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EXHIBIT 10.1
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[BANK OF AMERICA LOGO]
CREDIT AGREEMENT
Dated as of June 29, 2001
among
GRANITE CONSTRUCTION INCORPORATED,
as the Borrower,
BANK OF AMERICA, N.A.,
as Administrative Agent, as a Lender,
and
as L/C 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
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ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS.... ................................ 1
1.01 DEFINED TERMS................................................................ 1
1.02 OTHER INTERPRETIVE PROVISIONS................................................ 16
1.03 ACCOUNTING TERMS............................................................. 16
1.04 ROUNDING..................................................................... 17
1.05 REFERENCES TO AGREEMENTS AND LAWS............................................ 17
ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS................................ 17
2.01 LOANS........................................................................ 17
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS........................... 17
2.03 LETTERS OF CREDIT............................................................ 19
2.04 PREPAYMENTS.................................................................. 24
2.05 REDUCTION OR TERMINATION OF COMMITMENTS...................................... 25
2.06 REPAYMENT OF LOANS........................................................... 25
2.07 INTEREST..................................................................... 25
2.08 FEES......................................................................... 26
2.09 COMPUTATION OF INTEREST AND FEES............................................. 26
2.10 EVIDENCE OF DEBT............................................................. 27
2.11 PAYMENTS GENERALLY........................................................... 27
2.12 SHARING OF PAYMENTS.......................................................... 28
2.13 GUARANTY OF OBLIGATIONS...................................................... 29
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY .............................. 29
3.01 TAXES........................................................................ 29
3.02 ILLEGALITY................................................................... 30
3.03 INABILITY TO DETERMINE RATES................................................. 31
3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY; RESERVES ON EURODOLLAR
RATE LOANS.................................................................. 31
3.05 FUNDING LOSSES............................................................... 32
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.......................... 32
3.07 SURVIVAL..................................................................... 32
ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS............................ 33
4.01 CONDITIONS TO EFFECTIVENESS AND INITIAL CREDIT EXTENSION..................... 33
4.02 CONDITIONS TO ALL CREDIT EXTENSIONS AND CONVERSIONS AND CONTINUATIONS........ 34
ARTICLE V. REPRESENTATIONS AND WARRANTIES....................................... 34
5.01 EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH LAWS..................... 35
5.02 AUTHORIZATION; NO CONTRAVENTION.............................................. 35
5.03 GOVERNMENTAL AUTHORIZATION................................................... 35
5.04 BINDING EFFECT............................................................... 35
5.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT............................. 35
5.06 LITIGATION................................................................... 36
5.07 NO DEFAULT................................................................... 36
5.08 OWNERSHIP OF PROPERTY; LIENS................................................. 36
5.09 ENVIRONMENTAL COMPLIANCE..................................................... 36
5.10 INSURANCE.................................................................... 37
5.11 TAXES........................................................................ 37
5.12 ERISA COMPLIANCE............................................................. 37
5.13 SUBSIDIARIES................................................................. 38
5.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY
ACT.......................................................................... 38
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5.15 DISCLOSURE.................................................................. 38
5.16 INTELLECTUAL PROPERTY; LICENSES, ETC. ...................................... 38
5.17 SWAP CONTRACTS.............................................................. 39
5.18 LABOR RELATIONS............................................................. 39
5.19 USE OF PROCEEDS............................................................. 39
5.20 SOLVENCY.................................................................... 39
ARTICLE VI. AFFIRMATIVE COVENANTS............................................... 39
6.01 FINANCIAL STATEMENTS........................................................ 39
6.02 CERTIFICATES; OTHER INFORMATION............................................. 40
6.03 NOTICES..................................................................... 41
6.04 PAYMENT OF OBLIGATIONS...................................................... 42
6.05 PRESERVATION OF EXISTENCE, ETC. ............................................ 42
6.06 MAINTENANCE OF PROPERTIES................................................... 42
6.07 MAINTENANCE OF INSURANCE.................................................... 42
6.08 COMPLIANCE WITH LAWS........................................................ 42
6.09 BOOKS AND RECORDS........................................................... 43
6.10 INSPECTION RIGHTS........................................................... 43
6.11 COMPLIANCE WITH ERISA....................................................... 43
6.12 ENVIRONMENTAL LAWS.......................................................... 43
6.13 USE OF PROCEEDS............................................................. 43
6.14 TAX CLEARANCE CERTIFICATES.................................................. 44
ARTICLE VII. NEGATIVE COVENANTS.................................................. 44
7.01 LIENS....................................................................... 44
7.02 INVESTMENTS................................................................. 45
7.03 INDEBTEDNESS................................................................ 46
7.04 FUNDAMENTAL CHANGES......................................................... 47
7.05 DISPOSITIONS................................................................ 47
7.06 LEASE OBLIGATIONS........................................................... 48
7.07 RESTRICTED PAYMENTS......................................................... 48
7.08 ERISA....................................................................... 49
7.09 CHANGE IN NATURE OF BUSINESS OR IN STRUCTURE................................ 49
7.10 TRANSACTIONS WITH AFFILIATES................................................ 49
7.11 BURDENSOME AGREEMENTS....................................................... 49
7.12 USE OF PROCEEDS............................................................. 50
7.13 FINANCIAL COVENANTS......................................................... 50
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES...................................... 50
8.01 EVENTS OF DEFAULT........................................................... 50
8.02 REMEDIES UPON EVENT OF DEFAULT.............................................. 52
ARTICLE IX. ADMINISTRATIVE AGENT................................................ 53
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT....................... 53
9.02 DELEGATION OF DUTIES........................................................ 53
9.03 LIABILITY OF ADMINISTRATIVE AGENT........................................... 53
9.04 RELIANCE BY ADMINISTRATIVE AGENT............................................ 54
9.05 NOTICE OF DEFAULT........................................................... 54
9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT.......... 54
9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT..................................... 55
9.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY............................. 55
9.09 SUCCESSOR ADMINISTRATIVE AGENT.............................................. 56
ARTICLE X. GENERAL PROVISIONS.................................................. 56
10.01 AMENDMENTS, ETC. .................................................... 56
10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES................... 57
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10.03 NO WAIVER; CUMULATIVE REMEDIES....................................... 58
10.04 ATTORNEY COSTS, EXPENSES AND TAXES................................... 58
10.05 INDEMNIFICATION BY THE BORROWER...................................... 59
10.06 PAYMENTS SET ASIDE................................................... 59
10.07 SUCCESSORS AND ASSIGNS............................................... 60
10.08 CONFIDENTIALITY...................................................... 62
10.09 SET-OFF.............................................................. 63
10.10 INTEREST RATE LIMITATION............................................. 63
10.11 COUNTERPARTS......................................................... 63
10.12 INTEGRATION.......................................................... 64
10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES........................... 64
10.14 SEVERABILITY......................................................... 64
10.15 FOREIGN LENDERS...................................................... 64
10.16 REMOVAL AND REPLACEMENT OF LENDERS................................... 65
10.17 GOVERNING LAW........................................................ 65
10.18 WAIVER OF RIGHT TO TRIAL BY JURY..................................... 66
10.19 TIME OF THE ESSENCE.................................................. 66
SIGNATURES...................................................................S-1
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SCHEDULES
A Existing Letters of Credit
B Guarantors
2.01 Commitments and Pro Rata Shares
5.06 Litigation
5.09 Environmental Matters
5.13 Subsidiaries and Other Equity Investments
5.16 Intellectual Property Matters
7.01 Existing Liens
7.02 Existing Investments
7.03 Existing Indebtedness
7.06 Existing Leases
10.02 Eurodollar and Domestic Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Loan Notice
Exhibit B Form of Note
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Assumption Agreement
Exhibit E Form of Guaranty
Exhibit F Form of Opinion of Counsel
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CREDIT AGREEMENT
This CREDIT AGREEMENT, dated as of June 29, 2001, is entered into among
Granite Construction Incorporated, a Delaware corporation (the "Borrower"), each
lender from time to time party hereto (collectively, the "Lenders" and,
individually, a "Lender"), and BANK OF AMERICA, N.A., as Administrative Agent
and as L/C Issuer.
The Borrower has requested that the Lenders provide the Borrower with a
senior unsecured revolving credit facility of up to $60,000,000, 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, and intending to be legally bound hereby, 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:
"Administrative Agent" means the sole administrative agent under the
Loan Documents or any successor administrative agent, which, initially, shall be
Bank of America.
"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 indirectly, power (a)
to vote 5% or more of the securities 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 voting
securities, through the ownership of contract or otherwise.
"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 Commitments" means, as of any date of determination, the
aggregate amount of all Lenders' Commitments hereunder.
"Agreement" means this Credit Agreement.
"Applicable Rate" means, with respect to commitment fees, Base Rate
Loans, Eurodollar Rate Loans and utilization fees, as applicable, the following
percentages per annum (expressed in basis points per annum), each based upon the
Pricing Level Leverage Ratio as set forth in the most recent Compliance
Certificate received by the Administrative Agent pursuant to Section 6.02(b):
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PRICING PRICING LEVEL APPLICABLE APPLICABLE APPLICABLE APPLICABLE
LEVEL LEVERAGE RATIO RATE RATE RATE (BASE RATE
(COMMITMENT (EURODOLLAR RATE LOANS) (UTILIZATION
FEE) RATE LOANS) FEE)
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1 Less than 0.50 to 25.0 100.0 00.0 12.5
1.00
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Less than 1.00 to 30.0 125.0 00.0 12.5
2 1.00 but greater
than or equal to
0.50 to 1.00
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Less than 1.50 to 35.0 137.5 00.0 12.5
3 1.00 but greater
than or equal to
1.00 to 1.00
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Greater than or 40.0 162.5 00.0 12.5
4 equal to 1.50 to
1.00
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Any increase or decrease in the Applicable Rate resulting from a change
in the Pricing Level Leverage Ratio shall become effective as of the date that
is the earlier of: (a) the last date by which the Borrower is otherwise required
to deliver a Compliance Certificate in accordance with Section 6.02(b) with
reference to Section 6.01 for a given fiscal period (each such date, a
"Calculation Date"); and (b) the date that is two (2) Business Days after the
date (prior to the related Calculation Date) on which the Borrower actually
delivers a Compliance Certificate in accordance with Section 6.02(b) with
reference to Section 6.01 for such fiscal period; provided that the Applicable
Rate in effect from the Closing Date to the date that is two (2) Business Days
following receipt by the Administrative Agent of a timely delivered Compliance
Certificate with respect to the fiscal quarter ended June 30, 2001 shall be
determined based upon Pricing Level 1; provided further that, if any Compliance
Certificate for any fiscal period is not delivered to the Administrative Agent
on or before the related Calculation Date, then Pricing Level 4 shall apply,
effective on the related Calculation Date until two (2) Business Days after such
Compliance Certificate is actually received by the Administrative Agent.
"Approved Fund" has the meaning set forth in Section 10.07(h).
"Arranger" means the Person acting as sole lead arranger and sole book
manager, which, initially, shall be Banc of America Securities LLC.
"Assignment and Assumption Agreement" means an Assignment and Assumption
Agreement 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 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.
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"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal year ended December
31, 2000, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for such fiscal year of the Borrower and its
Subsidiaries.
"Auto-Renewal Letter of Credit" has the meaning set forth in Section
2.03(b)(iii).
"Bank of America" means Bank of America, N.A.
"Bankruptcy Code" means the federal Bankruptcy Reform Act of 1978 (11
U.S.C. Section 101 et seq.).
"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." Bank of America's "prime 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.
"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
London interbank eurodollar market.
"Calculation Date" has the meaning set forth in the definition of
"Applicable Rate" contained herein.
"Capital Expenditures" means for any period and with respect to any
Person, the aggregate of all expenditures by such Person and its Subsidiaries
for the acquisition or leasing of fixed or capital assets or additions to
equipment (including replacements, capitalized repairs and improvements during
such period) which should be capitalized under GAAP on a consolidated balance
sheet of such Person and its Subsidiaries, minus net proceeds from sales of
fixed or capital assets received by such Person or any of its Subsidiaries
during such period. For the purpose of this definition, the purchase price of
equipment which is purchased simultaneously with the trade-in of existing
equipment owned by such Person or any of its Subsidiaries or with insurance
proceeds shall be included in Capital Expenditures only to the extent of the
gross amount of such purchase price less the credit granted by the seller of
such equipment for such equipment being traded in at such time, or the amount of
such proceeds, as the case may be.
"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 satisfactory to the Administrative Agent and
the L/C Issuer (which documents are hereby consented to by the Lenders).
Derivatives of such
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term shall have corresponding meaning. 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 Bank of America.
"Change of Control" means, with respect to any Person, 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 Exchange Act, but excluding any employee benefit
plan of such person or its subsidiaries, and any person or entity 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 Exchange Act, except that a person or group shall be
deemed to have "beneficial ownership" of all securities that such person
or group has the right to acquire (such right, an "option right"),
whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of 25% or more of the equity
securities of such Person entitled to vote for members of the board of
directors or equivalent governing body of such Person on a
partially-diluted basis (i.e., taking into account all such securities
that such person or group has the right to acquire pursuant to any
option right); 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
such Person cease 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 on which 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(b), waived by the Person entitled to
receive the applicable payment).
"Code" means the Internal Revenue Code of 1986.
"Commitment" means, as to each Lender as of any date of determination,
its obligation to (a) make Loans to the Borrower pursuant to Section 2.01, and
(b) 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.
"Compensation Period" has the meaning set forth in Section 2.11(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) the
operating income for such period plus (b) the amount of depreciation and
amortization expense deducted in determining the operating income for such
period.
"Consolidated Funded Indebtedness" means, as of any date of
determination, for the Borrower and its Subsidiaries on a consolidated basis,
the sum of (a) the outstanding principal amount of all
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obligations, whether current or long-term, for borrowed money (including
Obligations hereunder) and all obligations evidenced by bonds, debentures,
notes, loan agreements or other similar instruments, plus (b) Attributable
Indebtedness in respect of capital leases and Synthetic Lease Obligations, plus
(c) without duplication, all Guaranty Obligations with respect to Indebtedness
of the types specified in subsections (a) and (b) above of Persons other than
the Borrower or any Subsidiary.
"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, plus (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 from continuing operations after extraordinary items (excluding
gains or losses from Dispositions of assets) for that period.
"Consolidated Shareholders' Equity" means, as of any date of
determination for the Borrower and its Subsidiaries on a consolidated basis,
shareholders' equity as of that date determined in accordance with GAAP.
"Consolidated Tangible Net Worth" means, as of any date of
determination, the amount equal to Consolidated Shareholders' Equity on that
date minus the Intangible Assets of the Borrower and its Subsidiaries
(determined on a consolidated basis in accordance with GAAP) on that date.
"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.
"Debtor Relief Laws" means the Bankruptcy Code, 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 a fluctuating interest rate per annum equal to (a)
the Base Rate plus (b) the Applicable Rate, if any, applicable to Base Rate
Loans plus (c) 2% per annum.
"Disposition" or "Dispose" means the sale, transfer, license or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.
"Dollar" and "$" means lawful money of the United States of America.
"Eligible Assignee" has the meaning set forth in Section 10.07(h).
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"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or any 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 presence, placement, discharge, emission or release
(including intentional and unintentional, negligent and non-negligent, sudden or
non-sudden, accidental or non-accidental placement, spills, leaks, discharges,
emissions or releases) of any Hazardous Material at, in or from property,
whether or not owned by the Borrower or any of its Subsidiaries, or (b) any
other circumstances forming the basis of any violation, or alleged violation, of
any Environmental Law.
"Environmental Laws" means any and all federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.
"Environmental Permits" has the meaning set forth in Section 5.09(b).
"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) 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 any of the following: (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 Sections
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
might 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.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan:
(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 (or any successor thereto) 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 (2) Business Days prior to the first day of
such Interest Period, or
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(b) if 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 (2) Business
Days prior to the first day of such Interest Period, or
(c) if 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
1/100th 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 London
interbank eurodollar market at their request at approximately 11:00 a.m.
(London time) two (2) Business Days prior to the first day of such
Interest Period.
"Eurodollar Rate Loan" 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, Section 8.01.
"Exchange Act" means the Securities Exchange Act of 1934 and the
regulations promulgated thereunder.
"Existing Letters of Credit" means the letters of credit issued by Bank
of America (as the financial institution issuing letters of credit under the
Prior Credit Facility) that are outstanding immediately prior to the
effectiveness of this Agreement, as more particularly described on Schedule A.
"Federal Funds Rate" means, for any day, the rate per annum 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.
"Fee Letter" means that certain letter agreement, dated as of April 18,
2001, among the Borrower, the Arranger and the Administrative Agent.
"Fixed Charge Coverage Ratio" means, as of any date of determination,
the ratio of (a) the sum of (i) Consolidated EBITDA, measured for the period
consisting of the four consecutive fiscal quarters ending on such day, plus (ii)
interest income for such period (to the extent not included in Consolidated
EBITDA for such period), minus (iii) all Capital Expenditures actually made
during such period minus (iv) all taxes actually paid in cash during such period
to (b) the sum of (i) Consolidated Interest Expense, measured for the period
consisting of the four consecutive fiscal quarters ending on such day, which was
deductible in determining the operating income for such period plus (ii) the
current portion (determined in accordance with GAAP) of Consolidated Funded
Indebtedness.
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"Foreign Lender" has the meaning set forth in Section 10.15.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States of America.
"Fund" has the meaning set forth in Section 10.07(h).
"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.
"Guarantors" means all of the Subsidiaries listed on Schedule B and all
other Persons who, following the Closing Date, execute and deliver a guaranty,
substantially in the form of Exhibit E, in favor of the Administrative Agent on
behalf of the Lenders.
"Guaranty" means the Guaranty, substantially in the form of Exhibit E,
made by the Guarantors listed on Schedule B in favor of the Administrative Agent
on behalf of the Lenders.
"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 obligee in respect of such Indebtedness or other obligation of the
payment or performance thereof or to protect such obligee 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.
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, collectively, as of any date: (a) any
petroleum or petroleum products, flammable explosives, radioactive materials,
asbestos in any form that is or could become friable, urea formaldehyde foam
insulation, and transformers or other equipment that contain dielectric fluid
containing polychlorinated biphenyls (PCB's); (b) any chemicals or other
materials or substances which as of such date are defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic pollutants," "contaminants," "infectious wastes," "pollutants" or words
of similar
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import under any Environmental Law; and (c) any other chemical or other material
or substance, exposure to which or use of which as of such date is prohibited,
limited or regulated under any Environmental Law.
"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, whether or not included as indebtedness or liabilities in accordance
with GAAP:
(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) all direct or contingent obligations of such Person arising
under letters of credit (including standby and commercial),
reimbursement agreements, bankers' acceptances, bank guaranties, surety
bonds and similar instruments (in each case, whether or not such
obligations are contingent or absolute, provided that, for purposes of
calculations made under Section 7.13, only surety bonds under which a
breach or default has occurred and letters of credit which have been
drawn and for which reimbursement must be made are to be included as
"Indebtedness");
(c) net obligations under any Swap Contract in an amount equal to
the Swap Termination Value thereof;
(d) all obligations of such Person to pay the deferred purchase
price of property or services (other than trade accounts payable in the
Ordinary Course of Business);
(e) 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;
(f) capital leases and Synthetic Lease Obligations; and
(g) all Guaranty Obligations of such Person in respect of any of
the foregoing.
For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person
is a general partner or a joint venturer, unless such Indebtedness is expressly
made non-recourse to such Person (subject only to 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.
"Indemnified Liabilities" has the meaning set forth in Section 10.05.
"Indemnitees" has the meaning set forth in Section 10.05.
"Information" has the meaning set forth in Section 10.08.
"Intangible Assets" means assets that are considered to be intangible
assets under GAAP, including customer lists, goodwill, computer software,
copyrights, trade names, trade marks, patents, unamortized deferred charges,
unamortized debt discount and capitalized research and development costs.
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"Interest Payment Date" means, (a) as to any Eurodollar Rate Loan, the
last day of each Interest Period applicable to such Loan; provided 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 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:
(a) 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;
(b) 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
(c) no Interest Period shall extend beyond the scheduled
Maturity Date.
"Investment" means, as to any Person, any acquisition or investment by
such Person, whether by means of (a) the purchase or other acquisition of
capital stock or other securities of another Person, (b) a loan, advance or
capital contribution to, guaranty of debt of, or purchase or other acquisition
of any other debt or equity participation or interest in, another Person,
including any partnership or joint venture interest in such other Person, or (c)
the purchase or other acquisition (in one transaction or a series of
transactions) of assets of another Person that constitute a business unit. For
purposes of covenant compliance, the amount of any Investment shall be the
amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.
"IP Rights" has the meaning set forth in Section 5.16.
"IRS" means the United States Internal Revenue Service.
"Joint Venture" means a single-purpose corporation, partnership, limited
liability company, joint venture or other similar legal arrangement (whether
created by contract or conducted through a separate legal entity) now or
hereafter formed by one Person with another Person in order to conduct a common
venture or enterprise with such Person.
"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.
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"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 the financial institution acting as issuer of Letters
of Credit hereunder (or any successor issuer of Letters of Credit hereunder),
which initially shall be Bank of America.
"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.
"Lender" has the meaning set forth 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.
"Letter of Credit" means any standby letter of credit issued hereunder
and shall include each Existing Letter of Credit. A "Letter of Credit" may not
be a commercial letter of credit.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a standby letter of credit in the form from time to
time in use by the L/C Issuer.
"Letter of Credit Expiration Date" means the day that is five (5)
Business Days prior to the Maturity Date (or, if such day is not a Business Day,
the next preceding Business Day).
