5. The execution, delivery and performance by each Loan Party of the Loan
Documents to which it is a party will not (i) violate or be in conflict with any
provision of the certificate or articles of incorporation, as the case may be,
or by-laws of such Loan Party, (ii) violate or be in conflict with any law or
regulation having applicability to such Loan Party, (iii) violate or contravene
any judgment, decree, injunction, writ or order of any court, or any arbitrator
or other Governmental Authority, having jurisdiction over such Loan Party or
such Loan Party's properties or by which such Loan Party may be bound, or (iv)
violate or conflict with, or constitute a default under or result in the
termination of, or accelerate the performance required by, any indenture, any
loan or credit agreement (including the Existing Credit Facility), or any other
agreement for borrowed money or any other material agreement, lease or
instrument to which such Loan Party is a party or by which it or such Loan
Party's properties may be bound, or result in the creation of any Lien upon any
of the assets or properties of such Loan Party.
6. The provisions of the Borrower Security Agreement and the Subsidiary
Security Agreement (collectively, the "Security Agreements") are in form
sufficient to create, in favor of the Administrative Agent, as secured party, a
valid security interest in and lien on the Collateral described in such Security
Agreements and the financing statements related thereto. The financing
statements filed with the ____________ (the "Filing Offices") are in appropriate
form for filing in the Filing Offices, (ii) the Filing Offices are the
appropriate filing offices in order to
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perfect a security interest in such Collateral, subject only to the provisions
of the Intercreditor Agreement, (iii) the Administrative Agent has a perfected
security interest in such Collateral, and (iv) no other action is necessary
under the Uniform Commercial Code or other laws (including without limitation
the U.S. copyright laws, the U.S. patent laws and the U.S. trademark laws) as in
effect in ______________ to perfect a security interest in such Collateral.
7. The provisions of the Borrower Stock Pledge Agreement and the Subsidiary
Stock Pledge Agreement (collectively, the "Stock Pledge Agreements") are in form
sufficient to create, in favor of the Administrative Agent, as secured party, a
valid security interest in and lien on the Pledged Collateral described therein.
The security interest in the Pledged Collateral created under the Stock Pledge
Agreements will become perfected upon delivery to and possession by the
Administrative Agent of the certificates representing the Pledged Collateral,
indorsed to the Administrative Agent or in blank by an effective indorsement.
8. Based solely on our review of the minute books and stock records of the
Loan Parties, to our knowledge, the authorized, issued and outstanding capital
stock of each Loan Party (other than Ceridian) as set forth on Schedule __
hereto constitutes all of the authorized, issued and outstanding capital stock
of such Loan Party, and all of such issued and outstanding capital stock is
owned of record by the Persons indicated on such Schedule __.
9. No filings, registrations, recordings, or other actions are necessary
under the laws of _______________ to create, preserve, perfect, and protect the
Administrative Agent's Lien in the Pledged Securities under the Stock Pledge
Agreements, and no consent, approval, or authorization of any Person is required
under the laws of _______________ in order for the Administrative Agent's Lien
to be created, preserved, perfected, and protected.
10. The extension of credit under the Credit Agreement does not violate the
provisions of Regulations T, U or X of the Federal Reserve Board.
11. No Loan Party is an "investment company," or a company "controlled" by
an "investment company," within the meaning of the Investment Company Act of
1940.
12. No Loan Party is a "holding company" or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of Public Utility Holding
Company Act of 1935.
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EXHIBIT M
FORM OF CLOSING DATE OPINIONS OF COUNSEL
(CONTENT SUMMARY)
1. Each Loan Party has the corporate power and authority to enter into and
perform the Spin-Off Transaction and each of the Spin-Off Documents to which it
is a party, and has taken all necessary corporate action to authorize the
execution, delivery and performance of each Spin-Off Document and to consummate
the Spin-Off Transaction.
2. No authorization, consent, approval, license, exemption of, or filing or
registration with, any Governmental Authority, or approval or consent of any
other Person, is required for the due execution, delivery or performance by, or
enforcement against, any Loan Party of any Spin-Off Document to which it is a
party, or to consummate the Spin-Off Transaction, except as have been obtained
prior to the Closing Date.
