Exhibit 10.1
Published CUSIP Number: ▇▇▇▇▇▇▇▇▇
EXECUTION VERSION
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$110,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
among
▇▇▇▇▇▇▇ PHARMACEUTICALS, INC.,
as Borrower,
and
CERTAIN SUBSIDIARIES OF THE BORROWER,
as Guarantors,
THE LENDERS PARTIES HERETO,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent,
JPMORGAN CHASE BANK,
as Syndication Agent
and
GENERAL ELECTRIC CAPITAL CORPORATION,
as Documentation Agent
Dated as of November 14, 2005
WACHOVIA CAPITAL MARKETS, LLC,
as Sole Lead Arranger and Sole Book Runner
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS.........................................................1
Section 1.1 Defined Terms.............................................1
Section 1.2 Other Definitional Provisions............................28
Section 1.3 Accounting Terms.........................................28
Section 1.4 Time References..........................................28
ARTICLE II THE LOANS; AMOUNT AND TERMS.......................................29
Section 2.1 Revolving Loans..........................................29
Section 2.2 Term Loan................................................31
Section 2.3 Letter of Credit Subfacility.............................33
Section 2.4 Swingline Loan Subfacility...............................37
Section 2.5 Fees.....................................................39
Section 2.6 Commitment Reductions....................................39
Section 2.7 Prepayments..............................................40
Section 2.8 Lending Offices..........................................43
Section 2.9 Default Rate.............................................43
Section 2.10 Conversion Options.......................................43
Section 2.11 Computation of Interest and Fees.........................44
Section 2.12 Pro Rata Treatment and Payments..........................45
Section 2.13 Non-Receipt of Funds by the Administrative Agent.........47
Section 2.14 Inability to Determine Interest Rate.....................48
Section 2.15 Illegality...............................................48
Section 2.16 Requirements of Law......................................49
Section 2.17 Indemnity................................................50
Section 2.18 Taxes....................................................51
Section 2.19 Indemnification; Nature of Issuing
Lender's Duties........................................53
ARTICLE III REPRESENTATIONS AND WARRANTIES...................................54
Section 3.1 Financial Condition......................................54
Section 3.2 No Change................................................55
Section 3.3 Corporate Existence; Compliance with Law.................55
Section 3.4 Corporate Power; Authorization;
Enforceable Obligations................................56
Section 3.5 No Legal Bar; No Default.................................57
Section 3.6 No Material Litigation...................................57
Section 3.7 Investment Company Act; PUHCA; Etc.......................57
Section 3.8 Margin Regulations.......................................57
Section 3.9 ERISA....................................................58
Section 3.10 Environmental Matters....................................58
Section 3.11 Use of Proceeds..........................................59
Section 3.12 Subsidiaries; Joint Ventures; Partnerships...............59
Section 3.13 Ownership................................................60
Section 3.14 Indebtedness.............................................60
Section 3.15 Taxes....................................................60
Section 3.16 Intellectual Property....................................60
i
Section 3.17 Solvency.................................................61
Section 3.18 Investments..............................................61
Section 3.19 Location of Collateral...................................61
Section 3.20 Brokers' Fees............................................62
Section 3.21 Labor Matters............................................62
Section 3.22 Security Documents.......................................62
Section 3.23 Accuracy and Completeness of Information.................62
Section 3.24 Fraud and Abuse..........................................63
Section 3.25 Licensing and Accreditation..............................63
Section 3.26 Other Regulatory Protection..............................63
Section 3.27 Material Contracts.......................................64
Section 3.28 Insurance................................................64
Section 3.29 Reimbursement from Third Party Payors....................64
Section 3.30 Other Agreements.........................................64
Section 3.31 Classification as Senior Indebtedness....................65
Section 3.32 Foreign Assets Control Regulations, Etc..................65
Section 3.33 Compliance with OFAC Rules and Regulations...............65
ARTICLE IV CONDITIONS PRECEDENT..............................................65
Section 4.1 Conditions to Closing Date and
Initial Extensions of Credit...........................65
Section 4.2 Conditions to All Extensions of Credit...................71
ARTICLE V AFFIRMATIVE COVENANTS..............................................72
Section 5.1 Financial Statements.....................................72
Section 5.2 Certificates; Other Information..........................74
Section 5.3 Payment of Obligations...................................75
Section 5.4 Conduct of Business and Maintenance of Existence.........75
Section 5.5 Maintenance of Property; Insurance.......................75
Section 5.6 Inspection of Property; Books and Records;
Discussions............................................76
Section 5.7 Notices..................................................76
Section 5.8 Environmental Laws.......................................78
Section 5.9 Financial Covenants......................................78
Section 5.10 Additional Guarantors....................................79
Section 5.11 Compliance with Law......................................79
Section 5.12 Pledged Assets...........................................80
Section 5.13 Covenants Regarding Patents,
Trademarks and Copyrights..............................80
Section 5.14 Post-Closing Covenants...................................82
ARTICLE VI NEGATIVE COVENANTS................................................82
Section 6.1 Indebtedness.............................................83
Section 6.2 Liens....................................................84
Section 6.3 Nature of Business.......................................84
Section 6.4 Consolidation, Merger, Sale or
Purchase of Assets, etc................................84
Section 6.5 Advances, Investments and Loans..........................85
Section 6.6 Transactions with Affiliates.............................85