"Letter of Credit Sublimit" means an amount equal to the lesser of the
Aggregate Commitments and $50,000,000. The Letter of Credit Sublimit is part of,
and not in addition to, the Aggregate Commitments.
"Leverage Ratio" means, as of any date of determination, the ratio of
(a) Consolidated Funded Indebtedness to (b) Consolidated Funded Indebtedness
plus Consolidated Tangible Net Worth.
"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.
"Loan" means an extension of credit by a Lender to the Borrower under
Article II in the form of a loan.
"Loan Documents" means this Agreement, all Notes, the Fee Letter, all
Requests for Credit Extensions, all Compliance Certificates, the Guaranty and
all other agreements, documents and instruments (with the exception of Swap
Contracts except to the extent expressly required pursuant to the terms hereof),
executed and delivered by a Loan Party in connection with the transactions
contemplated hereby in favor of the Administrative Agent, the Arranger, the L/C
Issuer or any Lender.
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"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 each Guarantor.
"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; (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 (c) a material adverse effect upon the legality, validity, binding
effect or enforceability against any Loan Party of any Loan Document to which it
is a party.
"Material Subsidiary" means any Subsidiary that meets either of the
following conditions: (a) such Subsidiary's total net revenues for the period of
the immediately preceding four fiscal quarters is equal to or greater than 10%
of the consolidated total net revenues of the Borrower and its Subsidiaries for
such period, determined in accordance with GAAP, in each case as reflected in
the most recent annual or quarterly financial statements of the Borrower
required to be delivered pursuant to Section 6.01; or (b) such Subsidiary's
total assets, as of the last day of the immediately preceding fiscal quarter,
are equal to or greater than 10% of the consolidated total assets of the
Borrower and its Subsidiaries as of such date, determined in accordance with
GAAP, in each case as reflected in the most recent annual or quarterly (as
applicable) financial statements of the Borrower required to be delivered
pursuant to Section 6.01.
"Maturity Date" means: (a) three (3) years from the date of execution
and delivery of this Credit Agreement; or (b) such earlier date upon which the
Aggregate Commitments are terminated in accordance with the terms hereof.
"Maximum Rate" has the meaning set forth in Section 10.10.
"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.
"Non-Guarantor Subsidiary" has the meaning set forth in Section 2.13.
"Nonrenewal Notice Date" has the meaning set forth in Section
2.03(b)(iii).
"Note" means a promissory note, substantially in the form of Exhibit B,
made by the Borrower in favor of a Lender evidencing the Loans made by such
Lender.
"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.
"Ordinary Course of Business" means, in respect of any transaction
involving the Borrower or any Subsidiary of the Borrower, (a) the ordinary
course of such Person's business, substantially as
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conducted by any such Person prior to or as of the Closing Date, and undertaken
by such Person in good faith and not for purposes of evading any covenant or
restriction in any Loan Document, or (b) transactions outside the ordinary
course of such Person's then-existing business, as long as the Borrower provides
written notice to the Administrative Agent and the Lenders prior to such Person
undertaking such business, provided that the Required Lenders shall not have
delivered written objections to the Administrative Agent within five (5)
Business Days after their receipt of such written notice.
"Organization Documents" means: (a) with respect to any corporation,
such Person's certificate or articles of incorporation and its bylaws; (b) with
respect to any limited liability company, such Person's articles of formation
and operating agreement; and (c) with respect to any partnership, Joint Venture,
trust or other form of business entity, such Person's 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 set forth in Section 3.01(b).
"Outstanding Amount" means: (a) 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
(b) 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
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 set forth 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.
"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.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or any ERISA Affiliate.
"Pricing Level Leverage Ratio" means, as of any date of determination,
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.
"Prior Credit Facility" means that certain Credit Agreement, dated as of
June 30, 1997, as amended, modified or supplemented prior to the date hereof,
among the Borrower, the financial institutions party thereto, and Bank of
America, as administrative agent.
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"Pro Rata Share" means, with respect to each Lender, the percentage
(carried out to the ninth decimal place) of the Aggregate Commitments 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).
"Release" means any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the indoor or outdoor environment, including the movement of Hazardous Materials
through ambient air, soil, surface water, ground water, wetlands, land or
subsurface strata.
"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, a Letter of Credit Application.
"Required Lenders" means, as of any date of determination, Lenders whose
Voting Percentages aggregate more than 50%.
"Responsible Officer" means the president, chief operating officer,
chief executive officer, chief financial officer, treasurer, assistant treasurer
or secretary of a Loan Party. 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.
"Restricted Payment" means any dividend or other distribution (whether
in cash, securities or other property) with respect to any capital stock of the
Borrower or any Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such capital stock or of any option, warrant or other right to acquire any
such capital stock.
"SEC" means the Securities and Exchange Commission or any successor or
similar Governmental Authority.
"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
California Uniform Fraudulent Transfer 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 for
which such Person's property would constitute unreasonably small capital.
"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
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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.
"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.
"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 set forth in Section 3.01(a).
"Type" means, with respect to a Loan, its character as a Base Rate Loan
or a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Pension Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"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
Aggregate Commitments are in effect, such Lender's Pro Rata Share and (b) at any
time after the termination of the Aggregate 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 comprises of (ii) the Outstanding Amount of all
Loans and L/C
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Obligations; provided that, if any Lender has failed to fund any portion of the
Loans, participations in L/C Obligations required to be funded by it hereunder,
such Lender's Voting Percentage shall be deemed to be zero, 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.
1.02 OTHER INTERPRETIVE PROVISIONS.
With reference to this Agreement and each other Loan Document, unless
otherwise specified herein or in such other Loan Document:
(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) Article, Section, Exhibit and Schedule references are to the
Loan Document in which such reference appears.
(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, whether in physical or
electronic form.
(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 in 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.
(e) Unless otherwise expressly provided herein: (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document; and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
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
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request, the Administrative Agent, the Lenders and the Borrower shall negotiate
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, (i) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
(ii) 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 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 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 a
different Type 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 9:00 a.m., San Francisco time, (i) three (3) 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 confirmed immediately by delivery to the
Administrative Agent of a written Loan Notice (which may be sent by facsimile),
appropriately
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completed and signed by two (2) Responsible Officers of the Borrower. Each
Borrowing of Loans, each conversion of Loans from one Type to another Type, and
each continuation of Eurodollar Rate Loans shall be in a principal amount of
$3,000,000 or a whole multiple of $1,000,000 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 11:00 a.m., San Francisco time, on
the Business Day specified in the applicable Loan Notice. Upon satisfaction of
the applicable conditions set forth in Section 4.02 (and, if such Borrowing is
the initial Credit Extension, Section 4.01), 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 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 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 ten Interest Periods in effect with respect to Loans.
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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 Letter of Credit
Expiration 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 sum of 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 Letter of
Credit 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 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 in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(B) subject to clause (C) below and subject to Section
2.03(b)(iii), the expiry date of any Letter of Credit would occur
more than one year 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 Letter of Credit Expiration Date, unless
all the Lenders have approved such expiry date;
(D) the issuance of such Letter of Credit would violate
one or more policies of the L/C Issuer or such Letter of Credit
does not provide for drafts;
(E) the face amount of any Letter of Credit (other than an
Existing Letter of Credit) is less than $1,000,000;
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(F) such Letter of Credit is for the purpose of supporting
the issuance of any letter of credit issued by any other Person;
or
(G) such Letter of Credit is 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;
Auto-Renewal 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 a Letter of
Credit Application, appropriately completed and signed by two (2)
Responsible Officers of the Borrower. Such L/C Application must be
received by the L/C Issuer and the Administrative Agent not later than
9:00 a.m., San Francisco time, at least two (2) 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 Letter of Credit 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 Letter of Credit Application shall
specify in form and detail satisfactory to the L/C Issuer (A) the Letter
of Credit to be amended; (B) the proposed date of amendment thereof
(which shall be a Business Day); (C) the nature of the proposed
amendment; and (D) such other matters as the L/C Issuer may require.
(ii) Promptly after receipt of any Letter of Credit 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
Letter of Credit 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 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 risk
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 Letter of
Credit 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 "Auto-Renewal Letter of Credit"); provided that any
such Auto-Renewal Letter of Credit must permit the L/C Issuer to prevent
any such renewal at least
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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 Auto-Renewal 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 Letter of Credit Expiration Date; provided
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 shall be in writing, including by facsimile) 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 4.02 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 Auto-Renewal 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 9:00 a.m., San Francisco 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 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 4.02 (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 11:00 a.m., San
Francisco 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.
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(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 4.02 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
reimbursement pursuant to this Section 2.03 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.
(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.
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(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 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 immediately 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. 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 Letter of Credit 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 that this
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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 that, notwithstanding anything in such clauses
to the contrary, 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 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) Cash Collateral. Upon the request of the Administrative Agent, (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 Letter of Credit Expiration 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).
(h) Applicability of ISP98. Unless otherwise expressly agreed by the L/C
Issuer and the Borrower when a Letter of Credit is issued (including any such
agreement applicable to an Existing Letter of Credit), 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 standby 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 (for
Eurodollar Rate Loans) multiplied by the actual daily maximum amount available
to be drawn under such 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 Letter of Credit Expiration Date.
(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 with respect to each Letter of Credit in the amounts and at the
times specified in the Fee Letter. 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 Letter of Credit Application. In the event of any
conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
2.04 PREPAYMENTS.
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(a) 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 9:00 a.m., San Francisco time, (A) three (3)
Business Days prior to any date of prepayment of Eurodollar Rate Loans, and (B)
on the date of prepayment of Base Rate Loans; and (ii) any prepayment of Loans
shall be in a principal amount of $3,000,000 or a whole multiple of $1,000,000
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.
(b) If for any reason the Outstanding Amount of all Loans and L/C
Obligations at any time exceeds the Aggregate Commitments then in effect, the
Borrower shall immediately prepay Loans and/or Cash Collateralize the L/C
Obligations in an aggregate amount equal to such excess.
2.05 REDUCTION OR TERMINATION OF COMMITMENTS.
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 9:00 a.m., San Francisco time, five (5)
Business Days prior to the date of termination or reduction, and (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. 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 Section, the
Aggregate Commitments may not be increased. Any reduction of the Aggregate
Commitments shall be applied to the Commitment of each Lender according to its
Pro Rata Share. All fees accrued until the effective date of any termination of
the Aggregate Commitments shall be paid on the effective date of such
termination.
2.06 REPAYMENT OF LOANS.
The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Loans outstanding on such date.
2.07 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal 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 principal amount of all outstanding
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.
2.08 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 multiplied by 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 during a
quarterly period. The commitment fee shall accrue at all times from the Closing
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 Closing 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) Utilization Fee. The Borrower shall pay to the Administrative Agent
for the account of each Lender in accordance with its Pro Rata Share, a
utilization fee equal to the Applicable Rate multiplied by the actual daily
aggregate Outstanding Amount of Loans and L/C Obligations on each day that such
aggregate Outstanding Amount exceeds 33% of the Aggregate Commitments. The
utilization fee 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 Closing Date, and on the Maturity Date. The
utilization fee shall be calculated quarterly in arrears. The utilization fee
shall accrue at all times, including at any time during which one or more of the
conditions in Article IV is not met.
(c) 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 Fee Letter. Such fees shall be fully
earned when paid and shall be nonrefundable for any reason whatsoever.
(d) Lenders' Upfront Fees. On the Closing 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
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.
2.09 COMPUTATION OF INTEREST AND FEES.
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 any 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.
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2.10 EVIDENCE OF DEBT.
(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 all interest and payments thereon. Any failure to so 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 or
the 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 Note in addition
to such accounts or records. Each Lender may attach schedules to its 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.
2.11 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 11:00 a.m.,
San Francisco 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 11:00 a.m., San Francisco 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" contained in Section
1.01, 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 the funds received by and available to the
Administrative Agent are not sufficient 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 hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and L/C Borrowings
then due to such parties.
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(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 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.
2.12 SHARING OF PAYMENTS.
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If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Loans 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 made by them and/or such
subparticipations in the participations in L/C Obligations held by them, as the
case may be, as shall be necessary to cause such purchasing Lender to share the
excess payment in respect of such Loans or such participations, as the case may
be, pro rata with each of them; provided 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.
2.13 GUARANTY OF OBLIGATIONS.
The Obligations shall be jointly and severally guaranteed by the
Guarantors pursuant to one or more Guaranties. Promptly after the date on which
any Person becomes a Material Subsidiary of the Borrower, and, in any event,
within ten (10) Business Days following receipt by the Borrower from the
Administrative Agent of a request therefor, the Borrower will cause such Person
to execute and deliver to the Administrative Agent, on behalf of the Lenders, a
guaranty of the Obligations in substantially the form of the Guaranty. In
addition, promptly after any date that the total revenues or total assets of all
Subsidiaries that are at such time not Guarantors (each, a "Non-Guarantor
Subsidiary") together exceed 20% of the total revenues or total assets, as the
case may be, of the Borrower and its Subsidiaries, determined on a consolidated
basis, and in any event, within ten (10) Business Days following receipt by the
Borrower from the Administrative Agent of a request therefor, the Borrower will
cause one or more Non-Guarantor Subsidiaries to execute and deliver to the
Administrative Agent, on behalf of the Lenders, a guaranty of the Obligations in
substantially the form of a Guaranty, so that, after delivery of such guaranty
or guarantees, the total revenues and total assets of all remaining
Non-Guarantor Subsidiaries together are less than 20% of the total revenues or
total assets, as the case may be, of the Borrower and its Subsidiaries,
determined on a consolidated basis. In all of the foregoing instances, the
Borrower shall deliver or cause to be delivered such other agreements,
documents, instruments and other information and items as are reasonably
requested by the Administrative Agent, at the request of any Lender, in
connection with the foregoing, including resolutions, incumbency and officers'
certificates and opinions of counsel.
ARTICLE III.
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
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(a) 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 with respect thereto being hereinafter collectively 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 is
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) 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 made within 30 days after the date the Lender or the Administrative
Agent makes a demand therefor.
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 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
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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 accrued 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 London interbank
eurodollar 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 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; RESERVES ON
EURODOLLAR RATE LOANS.
(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 contemplated
by Section 3.04(c), then from time to time upon demand of such Lender (with a
copy of such demand 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 upon demand of
such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such reduction.
(c) The Borrower shall pay to each Lender, as long as such Lender shall
be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as
"Eurocurrency liabilities"), additional interest on the unpaid principal amount
of each Eurodollar Rate Loan equal to the actual costs of such reserves
allocated to such Loan by
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such Lender (as determined by such Lender in good faith, which determination
shall be conclusive), which shall be due and payable on each date on which
interest is payable on such Loan, provided the Borrower shall have received at
least 15 days prior notice (with a copy to the Administrative Agent) of such
additional interest from such Lender. If a Lender fails to give notice 15 days
prior to the relevant Interest Payment Date, such additional interest shall be
due and payable 15 days from receipt of such notice.
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:
(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; or
(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;
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 the Eurodollar Rate for such Loan by a matching deposit
or other borrowing in the London interbank eurodollar 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 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
or 3.04, the Borrower may remove or replace such Lender in accordance with
Section 10.16.
3.07 SURVIVAL.
All of the Borrower's obligations under this Article III shall survive
termination of the Aggregate Commitments and repayment of all other Obligations.
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ARTICLE IV.
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
4.01 CONDITIONS TO EFFECTIVENESS AND INITIAL CREDIT EXTENSION.
The effectiveness of this Agreement and the obligation of each Lender to
make its initial Credit Extension hereunder are subject to satisfaction of the
following conditions precedent:
(a) Unless waived by all the Lenders (or by the Administrative Agent
with respect to immaterial matters or items specified in clause (v) or (vi)
below with respect to which the Borrower has given assurances satisfactory to
the Administrative Agent that such items shall be delivered promptly following
the Closing 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, each dated the Closing Date (or, in the case of certificates
of governmental officials, a recent date before the Closing Date acceptable to
the Administrative Agent) and each in form and substance satisfactory to the
Administrative Agent, the Lenders and their respective legal counsel:
(i) executed counterparts of this Agreement and the Guaranty,
sufficient in number for distribution to the Administrative Agent, each
Lender and the Borrower;
(ii) if requested by a Lender, a Note executed by the Borrower in
favor of such Lender, such Note to be in an original face amount equal
to such Lender's Commitment;
(iii) such certificates respecting resolutions or other actions,
incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent or any Lender
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 and/or any Lender
may 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 in which it is required to be qualified to engage
in business, including certified copies of each Loan Party's
Organization Documents, certificates of good standing and qualification
to engage in business and tax clearance certificates; provided that, to
the extent that any of the tax clearance certificates required under
this sub-paragraph (iv) have not been received by the Borrower prior to
June 29, 2001, the Borrower shall only be required to deliver such tax
clearance certificates in accordance with Section 6.14;
(v) a certificate signed by a Responsible Officer of the Borrower
certifying (A) that the conditions specified in Sections 4.02(a) and (b)
have been satisfied, and (B) that there has been no event or
circumstance since the date of the Audited Financial Statements which
has or could be reasonably expected to have a Material Adverse Effect;
(vi) an opinion of counsel to each Loan Party substantially in
the form of Exhibit F in form and substance satisfactory to the
Administrative Agent, the Lenders and their respective legal counsel;
(vii) evidence satisfactory to the Administrative Agent that the
Prior Credit Facility has been or concurrently with the Closing Date is
being terminated (with all Indebtedness
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thereunder being repaid in full) and all Liens securing obligations
under the Prior Credit Facility have been or concurrently with the
Closing Date are being released; and
(viii) such other assurances, certificates, documents, consents,
approvals, materials or opinions as the Administrative Agent, the L/C
Issuer or any Lender reasonably may require.
(b) Any fees required to be paid on or before the Closing Date shall
have been paid.
(c) Unless waived by the Administrative Agent, the Borrower shall have
paid all reasonable Attorney Costs of the Administrative Agent to the extent
invoiced prior to or on the Closing Date, plus such additional amounts of
reasonable Attorney Costs as shall constitute its reasonable estimate of such
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.
Notwithstanding anything to the contrary contained in this Section 4.01,
neither this Agreement nor any of the other Loan Documents shall become
effective or be binding on any party unless the preceding conditions have been
satisfied (or waived, as appropriate), on or before 9:00 a.m., San Francisco
time, on June 29, 2001.
4.02 CONDITIONS TO ALL CREDIT EXTENSIONS AND CONVERSIONS AND
CONTINUATIONS.
The obligation of each Lender to honor any Request for Credit Extension
is subject to the following conditions precedent:
(a) The representations and warranties of the Borrower contained in
Article V, or which are contained in any document furnished at any time under or
in connection herewith, shall be true and correct on and as of the date of such
Credit Extension, conversion or continuation, 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
Credit Extension, conversion or continuation.
(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 submitted by the Borrower shall be
deemed to be a representation and warranty that the conditions specified in
Sections 4.02(a) and (b) have been satisfied on and as of the date of the
applicable Credit Extension.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
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The Borrower represents and warrants to the Administrative Agent and the
Lenders that:
5.01 EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH LAWS.
Each Loan Party (a) is a corporation, partnership or limited liability
company, duly organized or formed, validly existing and in good standing under
the Laws of the jurisdiction of its incorporation or organization, (b) has all
requisite power and authority and all governmental licenses, authorizations,
consents and approvals to own its assets, carry on its business and to execute,
deliver, and perform its obligations under the Loan Documents to which it is a
party, (c) is duly qualified and is licensed and in good standing under the Laws
of each jurisdiction where its ownership, lease or operation of properties or
the conduct of its business requires such qualification or license, and (d) is
in compliance with all Laws, except in each case referred to in subsections (c)
or this subsection (d), to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect.
5.02 AUTHORIZATION; NO CONTRAVENTION.
The execution, delivery and performance by each Loan Party of each Loan
Document to which such Person is party, have been duly authorized by all
necessary corporate or other organizational action, and do not and will not (a)
contravene the terms of any of such Person's Organization Documents; (b)
conflict with or result in any breach or contravention of, or the creation of
any Lien under, any Contractual Obligation to which such Person is a party or
any order, injunction, writ or decree of any Governmental Authority to which
such Person or its property is subject; or (c) violate any Law.
5.03 GOVERNMENTAL AUTHORIZATION.
No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority is necessary or required
in connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document.
5.04 BINDING EFFECT.
This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by each Loan Party that
is party thereto. This Agreement constitutes, and each other Loan Document when
so delivered will constitute, a legal, valid and binding obligation of such Loan
Party, enforceable against each Loan Party that is party thereto in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws generally affecting the rights of creditors,
and subject to equitable principles of general application.
5.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.
(a) The Audited Financial Statements (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present the financial condition
of the Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Borrower and its consolidated Subsidiaries as of
the date thereof, including liabilities for taxes, material commitments and
Indebtedness.
(b) The unaudited consolidated financial statements of the Borrower and
its Subsidiaries, dated March 31, 2001, contained in the related quarterly
report on Form 10-Q filed with the SEC (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as
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otherwise expressly noted therein, and subject to ordinary, good faith year end
audit adjustments; (ii) fairly present the financial condition of the Borrower
and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby; and (iii) show all material indebtedness and other
liabilities, direct or contingent, of the Borrower and its consolidated
Subsidiaries as of the date thereof, including liabilities for taxes, material
commitments and Indebtedness.
(c) Since the date of the Audited Financial Statements, there has been
no event or circumstance that has had or could reasonably be expected to have a
Material Adverse Effect.