3. The Spin-Off Documents to which each Loan Party is a party have been
duly executed and delivered by such Loan Party and constitute the legal, valid
and binding obligations of such Loan Party, enforceable against such Loan Party
in accordance with their respective terms.
4. The execution, delivery and performance by each Loan Party of each
Spin-Off Document to which it is a party, and the consummation of the Spin-Off
Transaction, will not (i) violate or be in conflict with any provision of the
certificate or articles of incorporation, as the case may be, or by-laws of such
Loan Party, (ii) violate or be in conflict with any law or regulation having
applicability to such Loan Party, (iii) violate or contravene any judgment,
decree, injunction, writ or order of any court, or any arbitrator or other
Governmental Authority, having jurisdiction over such Loan Party or such Loan
Party's properties or by which such Loan Party may be bound, or (iv) violate or
conflict with, or constitute a default under or result in the termination of, or
accelerate the performance required by, any indenture, any loan or credit
agreement, or any other agreement for borrowed money or any other material
agreement, lease or instrument to which such Loan Party is a party or by which
it or such Loan Party's properties may be bound, or result in the creation of
any Lien upon any of the assets or properties of such Loan Party.
5. The Distribution is legal under the Delaware General Corporation Law.
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EXHIBIT N
FORM OF ADDITIONAL GUARANTOR ASSUMPTION AGREEMENT
Date: ______________
To each of the Lenders party to the Credit Agreement referred to below, and to
Bank of America, N.A., as the Administrative Agent
Ladies and Gentlemen:
This agreement ("Additional Guarantor Assumption Agreement") is
made and delivered pursuant to Section 6.14 of that certain Credit Agreement
dated as of January 31, 2001 (as renewed, extended, amended or restated, the
"Credit Agreement"), among CERIDIAN CORPORATION (the "Borrower"), the several
financial institutions from time to time party thereto (each a "Lender" and
together with the Assignor, the "Lenders") and BANK OF AMERICA, N.A., as
administrative agent (in such capacity, the "Administrative Agent"). All
capitalized terms used in this Additional Guarantor Assumption Agreement and not
otherwise defined herein shall have the meanings assigned to them in the Credit
Agreement.
_____________, a _____________ corporation (the "Subsidiary")
hereby confirms, represents and warrants to the Administrative Agent and the
Lenders that the Subsidiary is a Subsidiary of the Borrower effective as of
________________. [The Subsidiary further represents that it is a Foreign
Subsidiary.]
The documents, resolutions, incumbency and officer's
certificates, opinions of counsel, UCC-1 financing statements, Supplemental IP
Security Agreements and other documents and certificates required to be
delivered to the Administrative Agent under subsections (b) and (c) of Section
6.14 and Section 6.16 of the Credit Agreement will be furnished to the
Administrative Agent in accordance with the requirements of the Credit
Agreement.
The Subsidiary hereby confirms that with effect from the date
hereof, the Subsidiary shall (i) be a party to the Guaranty, dated as of January
31, 2001 (the "Subsidiary Guaranty"), given by certain Subsidiaries of the
Borrower, as Guarantor, in favor of the Administrative Agent, to the Security
Agreement, dated as of January 31, 2001, (the "Subsidiary Security Agreement"),
among certain Subsidiaries of the Borrower, as Grantors, and the Administrative
Agent and to the Supplemental IP Security Agreements dated as of ______, ____,
and ______; and (ii) shall have the same obligations, duties and liabilities
towards the Administrative Agent and Lenders as those which the Subsidiary would
have had if the Subsidiary had been an original party to the Subsidiary
Guaranty, as a Guarantor, and the Subsidiary Security Agreement, as a Grantor
(and pursuant to Section 2(a) of the Subsidiary
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Security Agreement, the Subsidiary hereby grants to the Administrative Agent a
security interest in all its "Collateral" (as defined therein) as security for
the payment and performance of the Secured Obligations (as defined therein)).