Section 6.7 Ownership of Subsidiaries; Restrictions..................85
Section 6.8 Fiscal Year; Organizational Documents;
Material Contracts.....................................86
Section 6.9 Limitation on Restricted Actions.........................86
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Section 6.10 Restricted Payments......................................86
Section 6.11 Sale Leasebacks..........................................87
Section 6.12 No Further Negative Pledges..............................87
Section 6.13 Operating Lease Obligations..............................87
Section 6.14 Deposit Account Control Agreements;
Additional Bank Accounts...............................87
ARTICLE VII EVENTS OF DEFAULT................................................88
Section 7.1 Events of Default........................................88
Section 7.2 Acceleration; Remedies...................................91
ARTICLE VIII THE AGENT.......................................................92
Section 8.1 Appointment..............................................92
Section 8.2 Delegation of Duties.....................................92
Section 8.3 Exculpatory Provisions...................................92
Section 8.4 Reliance by Administrative Agent.........................93
Section 8.5 Notice of Default........................................93
Section 8.6 Non-Reliance on Administrative Agent and
Other Lenders..........................................94
Section 8.7 Indemnification..........................................94
Section 8.8 Administrative Agent in Its Individual Capacity..........95
Section 8.9 Successor Administrative Agent...........................95
Section 8.10 Other Agents.............................................96
Section 8.11 Releases.................................................96
ARTICLE IX MISCELLANEOUS.....................................................96
Section 9.1 Amendments, Waivers and Release of Collateral............96
Section 9.2 Notices..................................................98
Section 9.3 No Waiver; Cumulative Remedies..........................100
Section 9.4 Survival of Representations and Warranties..............100
Section 9.5 Payment of Expenses and Taxes...........................100
Section 9.6 Successors and Assigns; Participations;
Purchasing Lenders.....................................101
Section 9.7 Adjustments; Set-off....................................105
Section 9.8 Table of Contents and Section Headings..................106
Section 9.9 Counterparts............................................106
Section 9.10 Effectiveness...........................................106
Section 9.11 Severability............................................106
Section 9.12 Integration.............................................106
Section 9.13 Governing Law...........................................106
Section 9.14 Consent to Jurisdiction and Service of Process..........107
Section 9.15 Arbitration.............................................107
Section 9.16 Confidentiality.........................................108
Section 9.17 Acknowledgments.........................................109
Section 9.18 Waivers of Jury Trial; Waiver of
Consequential Damages.................................110
Section 9.19 Patriot Act Notice......................................110
ARTICLE X GUARANTY..........................................................110
Section 10.1 The Guaranty............................................110
Section 10.2 Bankruptcy..............................................111
Section 10.3 Nature of Liability.....................................111
Section 10.4 Independent Obligation..................................112
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Section 10.5 Authorization...........................................112
Section 10.6 Reliance................................................112
Section 10.7 Waiver..................................................112
Section 10.8 Limitation on Enforcement...............................114
Section 10.9 Confirmation of Payment.................................114
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Schedules
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Schedule 1.1-1 Account Designation Letter
Schedule 1.1-2 Permitted Investments
Schedule 1.1-3 Permitted Liens
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 2.2(d) Form of Term Note
Schedule 2.4(d) Form of Swingline Note
Schedule 2.10 Form of Notice of Conversion/Extension
Schedule 2.18 Tax Exempt Certificate
Schedule 3.12 Subsidiaries
Schedule 3.16 Intellectual Property
Schedule 3.19(a) Location of Real Property
Schedule 3.19(b) Location of Collateral
Schedule 3.19(c) Chief Executive Offices
Schedule 3.21 Labor Matters
Schedule 3.27 Material Contracts
Schedule 3.28 Insurance
Schedule 4.1-1 Form of Secretary's Certificate
Schedule 4.1-2 Litigation
Schedule 4.1-3 Form of Solvency Certificate
Schedule 4.1-4 Mortgaged Properties
Schedule 4.1-5 Closing EBITDA
Schedule 5.10 Form of Joinder Agreement
Schedule 6.1(b) Indebtedness
Schedule 6.14 Deposit and Securities Accounts
Schedule 9.6(c) Form of Commitment Transfer Supplement
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AMENDED AND RESTATED CREDIT AGREEMENT, dated as of November 14, 2005,
among ▇▇▇▇▇▇▇ PHARMACEUTICALS, INC., a Delaware corporation (the "Borrower"),
those Domestic Subsidiaries of the Borrower identified as a "Guarantor" on the
signature pages hereto and such other Domestic Subsidiaries of the Borrower as
may from time to time become a party hereto (each a "Guarantor" and,
collectively, the "Guarantors"), the several banks, financial institutions or
other investment entities as are, or may from time to time become parties to
this Credit Agreement (each a "Lender" and, collectively, the "Lenders"), and
WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association, as
administrative agent for the Lenders hereunder (in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
--------------------
WHEREAS, the Borrower, the Guarantors, the lenders party thereto and the
Administrative Agent are parties to that certain Credit Agreement dated as of
September 28, 2004 (as amended, supplemented or otherwise modified from time to
time prior to the date hereof, the "Existing Credit Agreement"); and
WHEREAS, the Borrower desires to amend the Existing Credit Agreement as
set forth herein and to restate the Existing Credit Agreement in its entirety to
read as follows; and
WHEREAS, the Borrower has requested that the Lenders make loans and other
financial accommodations to the Borrower in the amount of up to $110,000,000, as
more particularly described herein; and
WHEREAS, the Lenders have agreed to make such loans and other financial
accommodations to the Borrower on the terms and conditions contained herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Defined Terms.