5.06 LITIGATION.
Except as specifically disclosed on Schedule 5.06, there are no actions,
suits, proceedings, claims or disputes pending or, to the knowledge of the
Borrower after due and diligent investigation, threatened or contemplated, at
law, in equity, in arbitration or before any Governmental Authority, by or
against the Borrower or any of its Subsidiaries or against any of their
properties or revenues that (a) purport to affect or pertain to this Agreement
or any other Loan Document, or any of the transactions contemplated hereby, or
(b) if determined adversely, could reasonably be expected to have a Material
Adverse Effect.
5.07 NO DEFAULT.
Neither the Borrower nor any Subsidiary is in default under or with
respect to any Contractual Obligation that could be reasonably expected to have
a Material Adverse Effect. No Default or Event of Default has occurred and is
continuing or would result from the consummation of the transactions
contemplated by this Agreement or any other Loan Document.
5.08 OWNERSHIP OF PROPERTY; LIENS.
Each of the Borrower and its Subsidiaries has good record and marketable
title in fee simple to, or valid leasehold interests in, all real property
necessary or used in the ordinary conduct of its business, except for such
defects in title as could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. As of the Effective Date, the
property of the Borrower and its Subsidiaries is not subject to any Lien, other
than Liens permitted by Section 7.01.
5.09 ENVIRONMENTAL COMPLIANCE.
(a) The on-going operations of the Borrower and each of its
Subsidiaries, after the Closing Date, comply in all respects with all
Environmental Laws, except such non-compliance that would not result in
liability in excess of $2,000,000 in the aggregate.
(b) Except as specifically identified on Schedule 5.09, and except to
the extent that noncompliance would not result in liability in excess of
$300,000 in the aggregate, the Borrower and each of its Subsidiaries have
obtained all licenses, permits, authorizations and registrations required under
any Environmental Law ("Environmental Permits") necessary for their respective
operations, and all such Environmental Permits are in good standing, and the
Borrower and each of its Subsidiaries are in compliance with all terms and
conditions of such Environmental Permits.
(c) Except as specifically identified on Schedule 5.09, none of the
Borrower or any of its Subsidiaries or any of their present property or
operations is subject to any outstanding written order from or agreement with
any Governmental Authority or other Person, nor is subject to any judicial or
docketed administrative proceeding respecting any Environmental Law,
Environmental Claim or Hazardous Material.
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(d) There are no conditions or circumstances relating to any property of
the Borrower or its Subsidiaries, or arising from operations of the Borrower or
its Subsidiaries conducted prior to the Closing Date that, together with all
other such conditions and circumstances relating to all other properties and
operations, may give rise to Environmental Claims with a potential liability as
to the Borrower and its Subsidiaries together in excess of $15,000,000 in the
aggregate. Schedule 5.09 contains the Borrower's good faith estimate of clean-up
costs associated with hydrocarbon contamination at the properties described
therein. Notwithstanding the foregoing, (i) neither the Borrower nor any of its
Subsidiaries has any underground storage tanks (x) that are not properly
registered or permitted under applicable Environmental Laws or (y) that are
leaking or disposing of Hazardous Materials off-site, (ii) the Borrower and its
Subsidiaries have notified all of their employees of the existence, if any, of
any health hazard arising from the conditions of their employment and have met
all notification requirements under all applicable Environmental Laws, and (iii)
no Hazardous Materials have been Released at, on or under any site, facility or
vessel now or previously owned, operated or leased by the Borrower or any of its
Subsidiaries that would have a Material Adverse Effect.
(e) Except as specifically identified on Schedule 5.09, the Borrower has
no knowledge of any oral or written notification of a Release of a Hazardous
Material has been filed by or on behalf of the Borrower or any of its
Subsidiaries and no site, facility or vessel now or previously owned, operated
or leased by the Borrower or any of its Subsidiaries is listed or proposed for
listing on any federal or state list of sites requiring investigation or
clean-up.
5.10 INSURANCE.
The properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the
Borrower, 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 its Subsidiaries operate.
5.11 TAXES.
The Borrower and its Subsidiaries have filed all Federal, state and
other material tax returns and reports required to be filed, and have paid all
Federal, state 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. There is no proposed tax assessment against
the Borrower or any Subsidiary that would, if made, have a Material Adverse
Effect.
5.12 ERISA COMPLIANCE.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws. Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the best
knowledge of the Borrower, nothing has occurred which would prevent, or cause
the loss of, such qualification. The Borrower and each ERISA Affiliate have made
all required contributions to each 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 that could be
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reasonably be expected to have a Material Adverse Effect. There has been no
prohibited transaction or violation of the fiduciary responsibility rules with
respect to any Plan that has resulted or could reasonably be expected to result
in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither the
Borrower nor any ERISA Affiliate has incurred, or 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); (iv) neither
the Borrower nor any ERISA Affiliate has incurred, or 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 Sections 4201
or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the
Borrower nor any ERISA Affiliate has engaged in a transaction that could be
subject to Sections 4069 or 4212(c) of ERISA.
5.13 SUBSIDIARIES.
As of the Closing Date, the Borrower has no Subsidiaries other than
those specifically disclosed in Part (a) of Schedule 5.13 and those of whom the
Borrower has notified the Administrative Agent in writing following the Closing
Date pursuant to Section 2.13 and has no equity investments in any other
corporation or entity other than those specifically disclosed in Part (b) of
Schedule 5.13.
5.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT.
(a) The Borrower is not engaged and will not engage, principally or as
one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.
(b) None of the Borrower, any Person controlling the Borrower, or any
Subsidiary (i) is a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, or (ii) is or is required to be registered as an "investment
company" under the Investment Company Act of 1940, 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.
5.15 DISCLOSURE.
The documents, certificates and written statements (including the Loan
Documents) furnished to the Administrative Agent and the Lenders by the Borrower
or any Subsidiary for use in connection with the transactions contemplated by
this Agreement, taken as a whole, do not contain any untrue statement of a
material fact or omit to state a material fact (known to the Borrower in the
case of any document not furnished by it) necessary in order to make the
statements contained herein or therein not misleading (it being recognized by
the Administrative Agent and the Lenders that projections and forecasts provided
to them by the Borrower are not to be viewed as facts and that actual results
during the period or periods covered by any such projections and forecasts may
differ from the projected or forecasted results).
5.16 INTELLECTUAL PROPERTY; LICENSES, ETC.
The Borrower and its Subsidiaries own, or possess the right to use, all
of the trademarks, service marks, trade names, copyrights, patents, patent
rights, franchises, licenses and other intellectual property
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rights (collectively, "IP Rights") that are reasonably necessary for the
operation of their respective businesses, without conflict with the rights of
any other Person. To the best knowledge of the Borrower, no slogan or other
advertising device, product, process, method, substance, part or other material
employed or contemplated to be employed by the Borrower or any Subsidiary
infringes upon any rights held by any other Person. Except as specifically
disclosed in Schedule 5.16, no claim or litigation regarding any of the
foregoing is pending or, to the best knowledge of the Borrower, threatened, and
no patent, invention, device, application, principle or any statute, law, rule,
regulation, standard or code is pending or, to the knowledge of the Borrower,
proposed, which, in either case, could reasonably be expected to have a Material
Adverse Effect.
5.17 SWAP CONTRACTS.
The Borrower and its Subsidiaries have each voluntarily entered into
each Swap Contract to which it is a party based upon its own independent
assessment of its consolidated assets, liabilities and commitments in each case
as an appropriate means of mitigating and managing risks associated with such
matters.
5.18 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 could reasonably be expected to result in a Material Adverse Effect.
5.19 USE OF PROCEEDS.
The Borrower shall use the proceeds of the Credit Extensions solely for
working capital and other general corporate purposes (including stock
repurchases and acquisitions not prohibited hereunder) not in contravention of
any Loan Document or any Law.
5.20 SOLVENCY.
The Borrower is and shall continue to be, and shall cause each of its
Subsidiaries to be, Solvent.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, the Borrower shall, and shall (except in the case of
the covenants set forth in Sections 6.01, 6.02, 6.03 and 6.11) cause each
Subsidiary to:
6.01 FINANCIAL STATEMENTS.
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 in any event within 90 days after the end
of each fiscal year of the Borrower: (i) a consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders' equity and cash
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flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail, audited and
accompanied by a report and opinion of an independent certified public
accountant of nationally recognized standing reasonably acceptable to the
Required Lenders, which report and opinion shall be prepared in accordance with
GAAP and shall not be subject to any qualifications or exceptions as to the
scope of the audit nor to any qualifications and exceptions not reasonably
acceptable to the Required Lenders; or (ii) an SEC Form 10-K for the Borrower
(excluding the exhibits thereto) relating to such fiscal year; and
(b) as soon as available, but in any event within 45 days after the end
of each of the first three fiscal quarters of each fiscal year of the Borrower:
(i) 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 or
operations, shareholders' equity 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,
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; or (ii) an
SEC Form 10-Q for the Borrower (excluding the exhibits thereto) relating to such
fiscal quarter.
6.02 CERTIFICATES; OTHER INFORMATION.
Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders:
(a) concurrently with the delivery of the financial statements referred
to in Section 6.01(a) (unless included in the applicable SEC Form 10-K), a
certificate of its independent certified public accountants certifying such
financial statements;
(b) concurrently with the delivery of the financial statements referred
to in Sections 6.01(a) and (b), a duly completed Compliance Certificate signed
by a Responsible Officer of the Borrower;
(c) promptly after the same are available, copies of each annual report,
proxy or financial statement or other report or communication sent to the
stockholders of the Borrower, and copies of all annual, regular, periodic and
special reports and registration statements which the Borrower may file or be
required to file with the SEC under Section 13 or 15(d) of the Exchange Act, and
not otherwise required to be delivered to the Administrative Agent pursuant
hereto; and
(d) promptly, such additional information regarding the business,
financial or corporate affairs of the Borrower or any Subsidiary as the
Administrative Agent, at the request of any Lender, may from time to time
request.
Reports required to be delivered pursuant to Sections 6.01(a) or (b) or
6.02(b) shall be deemed to have been delivered on the date on which the Borrower
posts such reports on the Borrower's website on the Internet at the website
address listed on Schedule 10.02 or when such report is posted on the SEC's
website at ▇▇▇.▇▇▇.▇▇▇; provided that (x) the Borrower shall deliver paper
copies of such reports to the Administrative Agent or 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(b) to the Administrative Agent and each of the Lenders. Except for such
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Compliance Certificates, the Administrative Agent shall not have any obligation
to request the delivery or to maintain copies of the reports referred to above
(and, in any event, the Administrative Agent shall not have any 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.
Promptly notify the Administrative Agent and each Lender:
(a) of the occurrence of any Default or Event of Default;
(b) of any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including (i) breach or non-performance of,
or any default under, a Contractual Obligation of the Borrower or any
Subsidiary; (ii) any dispute, litigation, investigation, proceeding or
suspension between the Borrower or any Subsidiary and any Governmental
Authority; or (iii) the commencement of, or any material development in, any
litigation or proceeding affecting the Borrower or any Subsidiary, including
pursuant to any applicable Environmental Laws;
(c) of any litigation, investigation or proceeding affecting any Loan
Party (i) in which the amount of damages claimed and not fully covered by
insurance equals or exceeds $5,000,000 (or its equivalent in another currency or
currencies), or in which injunctive relief or similar relief is sought, which
relief, if granted, could reasonably be expected to have a Material Adverse
Effect or (ii) within four days after reporting the same to the SEC if the
Borrower is required to report the same to such entity under applicable Law;
(d) of the occurrence of any ERISA Event;
(e) of any material change in accounting policies or financial reporting
practices by the Borrower or any Subsidiary;
(f) within three (3) Business Days after the date of such occurrence,
(i) if any Subsidiary or other Person shall become a Material Subsidiary of the
Borrower, or (ii) if the total revenues or total assets of all Non-Guarantor
Subsidiaries shall at any time together exceed 20% of the total revenues or
total assets, as the case may be, of the Borrower and its Subsidiaries,
determined on a consolidated basis;
(g) if applicable, upon the request from time to time of the
Administrative Agent, of the Swap Termination Values, together with a
description of the method by which such values were determined, relating to any
Swap Contracts then outstanding to which the Borrower or any of its Subsidiaries
is a party;
(h) upon becoming aware thereof, 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 Subsidiary that
would materially impact the operations of the Borrower or any Subsidiary; and
(i) upon, but in no event later than ten days after, becoming aware of
(i) any and all enforcement, cleanup, removal or other governmental or
regulatory actions involving a potential liability in excess of $5,000,000 in
the aggregate instituted, completed or threatened against the Borrower or any
Subsidiary or any of their properties pursuant to any applicable Environmental
Laws, (ii) all other Environmental Claims involving the Borrower or a Subsidiary
with a potential liability in excess of
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$5,000,000 in the aggregate, 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 such property or
any part thereof to be subject to any restrictions on the ownership, occupancy,
transferability or use of such property under any Environmental Laws and
involving a potential liability in excess of $5,000,000 in the aggregate.
Each notice pursuant to this Section shall be accompanied by a statement
of a Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower has taken and proposes
to take with respect thereto. Each notice pursuant to Section 6.03(a) shall
describe with particularity any and all provisions of this Agreement or other
Loan Document that have been breached.
6.04 PAYMENT OF OBLIGATIONS.
Pay and discharge as the same shall become due and payable (a) 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; (b) all lawful claims which, if
unpaid, would by law become a Lien upon its property; and (c) all Indebtedness,
as and when due and payable, but subject to any subordination provisions
contained in any instrument or agreement evidencing such Indebtedness.
6.05 PRESERVATION OF EXISTENCE, ETC.
Preserve, renew and maintain in full force and effect its legal
existence and good standing under the Laws of the jurisdiction of its
organization; take all reasonable action to maintain all rights, privileges,
permits, licenses and franchises necessary or desirable in the normal conduct of
its business, except in a transaction permitted by Section 7.04 or 7.05; and
preserve or renew all of its registered patents, trademarks, trade names and
service marks, the non-preservation of which could reasonably be expected to
have a Material Adverse Effect.
6.06 MAINTENANCE OF PROPERTIES.
(a) Maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good working order and
condition, ordinary wear and tear excepted; (b) make all necessary repairs
thereto and renewals and replacements thereof except where the failure to do so
could not reasonably be expected to have a Material Adverse Effect; and (c) use
the standard of care typical in the industry in the operation and maintenance of
its facilities.
6.07 MAINTENANCE OF INSURANCE.
Maintain with financially sound and reputable insurance companies not
Affiliates of the Borrower, 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.
6.08 COMPLIANCE WITH LAWS.
Comply in all material respects with the requirements of all Laws
applicable to it or to its business or property, except in such instances in
which (i) such requirement of Law is being contested in good faith or a bona
fide dispute exists with respect thereto; or (ii) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.
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6.09 BOOKS AND RECORDS.
(a) 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 or such Subsidiary, as the case may be; and
(b) maintain such books of record and account in material conformity
with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Subsidiary, as the case may be.
6.10 INSPECTION RIGHTS.
Permit representatives and independent contractors of the Administrative
Agent and each Lender to visit and inspect any of its properties, to examine its
corporate, financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss its affairs, finances and accounts with its directors,
officers, and independent public accountants, all at the expense of the Borrower
and at such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Borrower; provided
that when an Event of Default exists the Administrative Agent or any Lender (or
any of their respective representatives or independent contractors) may do any
of the foregoing at the expense of the Borrower at any time during normal
business hours and without advance notice.
6.11 COMPLIANCE WITH ERISA.
Do, and cause each of its ERISA Affiliates to do, each of the following:
(a) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state law; (b)
cause each Plan which is qualified under Section 401(a) of the Code to maintain
such qualification; and (c) make all required contributions to any Plan subject
to Section 412 of the Code.
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 with all
Environmental Laws.
(b) Upon written request of the Administrative Agent or any Lender, the
Borrower shall submit and cause each of its Subsidiaries to submit, to the
Administrative Agent and such Lender, at the Borrower's sole cost and expense
and at reasonable intervals, 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(i) and any other
environmental, health or safety compliance obligation, remedial obligation or
liability, that could, individually or in the aggregate, result in liability in
excess of $1,000,000.
6.13 USE OF PROCEEDS.
Use the proceeds of the Credit Extensions for working capital and other
general corporate purposes not in contravention of any Law or of any Loan
Document.
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6.14 TAX CLEARANCE CERTIFICATES.
On or before the date that is thirty calendar days following the Closing
Date, the Borrower shall provide to the Administrative Agent all tax clearance
certificates not delivered to the Administrative Agent under Section 4.01(a)(iv)
and permitted by such section to be delivered under this Section 6.14; provided
that, if the Borrower is unable to deliver any such certificate by virtue of a
delay in the ability of any applicable Governmental Authority to provide such
certificate in the ordinary course (and not by virtue of any Loan Party not
being in tax good standing) and the Borrower has provided to the Administrative
Agent reasonable evidence of such inability, then the Borrower shall have such
additional time to deliver such certificate(s) as the Administrative Agent shall
reasonably determine.
ARTICLE VII.
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, the Borrower shall not, nor shall it permit any
Subsidiary to, directly or indirectly:
7.01 LIENS.
Create, incur, assume or suffer to exist, any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, other
than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof 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(b);
(c) Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings, if adequate reserves with respect thereto
are maintained on the books of the applicable Person in accordance with GAAP;
(d) carriers', landlords', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the Ordinary Course of Business which
are not overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings, if adequate reserves with respect
thereto are maintained on the books of the applicable Person;
(e) pledges or deposits in the Ordinary Course of Business in connection
with workers' compensation, unemployment insurance and other social security
legislation, other than any Lien imposed by ERISA;
(f) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
Ordinary Course of Business, provided that all such deposits in the aggregate
could not reasonably be expected to result in a Material Adverse Effect;
(g) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property 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 materially interfere with the ordinary
conduct of the business of the applicable Person;
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(h) Liens securing or arising from judgments, decrees or attachments in
circumstances not constituting an Event of Default under Section 8.01(h);
(i) Liens securing Indebtedness permitted under Section 7.03(d),
provided that (i) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness; (ii) such Liens attach to the
subject property within 30 days after the acquisition thereof and (iii) the
Indebtedness secured thereby does not exceed the cost or fair market value,
whichever is lower, of the property being acquired on the date of acquisition;
(j) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(k) Liens securing reimbursement obligations of the Borrower or its
Subsidiaries with respect to commercial letters of credit obtained in the
Ordinary Course of Business and not prohibited hereby, provided that such Liens
shall attach only to documents or other property relating to such letters of
credit and products and proceeds thereof; and
(l) 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 that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Borrower in excess of those set forth by regulations promulgated
by the FRB, and (ii) such deposit account is not intended by the Borrower or any
Subsidiary to provide collateral to the depository institution.
7.02 INVESTMENTS.
Make any Investments, except:
(a) Investments other than those permitted by subsections (b) through
(h) that are existing on the date hereof and listed on Schedule 7.02;
(b) Investments held by the Borrower or any of its Subsidiaries in the
form of cash equivalents or short-term marketable securities;
(c) Investments consisting of extensions of credit by the Borrower to
any of its wholly owned Subsidiaries or by any of its wholly owned Subsidiaries
to the Borrower or to another of its wholly owned Subsidiaries;
(d) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the sale or lease of goods
or services 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;
(e) Guaranty Obligations permitted by Section 7.03;
(f) Investments resulting by virtue of transactions otherwise permitted
by Section 7.07;
(g) Investments managed by Granite Land Company, a Subsidiary of the
Borrower, in an aggregate amount not to exceed at any time $25,000,000; and
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(h) Investments not otherwise permitted pursuant to subsections (a)
through (g) of this Section 7.02 in the equity of any Subsidiary or the capital
stock, assets, obligations or other securities of or interests in any other
Person in an aggregate amount not to exceed at any time $100,000,000.
7.03 INDEBTEDNESS.
Create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Indebtedness outstanding on the date hereof and listed on Schedule
7.03 and any refinancings, refundings, renewals or extensions thereof, provided
that the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing and by an amount equal
to any existing commitments unutilized thereunder;
(c) obligations (contingent or otherwise) of the Borrower or any
Subsidiary existing or arising under any Swap Contract, provided that (i) such
obligations are (or were) entered into by such Person in the Ordinary Course of
Business for the purpose of directly mitigating risks associated with
liabilities, commitments, investments, assets, or property held or reasonably
anticipated by such Person, or changes in the value of securities issued by such
Person and not for purposes of speculation or taking a "market view;" and (ii)
such Swap Contract does not contain any provision exonerating the non-defaulting
party from its obligation to make payments on outstanding transactions to the
defaulting party;
(d) Indebtedness in respect of capital leases, Synthetic Lease
Obligations and purchase money Indebtedness for fixed or capital assets within
the limitations set forth in Section 7.01(i); provided that the aggregate amount
of (i) all purchase money Indebtedness for fixed or capital assets that may be
incurred by the Borrower or any of its then existing Subsidiaries in any fiscal
year of the Borrower shall not exceed $10,000,000; (ii) all Indebtedness in
respect of capital leases and Synthetic Lease Obligations to finance the
acquisition of fixed or capital assets incurred by the Borrower or any of its
then existing Subsidiaries in any fiscal year shall not exceed $10,000,000; and
(iii) all Indebtedness in respect of capital leases, Synthetic Lease Obligations
and purchase money Indebtedness for fixed or capital assets of Persons
immediately prior to such Persons becoming Subsidiaries or being merged with or
into (or otherwise becoming acquired by the Borrower or any of its Subsidiaries)
following the Closing Date shall not exceed $30,000,000; provided that none of
such Indebtedness was incurred in anticipation of any such acquisition;
(e) Indebtedness arising as a consequence of Investments pursuant to
Section 7.02(c);
(f) Indebtedness respecting (i) letters of credit (other than Letters of
Credit) issued for the account of the Borrower or any Subsidiary in the Ordinary
Course of Business in an aggregate outstanding amount not to exceed $25,000,000
at any time; and (ii) the obligation of a subcontractor of the Borrower or its
Subsidiaries on a construction project, provided that the Borrower or such
Subsidiary determines in good faith that such financial arrangement best serves
the Borrower's or such Subsidiary's financial interests;
(g) Indebtedness incurred in the Ordinary Course of Business in
connection with (i) securing the performance of bids, trade contracts (other
than for borrowed money), and statutory obligations, (ii) obligations on surety
and appeal bonds, and (iii) other obligations of a like nature incurred in the
Ordinary
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Course of Business, in each of the foregoing cases to the extent not otherwise
prohibited by the terms of any Loan Document; and
(h) additional Indebtedness, comprised solely of (i) the outstanding
principal amount of obligations, whether current or long-term, for borrowed
money and all obligations evidenced by bonds (other than performance, surety and
appeal bonds), debentures, notes, loan agreements or other similar instruments,
(ii) Attributable Indebtedness in respect of capital leases and Synthetic Lease
Obligations, or (iii) without duplication, Guaranty Obligations with respect to
Indebtedness of the types specified in the immediately preceding clauses (i) and
(ii), in an aggregate amount outstanding not to exceed $100,000,000 at any time;
provided that no such Indebtedness shall be permitted under this clause (h) if
such Indebtedness represents Indebtedness of any co-joint venturer in any Joint
Venture to which the Borrower or any Subsidiary is a party is that is assumed by
the Borrower or any of Subsidiary if such Indebtedness was not originally
incurred by such co-joint venturer in connection with (and relate solely to) the
subject Joint Venture.