The Subsidiary hereby confirms its acceptance of, and consents to, all
representations and warranties, covenants, and other terms and provisions of the
Subsidiary Guaranty applicable to Guarantors, and the Subsidiary Security
Agreement applicable to Grantors, and to any other Loan Documents to which the
Guarantors are parties.
Without limiting the generality of the foregoing, the Subsidiary
confirms that effective as of the date hereof it shall be liable as a Guarantor
pursuant to Section 8.01(n) of the Credit Agreement.
This Additional Guarantor Assumption Agreement shall constitute
a Loan Document under the Credit Agreement.
THIS ADDITIONAL GUARANTOR ASSUMPTION AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Subsidiary has caused this Additional
Guarantor Assumption Agreement to be duly executed and delivered in
_____________, ______________, by its proper and duly authorized officer as of
the day and year first above written.
[SUBSIDIARY]
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
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EXHIBIT O
FORM OF ADDITIONAL GUARANTOR OPINION OF COUNSEL
(CONTENT SUMMARY)
1. The Additional Guarantor is a ___________ duly
organized, validly existing and in good standing under the laws of [the State of
__________] [the country of _________] with the power and authority to own and
operate (or lease, as the case may be) its properties and to carry on its
business as it is now conducted. The Additional Guarantor is qualified and in
good standing in ___________________.
2. The Additional Guarantor has the power and authority to
enter into and perform the Additional Guarantor Documents, and has taken all
necessary action to authorize the execution, delivery and performance of the
Additional Guarantor Documents.
3. No authorization, consent, approval, license, exemption
of, or filing or registration with, any Governmental Authority, or approval or
consent of any other Person, is required for the due execution, delivery or
performance by the Additional Guarantor of the Additional Guarantor Documents[,
except for recordings or filings in connection with the perfection of the Liens
on the Collateral in favor of the Administrative Agent on behalf of the
Lenders].
4. The Additional Guarantor Documents have been duly
executed and delivered by the Additional Guarantor and constitute the legal,
valid and binding obligations of the Additional Guarantor enforceable against
the Additional Guarantor in accordance with their respective terms.
5. The execution, delivery and performance by the
Additional Guarantor of the Additional Guarantor Documents will not (i) violate
or be in conflict with any provision of the _______________ [specify applicable
Organization Documents reviewed] of the Additional Guarantor or any, (ii)
violate or be in conflict with any law or regulation having applicability to the
Additional Guarantor, (iii) violate or contravene any judgment, decree,
injunction, writ or order of any court, or any arbitrator or other Governmental
Authority, having jurisdiction over the Additional Guarantor or the Additional
Guarantor's properties or by which the Additional Guarantor may be bound, or
(iv) violate or conflict with, or constitute a default under or result in the
termination of, or accelerate the performance required by, any indenture, any
loan or credit agreement, or any other agreement for borrowed money or any other
material Contractual Obligation to which the Additional Guarantor is a party or
by which it or the Additional Guarantor's properties may be bound, or result in
the creation of any Lien upon any of the assets or properties of the Additional
Guarantor.
6. The provisions of the Security Agreement [and
Supplemental IP Security Agreement] are in form sufficient to create, in favor
of the Administrative Agent on behalf of the Lenders, as secured party, a valid
security interest in and lien on the Collateral of the Additional Guarantor
described in the Security Agreement and the financing statements. Upon the
filing of the financing statements with the filing offices and the delivery of
the Pledged Collateral, the
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Administrative Agent will have a valid and perfected security interest in and
lien on all of such Collateral described in the Security Agreement and the
financing statements.
7. Except as specifically disclosed in
__________________________, there are no actions, suits, proceedings, claims or
disputes pending, or to the best of our knowledge, threatened or contemplated,
at law, in equity, in arbitration or before any Governmental Authority, against
the Additional Guarantor or any of its properties which (i) purport to affect or
pertain to the Additional Guarantor Documents, or any of the transactions
contemplated thereby; or (ii) if determined adversely to the Additional
Guarantor, would be likely to have a Material Adverse Effect.
8. Our opinion set forth in paragraph 4 above is subject to
the qualification that the enforceability of the Additional Guarantor Documents
may be limited by bankruptcy, insolvency, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally and by general
equity principles.
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