As used in this Credit Agreement, terms defined in the preamble to this
Credit Agreement have the meanings therein indicated, and the following terms
have the following meanings:
"ABR Default Rate" shall mean the Alternate Base Rate plus the Applicable
Percentage with respect to Alternate Base Rate Loans plus two percent (2%).
"Accessible Borrowing Availability" shall mean, as of any date of
determination, the amount that the Borrower is able to borrow on such date under
the Revolving Committed
1
Amount without a Default or Event of Default occurring or existing after giving
pro forma effect to such borrowing.
"Account Designation Letter" shall mean the Account Designation Letter
dated as of the Closing Date from the Borrower to the Administrative Agent
substantially in the form attached hereto as Schedule 1.1-1.
"Additional Credit Party" shall mean each Person that becomes a Guarantor
by execution of a Joinder Agreement in accordance with Section 5.10.
"Administrative Agent" shall have the meaning set forth in the first
paragraph of this Credit Agreement and shall include any successors in such
capacity.
"Administrative Details Form" shall mean, with respect to any Lender, a
document containing such Lender's contact information for purposes of notices
provided under this Credit Agreement and account details for purposes of
payments made to such Lender under this Credit Agreement.
"Affiliate" shall mean as to any Person, any other Person (excluding any
Subsidiary) which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person. For purposes of this definition, a
Person shall be deemed to be "controlled by" a Person if such Person possesses,
directly or indirectly, power either (a) to vote ten percent (10%) or more of
the Capital Stock having ordinary voting power for the election of directors of
such Person or (b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Agreement" or "Credit Agreement" shall mean this Amended and Restated
Credit Agreement, as amended, modified, restated, amended and restated,
extended, replaced, increased or supplemented from time to time in accordance
with its terms.
"Alternate Base Rate" shall mean, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Rate" shall mean, at any time, the rate of interest per annum publicly
announced from time to time by Wachovia at its principal office in Charlotte,
North Carolina as its prime rate. Each change in the Prime Rate shall be
effective as of the opening of business on the day such change in the Prime Rate
occurs. The parties hereto acknowledge that the rate announced publicly by
Wachovia as its Prime Rate is an index or base rate and shall not necessarily be
its lowest or best rate charged to its customers or other banks; and "Federal
Funds Effective Rate" shall mean, for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published on the next succeeding Business Day, the average of the quotations for
the day of such transactions received by the Administrative Agent from three (3)
federal funds brokers of recognized standing selected by it. If for any reason
the Administrative Agent shall have determined (which determination shall be
conclusive in the absence of manifest error) that it is unable to ascertain the
Federal Funds Effective Rate, for any
2
reason, including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms, the Alternate Base Rate
shall be determined without regard to clause (b) of the first sentence of this
definition, until the circumstances giving rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime Rate
or the Federal Funds Effective Rate shall be effective on the opening of
business on the date of such change.
"Alternate Base Rate Loans" shall mean Loans that bear interest at an
interest rate based on the Alternate Base Rate.
"Applicable Percentage" shall mean, for any day, the rate per annum set
forth below, it being understood that the Applicable Percentage for (a)
Revolving Loans and Term Loans that are Alternate Base Rate Loans shall be 3.00%
at all times, (b) Revolving Loans and Term Loans that are LIBOR Rate Loans and
the Letter of Credit Fee shall be 4.00% at all times, (c) the Commitment Fee
shall be 0.50% at all times.
"Approved Fund" shall mean, with respect to any Lender, any fund or trust
or entity that invests in commercial bank loans in the ordinary course of
business and is advised or managed by (i) such Lender, (ii) an Affiliate of such
Lender, (iii) any other Lender or any Affiliate thereof or (iv) the same
investment advisor as any Person described in clauses (i) - (iii).
"Arranger" shall mean Wachovia Capital Markets, LLC, as Sole Lead Arranger
and Sole Book Runner, together with its successors and/or assigns.
"Asset Disposition" shall mean the disposition of any or all of the assets
(including, without limitation, the Capital Stock of a Subsidiary or any
ownership interest in a joint venture) of any Credit Party or any Subsidiary
whether by sale, lease, transfer or otherwise, in a single transaction or in a
series of transactions. The term "Asset Disposition" shall not include (i) the
sale, lease, transfer or other disposition of assets permitted by Section
6.4(a)(i), (ii), (iii)(A), (iv) or (v) hereof or (ii) any Equity Issuance.
"Bankruptcy Code" shall mean the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Bankruptcy Event" shall mean the occurrence of an Event of Default under
Section 7.1(f).
"Borrower" shall have the meaning set forth in the first paragraph of this
Credit Agreement.