7.04 FUNDAMENTAL CHANGES.
Merge, consolidate with or into, or convey, transfer, lease or otherwise
dispose of (whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired) to or
in favor of any Person or enter into any Joint Venture, except that, so long as
no Default or Event of Default exists at the time or would occur as a result
thereof:
(a) any Subsidiary may merge with (i) the Borrower, provided that the
Borrower shall be the continuing or surviving Person, (ii) any one or more
Subsidiaries, provided that, when any wholly-owned Subsidiary is merging with
another Subsidiary, the wholly-owned Subsidiary shall be the continuing or
surviving Person, or (iii) any other Person, provided that the Subsidiary shall
be the continuing or surviving Person or immediately upon such merger,
consolidation or combination, the surviving Person shall be a wholly-owned
Subsidiary of the Borrower;
(b) any Subsidiary may sell all or substantially all of its assets (upon
voluntary liquidation or otherwise), to the Borrower or to another Subsidiary;
provided that if the seller in such a transaction is a wholly-owned Subsidiary,
then the purchaser must either be the Borrower or a wholly-owned Subsidiary;
(c) the Borrower may merge, consolidate or combine with another entity
if the Borrower is the corporation surviving the merger; and
(d) the Borrower or any of its Subsidiaries may enter into any Joint
Venture or partnership with any Person in the Ordinary Course of Business.
7.05 DISPOSITIONS.
Sell, lease or make any Disposition or enter into any agreement to make
any Disposition, except so long as no Default or Event of Default exists at the
time or would occur as a result thereof:
(a) Dispositions of obsolete or worn out property, whether now owned or
hereafter acquired, in the Ordinary Course of Business;
(b) Dispositions of inventory in the Ordinary Course of Business;
(c) Dispositions of equipment or real property to the extent that (i)
such property is exchanged for credit against the purchase price of similar
replacement property for use in the Ordinary
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Course of Business, (ii) the proceeds of such Disposition are reasonably
promptly applied to the purchase price of such replacement property for use in
the Ordinary Course of Business or (iii) the board of directors or senior
management of the Borrower or such Subsidiary has determined in good faith that
the failure to replace such property will not be detrimental to the business of
the Borrower or such Subsidiary;
(d) Dispositions of property by any Subsidiary to the Borrower or to a
wholly-owned Subsidiary of the Borrower;
(e) Dispositions permitted by Section 7.04;
(f) non-exclusive licenses of IP Rights in the Ordinary Course of
Business and substantially consistent with past practice for terms not exceeding
five years; and
(g) other Dispositions or property (other than accounts and notes
receivable) not described in subsections (a) through (f) of this Section 7.05;
provided that the aggregate consideration from such Dispositions received by the
Borrower and its Subsidiaries, including aggregate cash received and the
aggregate fair market value of non-cash property received, shall not exceed 5%
of the total assets of the Borrower (determined on a consolidated basis in
accordance with GAAP) as of the end of the Borrower's most recently ended fiscal
year;
provided that any Disposition pursuant to subsections (a) through (g) shall be
for fair market value.
7.06 LEASE OBLIGATIONS.
Create or suffer to exist any obligations for the payment of rent for
any property under lease or agreement to lease, except:
(a) leases in existence on the date hereof and listed on Schedule 7.06,
and any renewal, extension or refinancing thereof;
(b) operating leases (other than those constituting Synthetic Lease
Obligations) entered into or assumed by the Borrower or any Subsidiary after the
date hereof in the Ordinary Course of Business;
(c) leases in connection with any sale-leaseback arrangement permitted
hereby; and
(d) capital leases and Synthetic Lease Obligations to the extent
permitted by Section 7.03.
7.07 RESTRICTED PAYMENTS.
Declare or make, directly or indirectly, any Restricted Payment
(including, but not limited to, dividends, redemptions and repurchases of common
stock), or incur any obligation (contingent or otherwise) to do so, except that:
(a) each Subsidiary may make Restricted Payments to the Borrower and to
wholly-owned Subsidiaries (and, in the case of a Restricted 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);
(b) the Borrower and each Subsidiary may declare and make dividend
payments or other distributions payable solely in the common stock of such
Person;
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(c) so long as no Default or Event of Default exists or would result by
virtue thereof, the Borrower and each Subsidiary may purchase, redeem or
otherwise acquire shares of its common stock or warrants or options to acquire
any such shares with the proceeds received from the substantially concurrent
issue of new shares of its common stock;
(d) so long as no Default or Event of Default exists or would result by
virtue thereof, the Borrower may purchase, redeem or otherwise acquire shares of
common stock for cash in order to contribute such shares to the Borrower's
employee stock ownership plan, provided the aggregate amount paid by the
Borrower in connection with such transactions does not exceed in any fiscal year
an amount equal to 15% of plan compensation (as such term is interpreted for
purposes of Section 401(a)(17) of the Code) paid by the Borrower in such fiscal
year, and such shares are promptly so contributed;
(e) so long as no Default or Event of Default exists or would result by
virtue thereof, the Borrower may purchase, redeem or otherwise acquire shares of
its capital stock, or warrants, rights or options to acquire any such shares for
cash in an aggregate amount not to exceed $50,000,000 computed on a cumulative
basis during the term of this Agreement; and
(f) so long as no Default or Event of Default exists or would result by
virtue thereof, the Borrower may declare and make dividend payments in cash.
7.08 ERISA.
At any time engage in a transaction which could be subject to Section
4069 or 4212(c) of ERISA, or permit any Plan to (a) engage in any non-exempt
"prohibited transaction" (as defined in Section 4975 of the Code); (b) fail to
comply with ERISA or any other applicable Laws; or (c) incur any material
"accumulated funding deficiency" (as defined in Section 302 of ERISA), which,
with respect to each event listed above, could reasonably be expected to have a
Material Adverse Effect.
7.09 CHANGE IN NATURE OF BUSINESS OR IN STRUCTURE.
(a) Engage in any material line of business substantially different from
those lines of business conducted by the Borrower and its Subsidiaries on the
date hereof; and
(b) Except as otherwise permitted under Section 7.04, make any change in
the Borrower's capital structure (including in the terms of its outstanding
capital stock) or amend its certificate of incorporation or bylaws if, as a
result, there would be a reasonably likelihood of the occurrence of a Material
Adverse Effect.
7.10 TRANSACTIONS WITH AFFILIATES.
Enter into any transaction of any kind with any Affiliate of the
Borrower, other than arm's-length transactions with Affiliates that are
otherwise permitted hereunder.
7.11 BURDENSOME AGREEMENTS.
(a) Limiting Contracts. Enter into any Contractual Obligation that
limits the ability (i) of any Subsidiary to make Restricted Payments to the
Borrower or to otherwise transfer property to the Borrower or (ii) of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; and
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(b) Employment Contracts. Enter into any employment contracts or other
arrangements who terms, including salaries, benefits and other compensation, are
different from those previously entered into by it in the Ordinary Course of
Business.
7.12 USE OF PROCEEDS.
Use the proceeds of any Credit Extension, whether directly or
indirectly, and whether immediately, incidentally or ultimately, to purchase or
carry margin stock (within the meaning of Regulation U of the FRB), to extend
credit to others for the purpose of purchasing or carrying margin stock or to
refund indebtedness originally incurred for such purpose, or to acquire any
security in any transaction that is subject to Section 13 or 14 of the Exchange
Act.
7.13 FINANCIAL COVENANTS.
(a) Consolidated Tangible Net Worth. Permit Consolidated Tangible Net
Worth as of the end of any fiscal quarter of the Borrower to be less than the
sum of (a) $318,866,000 plus (b) an amount equal to 50% of the Consolidated Net
Income earned in each fiscal quarter ending after March 31, 2001 (with no
deduction for a net loss in any such fiscal quarter) plus (c) an amount equal to
50% of the aggregate increases in Consolidated Shareholders' Equity after the
date hereof by reason of the issuance and sale of capital stock of the Borrower
(including upon any conversion of debt securities of the Borrower into such
capital stock).
(b) Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio
as of the end of any fiscal quarter of the Borrower to be less than 1.50 to
1.00.
(c) Leverage Ratio. Permit the Leverage Ratio as of the end of any
fiscal quarter of the Borrower to be greater than 0.55 to 1.00.
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 (3) Business Days after the same becomes due, any interest on
any Loan or on any L/C Obligation, any commitment, utilization or other fee due
hereunder, or any other amount payable hereunder or under any other Loan
Document; or
(b) Specific Covenants. The Borrower fails to perform or observe any
term, covenant or agreement contained in any of Section 6.01, 6.02, 6.03, 6.05,
6.10, 6.12 or 6.13 or Article VII; or
(c) Other Defaults. Any Loan Party fails to perform or observe any other
covenant or agreement (not specified in subsection (a) or (b) above) contained
in any Loan Document on its part to be performed or observed and such failure
continues for 30 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 when made or deemed made; or
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(e) Cross-Default. (i) The Borrower or any Material Subsidiary or any
Guarantor (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
$5,000,000, 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 (A) any event of default under such Swap Contract as to which the
Borrower or any Material Subsidiary or any Guarantor is the Defaulting Party (as
defined in such Swap Contract) or (B) any Termination Event (as so defined)
under such Swap Contract as to which the Borrower or any Material Subsidiary is
an Affected Party (as so defined) and, in either event, the Swap Termination
Value owed by the Borrower or such Material Subsidiary as a result thereof is
greater than $5,000,000; or
(f) Insolvency Proceedings, Etc. Any Loan Party or any of its
Subsidiaries 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 entered
in any such proceeding; or
(g) Inability to Pay Debts; Attachment. (i) Any Loan Party or any of its
Subsidiaries 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; or
(h) Judgments. There is entered against any Loan Party or any Subsidiary
(i) a final judgment or order 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 that has, or could reasonably be expected to have, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period
of 10 consecutive days during which a stay of enforcement of such judgment, by
reason of a pending appeal or otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could 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 in excess of $1,000,000,
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
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under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of the $1,000,000; 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 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) Loss of Material Licenses, Permits or Intellectual Property. Any
Governmental Authority revokes or fails to renew any material license, permit or
franchise of the Borrower or any of its Subsidiaries, or the Borrower or any of
its Subsidiaries for any reason loses any material license, permit or franchise,
or the Borrower or any of its Subsidiaries suffers the imposition of any
restraining order, escrow, suspension or impound of funds in connection with any
proceeding (judicial or administrative) with respect to any material license,
permit or franchise; or
(l) Change of Control. There occurs any Change of Control; or
(m) Material Adverse Effect. There occurs any event or circumstance that
has a Material Adverse Effect.
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 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 due and payable, the obligation
of the Borrower to Cash Collateralize the L/C Obligations as aforesaid shall
automatically become effective, all payment obligations under the Guaranty of
each Guarantor shall automatically become due and payable, in each case without
further act of the Administrative Agent or any Lender.
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ARTICLE IX.
ADMINISTRATIVE AGENT
9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably 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 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
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
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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, 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
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 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
hereafter 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.
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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 and the other Loan Parties
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), pro rata, and hold harmless each Agent-Related
Person from and against any and all Indemnified Liabilities incurred by it;
provided that no Lender shall be liable for the payment to any Agent-Related
Person of any portion of such Indemnified Liabilities determined in a final,
nonappealable judgment by a court of competent jurisdiction to have been caused
primarily by such Person's own gross negligence or willful misconduct; provided
that no action taken in accordance with the directions of the Required Lenders
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 of any
costs or out-of-pocket expenses (including reasonable Attorney Costs and costs
and expenses in connection with the use of the Internet, IntraLinks or other
similar information transmission systems in connection with this Agreement)
incurred by the Administrative Agent in connection with the 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 Aggregate 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
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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
prior notice to the Lenders; provided that any such resignation by Bank of
America shall also constitute its resignation as L/C Issuer. 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, then 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, the Person acting as such successor
administrative agent shall succeed to all the rights, powers and duties of the
retiring Administrative Agent and L/C and the respective terms "Administrative
Agent" and "L/C Issuer" shall mean such successor administrative agent and
Letter of Credit issuer, and the retiring Administrative Agent's appointment,
powers and duties as Administrative Agent shall be terminated and the retiring
L/C Issuer's rights, powers and duties as such shall be terminated, without any
other or further act or deed on the part of such retiring L/C Issuer or any
other Lender, other than the obligation of the successor L/C Issuer to issue
letters of credit in substitution for the Letters of Credit, if any, outstanding
at the time of such succession. 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 such Person's 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.
ARTICLE X.
GENERAL PROVISIONS
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 that no such amendment, waiver or consent shall, unless in
writing and signed by each of the Lenders directly 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;
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(b) postpone any date fixed by this Agreement or any other Loan Document
for any payment or mandatory prepayment 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 (subject to clause (iv) of the proviso below)
any fees or other amounts payable hereunder or under any other Loan Document, or
change the manner of computation of any financial covenant used in determining
the Applicable Rate that would result in a reduction of any interest rate on any
Loan; provided that only the consent of the Required Lenders shall be necessary
to amend the definition of "Default Rate" contained in Section 1.01 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 (except
for any change resulting from Section 3.06(b));
(f) amend this Section, or Section 2.12, or any provision herein
providing for consent or other action by all the Lenders; or
(g) release any Guarantor from the Guaranty;
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 each
directly-affected Lender, as the case may be, affect the rights or duties of the
L/C Issuer under this Agreement or any Letter of Credit 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 each directly-affected Lender, 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 Fee Letter may be amended,
or rights or privileges thereunder waived, in a writing executed only by the
respective parties thereto. Notwithstanding anything to the contrary herein, any
Lender that has a Voting Percentage of zero shall not have any right to approve
or disapprove any amendment, waiver or consent hereunder, except that the Pro
Rata Share of such Lender may not be increased (except for any such increase
resulting from Section 3.06(b)) without the consent of such Lender.
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 mail, four (4) 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
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delivered; provided that notices and other communications to the Administrative
Agent and the L/C Issuer pursuant to Article II shall be in writing (including
by facsimile) 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 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.
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 reasonable Attorney Costs
(including non-duplicative allocated costs of in-house counsel) and costs and
expenses in connection with the use of internet, IntraLinks or other similar
information transmission systems in connection with this Agreement, and (b) to
pay or reimburse the Administrative Agent, the Arranger and each Lender for all
costs and expenses (including Attorney Costs) incurred in connection with the
enforcement, attempted enforcement, or preservation of any rights
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or remedies under this Agreement, the other Loan Documents or applicable Law
(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). 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
Aggregate Commitments and repayment of all other Obligations.
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 arising out of or relating to the Loan Documents, any predecessor loan
documents, any Commitment, the use or contemplated use of the proceeds of any
Credit Extension, or the relationship of any Loan Party, the Administrative
Agent and the Lenders under this Agreement or any other Loan Document, (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, any Commitment, the use
or contemplated use of the proceeds of any Credit 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, whether or not arising out of the negligence of an Indemnitee, 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 determined in a final, nonappealable judgment by a court of
competent jurisdiction to have been caused primarily by its own gross negligence
or willful misconduct or for any loss asserted against it by another Indemnitee.
No Indemnitee shall be liable for any damages arising from the use by others of
any information or other materials obtained through internet, Intralinks or
other similar information transmission systems in connection with this
Agreement. The agreements in this Section shall survive the termination of the
Aggregate Commitments and repayment of all 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
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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) Any Lender may, with the prior written consent of the Administrative
Agent and, so long as no Default or Event of Default has occurred and is
continuing, the Borrower (whose consent, if required, shall not be unreasonably
withheld or delayed), 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 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 hereunder) subject to each such
assignment, determined as of the date the Assignment and Assumption Agreement
with respect to such assignment is delivered to the Administrative Agent, shall
not be less than $5,000,000 unless the Administrative Agent and, so long as no
Default or Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed), (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 Assumption Agreement and shall pay to the Administrative
Agent a processing and recordation fee in an amount equal to $3,500. 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 Assumption Agreement, the Eligible Assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such Assignment
and Assumption Agreement, 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 Assumption Agreement, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Assumption Agreement 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 3.07, 10.04 and
10.05). Upon request, the Borrower (at its expense) shall execute and deliver
new or replacement 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.
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(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 Assumption Agreement 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
Persons (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 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 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 (i) postpone any date upon which any payment of money is scheduled to
be paid to such Participant, (ii) reduce the principal, interest, fees or other
amounts payable to such Participant or (iii) release any 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 2.14 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
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 (5) 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 (5th) Business
Day.
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(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 (i) the Administrative Agent, in the case of
any assignment of a Loan, (ii) the L/C Issuer, and (iii) unless (A) such
Person is taking delivery of an assignment in connection with physical
settlement of a credit derivatives transaction or (B) an Event of
Default has occurred and is continuing, the Borrower (each such approval
referred to in clauses (i) through (iii) not to be unreasonably withheld
or delayed).
"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 30 days prior written notice to
the Borrower and the Lenders, resign as L/C Issuer. In the event of any such
resignation as L/C Issuer, the Borrower shall be entitled to appoint from among
the Lenders a successor L/C Issuer hereunder, provided 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 of 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 2.04(c)). Until such time, if at all, as Bank of America shall have
resigned as "L/C Issuer" hereunder, no other Person shall be, shall be entitled
to be or shall be deemed to be an "L/C Issuer" or additional or co- "L/C Issuer"
hereunder.
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 non-confidential basis from a source
other than the Borrower; or (i) to the National Association of Insurance
Commissioners or any other similar organization or any nationally
62
68
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. In addition, the Administrative Agent
and the Lenders may disclose the existence of this Agreement and information
about this Agreement to market data collectors, similar service providers to the
lending industry, and service providers to the Administrative Agent and the
Lenders in connection with the administration and management of this Agreement,
the other Loan Documents, the Commitments, and the Credit Extensions. 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
non-confidential 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.
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 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.
63
69
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 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 not a "United States person" within the meaning of
Section 7701(a)(30) 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 upon 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
64
70
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 reasonable Attorney Costs) of the
Administrative Agent. The obligation of the Lenders under this Section shall
survive the termination of the Aggregate Commitments, repayment of all
Obligations and the resignation or replacement of the Administrative Agent.
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 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 removal or
replacement (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 each 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 Assumption Agreement 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.
(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.
(c) This section shall supersede any provision in Section 10.01 to the
contrary.
10.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, the LAW OF THE STATE OF CALIFORNIA 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.
65
71
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA
SITTING IN THE CITY AND COUNTY OF SAN FRANCISCO, CALIFORNIA OR OF THE UNITED
STATES FOR THE NORTHERN 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 SUCH JURISDICTION
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.
10.19 TIME OF THE ESSENCE.
Time is of the essence of the Loan Documents.