"Borrowing Date" shall mean, in respect of any Loan, the date such Loan is
made.
"Business" shall have the meaning set forth in Section 3.10(b).
"Business Day" shall mean a day other than a Saturday, Sunday or other day
on which commercial banks in Charlotte, North Carolina or New York, New York are
authorized or
3
required by law to close; provided, however, that when used in connection with a
rate determination, borrowing or payment in respect of a LIBOR Rate Loan, the
term "Business Day" shall also exclude any day on which banks in London, England
are not open for dealings in Dollar deposits in the London interbank market.
"Capital Lease" shall mean any lease of property, real or personal, the
obligations with respect to which are required to be capitalized on a balance
sheet of the lessee in accordance with GAAP.
"Capital Lease Obligations" shall mean the capitalized lease obligations
relating to a Capital Lease determined in accordance with GAAP.
"Capital Stock" shall mean (i) in the case of a corporation, capital
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of capital stock, (iii) in the case of a partnership, partnership
interests (whether general or limited), (iv) in the case of a limited liability
company, membership interests and (v) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person.
"Cash Equivalents" shall mean (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve (12) months from the date of acquisition ("Government Obligations"),
(ii) Dollar denominated (or foreign currency fully hedged) time deposits,
certificates of deposit, Eurodollar time deposits and Eurodollar certificates of
deposit of (y) any domestic commercial bank of recognized standing having
capital and surplus in excess of $250,000,000 or (z) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent thereof or
from ▇▇▇▇▇'▇ is at least P-1 or the equivalent thereof (any such bank being an
"Approved Bank"), in each case with maturities of not more than 364 days from
the date of acquisition, (iii) commercial paper and variable or fixed rate notes
issued by any Approved Bank (or by the parent company thereof) or any variable
rate notes issued by, or guaranteed by any domestic corporation rated A-1 (or
the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody's and maturing within six (6) months of the date of acquisition,
(iv) repurchase agreements with a bank or trust company (including a Lender) or
a recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America, (v) obligations of any state of the United States or any
political subdivision thereof for the payment of the principal and redemption
price of and interest on which there shall have been irrevocably deposited
Government Obligations maturing as to principal and interest at times and in
amounts sufficient to provide such payment, (vi) auction preferred stock rated
in the highest short-term credit rating category by S&P or Moody's, and (vii)
money market accounts subject to Rule 2a-7 of the Securities Exchange Act ("SEC
Rule 2a-7") which consist primarily of cash and cash equivalents set forth in
clauses (i) through (vi) above and of which 95% shall at all times be comprised
of First Tier Securities (as defined in SEC Rule 2a-7) and any remaining amount
shall at all times be comprised of Second Tier Securities (as defined in SEC
Rule 2a-7).
4
"CHAMPUS" shall mean the United States Department of Defense Civilian
Health and Medical Program of the United States.
"Change of Control" shall mean the occurrence of any of the following: (a)
any "person" or "group" (within the meaning of Sections 13(d) and 14(d)(2) of
the Securities Exchange Act) becomes the "beneficial owner" (as defined in Rule
l3d-3 under the Securities Exchange Act) of more than twenty-five percent (25%)
of then outstanding Voting Stock of the Borrower, measured by voting power
rather than the number of shares, but shall not include any transfer of Voting
Stock of the Borrower by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ for estate planning purposes to any
family members of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, or an entity controlled by any thereof or a
trust for the benefit of any thereof so long as ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ remains chairman
of the board of directors and chief executive officer of the Borrower; (b)
Continuing Directors shall cease for any reason to constitute a majority of the
members of the board of directors of the Borrower then in office or (c) the
occurrence of a "Change of Control" (or any comparable term) under, and as
defined in, the documents evidencing or governing any Subordinated Indebtedness.
"Closing Date" shall mean the date of this Credit Agreement.
"CMS" shall mean the Center for Medicare and Medicaid Services and any
successor thereto.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" shall mean a collective reference to the collateral which is
identified in, and at any time will be covered by, the Security Documents and
any other collateral that may from time to time secure the Credit Party
Obligations.
"Compliance Certificate" shall have the meaning set forth in Section
5.2(b).
"Commitment" shall mean the Revolving Commitment, the LOC Commitment, the
Term Loan Commitment and the Swingline Commitment, individually or collectively,
as appropriate.
"Commitment Fee" shall have the meaning set forth in Section 2.5(a).
"Commitment Percentage" shall mean the Revolving Commitment Percentage
and/or the Term Loan Commitment Percentage, as appropriate.
"Commitment Period" shall mean (a) with respect to Revolving Loans, the
period from and including the Closing Date to but excluding the Revolving
Commitment Termination Date and (b) with respect to Letters of Credit, the
period from and including the Closing Date to but excluding the date that is
thirty (30) days prior to the Revolving Commitment Termination Date.
"Commitment Transfer Supplement" shall mean a Commitment Transfer
Supplement, substantially in the form of Schedule 9.6(c).
5
"Commonly Controlled Entity" shall mean an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"Consolidated Capital Expenditures" shall mean, for any period, all
capital expenditures of the Borrower and its Subsidiaries on a consolidated
basis for such period, as determined in accordance with GAAP.