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72
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
GRANITE CONSTRUCTION INCORPORATED,
a Delaware corporation, as the Borrower
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Financial Officer
BANK OF AMERICA, N.A., as Administrative Agent,
as a Lender and as L/C Issuer
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
BNP PARIBAS, as a Lender
By: /s/ PIERRE ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------------------------
Name: Pierre ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇
Title: Managing Director Associate
FIRST UNION NATIONAL BANK, as a Lender
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
UNION BANK OF CALIFORNIA, N.A., as a Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION, as a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
73
SCHEDULE A
EXISTING LETTERS OF CREDIT
(Previously issued by Bank of America, N.A. for the account of
Granite Construction Incorporated)
-------------------------------------------------------------------------------------------------
L/C NO. ORIG. ISSUE DATE BENEFICIARY EXPIRY DATE FACE AMT. AS OF 6-29-01
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
3016467 ▇-▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇ (▇▇▇▇▇▇, ▇▇▇▇▇) 5-25-02 $10,016,400.00
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
1171 ▇-▇▇-▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇-▇▇-▇▇ $1,366,472.00
Self-Insurance Plans
-------------------------------------------------------------------------------------------------
138514 ▇-▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇-▇▇-▇▇ $3,299,861.30
Paris
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
74
SCHEDULE B
GUARANTORS
Granite Construction Company, a California corporation
Granite Land Company, a California corporation
G.G. & R., Inc., a Utah corporation
Intermountain Slurry Seal, Inc., a Wyoming corporation
Pozzolan Products Company (P.P.C.), a Utah corporation
GILC, L.P., a California limited partnership
75
SCHEDULE 2.01
COMMITMENTS AND PRO RATA SHARES
LENDER COMMITMENT PRO RATA SHARE
--------------------------------------------- ----------------------------- ---------------------
Bank of America, N.A. $13,000,000.00 21.666666667
BNP Paribas $12,500,000.00 20.833333333
Union Bank of California, N.A. $12,500,000.00 20.833333333
First Union National Bank $12,000,000.00 20.000000000
U.S. Bank National Association $10,000,000.00 16.666666667
------------------------------ -------------- ------------
Total $60,000,000.00 100.000000000%
76
SCHEDULE 5.06
Litigation
None
77
SCHEDULE 5.09
Environmental Matters
Granite Construction in the normal course of business utilizes petroleum
(hydrocarbon) products which may be considered hazardous materials when
encountered at regulatory levels established by the Federal EPA or the Regional
State EPA. The utilization of these asphalt products, diesel, and gasoline over
the years of operations have the potential of creating exposure to environmental
clean up requirements. All underground tanks meet current requirements. There
are no pending governmental ordered clean up requirements. However, the
following represents estimates based on construction industry housekeeping
practices as encountered during our normal course of business. Except as
indicated with an " * ", these costs do not represent actual identified
exposures.
Locations Description Amount
--------- ----------- ------
Arvin, CA Asphalt Batch Plant 100,000
Arvin, CA Surface Spills 50,000
Bakersfield, CA Surface Spills 100,000
Bakersfield, CA Diesel Aboveground Storage Tanks 25,000
Bakersfield, CA Asphalt Batch Plant 100,000
Coalinga, CA Asphalt Batch Plant 50,000
Felton, Ca Asphalt Batch plant 200,000
French Camp, CA Diesel/Gasoline Underground Storage Tanks 100,000
Gardnerville, NV Surface Spills 25,000
Gardnerville, NV Asphalt Batch Plant 50,000
Indio, CA ▇▇▇▇▇▇ Shop/Smitty's Garage Cleanup 50,0000
Palmdale, CA Surface Spills 10,000
Palmdale, CA Asphalt Batch Plant 50,000
▇▇▇▇▇▇▇, NV Asphalt Batch Plant 75,000
▇▇▇▇▇▇▇, NV Surface Spills 50,000
Sacramento, CA Diesel/Gasoline Underground Storage Tanks 50,000
Sacramento, CA Asphalt Batch Plant 300,000
Sacramento, CA Surface Spills 200,000
Sacramento, CA Diesel Aboveground Storage Tanks 50,000
Sacramento, CA Shop Area Cleanup 50,000
Salinas, CA Surface Spills 250,000
Santa Barbara, CA Surface Spills 200,000
Santa Barbara, CA Diesel/Gasoline Underground Storage Tanks 75,000
Santa Barbara, CA Asphalt Batch Plant 50,000
Santa Cruz, CA Santa ▇▇▇▇ Yard Cleanup 250,000
Sparks, NV Diesel/Gasoline Underground Storage Tanks 100,000
Tracy, CA Asphalt Batch Plant 75,000
Tracy, CA Surface Spills 25,000
Tucson, AZ Surface Spills 25,000
Tucson, AZ Diesel/Gasoline Underground Storage Tanks 50,000
Watsonville, CA Diesel/Gasoline Underground Storage Tanks 150,000
Watsonville, CA Surface Spills 50,000
▇▇▇▇, UT * Asphalt Batch Plant 500,000
Whitehall, UT * Asphalt Batch Plant 55,000
Salt Lake City, UT * Concrete Batch Plant 250,000
Salt Lake County, UT * Surface Spills 30,000
▇▇▇▇▇ County, UT (Ogden) * Surface Spills 100,000
Salt Lake County, UT (CPC) * Aggregate and smelter site 1,250,000
▇▇▇▇▇▇, UT * Surface Spills 100,000
Fireclay Battery, UT * Surface Spills 25,000
---------
5,295,000
78
SCHEDULE 5.13
Subsidiaries and other Equity Investments
Part (a)
Jurisdiction of Ownership By Company and/or
Name Organization Capital Structure Subsidiary
Granite Construction Company California Corporation 100% wholly owned subsidiary of GCI
▇▇▇▇▇▇▇ Corporation Colorado Corporation 100% wholly owned subsidiary of GCI
Granite Land Company California Corporation 100% wholly owned subsidiary of GCI
Granite SR9l Corporation California Corporation 100% wholly owned subsidiary of GCI
Granite SR91 L.P. California Limited Partnership 99% limited partner of GCI and 1% general
partner of SR91 Corporation
GILC Incorporated California Corporation 100% wholly owned subsidiary of GCI
GILC L.P. California Limited Partnership 99% limited partner of GCC and 1% general
partner of GILC Incorporated
G. G. & R, Inc. Utah Corporation 100% wholly owned subsidiary of GCI
Intermountain Slurry Seal, Inc. Wyoming Corporation 100% wholly owned subsidiary of G. G.& R
Pozzolan Products Company Utah Corporation 100% wholly owned subsidiary of G. G.& R
GTC, Inc. Texas Corporation 100% wholly owned subsidiary of GCI
Granite Construction International California Corporation 100% wholly owned subsidiary of GCI
Waters Ridge II, LTD Texas LP 69% Interest owned by GCI
Granite Mandalay Finance California LLC 70% Interest owned by GLC
Granite/Kiewit (Tongue River) Montana Joint Venture 76% partnership interest by GCC
Granite/▇▇▇▇▇ (I-17) Arizona Joint Venture 55% partnership interest by GCC
Minn.Transit Constrs (Light Rail) Minnesota Joint Venture 56.5% partnership interest by GCC
Granite Rizzani (Hathaway Bridge) Florida Joint Venture 60% partnership interest by GCC
River Mountain Constructors Arkansas Joint Venture 60% partnership interest by GCC
Granite ▇▇▇▇▇▇ California Joint Venture 60% partnership interest by GCC
Granite2 ▇▇▇▇▇ (Supersition Hwy) Arizona Joint Venture 65% partnership interest by GCC
Granite/PCL (I-4 St ▇▇▇▇▇ River) Florida Joint Venture 64.6% partnership interest by GCC
Part (b)
Paramount-Nevada Asphalt California LLP 50% Interest owned by GCI
Wilders Construction Company Washington Minority Interest 46% Interest owned by GCC
TIC Holidings, Inc. Delaware Minority Interest 30% Interest owned by GCI
▇▇▇▇▇▇▇▇▇▇ Ranch Plaza California LP 25% Interest owned by GLC
Oly Mandalay Bay California LLC 9% Interest owned by GLC
Granite Regional Park California LP 25% partnership interest by GLC
CPTC L.P. California LLP 22% Interest owned by GCI
Kiewit/Granite (TCA) California Joint Venture 30% partnership interest by GCC
KG Leasing (TCA) California Joint Venture 30% partnership interest by GCC
Kiewit/Granite (East Dam) California Joint Venture 25% partnership interest by GCC
Kiewit/Granite/Washington (Wasatch) Utah Joint Venture 23% partnership interest by GCC
KGW Leasing (Wasatch) Utah Joint Venture 23% partnership interest by GCC
Yonkers/Granite (Atlantic City) New Jersey Joint Venture 40% partnership interest by GCC
Western Summit/TIC/Granite (UTOY) Georgia Joint Venture 15% partnership interest by GCC
▇▇▇▇▇▇▇/Granite (Cabrillo College) California Joint Venture 40% partnership interest by GCC
Washington Granite California Joint Venture 40% partnership interest by GCC
Las Vegas Monorail (Light Rail) Nevada Joint Venture 44.8% partnership interest by GCC
79
SCHEDULE 5.16
Intellectual Property Matters
None
80
SCHEDULE 7.01
Existing Liens
There are approximately 5 UCC-1 liens filed against Granite Construction Company
with respect to rental leases for construction equipment.
81
SCHEDULE 7.02
Existing Investments
Company Descriptions Market
05/31/01
Perini Corporation Common Stock 2,878
Vulcan Materials Company Common Stock 2,813
Cascade Corporation Common Stock 2,384
Paramount-Nevada Asphalt LLP 4,649,128
▇▇▇▇▇▇ Construction Company Minority Interest 17,738,190
TIC Holdings, Inc. Minority Interest 21,890,787
Waters Ridge 11, LTD LP 754,920
▇▇▇▇▇▇▇▇▇▇ Ranch Plaza LP 708,223
Granite Mandalay Bay LLC 1,695,357
Granite Mandalay Finance LLC 1,800,000
Granite Regional Park LP 226,200
CPTC L.P./SR91 L.P. LP 1,121,915
Granite/▇▇▇▇▇▇ Joint Venture 184,894
Kiewit/Granite (TCA) Joint Venture 324,236
Kiewit/Granite (KG Leasing) Joint Venture 1,459,589
Kiewit/Granite (E. Dam) Joint Venture 411,564
Kiewit/Granite (Wasatch) Joint Venture 2,535,620
Kiewit/Granite (KGW Leasing) Joint Venture 6,698,970
Yonkers/Granite (Atlantic City) Joint Venture 10,658,003
Western Summit/TIC/Granite Joint Venture 158,649
Granite/Kiewit (Tongue River) Joint Venture 105,964
Granite/▇▇▇▇▇ (I-17) Joint Venture 257,000
Washington Granite Joint Venture 120,000
▇▇▇▇▇▇▇/Granite (Cabrillo College) Joint Venture 187,257
Minnesta Transit Constructors (Light Rail) Joint Venture 1,500,381
River Mountain Constructors Joint Venture 3,500
Granite2/▇▇▇▇▇ (Supersition Hwy) Joint Venture 0
Las Vegas Monorail (Light Rail) Joint Venture 0
$75,198,422
82
SCHEDULE 7.03
Existing Indebtedness
Balance
Description Interest Rate Maturity 6/01/01
Aggregate property 6.50% 04/14/02 1,579,633
Real Estate property 6.50% 12/01/07 1,438,937
Aggregate property 8.82% 06/01/01 1,700,000
Refinance debt & general corporate purposes 6.54% 03/15/10 60,000,000
Refinance debt & general corporate purposes 6.96% 05/01/13 75,000,000
Self insured Workers Compensation 100.0 bps 04/30/02 1,562,962
Aggregate property 8.00% 05/12/01 260,000
$141,541,532
83
SCHEDULE 7.06
Existing Leases
Leases: (Halmar Builder's of NY, Inc. as Lessee) *
Annual
Lessor Description Maturity Payments
Union State Bank Construction Equipment 12/20/02 46,800
▇▇▇▇▇▇ Financial, Inc. Construction Equipment 08/01/01 16,380
▇▇▇▇▇▇ Financial, Inc. Construction Equipment 06/01/01 23,472
▇▇▇▇▇▇ Financial, Inc. Construction Equipment 11/01/01 22,980
▇▇▇▇▇▇ Financial, Inc. Construction Equipment 08/01/01 52,020
Caterpillar Financial Services Corporation Construction Equipment 09/16/03 71,724
Caterpillar Financial Services Corporation Construction Equipment 09/16/03 71,724
M&T Credit Corporation Construction Equipment 04/26/03 38,652
M&T Credit Corporation Construction Equipment 07/01/03 114,612
M&T Credit Corporation Construction Equipment 12/01/03 45,288
M&T Credit Corporation Construction Equipment 07/01/02 91,992
Resource Capital Corporation Construction Equipment 12/10/01 5,100
The Bank of New York Office Building 08/01/02 37,980
$638,724
*Note: These leases will become part of Granite Halmar Construction Company,
Inc. once the acquisition is closed on 07/01/01.
84
SCHEDULE 10.02
EURODOLLAR AND DOMESTIC LENDING OFFICES;
ADDRESSES FOR NOTICES
BORROWER:
GRANITE CONSTRUCTION INCORPORATED
Granite Construction Incorporated
P. O. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Vice President/Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
Website: ▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
WITH A COPY TO:
Granite Construction Incorporated
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Treasurer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇-▇▇▇.▇▇▇
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A.
(for lending and administrative notices (including payments and Requests for
Credit Extensions)):
Bank of America, N.A.
Mail Code: CA4-706-05-09
Agency Administrative Services #5596
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Account No.: 3750836479
Ref: Granite Construction
ABA# ▇▇▇▇▇▇▇▇▇
85
(for all purposes other than lending and administrative notices):
Bank of America, N.A.
Mail Code: CA5-705-12-14
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Principal
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
L/C ISSUER:
BANK OF AMERICA, N.A.
Bank of America, N.A.
Trade Operations-Los Angeles #22621
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Mail Code: CA9-703-19-23
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
LENDERS:
BANK OF AMERICA, N.A.:
Bank of America, N.A.
Mail Code: CA5-705-12-14
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Principal
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
BNP PARIBAS:
BNP Paribas
4th Floor, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇
86
FIRST UNION NATIONAL BANK:
First Union National Bank
Care Of: First Union Securities, Inc.
11th Fl., Trans. & Construc. Indus.
▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇▇.▇▇▇
UNION BANK OF CALIFORNIA, N.A.:
Union Bank of California, N.A.
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇.▇▇▇
U.S. BANK NATIONAL ASSOCIATION:
U.S. Bank National Association
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
87
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 June 29,
2001 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "Agreement"; the terms defined therein being used
herein as therein defined), among Granite Construction Incorporated, a Delaware
corporation (the "Borrower"), the Lenders from time to time party thereto, and
Bank of America, N.A., as Administrative Agent and L/C Issuer.
The undersigned hereby requests (select one):
[ ] A Borrowing of .
--------------------------
[Type of Loans requested]
[ ] A conversion of Loans from _____ to ______
[ ] A continuation of .
-----------------------
[Type of Loans requested]
1. On (a Business Day).
----------------------------------------
2. In the amount of $ .
------------------------
3. Comprised of .
-----------------------------
[Type of Loans requested]
4. With an Interest Period of ___ months.
The Borrowing requested herein complies with the proviso to the first
sentence of Section 2.01 of the Agreement.
GRANITE CONSTRUCTION INCORPORATED
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
By:
------------------------------
Name:
----------------------------
88
Title:
---------------------------
89
EXHIBIT B
FORM OF 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 June 29, 2001 (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, the
"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 Administrative Agent and L/C Issuer.
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
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 Agreement.
This Note is one of the Notes referred to in the Agreement, is entitled
to the benefits thereof and is subject to optional and mandatory prepayment in
whole or in part as provided therein. This Note is also entitled to the benefits
of the Guaranties. Upon the occurrence of one or more of the Events of Default
specified in the Agreement, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable all as provided in
the 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 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 Note.
90
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
ENTIRELY WITHIN SUCH STATE; PROVIDED THAT LENDER SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.
GRANITE CONSTRUCTION INCORPORATED
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
91
EXHIBIT C
FORM OF COMPLIANCE CERTIFICATE
Financial Statement Date:________, 200__
The undersigned refers to that certain Credit Agreement, dated as of
June 29, 2001 (as amended, modified and/or supplemented from time to time, the
"Credit Agreement"), among Granite Construction Incorporated, a Delaware
corporation (the "Borrower"), the financial institutions from time to time party
thereto (collectively, the "Lenders") and Bank of America, National Association,
as Administrative Agent (the "Administrative Agent"). Unless otherwise defined
herein, each capitalized term used herein has the meaning assigned thereto in
the Credit Agreement.
The undersigned Responsible Officer of the Borrower hereby certifies as
of the date hereof that s/he holds the office of _____________________ with the
Borrower, that, as such, s/he is authorized to execute and deliver this
Certificate to the Bank on behalf of the Borrower and its Subsidiaries, and
that:
1. [ ] Attached hereto or [ ] posted on the Borrower's website or [ ]
posted on the website of the Securities and Exchange Commission at ▇▇▇.▇▇▇.▇▇▇
is:
[ ] a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of the fiscal year ended [____________, 200_]
(the "Subject Fiscal Year"), and the related consolidated statements of
income or operations, shareholders' equity and cash flows for the
Subject Fiscal Year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail, audited
and accompanied by a report and opinion of an independent certified
public accountant of nationally recognized standing reasonably
acceptable to the Required Lenders, which report and opinion have been
prepared in accordance with GAAP and are not subject to any
qualifications or exceptions as to the scope of the audit nor to any
qualifications and exceptions that are not reasonably acceptable to the
Required Lenders; or
[ ] an SEC Form 10-K for the Borrower (excluding the exhibits
thereto) relating to the fiscal year ended [____________, 200_]; or
[ ] a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of the fiscal quarter ended [____________,
200_] (the "Subject Fiscal Quarter"), and the related consolidated
statements of income or operations, shareholders' equity and cash flows
for the Subject 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, 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; or
[ ] an SEC Form 10-Q for the Borrower (excluding the exhibits
thereto) relating to the fiscal quarter ended [____________, 200_].
2. The financial statements referred to in Paragraph 1 fairly present,
in all material respects, the consolidated financial position and the results of
operations of the Borrower and its Subsidiaries.
C-1
92
3. The undersigned has reviewed and is familiar with the terms of the
Credit Agreement and the other Loan Documents and has made, or has caused to be
made under my supervision, a detailed review of the transactions and conditions
(financial or otherwise) of the Borrower and its Subsidiaries during the
accounting period covered by the attached financial statements.
4. To the best of the undersigned's knowledge, the Borrower and each of
its Subsidiaries have, during such period, observed, performed and/or satisfied
and/or have caused to be observed, performed and/or satisfied all of their
respective covenants and other agreements contained in the Loan Documents to
which they are a party, and have satisfied every condition in the Loan Documents
to which they are a party to be observed, performed and/or satisfied by them,
and the undersigned has no knowledge of any condition, event or occurrence,
which constitutes a Default or Event of Default, except as set forth below:
[Describe below (or in a separate attachment to this Certificate) the
exceptions, if any, to paragraph 4 above by listing, in detail and with
reference to specific sections of the Credit Agreement, the nature of the
condition, event or occurrence, the period during which it has existed and the
actions that the Borrower has taken, is taking or proposes to take with respect
to such condition, event or occurrence.]
5. The financial covenant and other compliance analyses and information
set forth on Schedule 1 attached hereto are true, complete and accurate on and
as of the date of this Certificate.
The foregoing certifications, together with the computations set forth
in Schedule 1 hereto, are made and delivered, and the financial statements
referenced above are made or posted, as applicable, this ____ day of _____,
200_, pursuant to the provisions of the Credit Agreement.
By: ____________________________________
Title: ____________________________________
of Granite Construction Incorporated
C-2
93
SCHEDULE 1
TO COMPLIANCE CERTIFICATE
1. DISPOSITIONS OF ASSETS. Section 7.05(g)
A. The aggregate consideration from Dispositions received by the
Borrower and its Subsidiaries pursuant to Section 7.05(g) during
the current fiscal year: $_____________
B. The amount equal to 5% of the total assets of the Borrower
(determined on a consolidated basis in accordance with GAAP) as
of the end of the Borrower's most recently ended fiscal year: $_____________
REQUIREMENT: THE AMOUNT IN A MAY NOT EXCEED THE AMOUNT IN B.
2. INVESTMENTS - INVESTMENTS MANAGED BY GRANITE LAND COMPANY, A SUBSIDIARY
OF THE BORROWER.
Section 7.02(g)
A. The aggregate amount of Investments managed by Granite Land
Company, a Subsidiary of the Borrower: $_____________
REQUIREMENT: THE AMOUNT IN A MAY NOT EXCEED $25,000,000.
3. INVESTMENTS - OTHER INVESTMENTS. Section 7.02(h)
A. The aggregate amount of Investments not otherwise permitted
pursuant to subsections (a) through (g) of Section 7.02 in the
equity of any Subsidiary or the capital stock, assets,
obligations or other securities of or interests in any other
Person: $_____________
REQUIREMENT: THE AMOUNT IN A MAY NOT EXCEED $100,000,000.
4. INDEBTEDNESS - INDEBTEDNESS IN RESPECT OF CAPITAL LEASES; SYNTHETIC
LEASE OBLIGATIONS; PURCHASE MONEY INDEBTEDNESS. Section 7.03(d)
A. The aggregate amount of all purchase money Indebtedness for fixed
or capital assets incurred by the Borrower or any of its
Subsidiaries in the current fiscal year (under Section
7.03(d)(i)): $_____________
B. The aggregate amount of all Indebtedness in respect of capital
leases and Synthetic Lease Obligations to finance the acquisition
of fixed or capital assets incurred by the Borrower or any of its
Subsidiaries in the current fiscal year (under Section
7.03(d)(ii)): $_____________
C. The aggregate amount of all Indebtedness in respect of capital
leases and Synthetic Lease Obligations and purchase money
Indebtedness for fixed or capital assets of Persons immediately
prior to such Persons becoming Subsidiaries or being merged with
or into (or otherwise being acquired by) the Borrower or its
Subsidiaries following June 29, 2001 (under Section
7.03(d)(iii)): $_____________
REQUIREMENTS: THE AMOUNT IN A MAY NOT EXCEED $10,000,000. Section 7.03(d)(i)
THE AMOUNT IN B MAY NOT EXCEED $10,000,000. Section 7.03(d)(ii)
THE AMOUNT IN C MAY NOT EXCEED $30,000,000. Section 7.03(d)(iii)
C-3
94
5. INDEBTEDNESS - INDEBTEDNESS IN RESPECT OF CERTAIN LETTERS OF CREDIT. Section 7.03(f)
A. The aggregate outstanding amount of Indebtedness respecting
letters of credit (other than Letters of Credit) issued for the
account of the Borrower or any Subsidiary in the Ordinary Course
of Business: $_____________
REQUIREMENT: THE AMOUNT IN A MAY NOT EXCEED $25,000,000.
6. INDEBTEDNESS - OTHER INDEBTEDNESS. Section 7.03(h)
A. Additional Indebtedness (not otherwise permitted under Section
7.03), comprised solely of (i) the outstanding principal amount
of obligations, whether current or long-term, for borrowed money
and all obligations evidenced by bonds (other than performance,
surety and appeal bonds), debentures, notes, loan agreements or
other similar instruments, (ii) Attributable Indebtedness in
respect of capital leases and Synthetic Lease Obligations, or
(iii) without duplication, Guaranty Obligations with respect to
Indebtedness of the types specified in the immediately preceding
clauses (i) and (ii); provided that none of the foregoing
includes Indebtedness of any co-joint venturer in any Joint
Venture to which the Borrower or any Subsidiary is a party that
has been assumed by the Borrower or any of Subsidiary if such
Indebtedness was not originally incurred by such co-joint
venturer in connection with (and relates solely to) the subject
Joint Venture: $_____________
REQUIREMENT: THE AMOUNT IN A MAY NOT EXCEED $100,000,000.
7. RESTRICTED PAYMENTS. Section 7.07
A. The aggregate amount paid by Borrower in connection with the
purchase, redemption or other acquisition of shares of common
stock for cash to contribute to the Borrower's employee stock
ownership plan (Section 7.07(d)): $______________
REQUIREMENT: THE AMOUNT IN A MAY NOT EXCEED AN AMOUNT EQUAL TO 15% OF
PLAN COMPENSATION.
B. The aggregate amount Borrower may purchase, redeem or otherwise
acquire shares of its capital stock, or warrants, rights or
options to acquire any such shares for cash (Section 7.07(e)): $______________
REQUIREMENT: THE AMOUNT IN B MAY NOT EXCEED $50,000,000.
8. MINIMUM CONSOLIDATED TANGIBLE NET WORTH. Section 7.13(a)
A. Consolidated Tangible Net Worth (A (i) - (A)(ii) below): $______________
(i) Consolidated Shareholder's Equity: $______________
minus
(ii) Intangible Assets of the Borrower and its Subsidiaries: $______________
C-4
95
B. Calculation of Minimum Consolidated Tangible Net Worth
(B(i) + B(ii) + B(iii) below): $______________
(i) $318,866,000 $318,866,000
-----------
plus
(ii) 50% of Consolidated Net Income (no deduction allowed for a
net loss) in each fiscal quarter ending after March 31, 2001: $______________
plus
(iii) 50% of the aggregate increases in Consolidated
Shareholder's Equity after June 29, 2001 by reason of the
issuance and sale of the capital stock of the Borrower: $______________
REQUIREMENT: THE AMOUNT IN A MAY NOT BE LESS THAN THE AMOUNT IN B.
9. MINIMUM FIXED CHARGE COVERAGE RATIO. Section 7.13(b)
A. (i) Consolidated EBITDA for the period consisting of the
four consecutive fiscal quarters ending on the date of
determination: $______________
plus
(ii) interest income for such period (to the extent not included
in Consolidated EBITDA for such period): $______________
minus
(iii) all Capital Expenditures actually made during such
period: $______________
minus
(iv) all taxes actually paid in cash during such period: $______________
Total: $______________
B. (i) Consolidated Interest Expense for the period consisting
of the four consecutive fiscal quarters ending on the date
of determination: $______________
plus
(ii) The current portion of Consolidated Funded
Indebtedness: $______________
Total: $______________
C. Ratio of A to B: _________ to 1.00
REQUIREMENT: THE RATIO IN C (I.E., THE RATIO OF A TO B) MAY NOT BE LESS THAN 1.50 TO 1.00.
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10. MINIMUM LEVERAGE RATIO. Section 7.13(c)
A. Consolidated Funded Indebtedness: $______________
B. (i) Consolidated Funded Indebtedness: $______________
plus
(ii) Consolidated Tangible Net Worth (from line 8A above): $______________
Total: $______________
C. Ratio of A to B: _________ to 1.00
REQUIREMENT: THE RATIO IN C (I.E., THE RATIO OF A TO B) MAY NOT EXCEED 0.55 TO 1.00.
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EXHIBIT D
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement (this "Assignment") is
dated as of the Effective Date set forth below and is entered into by and
between __________ (the "Assignor") and _______________ (the "Assignee").
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (the "Credit Agreement"), receipt
of a copy of which is hereby acknowledged by the Assignee. The Standard Terms
and Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment as if set
forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells
and assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Administrative Agent as contemplated below, the interest in and to all of
the Assignor's rights and obligations under the Credit Agreement and any other
documents or instruments delivered pursuant thereto that represents the amount
and percentage interest identified below of all of the Assignor's outstanding
rights and obligations under the respective facilities identified below
(including, to the extent included in any such facilities and Letters of Credit)
(the "Assigned Interest"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment, without
representation or warranty by the Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________ [and is an
Affiliate/Approved Fund]
3. Borrower(s): Granite Construction Incorporated
4. Administrative Agent: Bank of America, N.A., as the administrative agent
under the Credit Agreement
5. Credit Agreement: The Credit Agreement, dated as of June 29, 2001,
among Granite Construction Incorporated, the
Lenders parties thereto, and Bank of America, N.A.,
as Administrative Agent and as L/C Issuer
6. Assigned Interest:
-------------------------------------------------------------------------------------------------
Aggregate
Amount of Amount of Percentage
Commitment/Loans Commitment/Loans Assigned of
Facility Assigned for all Lenders Assigned Commitment/Loans
-------------------------------------------------------------------------------------------------
_____________ $________________ $________________ ______________%
-------------------------------------------------------------------------------------------------
_____________ $________________ $________________ ______________%
-------------------------------------------------------------------------------------------------
_____________ $________________ $________________ ______________%
-------------------------------------------------------------------------------------------------
Effective Date: __________________, 200__ [TO BE INSERTED BY
ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF
TRANSFER IN THE REGISTER THEREFOR.]
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The terms set forth in this Assignment are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By: _____________________________
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By: _____________________________
Title:
Consented to and Accepted:
BANK OF AMERICA, N.A., as
Administrative Agent
By: _________________________________
Title:
GRANITE CONSTRUCTION INCORPORATED, as
Borrower
By: _________________________________
Title:
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ANNEX 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT
[___________________](1)
STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
AND ASSUMPTION AGREEMENT
1. Representations and Warranties.
1.1 Assignor. The Assignor (a) represents and warrants that
(i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and to consummate the
transactions contemplated hereby; and (b) assumes no responsibility with respect
to (i) any statements, warranties or representations made in or in connection
with any Loan Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document delivered pursuant thereto, other than this Assignment
(herein collectively the "Loan Documents"), or any collateral thereunder, (iii)
the financial condition of the Borrower, any of its Subsidiaries or Affiliates
or any other Person obligated in respect of any Loan Document or (iv) the
performance or observance by the Borrower, any of its Subsidiaries or Affiliates
or any other Person of any of their respective obligations under any Loan
Document.
1.2 Assignee. The Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all requirements of an Eligible Assignee under the Credit Agreement, (iii)
from and after the Effective Date, it shall be bound by the provisions of the
Credit Agreement and, to the extent of the Assigned Interest, shall have the
obligations of a Lender thereunder, (iv) it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 6.01 thereof, as applicable, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and to purchase the Assigned
Interest on the basis of which it has made such analysis and decision, and (v)
if it is a Foreign Lender, attached hereto is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.
1.3 Assignee's Address for Notices, etc. Attached hereto as
Schedule 1 is all contact information, address, account and other administrative
information relating to the Assignee.
2. Payments. From and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignee whether
such amounts have accrued prior to or on or after the Effective Date. The
Assignor and the Assignee shall make all appropriate adjustments in payments by
the Administrative Agent for periods prior to the Effective Date or with respect
to the making of this assignment directly between themselves.
--------
(1) Describe Credit Agreement at option of Administrative Agent.
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3. General Provisions. This Assignment shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment may be executed in any number of counterparts, which
together shall constitute one instrument. Delivery of an executed counterpart of
a signature page of this Assignment by telecopy shall be effective as delivery
of a manually executed counterpart of this Assignment. THIS ASSIGNMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN
SUCH STATE; PROVIDED THAT THE PARTIES HERETO SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.
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SCHEDULE 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT
ADMINISTRATIVE DETAILS
(Assignee to list names of credit contacts, addresses, phone and facsimile
numbers, electronic mail addresses and account and payment information)
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EXHIBIT E
FORM OF CONTINUING GUARANTY AGREEMENT
CONTINUING GUARANTY AGREEMENT
This CONTINUING GUARANTY AGREEMENT (this "Agreement"), dated as of [],
200[_], is made by each of the undersigned (each, a "Guarantor" and,
collectively, the "Guarantors"), in favor of each Guaranteed Party (as
hereinafter defined).
WHEREAS, Granite Construction Incorporation, a Delaware corporation (the
"Company"), Bank of America, N.A., as Administrative Agent, as L/C Issuer and as
a Lender, and the other financial institutions as are, or may from time to time
become, parties thereto have entered into or are in the process of entering into
that certain Credit Agreement, dated as of June 29, 2001 (as amended, modified
and/or supplemented from time to time, the "Credit Agreement"), pursuant to
which the Lenders have provided the Commitments and agreed to make Loans to the
Company and to participate in Letters of Credit issued by the L/C Issuer for the
account of the Company or its Subsidiaries on the terms and conditions contained
therein; and
WHEREAS, to induce the Lenders and the L/C Issuer to provide and to
continue to provide financial accommodations to the Company pursuant to the
terms of the Credit Agreement and the other Loan Documents, the Guarantors have
each agreed to enter into this Agreement;
NOW, THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), and intending to be legally bound
hereby, each Guarantor irrevocably and unconditionally undertakes and agrees for
the benefit of Guaranteed Party as follows:
ARTICLE I
CERTAIN DEFINITIONS AND RULES OF CONSTRUCTION
Section 1.1 Certain Definitions. Each capitalized term used but not
otherwise defined herein has the meaning ascribed thereto in the Credit
Agreement. As used herein, the term "Guaranteed Party" means, as the context may
require, the Administrative Agent, the L/C Issuer and each Lender (and each of
such Person's respective successors, transferees and assigns).
Section 1.2 Construction. For purposes of this Agreement and unless
otherwise specified herein: (a) references to the plural include the singular
and to the singular include the plural, references to any gender include any
other gender, the part includes the whole, the term "including" is not limiting,
and the term "or" has, except where otherwise indicated, the inclusive meaning
represented by the phrase "and/or"; (b) references in this Agreement to any
determination by the Guaranteed Party include good faith estimates (in the case
of quantitative determinations) and good faith beliefs (in the case of
qualitative determinations) by any Guaranteed Party; any determination made in
good faith by any Guaranteed Party shall be conclusive absent manifest error;
(c) the words "hereof," "herein," "hereby," and "hereunder," and any other
similar words, refer to this Agreement as a whole and not to any particular
provision of this Agreement; (d) article, section, subsection, clause, exhibit
and schedule references are to this Agreement; and (e) any reference to this
Agreement or any other Loan Document includes all permitted alterations,
amendments, changes, extensions, modifications, renewals, or supplements thereto
or thereof, as applicable.
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ARTICLE II
GUARANTY BY GUARANTORS
Section 2.1 Promise to Pay and Perform. Each Guarantor jointly and
severally unconditionally and irrevocably guarantees to each Guaranteed Party
the payment and performance of all Obligations when and as the same shall become
due and payable (whether at stipulated or any accelerated or earlier date of
maturity (including the date of any required prepayment)) (the "Guaranteed
Obligations"), it being each Guarantor's intent that such Guarantor's guaranty
is a guaranty of payment and not a guaranty of collection. If the Company fails
to pay or perform any Guaranteed Obligation on or before the date when due
(whether at stipulated or any accelerated or earlier date of maturity (including
the date of any required prepayment)), each Guarantor shall jointly and
severally unconditionally and immediately make such payment or render such
performance upon written demand therefor by any Guaranteed Party.
Section 2.2 Cumulative Obligations; Continuing Guaranty. The obligations
of each Guarantor hereunder are in addition to any other obligations of such
Guarantor under any other guaranties of the Indebtedness or other obligations of
the Company or any other Person at any time given to any Guaranteed Party. This
Agreement shall not affect or invalidate any such other guaranties. This
Agreement is a continuing guaranty and shall remain in full force and effect
notwithstanding the fact that, at any particular time, no Guaranteed Obligations
may be outstanding.
Section 2.3 Joint and Several Obligation; Independent Obligation. Each
Guarantor is directly, jointly and severally with all other guarantors of the
Guaranteed Obligations or any portion thereof, liable to the Guaranteed Parties.
The obligations of each Guarantor hereunder are direct and primary and are
independent of the obligations of the Company or any other such guarantor, and a
separate action may be brought against each Guarantor irrespective of whether an
action is brought against the Company or any other such other guarantor or
whether the Company or any such other guarantor is joined in such action. Each
Guarantor's liability hereunder shall not be contingent upon the exercise or
enforcement by the Guaranteed Parties of any remedies they may have against the
Company or any other guarantor or the enforcement of any Lien or realization
upon any security the Guaranteed Parties may at any time possess. Any release
that may be given by the Guaranteed Parties to the Company or any other
guarantor shall not release any Guarantor hereunder unless such release
expressly so provides.
Section 2.4 Limit of Liability. Notwithstanding anything to the contrary
contained herein, each Guarantor shall be liable hereunder only for the largest
amount that would not render such Guarantor's obligations hereunder subject to
avoidance under Section 548 of the Bankruptcy Code or comparable provisions of
any applicable state law; provided that such amount shall be presumed to be the
entire amount of the Guaranteed Obligations. If, any Guarantor claims that such
Guarantor's liability hereunder is less than the entire amount of the Guaranteed
Obligations, such Guarantor shall have the burden of proving, by clear and
convincing evidence, that such Guarantor's liability hereunder should be so
limited since the information concerning, and the circumstances of, the
financial condition of such Guarantor are more readily available to and are
under the control of such Guarantor. All payments received by any Guaranteed
Party from any Person other than a Guarantor on account of the Guaranteed
Obligations shall be deemed as having been applied to Guaranteed Obligations
that, pursuant to this Section 2.4, are in excess of the amounts guaranteed
hereunder.
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ARTICLE III
PAYMENTS
Section 3.1 Nature and Application of Payments. Each Guarantor shall
make all payments hereunder in immediately available lawful money of the United
States, without deduction or withholding (whether for taxes (whether income,
excise, or otherwise) or offset). Without regard to the form in which received,
the Guaranteed Parties may apply any payment with respect to the Guaranteed
Obligations or any other amounts due hereunder in such order as the Guaranteed
Parties shall in their sole and absolute discretion determine, irrespective of
any contrary instructions received from any other Person.
Section 3.2 Indefeasible Payment; Revival. If any portion of any payment
to the Guaranteed Parties is set aside and repaid by any Guaranteed Party for
any reason after being made by any Guarantor, the amount so set aside shall be
revived as a Guaranteed Obligation and each Guarantor shall be liable for the
full amount the Guaranteed Parties are, or any Guaranteed Party is, required to
repay plus all costs and expenses (including attorneys' fees, costs, and
expenses) incurred by the Guaranteed Parties in connection therewith.
ARTICLE IV
CERTAIN REPRESENTATIONS AND WARRANTIES OF GUARANTORS
Each Guarantor represents and warrants as follows (which representations
and warranties shall be true, correct, and complete at all times):
Section 4.1 No Contravention; No Default. The execution, delivery, and
performance by such Guarantor of this Agreement do not and will not: (a)
conflict with or result in any breach or contravention of, or the creation of
any Lien under, any contractual obligation to which such Guarantor is a party or
any order, injunction, writ, or decree of any governmental authority to which
such Guarantor or such Guarantor's properties are subject; or (b) violate any
law, rule, or regulation of any governmental authority.
Section 4.2 Binding Effect. This Agreement constitutes the legal, valid,
and binding obligation of such Guarantor, enforceable against such Guarantor 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.
Section 4.3 Litigation. Except as set forth on Schedule 5.06 to the
Credit Agreement, there are no actions, suits, proceedings, claims, or disputes
pending, or, to the best knowledge of such Guarantor, threatened in writing, at
law, in equity, in arbitration, or before any governmental authority, against
such Guarantor or any of such Guarantor's properties which purport to affect or
pertain to this Agreement, any of the other Loan Documents, or any of the
transactions contemplated hereby or thereby.
Section 4.4 Regulated Entity. Neither such Guarantor nor any Person
controlling such Guarantor is: (a) an "investment company" within the meaning of
the Investment Company Act of 1940; or (b) subject to regulation by any federal
or state statute or regulation limiting such Guarantor's ability to incur such
Guarantor's obligations hereunder.
Section 4.5 No Action Required. No consent, license, permit, approval or
authorization of, exemption by, notice or report to, or registration, filing, or
declaration with any governmental authority or of, to, or with any other Person,
is or will be required for: (a) the execution, delivery, or performance of
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this Agreement by such Guarantor; or (b) the exercise by the Guaranteed Parties
of any of their respective rights and remedies provided for herein.
Section 4.6 Changes Affecting the Guaranteed Obligations. Such Guarantor
has taken and is taking all steps in such Guarantor's opinion necessary or
appropriate to be informed on a continuing basis of changes or potential changes
affecting the Guaranteed Obligations. Without limiting the generality of the
foregoing, such Guarantor hereby confirms that it has received and reviewed the
Credit Agreement, the Fee Letter and all other Loan Documents (and all other
agreements, documents and instruments related thereto) that such Guarantor, in
such Guarantor's sole determination, has deemed necessary or appropriate to
receive and review.
Section 4.7 Reliance by Guarantor; Financial Condition of the Company.
This Agreement is not made by such Guarantor in reliance on any representation
or warranty, express or implied, by any Guaranteed Party concerning the
financial condition of the Company, the nature, value, or extent of any security
for the Guaranteed Obligations, or any other matter. Such Guarantor is presently
informed of the financial condition of the Company and of all other
circumstances that a diligent inquiry would reveal and which bear upon the risk
of nonpayment of the Guaranteed Obligations. Such Guarantor has reviewed each of
the Loan Documents.
Section 4.8 Adequate Consideration. The consideration given or provided,
or to be given or provided, by the Guaranteed Parties in connection with this
Agreement is adequate and satisfactory in all respects, and represents
reasonably equivalent value, to support this Agreement and such Guarantor's
obligations hereunder.
ARTICLE V
CERTAIN COVENANTS OF GUARANTORS
Section 5.1 Knowledge of Financial Condition. Each Guarantor shall keep
informed of the Company's financial condition, the status of any guarantors or
of any security for the Guaranteed Obligations, and all other circumstances that
bear upon the risk of nonpayment of the Guaranteed Obligations.
Section 5.2 Further Assurances. Each Guarantor shall, from time to time,
at the expense of such Guarantor, promptly execute and deliver all further
documents and take all further action that may be necessary, or that the
Guaranteed Parties (or any of them) may reasonably request, to enable the
Guaranteed Parties (or any of them) to exercise and enforce their respective
rights and remedies hereunder.
Section 5.3 Sales, Dispositions, etc. Each Guarantor will not, without
the prior written consent of the Guaranteed Party, sell, lease, assign,
encumber, hypothecate, transfer or otherwise dispose of all of substantially all
of such Guarantor's properties or assets, or any interest therein, except as
otherwise permitted by the Credit Agreement.
ARTICLE VI
CERTAIN ACKNOWLEDGEMENTS AND AGREEMENTS OF GUARANTORS
Section 6.1 Modifications to Loan Documents and Guaranteed Obligations.
Each Guarantor acknowledges and agrees that, without notice to such Guarantor
and without affecting or impairing the obligations of such Guarantor hereunder,
the Guaranteed Parties (or any of them) may, by action or
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inaction, compromise or settle, extend the period of duration or the time for
the payment, or discharge the performance of, or may refuse to, or otherwise not
enforce, or may, by action or inaction, release all or any one or more parties
to, any one or more of the Loan Documents or otherwise with respect to the
Guaranteed Obligations or may grant other indulgences to the Company in respect
thereof, or may amend or modify in any manner and at any time (or from time to
time) any one or more of the Loan Documents or otherwise with respect to the
Guaranteed Obligations, or may, by action or inaction, release or substitute any
guarantor, if any, of the Guaranteed Obligations, or may enforce, exchange,
release, or waive, by action or inaction, any security for the Guaranteed
Obligations or any guaranty of the Guaranteed Obligations, or any portion
thereof.
Section 6.2 Subordination. Each Guarantor agrees that any and all
present and future indebtedness of the Company owing to such Guarantor is
postponed in favor of and subordinated to indefeasible payment, in full, in
cash, of the Guaranteed Obligations. In this regard, upon the occurrence and
during the continuance of a Default or an Event of Default, no payment of any
kind whatsoever shall be made with respect to such indebtedness until the
Guaranteed Obligations have been indefeasibly paid in full. Any payment received
by any Guarantor in respect of such indebtedness shall be held by such Guarantor
as trustee for the Guaranteed Parties and promptly paid over to the Guaranteed
Parties on account of the Guaranteed Obligations but without reducing or
affecting in any manner the liability of such Guarantor under the other
provisions of this Agreement.
Section 6.3 Administrative Agent as Each Guarantor's Attorney-in-Fact.