"Consolidated EBITDA" shall mean, for any period, the sum of (i)
Consolidated Net Income for such period, plus (ii) an amount which, in the
determination of Consolidated Net Income for such period, has been deducted for
(A) Consolidated Interest Expense, (B) total federal, state, local and foreign
income, value added and similar taxes and (C) depreciation, amortization
expense, all as determined in accordance with GAAP. Notwithstanding the
foregoing, for purposes of calculating Consolidated EBITDA for the fiscal
quarters ending September 30, 2005, December 31, 2005 and March 31, 2006,
Consolidated EBITDA shall be determined by annualizing such calculations during
such fiscal quarters such that (i) for the calculation of Consolidated EBITDA as
of September 30, 2005, Consolidated EBITDA for the fiscal quarter ending
September 30, 2005 would be multiplied by four (4), (ii) for the calculation of
Consolidated EBITDA as of December 31, 2005, Consolidated EBITDA for the two
fiscal quarter period then ending would be multiplied by two (2) and (iii) for
the calculation of Consolidated EBITDA as of March 31, 2006, Consolidated EBITDA
for the three fiscal quarter period then ending would be multiplied by one and
one-third (1 1/3).
"Consolidated Interest Expense" shall mean, for any period, all interest
expense of the Borrower and its Subsidiaries (including, without limitation, the
interest component under Capital Leases and any synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet financing
product, but excluding interest income), as determined in accordance with GAAP.
"Consolidated Net Income" shall mean, for any period, net income
(excluding extraordinary losses up to $3,000,000 in any twelve (12) month period
and excluding extraordinary gains) after taxes for such period of the Borrower
and its Subsidiaries on a consolidated basis, as determined in accordance with
GAAP.
"Consolidated Working Capital" shall mean, for any period, (i) all current
assets of the Borrower and its Subsidiaries on a consolidated basis minus (ii)
all current liabilities of the Borrower and its Subsidiaries on a consolidated
basis, as determined in accordance with GAAP.
"Continuing Directors" shall mean, during any period of up to twenty-four
(24) consecutive months commencing after the Closing Date, individuals who at
the beginning of such twenty-four (24) month period were directors of the
Borrower (together with any new director whose election by the Borrower's board
of directors or whose nomination for election by the Borrower's shareholders was
approved by a vote of at least two-thirds of the directors then still in office
who either were directors at the beginning of such period or whose election or
nomination for election was previously so approved).
6
"Contractual Obligation" shall mean, as to any Person, any provision of
any security issued by such Person or of any contract, agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Convertible Bonds" shall mean the securities issued pursuant to the
following: (i) the Indenture, dated June 11, 2003, between the Borrower and
American Stock Transfer & Trust Company, (ii) the First Supplemental Indenture,
dated as of July 24, 2003, between the Borrower and American Stock Transfer &
Trust Company, (iii) the Registration Rights Agreement, dated as of June 11,
2003, between Borrower and UBS Securities LLC and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates,
Inc. (for whom UBS Securities LLC is acting as representative), and (iv) the
Registration Rights Agreement, dated as of July 24, 2003, between Borrower and
UBS Securities LLC and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. (for whom UBS Securities
LLC is acting as representative).
"Copyright Licenses" shall mean any written agreement naming any Credit
Party as licensor and granting any right under any Copyright including, without
limitation, any thereof referred to in Schedule 3.16.
"Copyrights" shall mean (a) all registered copyrights of the Credit
Parties and their Subsidiaries in all Works, now existing or hereafter created
or acquired, all registrations and recordings thereof, and all applications in
connection therewith, including, without limitation, registrations, recordings
and applications in the United States Copyright Office or in any similar office
or agency of the United States, any state thereof or any other country or any
political subdivision thereof, or otherwise including, without limitation, any
thereof referred to in Schedule 3.16, and (b) all renewals thereof including,
without limitation, any thereof referred to in Schedule 3.16.
"Credit Documents" shall mean this Credit Agreement, each of the Notes,
any Joinder Agreement, the LOC Documents and the Security Documents.
"Credit Party" shall mean any of the Borrower or the Guarantors.
"Credit Party Obligations" shall mean, without duplication, (a) all of the
obligations, indebtedness and liabilities of the Credit Parties to the Lenders
(including the Issuing Lender) and the Administrative Agent, whenever arising,
under this Credit Agreement, the Notes or any of the other Credit Documents
(including, but not limited to, any interest accruing after the occurrence of a
filing of a petition of bankruptcy under the Bankruptcy Code with respect to any
Credit Party, regardless of whether such interest is an allowed claim under the
Bankruptcy Code) and (b) solely for purposes of the Security Documents and the
Guaranty, all liabilities and obligations, whenever arising, owing from any
Credit Party or any of their Subsidiaries to any Hedging Agreement Provider
arising under any Secured Hedging Agreement.
"Debt Issuance" shall mean the issuance of any Indebtedness for borrowed
money by any Credit Party or any of its Subsidiaries (excluding, for purposes
hereof, any Equity Issuance or
7
any Indebtedness of any Credit Party and its Subsidiaries permitted to be
incurred pursuant to Section 6.1 hereof).