Each Guarantor irrevocably appoints the Administrative Agent as such Guarantor's
attorney-in-fact, with full authority in the place and stead and name of such
Guarantor, from time to time at the Administrative Agent's discretion but only
following the occurrence and during the continuation of an Event of Default, to
take any action and to execute any instrument which the Guaranteed Parties (or
any of them) may, in accordance with the provisions of the Loan Documents or
this Agreement, require as necessary or advisable to accomplish the purposes of
this Agreement.
ARTICLE VII
GENERAL PROVISIONS
Section 7.1 Notices. All notices, requests, and other communications to
any party under this Agreement shall be in writing (including telegraphic,
telex, telefacsimile, or cable communication) and mailed, telegraphed, telexed,
sent by telefacsimile, cabled, or delivered to such party at its address or
telefacsimile number set forth, in the case of each Guarantor, on the signature
pages hereof, or, in the case of the Guaranteed Parties, on Schedule 10.02 to
the Credit Agreement, or such other address or telefacsimile number as such
party may hereafter specify for the purpose by notice to the other party given
in accordance with this Section 7.1. Each such notice, request or other
communication shall be deemed to have been received: (a) if mailed as provided
above by any method other than overnight delivery service, on the third Business
Day after deposit in the mails; (b) if mailed by overnight delivery service,
telegraphed, telexed, sent by telefacsimile, or cable, when delivered for
overnight delivery, delivered to the telegraph company, confirmed by telex
answerback, transmitted by telefacsimile (with electronic confirmation), or
delivered to the cable company, respectively; or (c) if delivered by hand, upon
delivery. If any conflict exists between any oral communication to any
Guaranteed Party and the written confirmation thereof, the oral communication
shall control if any Guaranteed Party has acted thereon prior to actual receipt
of such written confirmation.
Section 7.2 Amendments, Waivers, and Consents. No amendments or waivers
of any provision of this Agreement nor any consent to any departure by any
Guarantor from the terms hereof shall in any event be effective unless the same
shall be in writing and signed by the Administrative Agent
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(or all Guaranteed Parties if required by the terms of the Credit Agreement) and
the Guarantors. Any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
Section 7.3 No Waiver; Cumulative Nature of Remedies. No failure or
delay on the part of any Guaranteed Party in exercising any of its rights and
remedies under this Agreement, any of the Loan Documents, or otherwise with
respect to any of the Guaranteed Obligations shall operate as a waiver thereof;
nor shall any single or partial exercise of any right under this Agreement, the
Loan Documents, or otherwise with respect to the Guaranteed Obligations preclude
any other or further exercise thereof or the exercise of any other right or
remedies. The rights and remedies provided in this Agreement and otherwise with
respect to the Guaranteed Obligations are cumulative and not exclusive of any
rights and remedies provided by law.
Section 7.4 Costs and Expenses. Each Guarantor shall pay or reimburse
the Guaranteed Parties on demand for all fees, costs, and expenses incurred by
the Guaranteed Parties in connection with the enforcement or attempted
enforcement of this Agreement, the preservation of any rights or remedies under
this Agreement, or in any action, case, or proceeding (whether at law or in
equity) relating to this Agreement. Without limiting the generality of the
foregoing, such fees, costs, and expenses shall include reasonable Attorney
Costs actually incurred by the Guaranteed Parties or any of them (irrespective
of whether the Company is liable therefor), whether or not suit is brought, in
connection therewith.
Section 7.5 Successors and Assigns. This Agreement shall: (a) be binding
upon each Guarantor and each Guarantor's successors and assigns; and (b) inure
to the benefit of each Guaranteed Party and its successors and assigns (all to
the extent permitted by the Loan Documents). Without limiting the generality of
the foregoing subsection (b) but subject to the provisions of the Credit
Agreement, any Guaranteed Party may assign or otherwise transfer all or any part
of the Guaranteed Obligations owed to it to any other Person.
Section 7.6 Headings. Section and subsection headings in this Agreement
are included herein for convenience of reference only and shall not constitute a
part of this Agreement and shall not be given any substantive effect.
Section 7.7 Ambiguities. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed or resolved using any presumption against
any Guarantor or any Guaranteed Party, whether under any rule of construction or
otherwise. On the contrary, this Agreement has been reviewed by each Guarantor
and each Guaranteed Party and their respective counsel. In case of any ambiguity
or uncertainty, this Agreement shall be construed and interpreted according to
the ordinary meaning of the words used to accomplish fairly the purposes and
intentions of all parties hereto.
Section 7.8 Severability. In case any provision in or obligation under
this Agreement shall be invalid, illegal, or unenforceable in any jurisdiction,
the validity, legality, and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby. In addition, all agreements and
covenants herein shall be given independent effect such that, if a particular
action or condition is prohibited by the terms of any such agreement or
covenant, the fact that such action or condition would be permitted by another
agreement or covenant shall not be construed as allowing such action to be taken
or condition to exist.
Section 7.9 Counterparts; Telefacsimile Signatures. 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.
Each Guarantor may effect execution and delivery of this Agreement by executing
a counterpart hereof and sending the signature page bearing such Guarantor's
signature to the
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Administrative Agent by telefacsimile and, thereafter, promptly sending by mail
or delivering such signature page to the Administrative Agent; provided that the
failure to deliver such signature page by such Guarantor shall not affect the
validity, enforceability, or binding effect of this Agreement against such
Guarantor.
Section 7.10 Entire Agreement. This Agreement and the Credit Agreement
embody the entire agreement and understanding concerning the Guarantors and the
Guaranteed Parties relating to the subject matter hereof and supersede all prior
agreements and understandings relating to the subject matter hereof. No course
of prior dealing between any Guarantor and the Guaranteed Parties (or any of
them), no usage of the trade, and no parol or extrinsic evidence of any nature,
shall be used or be relevant to supplement, explain or modify any term used
herein.
ARTICLE VIII
CERTAIN WAIVERS BY GUARANTORS
EACH GUARANTOR MAKES THE FOLLOWING WAIVERS WITH FULL KNOWLEDGE AND
UNDERSTANDING THAT SUCH WAIVERS, IF NOT SO MADE, MIGHT OTHERWISE RESULT IN SUCH
GUARANTOR BEING ABLE TO AVOID OR LIMIT SUCH GUARANTOR'S LIABILITY HEREUNDER
EITHER IN WHOLE OR IN PART.
Section 8.1 Notices. Each Guarantor absolutely, unconditionally,
knowingly, and expressly waives: (a) notice of the acceptance by the Guaranteed
Parties of this Agreement; (b) notice of any Credit Extensions consisting
Guaranteed Obligations; (c) notice of the amount of the Guaranteed Obligations,
subject, however, to such Guarantor's right to make inquiry, at any reasonable
time, of any Guaranteed Party to ascertain the amount of the Guaranteed
Obligations owing to such Guaranteed Party; (d) notice of any adverse change in
the financial condition of the Company, of any change in value, or the release,
of any collateral, or of any other fact that might increase such Guarantor's
risk hereunder; (e) notice of presentment for payment, demand, protest, and
notice thereof as to any instrument; (f) notice of any Default or Event of
Default; and (g) all other notices (except if such notice is expressly required
to be given to such Guarantor under this Agreement) and demands to which
guarantor might otherwise be entitled.
Section 8.2 Revocation. Each Guarantor absolutely, unconditionally,
knowingly, and expressly waives any right to revoke such Guarantor's guaranty
obligation hereunder as to future Guaranteed Obligations and, in light thereof,
all protection afforded such Guarantor under Section 2815 of the California
Civil Code. Each Guarantor fully realizes and understands that, upon execution
of this Agreement, such Guarantor will not have any right to revoke this
Agreement as to any future indebtedness and, thus, may have no control over such
Guarantor's ultimate responsibility for the amount and nature of the Guaranteed
Obligations.
Section 8.3 Defenses of the Company. Each Guarantor absolutely,
unconditionally, knowingly, and expressly waives any defense arising by reason
of any disability or other defense (other than the defense that the Guaranteed
Obligations shall have been fully and finally performed and indefeasibly paid)
of the Company or by reason of the cessation from any cause whatsoever
(including any act or failure to act by the Company or the Guaranteed Parties)
of the liability of the Company in respect thereof, including any such defense
or cessation of liability arising from or as a result of: (a) any statute of
limitations; (b) any lack of power or authority of the Company or any Person
acting or purporting to act on the Company's behalf; (c) the operation of
Sections 580a, 580b, 580d, or 726 of the California Code of Civil Procedure or
any similar law of the State of California or any other jurisdiction; or (d) any
claim of fraudulent transfer or preference.
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Section 8.4 Suretyship and Certain Other Rights and Defenses of
Guarantors. Each Guarantor absolutely, unconditionally, knowingly, and expressly
waives:
(a) any right to assert against the Guaranteed Parties (or any of them)
any defense (legal or equitable), set-off, counterclaim, or claim which such
Guarantor may now or at any time hereafter have against the Company or any other
Person liable to the Guaranteed Parties (or any of them);
(b) any defense, set-off, counterclaim, or claim, of any kind or nature,
arising directly or indirectly from the present or future lack of perfection,
sufficiency, validity, or enforceability of any of the Guaranteed Obligations or
any security therefor or from any failure of the Guaranteed Parties (or any of
them) to act in a commercially reasonable manner;
(c) any defense arising by reason of or deriving from any claim or
defense based upon an election of remedies by the Guaranteed Parties (or any of
them) (including a nonjudicial foreclosure sale of any real property collateral
which destroys, diminishes, or otherwise adversely affects any Guarantor's
rights of subrogation, reimbursement, indemnity, or contribution or other rights
against the Company or any other Person), including any defense based upon an
election of remedies by any Guaranteed Party under the provisions of Sections
580a, 580b, 580d, and 726 of the California Code of Civil Procedure or any
similar law of the State of California or any other jurisdiction. In making this
waiver, each Guarantor specifically acknowledges that it understands and is
aware that, under Sections 580b and 580d of the California Code of Civil
Procedure, if the Guaranteed Parties (or any of them) conducted a nonjudicial
foreclosure sale of real property collateral: (i) such Guaranteed Party(ies)
would lose the right to pursue the Company for any deficiency that might remain
following such sale; (ii) if such Guarantor were to pay such deficiency
following such sale, it would be precluded from pursuing the Company for
reimbursement; and (iii) as a result, such Guaranteed Party(ies) would be
prevented from pursuing such Guarantor for such deficiency following such sale;
(d) the benefit of any statute of limitations affecting such Guarantor's
liability hereunder (or the enforcement thereof);
(e) any defense based on any alteration, impairment, or release of the
Guaranteed Obligations or any security therefor, irrespective of whether
resulting from any act or failure to act by the Guaranteed Parties (or any of
them); and
(f) any right to require the Guaranteed Parties (or any of them): (i) to
institute suit or otherwise proceed against the Company or any other Person; or
(ii) to exhaust any rights and remedies which the Guaranteed Parties (or any of
them) have or may have against the Company or any other Person.
Section 8.5 Marshalling. Each Guarantor absolutely, unconditionally,
knowingly, and expressly waives any rights it has to require the Guaranteed
Parties (or any of them) to marshal, foreclose upon, sell, or otherwise realize
upon or collect or apply any particular part of any other assets securing any of
the Guaranteed Obligations (including any rights arising by virtue of Sections
2899 and 3433 of the California Civil Code).
Section 8.6 Claims Against the Company and Others. Each Guarantor
absolutely, unconditionally, knowingly, and expressly agrees that, until the
Guaranteed Obligations have been indefeasibly repaid in full, such Guarantor
will not in any manner enforce or pursue, or seek to enforce or pursue, any or
all of the following rights (it being expressly agreed that all such rights are
subordinate to any claims of the Guaranteed Parties (or any of them)): (a) any
right of subrogation, indemnity, or
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contribution such Guarantor has or may have as against the Company or any other
Person with respect to any of the Guaranteed Obligations; (b) any right to
proceed against the Company or any other Person, now or hereafter, for
contribution, indemnity, reimbursement, or any other suretyship rights and
claims (irrespective of whether direct or indirect, liquidated or contingent)
with respect to any of the Guaranteed Obligations; and (c) any right to proceed
or to seek recourse against or with respect to any assets of the Company or any
other Person with respect to any of the Guaranteed Obligations.
Section 8.7 Certain Additional Statutory Rights. Without limiting the
generality of any other waiver or other provision set forth in this agreement,
each Guarantor absolutely, unconditionally, knowingly, and expressly waives any
and all benefits or defenses, if any, arising directly or indirectly under any
one or more of Sections 2799, 2808, 2809, 2810, 2815, 2819, 2820, 2821, 2822,
2838, 2839, 2845, 2848, 2849, and 2850 of the California Civil Code, Sections
580a, 580b, 580c, 580d, and 726 of the California Code of Civil Procedure, and
Sections 3116, 3118, 3119, 3419, 3605, 9504, 9505, and 9507 of the California
Uniform Commercial Code.
ARTICLE IX
GOVERNING LAW; JURISDICTION AND VENUE; WAIVER OF TRIAL BY JURY
Section 9.1 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF CALIFORNIA,
PROVIDED THAT THE GUARANTEED PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
Section 9.2 Jurisdiction. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF
CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GUARANTOR AND
EACH OF THE GUARANTEED PARTIES CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THOSE COURTS. EACH GUARANTOR AND
EACH OF THE GUARANTEED PARTIES 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 SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. EACH GUARANTOR AND EACH OF THE GUARANTEED PARTIES WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
Section 9.3. Waiver of Jury Trial. EACH GUARANTOR AND EACH OF THE
GUARANTEED PARTIES WAIVES ITS RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY INDEMNIFIED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH
RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH GUARANTOR AND EACH
OF THE GUARANTEED PARTIES AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH
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SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
EACH GUARANTOR WARRANTS AND AGREES THAT EACH OF THE WAIVERS SET FORTH
ABOVE IS MADE WITH SUCH GUARANTOR'S FULL KNOWLEDGE OF ITS SIGNIFICANCE AND
CONSEQUENCE AND THAT, UNDER THE CIRCUMSTANCES, THE WAIVERS ARE REASONABLE AND
NOT CONTRARY TO PUBLIC POLICY OR LAW. IF ANY SUCH WAIVER IS DETERMINED TO BE
CONTRARY TO ANY APPLICABLE LAW OR PUBLIC POLICY, SUCH WAIVER SHALL BE EFFECTIVE
ONLY TO THE EXTENT, BUT TO THE FULLEST EXTENT, PERMITTED BY LAW OR PUBLIC
POLICY.
EACH GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
AGREEMENT AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS AGREEMENT IS EFFECTIVE UPON SUCH GUARANTOR'S EXECUTION AND DELIVERY OF THIS
AGREEMENT TO THE ADMINISTRATIVE AGENT ON BEHALF OF ALL OF THE GUARANTEED PARTIES
(AND THE SATISFACTION OF ALL OF THE CONDITIONS SET FORTH IN SECTION 5.1 OF THE
CREDIT AGREEMENT). NO FORMAL ACCEPTANCE BY THE GUARANTEED PARTIES IS NECESSARY
TO MAKE THIS AGREEMENT EFFECTIVE.
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IN WITNESS WHEREOF, each Guarantor has executed this Agreement as of the
date first written above.
[_______________________________],
a [_____________]
By: _________________________
Name: _________________________
Title: _________________________
Notice Information:
Attn: ___________________
Telephone: ___.___.____
Telefacsimile: ___.___.____
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113
EXHIBIT F
FORM OF OPINION OF COUNSEL
June 29, 2001
Bank of America, N.A.,
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
Mail Code: CA5-705-12-14
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
I have acted as counsel for Granite Construction Incorporated, a
Delaware corporation ("Borrower"), in connection with (a) that certain Credit
Agreement dated as of June 29, 2001 including Exhibits and Schedules (the
"Credit Agreement"), by and among Borrower, the several financial institutions
parties to the Credit Agreement (the "Banks") and Bank of America, N.A., as
agent for the Banks (the "Agent") and as the L/C Issuer; and (b) (i) the Note,
dated June 29, 2001, in the original principal amount of Twelve Million Dollars
(U.S. $12,000,000.00), issued by the Borrower to the order of First Union
National Bank and (ii) the Note, Dated June 29, 2001, in the original principal
amount of Twelve Million Five Hundred Thousand Dollars (U.S. $12,500,000.00),
issued by the Borrower to the order of Union Bank of California, N.A.
(collectively, the "Notes"). I have also represented each of Granite
Construction Company, a California corporation ("GCC"), Granite Land Company, a
California corporation ("GLC"), G.G. & R., Inc., a Utah corporation ("GG&R"),
Intermountain Slurry Seal, Inc., a Wyoming corporation ("Intermountain"),
Pozzolan Products Company (P.P.C.), a Utah corporation ("Pozzolan"), and GILC,
L.P., a California limited partnership ("GILC", and together with GCC, GLC,
GG&R, Intermountain, and Pozzolan, the "Subsidiaries"), each of which is a
direct or indirect wholly-owned subsidiary of Borrower, in connection with the
Guaranty given by each of the Subsidiaries in favor of the Agent for the benefit
of Banks guaranteeing the obligations of Borrower under the Credit Agreement. I
am rendering this opinion pursuant to subsection 4.01(a)(vi) of the Credit
Agreement. Except as otherwise defined herein, capitalized terms used but not
defined herein shall have the meanings given to them in the Credit Agreement.
As used herein, the term "Loan Documents" shall mean the Credit
Agreement, the Notes and the Guaranty.
I am admitted to practice law only in the State of California, and I
express no opinion concerning any law other than the law of the State of
California, the Delaware General Corporation law, the law of the United States
of America, and, to the extent necessary to render my opinion in paragraphs
1(c), 1(d), the second sentence of paragraph 3 and paragraphs 5(d), 6 and 8, the
Utah Revised Business Corporation Act and the Wyoming Business Corporation Act.
In so far as the opinions contained herein purport to relate to the Delaware
General Corporation Law, the Utah Revised Business Corporation Act and the
Wyoming Business Corporation Act (collectively, the "laws"), I have relied on
such laws as reported in standard compilations.
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114
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 2
In rendering this Opinion, I have assumed the genuineness and
authenticity of all signatures (other than that of Borrower and each Subsidiary)
on original documents; the authenticity of all documents submitted to me as
originals; the conformity of originals to all documents submitted to me as
copies; the accuracy, completeness and authenticity of certificates of public
officials; the due authorization, execution and delivery of all documents
(except the due authorization, execution and delivery by Borrower of the Credit
Agreement and by each Subsidiary of the Guaranty) where authorization, execution
and delivery are prerequisites to the effectiveness of such documents; the power
and authority of the Banks to enter into and perform their obligations under the
Loan Documents; that the Banks are duly qualified in the State of California to
do business of the type contemplated by the Loan Documents; that each of the
Banks qualifies for the exemption from the otherwise applicable interest rate
limitations of California law for loans or forbearances by, as the case may be:
(i) national banks provided by Article XV, Section 1 of the California
Constitution; or (ii) certain "foreign (other nation) banks" provided by
California Financial Code Section 1716; or (iii) state banks provided by Article
XV, Section 1 of the California Constitution; that all loans under the Credit
Agreement will be made by the Banks for their own accounts or for the account of
another person or entity that qualifies for an exemption from the interest rate
limitations of California law, and there is no present agreement or plan,
express or implied, on the part of the Banks to sell participations or any other
interest in the loans to be made under the Credit Agreement to any person or
entity other than a person or entity that also qualifies for an exemption from
the interest rate limitations of California law; and with respect to matters of
fact (as distinguished from matters of law), I also have relied upon and assumed
that the representations of the Borrower and each Subsidiary and the other
parties set forth in the Loan Documents and any other certificates, instruments
or agreements executed in connection therewith or delivered to me are true,
correct, complete and not misleading, although to my knowledge the
representations of the Borrower and each Subsidiary set forth in the Loan
Documents and any such other certificates, instruments and agreements are true,
correct, complete and not misleading. I have also assumed that all individuals
executing and delivering documents on behalf of the Banks and Agent had the
legal capacity to so execute and deliver and that the Loan Documents are
obligations binding upon Banks and Agent.
With respect to my opinions in paragraph 4(c) and 5(c) below, I have
relied solely upon copies, supplied to me by the Borrower or a Subsidiary, of
each undertaking, contract, indenture, mortgage, deed of trust or other
instrument, document or agreement listed in Exhibit A, (i) of the Borrower
listed on the Index to Form 10K Exhibits to the Borrower's Annual Report on Form
10K for the fiscal year ending December 31, 2000 and (ii) of the Borrower
involving amounts in excess of $50,000,000 to which Borrower or any Subsidiary
is a party or by which Borrower or any Subsidiary is bound.
In rendering my opinion in paragraph 6, I have relied solely on a
certificate of good standing from each of the Secretary of State's office of
each of the states listed below the Borrower's and each Subsidiary's name on
Exhibit B.
Where I render an opinion "to the best of my knowledge" or concerning an
item "known to me" or my opinion otherwise refers to my "knowledge," it is
intended to indicate that during the course of my representation of Borrower and
the Subsidiaries, no information that would give me current actual knowledge of
the inaccuracy of such statement has come to my attention in rendering legal
services to Borrower or the Subsidiaries.