"Default" shall mean any event which would constitute an Event of Default,
whether or not any requirement for the giving of notice or the lapse of time, or
both, or any other condition with respect to such Event of Default, has been
satisfied.
"Defaulting Lender" shall mean, at any time, any Lender that, at such time
(a) has failed to make a Loan required pursuant to the terms of this Credit
Agreement, including the funding of a Participation Interest in accordance with
the terms hereof, (b) has failed to pay to the Administrative Agent or any
Lender an amount owed by such Lender pursuant to the terms of this Credit
Agreement, or (c) has been deemed insolvent or has become subject to a
bankruptcy or insolvency proceeding or to a receiver, trustee or similar
official.
"Deposit Account Control Agreement" shall mean an agreement among a Credit
Party, a depository institution, and the Administrative Agent, which agreement
is in a form acceptable to the Administrative Agent and which provides the
Administrative Agent with "control" (as such term is used in Article 9 of the
Uniform Commercial Code) over the deposit accounts described therein, as the
same may be amended, restated, supplemented, extended, replaced or otherwise
modified from time to time.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Domestic Lending Office" shall mean, initially, the office of each Lender
designated as such Lender's Domestic Lending Office in such Lender's
Administrative Details Form; and thereafter, such other office of such Lender as
such Lender may from time to time specify to the Administrative Agent and the
Borrower as the office of such Lender at which Alternate Base Rate Loans of such
Lender are to be made.
"Domestic Subsidiary" shall mean any Subsidiary that is organized and
existing under the laws of the United States or any state or commonwealth
thereof or under the laws of the District of Columbia.
"Environmental Laws" shall mean any and all applicable foreign, Federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority or other
Requirement of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time be in effect during the term of this
Credit Agreement.
"Equity Issuance" shall mean any issuance by any Credit Party or any
Subsidiary to any Person which is not a Credit Party of (a) shares or interests
of its Capital Stock, (b) any shares or interests of its Capital Stock pursuant
to the exercise of options or warrants (including, without limitation, employee
stock options), (c) any shares or interests of its Capital Stock pursuant to the
conversion of any debt securities to equity or (d) warrants or options or other
similar rights which are exercisable for or convertible into shares or interests
of its Capital Stock. The term
8
"Equity Issuance" shall not include (i) any Asset Disposition, (ii) Debt
Issuance or (iii) any equity issuance to officers or employees of any Credit
Party.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurodollar Reserve Percentage" shall mean for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities, as defined in Regulation D of such Board as
in effect from time to time, or any similar category of liabilities for a member
bank of the Federal Reserve System in New York City.
"Event of Default" shall mean any of the events specified in Section 7.1;
provided, however, with respect to any such event, that any requirement for the
giving of notice or the lapse of time, or both, or any other condition with
respect thereto, has been satisfied.
"Excess Cash Flow" shall mean, with respect to any fiscal year of the
Borrower, for the Borrower and its Subsidiaries on a consolidated basis, an
amount equal to (a) Consolidated EBITDA for such period minus (b) Consolidated
Capital Expenditures for such period minus (c) Scheduled Funded Debt Payments
made during such period minus (d) Consolidated Interest Expense (excluding any
Consolidated Interest Expense associated with intercompany indebtedness) for
such period minus (e) amounts paid in cash in respect of federal, state, local
and foreign income taxes of the Borrower and its Subsidiaries with respect to
such period minus (f) increases in Consolidated Working Capital plus (g)
decreases in Consolidated Working Capital minus (h) optional prepayments of
Revolving Loans (to the extent accompanied by a corresponding reduction of the
Revolving Commitments).
"Extension of Credit" shall mean, as to any Lender, the making of a Loan
by such Lender or the issuance of, or participation in, a Letter of Credit by
such Lender.
"Federal Funds Effective Rate" shall have the meaning set forth in the
definition of "Alternate Base Rate".
"Fee Letter" shall mean the letter agreement dated June 29, 2005 addressed
to the Borrower from Wachovia and the Arranger, as amended, modified or
otherwise supplemented.
"Fixed Charge Coverage Ratio" shall mean, with respect to the Borrower and
its Subsidiaries on a consolidated basis for the twelve-month period ending on
the last day of any fiscal quarter of the Borrower, the ratio of (i)
Consolidated EBITDA for such period minus Consolidated Capital Expenditures made
in cash during such period to the extent permitted under this Credit Agreement
to (ii) the sum of Consolidated Interest Expense made in cash during such period
to the extent permitted under this Credit Agreement plus Scheduled Funded Debt
Payments for such period plus total federal, state, local and foreign income,
value added and similar taxes paid or payable in cash during such period plus
Restricted Payments made during
9
such period. Notwithstanding the foregoing, for purposes of calculating the
Fixed Charge Coverage Ratio for the fiscal quarters ending September 30, 2005,
December 31, 2005 and March 31, 2006, the Fixed Charge Coverage Ratio shall be
determined by annualizing Consolidated Interest Expense and the Scheduled Funded
Debt Payments during such fiscal quarters such that (i) for the calculation of
the Fixed Charge Coverage Ratio as of September 30, 2005, Consolidated Interest
Expense and the Scheduled Funded Debt Payments for the fiscal quarter ending
September 30, 2005 would be multiplied by four (4), (ii) for the calculation of
the Fixed Charge Coverage Ratio as of December 31, 2005 Consolidated Interest
Expense and the Scheduled Funded Debt Payments for the two fiscal quarter period
then ending would be multiplied by two (2) and (iii) for the calculation of the
Fixed Charge Coverage Ratio as of March 31, 2006, Consolidated Interest Expense
and the Scheduled Funded Debt Payments for the three fiscal quarter period then
ending would be multiplied by one and one-third (1 1/3).
"Flood Hazard Property" shall have the meaning set forth in Section
4.1(e)(iv).
"Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.
"Fronting Fee" shall have the meaning set forth in Section 2.5(b).
"Funded Debt" shall mean, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations (including, without limitation, earnout
obligations) of such Person incurred, issued or assumed as the deferred purchase
price of property or services purchased by such Person (other than trade debt
incurred in the ordinary course of business and due within six (6) months of the
incurrence thereof) which would appear as liabilities on a balance sheet of such
Person, (e) the principal portion of all obligations of such Person under
Capital Leases, (f) all obligations of such Person under Hedging Agreements,
excluding any portion thereof which would be accounted for as interest expense
under GAAP, (g) the maximum amount of all letters of credit issued or bankers'
acceptances facilities created for the account of such Person and, without
duplication, all drafts drawn thereunder (to the extent unreimbursed), (h) all
preferred Capital Stock or other equity interests issued by such Person and
which by the terms thereof could be (at the request of the holders thereof or
otherwise) subject to mandatory sinking fund payments, redemption or other
acceleration, (i) the principal balance outstanding under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product, (j) all Indebtedness of others of the type described in
clauses (a) through (i) hereof secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on, or payable out of the proceeds of production from, property owned
or acquired by such Person, whether or not the obligations secured thereby have
been assumed, (k) all Guaranty Obligations of such Person with respect to
Indebtedness of another Person of the type described in clauses (a) through (i)
hereof, and (l) all Indebtedness of the type described in clauses (a) through
(i) hereof of any partnership or unincorporated joint venture in which such
Person is a general partner or a joint venturer; provided, however, that with
respect to Funded Debt of the Borrower and its
10
Subsidiaries, Funded Debt shall not include Subordinated Indebtedness among the
Borrower and the Guarantors to the extent such Indebtedness would be eliminated
on a consolidated basis.
"GAAP" shall mean generally accepted accounting principles in effect in
the United States of America applied on a consistent basis, subject, however, in
the case of determination of compliance with the financial covenants set out in
Section 5.9 to the provisions of Section 1.3.
"Government Acts" shall have the meaning set forth in Section 2.19(a).
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantor" shall have the meaning set forth in the first paragraph of
this Credit Agreement.
"Guaranty Obligations" shall mean, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (i) to purchase any such Indebtedness or
any property constituting security therefor, (ii) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (iii) to lease or
purchase Property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The amount of
any Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.
"Guaranty" shall mean the guaranty of the Guarantors set forth in Article
X.
"Hedging Agreement Provider" shall mean any Person that enters into a
Secured Hedging Agreement with a Credit Party or any of its Subsidiaries that is
permitted by Section 6.1(e) to the extent such Person is a Lender, an Affiliate
of a Lender or any other Person that was a Lender (or an Affiliate of a Lender)
at the time it entered into the Secured Hedging Agreement but has ceased to be a
Lender (or whose Affiliate has ceased to be a Lender) under the Credit
Agreement; provided, in the case of a Secured Hedging Agreement with a Person
who is no longer a Lender, such Person shall be considered a Hedging Agreement
Provider only through the stated maturity date (without extension or renewal) of
such Secured Hedging Agreement.
"Hedging Agreements" shall mean, with respect to any Person, any agreement
entered into to protect such Person against fluctuations in interest rates, or
currency or raw materials values, including, without limitation, any interest
rate swap, cap or collar agreement or similar
11
arrangement between such Person and one or more counterparties, any foreign
currency exchange agreement, currency protection agreements, commodity purchase
or option agreements or other interest or exchange rate or commodity price
hedging agreements.
"Immaterial Subsidiary" shall mean any Subsidiary having (a) assets with a
book value of less than $100,000 and (b) EBITDA of less than $100,000 during the
immediately preceding four (4) fiscal quarter period, as calculated in
accordance with GAAP.
"Indebtedness" shall mean, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person (other than customary
reservations or retentions of title under agreements with suppliers entered into
in the ordinary course of business), (d) all obligations (including, without
limitation, earnout obligations) of such Person issued or assumed as the
deferred purchase price of property or services purchased by such Person (other
than trade debt incurred in the ordinary course of business and due within six
(6) months of the incurrence thereof) which would appear as liabilities on a
balance sheet of such Person, (e) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements, (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on,
or payable out of the proceeds of production from, property owned or acquired by
such Person, whether or not the obligations secured thereby have been assumed,
(g) all Guaranty Obligations of such Person with respect to Indebtedness of
another Person, (h) the principal portion of all obligations of such Person
under Capital Leases plus any accrued interest thereon, (i) all obligations of
such Person under Hedging Agreements, (j) the maximum amount of all letters of
credit issued or bankers' acceptances facilities created for the account of such
Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (k) all preferred Capital Stock or other equity interests issued
by such Person and which by the terms thereof could be (at the request of the
holders thereof or otherwise) subject to mandatory sinking fund payments,
redemption or other acceleration, (l) the principal balance outstanding under
any synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing product plus any accrued interest thereon,
and (m) the Indebtedness of any partnership or unincorporated joint venture in
which such Person is a general partner or a joint venturer.