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115
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 3
On the basis of the foregoing, in reliance thereon, and with the
foregoing qualifications, I am of the opinion that:
1. (a) Borrower is a corporation, duly incorporated and validly existing
under the laws of Delaware and has the requisite corporate power and authority
to own its property and to conduct the business in which it is currently
engaged; (b) Each of GCC and GLC is a corporation duly incorporated and validly
existing under the laws of California and has the requisite corporate power and
authority to own its property and to conduct the business in which it is
currently engaged; (c) Each of GG&R and Pozzolan is a corporation duly
incorporated and validly existing under the laws of Utah and has the requisite
corporate power and authority to own its property and to conduct the business in
which it is currently engaged; (d) Intermountain is a corporation duly
incorporated and validly existing under the laws of Wyoming and has the
requisite corporate power and authority to own its property and to conduct the
business in which it is currently engaged; (e) GILC is a California limited
partnership validly existing under the laws of California and has the requisite
partnership power and authority to own its property and to conduct the business
in which it is currently engaged.
2. Borrower (a) has taken all necessary and appropriate corporate action
to authorize the execution, delivery and performance of the Credit Agreement and
the Notes, and (b) has the corporate power and authority to execute, deliver and
perform the Credit Agreement. Each Subsidiary (a) has taken all necessary and
appropriate corporate action or partnership action, as applicable, to authorize
the execution, delivery and performance of the Guaranty, and (b) has the
corporate power or partnership power, as applicable, and authority to execute,
deliver and perform the Guaranty.
3. The Credit Agreement and the Notes have been duly executed and
delivered by the Borrower. The Guaranty has been duly executed and delivered by
each of the Subsidiaries. The Credit Agreement and the Notes constitute legal,
valid and binding obligations of Borrower, enforceable against Borrower in
accordance with their terms. The Guaranty constitutes a legal, valid and binding
obligation of each Subsidiary, enforceable against each Subsidiary in accordance
with its terms.
4. The execution, delivery and performance by Borrower of the Credit
Agreement and the Notes do not: (a) violate or contravene any injunction, order,
writ, judgment, decree, determination or award of any United States or
California Governmental Authority as presently in effect applicable to Borrower;
(b) conflict with or result in a breach of or constitute a default under the
certificate of incorporation and bylaws of Borrower; (c) violate or result in a
breach of or constitute any default under any agreements of Borrower set forth
in Exhibit A, and, do not result in or require the creation or imposition of any
lien on any of Borrower's properties or revenues pursuant to any injunction,
order, decree or undertaking as presently in effect or any such agreements of
Borrower set forth in Exhibit A; or (d) result in or require the creation or
imposition of any lien on any of its properties or revenues pursuant to any
provision of any law, rule or regulation as presently in effect.
5. The execution, delivery and performance by each Subsidiary of the
Guaranty do not: (a) violate or contravene any injunction, order. writ,
judgment, decree, determination or award of any United States or California
Governmental Authority as presently in effect applicable to each Subsidiary; (b)
conflict with or result in a breach of or constitute a default under the
articles/certificates of incorporation
F-3
116
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 4
and bylaws or partnership agreement, as applicable, of each Subsidiary; (c)
violate or result in a breach of or constitute any default under any agreements
of each Subsidiary set forth in Exhibit A, and do not result in or require the
creation or imposition of any lien on any Subsidiary's its properties or
revenues pursuant to any injunction, order, decree or undertaking as presently
in effect or any such agreements of each Subsidiary; or (d) result in or require
the creation or imposition of any lien on any of its properties or revenues
pursuant to any provision of any law, rule or regulation as presently in effect.
6. Each of Borrower and the Subsidiaries is duly qualified to do
business and is in good standing in the states listed below its name on Exhibit
B hereto.
7. No authorization, consent, approval, license, qualification or formal
exemption from, nor notice to, nor any filing, recordation, declaration or
registration with, any United States or California Governmental Authority, or to
my knowledge any other Governmental Authority, is necessary or required on the
part of Borrower in connection with the execution, delivery, or performance by
Borrower of the Credit Agreement and the Notes.
8. No authorization, consent, approval, license, qualification or formal
exemption from, nor notice to, nor any filing, recordation, declaration or
registration with any United States or California Governmental Authority, or to
my knowledge any other Governmental Authority, is necessary or required on the
part of each Subsidiary in connection with the execution, delivery, or
performance by each Subsidiary of the Guaranty.
9. There is no claim, dispute, injunction, temporary restraining order,
action, litigation, investigation or proceeding pending or, to the best of my
knowledge, threatened against Borrower before any court, arbitrator,
administrative agency or Governmental Authority of any kind (a) with respect to
the Credit Agreement and the Notes or (b) which, if adversely determined, would
have a Material Adverse Effect.
10. There is no claim, dispute, injunction, temporary restraining order,
action, litigation, investigation or proceeding pending or, to the best of my
knowledge, threatened against any Subsidiary before any court, arbitrator,
administrative agency or Governmental Authority of any kind (a) with respect to
the Guaranty or (b) which, if adversely determined, would have a Material
Adverse Effect.
11. Neither the Borrower nor any Subsidiary is an "investment company"
or a company "controlled" by an "investment company," within the meaning of the
Investment Company Act of 1940, as amended. Neither the Borrower nor any
Subsidiary is subject to regulation under the Public Utility Holding Company Act
of 1935, the Interstate Commerce Act (49 U.S.C Sections 10101 et seq. (Supp.
1992)) or the Federal Power Act which would limit its ability to incur
Indebtedness.
12. Neither the Borrower nor any Subsidiary is generally engaged in the
business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock. The aggregate value of all
Margin Stock directly or indirectly owned by the Borrower and its Subsidiaries
is less than 25% of the aggregate value of the consolidated assets of the
Borrower and its Subsidiaries.
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117
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 5
13. The only subsidiaries of Borrower are the Subsidiaries and GILC
Incorporated, a California corporation, GTC, Inc., a Texas corporation, ▇▇▇▇▇▇▇
Corporation, a Colorado corporation, Granite Construction International, a
California corporation, Granite SR 91 Corporation, a California corporation and
Granite SR 91 L.P., a California limited partnership, of which Granite SR91
Corporation is the general partner and the Borrower is the sole limited partner.
The opinions expressed in this letter are qualified to the extent that
the validity, binding nature or enforceability of any provisions of the Loan
Documents may be limited or otherwise affected by:
a. The effects of bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium, or other similar laws now or hereafter in effect
limiting the validity or enforceability of creditor's rights and remedies
generally;
b. General principles of equity, regardless of whether considered in
proceedings in equity or at law;
c. The covenant of good faith and fair dealing implied in every
agreement under common law (and to similar provisions of federal law, where
applicable); and
d. The effect of any law or legal principle which provides that a court
may refuse to enforce, or may limit the application of; a contract or any clause
thereof which the court finds as a matter of law to have been unconscionable at
the time it was made.
e. The opinions expressed in this letter are further qualified to the
extent that the validity, binding nature or enforceability of any provisions of
the Loan Documents may be limited or otherwise affected by:
i. The unenforceability under certain circumstances under California
or federal law or court decisions of provisions (i) releasing a party against
liability for wrongful or negligent acts, (ii) indemnifying a party to the
extent that the events giving rise to the indemnity arise in whole or in part
from the wrongful or negligent acts of the indemnitee, or (iii) where such
release or indemnification is contrary to public policy, including but not
limited to indemnification and/or releases relating to any issues of securities
laws;
ii. The effect of California Civil Code Section 1717 and other
applicable statutes and judicial decisions which provide, among other things,
that a court may limit the granting of attorneys' fees to those attorneys' fees
which are determined by the court to be reasonable and that attorneys' fees may
be granted only to a prevailing party and that a contractual provision for
attorneys' fees is deemed to extend to both parties (notwithstanding that such
provision by its express terms benefits only one party);
iii. The assumption that, if the Agent or the Banks enforce their
remedies, they will do so in a commercially reasonable manner;
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118
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 6
iv. The effect of California court decisions invoking statutes or
principles of equity which have held that certain covenants and provisions of
agreements are unenforceable where (i) the breach of such covenants or
provisions imposes restrictions or burdens upon the debtor, including the
acceleration of indebtedness due under debt instruments, and it cannot be
demonstrated that the enforceability of such restrictions or burdens is
reasonably necessary for the protection of the creditors, or (ii) the creditor's
enforcement of such covenants or provisions under the circumstances would
violate the creditor's implied covenants of good faith and fair dealing;
v. The unenforceability under certain circumstances of contractual
provisions self-help or summary remedies; and
vi. Decisions by California courts admitting evidence extrinsic to a
written agreement between the parties thereto that the parties intended a
meaning contrary to that expressed by the parties in writing.
The foregoing opinions are also subject to the following additional
assumptions, limitations, qualifications and exceptions:
a. Provisions in the Loan Documents requiring Borrower or any Subsidiary
to execute, in the future, additional instruments and documents may be
unenforceable.
b. Any provision contained in the Loan Documents that purports to
require that any action or decision of Agent or Banks is conclusively binding
upon Borrower or any Subsidiary may be unenforceable.
c. You are advised that any provision in the Loan Documents purporting
to waive, limit or restrict the right of Borrower or Subsidiary to offset
against obligations owing under the Loan Documents may not be enforceable.
d. Those provisions in the Loan Documents imposing late charges
(interest or otherwise) and/or additional interest in the event of default are
governed by the rules relating to "liquidated damages" as set forth in
California Civil Code Sections 1671 et seq., and relevant case law (see, e.g.,
▇▇▇▇▇▇▇ ▇. Coast and Southern Federal Savings & Loan, 9 Cal.3d 731(1973)). I
express no opinion as to the effect of judicial decisions and statutes limiting
the enforceability of provisions imposing penalties, forfeitures, late payment
charges, an increase in interest rate, or payment of other additional
consideration, (i) upon prepayment, late payment, maturity, default or a
lender's election to accelerate a loan, particularly in cases where the
occurrence of a default or waiving the benefit of a statutory right bears no
reasonable relation to the damage suffered by the lender or is otherwise held to
be a penalty; or (ii) as a consequence of costs incurred by the lender or
imposition of governmental charges, taxes, levies or requirements upon a lender.
e. Those provisions in the Loan Documents requiring the consent of Agent
and Banks or allowing Agent or Banks to take certain actions may be interpreted
by a court to contain an implied covenant of reasonableness and/or fair dealing
(see, e.g., ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, 40 Cal. 3d 488 (1985); ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 147
Cal. App. 3d 321(1983)).
F-6
119
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 7
f. You should be aware of the unenforceability, under certain
circumstances, of provisions waiving broadly or vaguely stated rights or unknown
future rights, or rights which may not be waived on statutory or public policy
grounds, or provisions stating that rights or remedies are not exclusive, that
every right or remedy is cumulative and may be exercised in addition to or with
any other right or remedy or that the election of some particular remedy or
remedies does not preclude recourse to one or more others.
g. You should be aware of limitations based on public policy on
provisions stating that a borrower's obligations are unaffected by reason of any
default or failure on the part of a lender to perform or comply with the terms
of the subject loan documents.
h. I express no opinion as to the enforceability of the consent to
service, jurisdiction or forum of any claim, demand, action or cause of action
arising under or related to the Loan Documents or the transactions contemplated
therein.
i. I express no opinion as to the enforceability of any right of any
creditor to collect any payment due under the Loan Documents to the extent that
such payment constitutes a penalty or forfeiture.
j. I express no opinion as to the enforceability of provisions in the
Loan Documents creating presumptions or creating rights of set-off.
k. I express no opinion on the accuracy of any representations or
warranties of Borrower or any Subsidiary. Furthermore I express no opinion as to
the survivability of any warranties, indemnities or other obligations.
l. I express no opinion as to the enforceability of those provisions in
the Loan Documents purporting to appoint the Agent or Banks as attorney-in-fact
for Borrower or to grant an irrevocable power of attorney to Agent or Banks.
m. I express no opinion as to the enforceability of provisions in the
Loan Documents purporting to provide that any approval, consent, authorization
or satisfaction required of Agent or Banks or any notice given by or other
action taken by Agent or Banks under the Loan Documents shall be presumed to be
reasonable.
n. I express no opinion as to the effect of laws and judicial decisions
that provide that in certain circumstances a surety may be exonerated if the
creditor materially alters the original obligation of the principal without the
surety's consent, or otherwise takes any action without notifying the surety
that materially prejudices the surety.
o. I express no opinion as to any securities, anti-trust, tax, land use,
safety, environmental, hazardous materials, insurance company or banking laws,
rules or regulations, or laws, rules or regulations applicable to Agent or
Banks.
F-7
120
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 8
p. I express no opinion as to any provision providing for the exclusive
jurisdiction of a particular court or purporting to waive rights to trial by
jury, service of process or objections to the laying of venue or to forum on the
basis of forum non conveniens in connection with any litigation arising out of
or pertaining to the Loan Documents.
q. I express no opinion as to the effect of California Civil Code
Section 1698 and similar statutes and federal laws and judicial decisions (a)
providing that oral modifications to a contract or waivers of contractual
provisions may be enforceable, if the modification was performed,
notwithstanding any express provision in the agreement that the agreement may
only be modified or an obligation thereunder waived in writing, or (b) creating
an implied agreement from trade practices or course of conduct.
r. I express no opinion as to the effect of certain rights, remedies and
waivers contained in the Loan Documents being limited or rendered ineffective by
applicable statutory law or judicial decisions governing such provisions, but
such laws and judicial decisions do not render the Loan Documents unenforceable
as a whole, and there exists, in the Loan Documents and pursuant to applicable
law, legally adequate remedies for realization of the principal benefits
purported to be afforded by the Loan Documents.
s. With respect to my opinions expressed in paragraphs 4(d), 5(d), 7 and
8, I have not conducted any special investigation of statutes laws, rules or
regulations and my opinion with respect thereto are limited to such laws that to
my knowledge and as in my experience are of general application to transactions
of the sort contemplated by the Loan Documents.
I further advise you that:
a. The enforceability of the Guaranty against a Subsidiary may be
subject to California statutory provisions and case law to the effect that a
guarantor may be exonerated if the beneficiary of the guaranty alters the
original obligation of the principal, fails to inform the guarantor of material
information pertinent to the principal or any collateral, elects remedies that
may impair the subrogation rights of the guarantor against the principal or that
may impair the value of the collateral, fails to accord the guarantor the
protections afforded a debtor under the Uniform Commercial Code or otherwise
takes any action that materially prejudices the guarantor unless, in any such
case, the guarantor validly waives such rights or the consequences of any such
action. See, e.g., California Civil Code Section 2799 through Section 2855;
Sumitomo Bank of California ▇. ▇▇▇▇▇▇▇, 70 Cal. 2d 81, 73 Cal. Rptr. 564 (1968);
Union Bank ▇. ▇▇▇▇▇▇▇, 265 Cal. App. 2d 40, 71 Cal. Rptr 64 (1968); ▇▇▇▇▇▇▇▇ v.
Bank of Sonoma County, 184, 2 Cal. App. 3d 1119, 29 Cal. Rptr. 396 (1986);
C.I.T. Corp. v. Anwright Corp., 191 Cal. App. 3d 1420, 237 Cal. ▇▇▇▇. ▇▇▇
(1987), American National Bank V. Perma-Tile Roof Co., 200 Cal. App. 3d 889, 246
Cal. Rptr. 381(1988), In re ▇▇▇▇▇▇▇▇, ▇▇▇ F. 2d 1236 (9th Cir. 1990); and Cathay
Bank ▇. ▇▇▇, 18 Cal. Rptr. 2d 420 (1993). While express and specific waivers of
a guarantor's right to be exonerated, such as those contained in the Guaranty,
are generally enforceable under California law, we express no opinion as to
whether the Guaranty contains an express and specific waiver of each exoneration
defense a guarantor might assert or as to whether each of the waivers contained
in the Guaranty is fully enforceable.
F-8
121
Bank of America, N.A.
as Agent for the Banks from time to time
party to the Credit Agreement referred to below,
and to the Banks
June 29, 2001
Page 9
b. It could be contended that the Guaranty has not been given for a fair
or reasonably equivalent consideration, that a Subsidiary is, or, by entering
into the Guaranty may become, insolvent, and that the Guaranty may be voidable
by creditors of a Subsidiary or by a trustee or receiver of a Subsidiary in
bankruptcy or similar proceedings pursuant to applicable bankruptcy, fraudulent
conveyance or similar laws. Because of these possible contentions, my opinions
are further limited by and subject to the effect of such laws.
This opinion is intended solely for the benefit of the Agent, and the
Banks and their Assignees and Participants, as defined in Section 10.07(d) of
the Credit Agreement, and is not to be made available to or relied upon by any
other person, firm, or entity, other than regulatory authorities in connection
with bank examinations, without our prior written consent.
Very truly yours,
▇▇▇▇▇▇▇ ▇▇▇▇▇
Vice President, Secretary and General Counsel
MF:pb
Encl.
F-9
122
EXHIBIT A
GRANITE CONSTRUCTION INCORPORATED
MATERIAL AGREEMENTS IN EXCESS OF $50,000,000
JOB
NUMBER DESCRIPTION AMOUNT
------ ----------- -------
300136 DALLAS CO IH45 50,739,000
370804 ST. JOHN'S RIVER BRIDGE-JOINT VENTURE 65,943,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ TO CAMDEN 73,300,000
300122 HILLSBOROUGH CO. I-4 S1 80,568,000
300161 HATHAWAY BRIDGE REPLACE 81,520,000
300823 ATLANTIC CITY DESIGN BUILD-JOINT VENTURE 85,690,000
216666 I-80 TRUCKEE TO FLORISTON 86,396,096
300146 DALLAS CO SH190/IH35 95,146,000
300875 LAS VEGAS MONORAIL-JOINT VENTURE 153,958,000
300866 HIAWATHA LIGHT RAIL-JOINT VENTURE 164,584,644
300819 I-15 UTAH HIGHWAY REBUILD-JOINT VENTURE 315,621,617
NA Private Placement Due 03/15/10 60,000,000
NA Private Placement Due 05/01/13 75,000,000
F-10
123
EXHIBIT B
==================================================================================
STATE OF
ARTICLE XI. COMPANY INCORPORATION/QUALIFICATION
==================================================================================
Granite Construction Delaware*
Incorporated (Borrower) California
----------------------------------------------------------------------------------
11.01 Granite Construction Company California*
----------------------------------------
Arizona
----------------------------------------
Colorado
----------------------------------------
Florida
----------------------------------------
Georgia
----------------------------------------
Idaho
----------------------------------------
Minnesota
----------------------------------------
Missouri
----------------------------------------
Nevada
----------------------------------------
New Jersey
----------------------------------------
New Mexico
----------------------------------------
North Carolina
----------------------------------------
Texas
----------------------------------------
Utah
----------------------------------------
Wyoming
----------------------------------------------------------------------------------
11.02 Granite Land Company California*
----------------------------------------------------------------------------------
GILC, L.P. California*
----------------------------------------
Arizona
----------------------------------------
Colorado
----------------------------------------
Florida
----------------------------------------
Georgia
----------------------------------------
Idaho
----------------------------------------
Missouri
----------------------------------------
Nevada
----------------------------------------
New Mexico
----------------------------------------
Texas
----------------------------------------
Utah
----------------------------------------
Wyoming
----------------------------------------------------------------------------------
G.G. & R., Inc. Utah*
----------------------------------------------------------------------------------
Intermountain Slurry Seal, Inc. Wyoming*
----------------------------------------
California
----------------------------------------
Colorado
----------------------------------------
Idaho
----------------------------------------
Nevada
----------------------------------------
New Mexico
----------------------------------------
Utah
----------------------------------------------------------------------------------
Pozzolan Products Company Utah*
(P.P.C.)
----------------------------------------
California
----------------------------------------
Colorado
----------------------------------------
Idaho
======================================== =========================================
*State of Incorporation/Organization
F-11
124
NOTE
$ 12,000,000.00 June 29, 2001
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises to
pay to the order of FIRST UNION NATIONAL BANK (the "Lender"), on the Maturity
Date (as defined in the Credit Agreement referred to below) the principal amount
of Twelve Million Dollars ($12,000,000.00), 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
June 29, 2001 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "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 Administrative
Agent and L/C Issuer.
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
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 Agreement.
This Note is one of the Notes referred to in the Agreement, is entitled
to the benefits thereof and is subject to optional and mandatory prepayment in
whole or in part as provided therein. This Note is also entitled to the benefits
of the Guaranties. Upon the occurrence of one or more of the Events of Default
specified in the Agreement, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable all as provided in
the 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 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 Note.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
ENTIRELY WITHIN SUCH STATE; PROVIDED THAT LENDER SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.
GRANITE CONSTRUCTION INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief Financial Officer
By: /s/ ▇.▇. ▇▇▇▇▇▇▇▇▇▇
---------------------------------------
▇.▇. ▇▇▇▇▇▇▇▇▇▇
Treasurer
125
$12,500,000.00 June 29, 2001
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises to
pay to the order of UNION BANK OF CALIFORNIA, N.A. (the "Lender"), on the
Maturity Date (as defined in the Credit Agreement referred to below) the
principal amount of Twelve Million Five Hundred Thousand Dollars
($12,500,000.00), 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 June 29, 2001 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to
time, the "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 Administrative Agent and L/C Issuer.
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
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 Agreement.
This Note is one of the Notes referred to in the Agreement, is entitled
to the benefits thereof and is subject to optional and mandatory prepayment in
whole or in part as provided therein. This Note is also entitled to the benefits
of the Guaranties. Upon the occurrence of one or more of the Events of Default
specified in the Agreement, all amounts then remaining unpaid on this Note shall
become, or may be declared to be, immediately due and payable all as provided in
the 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 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 Note.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
ENTIRELY WITHIN SUCH STATE; PROVIDED THAT LENDER SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.
GRANITE CONSTRUCTION INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief Financial Officer
By: /s/ ▇.▇. ▇▇▇▇▇▇▇▇▇▇
------------------------------------
▇.▇. ▇▇▇▇▇▇▇▇▇▇
Treasurer