"Insolvency" shall mean, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of such term as used in
Section 4245 of ERISA.
"Insolvent" shall mean being in a condition of Insolvency.
"Intellectual Property" shall mean, collectively, all Copyrights,
Copyright Licenses, Patents, Patent Licenses, Trademarks and Trademark Licenses.
"Interest Payment Date" shall mean (a) as to any Alternate Base Rate Loan
or Swingline Loan, the last Business Day of each March, June, September and
December during the term of this Credit Agreement and on the applicable Maturity
Date, (b) as to any LIBOR Rate Loan
12
having an Interest Period of three (3) months or less, the last day of such
Interest Period, (c) as to any LIBOR Rate Loan having an Interest Period longer
than three (3) months, (i) each three (3) month anniversary following the first
day of such Interest Period and (ii) the last day of such Interest Period and
(d) as to any Loan which is the subject of a mandatory prepayment required
pursuant to Section 2.7(b) hereof, the date of such prepayment.
"Interest Period" shall mean, with respect to any LIBOR Rate Loan,
(i) initially, the period commencing on the Borrowing Date or
conversion date, as the case may be, with respect to such LIBOR Rate Loan
and ending one, two, three or six (6) months thereafter, as selected by
the Borrower in the Notice of Borrowing or Notice of Conversion/Extension
given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the
immediately preceding Interest Period applicable to such LIBOR Rate Loan
and ending one, two, three or six (6) months thereafter, as selected by
the Borrower by irrevocable notice to the Administrative Agent not less
than three (3) Business Days prior to the last day of the then current
Interest Period with respect thereto;
provided that the foregoing provisions are subject to the
following:
(A) if any Interest Period pertaining to a LIBOR Rate Loan
would otherwise end on a day that is not a Business Day, such
Interest Period shall be extended to the next succeeding Business
Day unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding Business Day;
(B) any Interest Period pertaining to a LIBOR 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 relevant calendar month;
(C) if the Borrower shall fail to give notice as provided
above, the Borrower shall be deemed to have selected an Alternate
Base Rate Loan to replace the affected LIBOR Rate Loan;
(D) any Interest Period in respect of any Loan that would
otherwise extend beyond the applicable Maturity Date shall end on
such Maturity Date, and further with regard to the Term Loan, no
Interest Period shall extend beyond any principal amortization
payment date unless the portion of such Term Loan consisting of
Alternate Base Rate Loans together with the portion of such Term
Loan consisting of LIBOR Rate Loans with Interest Periods expiring
prior to or concurrently with the date such principal amortization
payment date is due, is at least equal to the amount of such
principal amortization payment due on such date; and
13
(E) no more than five (5) LIBOR Rate Loans may be in effect at
any time; provided that, for purposes hereof, LIBOR Rate Loans with
different Interest Periods shall be considered as separate LIBOR
Rate Loans, even if they shall begin on the same date and have the
same duration, although borrowings, extensions and conversions may,
in accordance with the provisions hereof, be combined at the end of
existing Interest Periods to constitute a new LIBOR Rate Loan with a
single Interest Period.
"Investment" shall mean all investments made directly or indirectly in, to
or from any Person, whether in cash or by acquisition of shares of Capital
Stock, property, assets, indebtedness or other obligations or securities or by
loan, advance, capital contribution or otherwise.
"Issuing Lender" shall mean Wachovia and any successor in such capacity.
"Issuing Lender Fees" shall have the meaning set forth in Section 2.5(c).
"Joinder Agreement" shall mean a Joinder Agreement substantially in the
form of Schedule 5.10, executed and delivered by an Additional Credit Party in
accordance with the provisions of Section 5.10.
"Lender" shall have the meaning set forth in the first paragraph of this
Credit Agreement and shall include the Issuing Lender and the Swingline Lender.
"Lender Commitment Letter" shall mean, with respect to any Lender, the
letter (or other correspondence) to such Lender from the Administrative Agent
notifying such Lender of its LOC Commitment, Revolving Commitment Percentage
and/or Term Loan Commitment Percentage.
"Letters of Credit" shall mean any letter of credit issued by the Issuing
Lender pursuant to the terms hereof, as such letters of credit may be amended,
modified, extended, renewed or replaced from time to time.
"Letter of Credit Fee" shall have the meaning set forth in Section 2.5(b).
"Leverage Ratio" shall mean, with respect to the Borrower and its
Subsidiaries on a consolidated basis for the twelve-month period ending on the
last day of any fiscal quarter of the Borrower, the ratio of (a) Funded Debt of
the Borrower and its Subsidiaries on the last day of such period to (b)
Consolidated EBITDA for such period.
"LIBOR" shall mean, for any LIBOR Rate Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
A.M. (London time) two (2) Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "LIBOR" shall mean, for any LIBOR Rate Loan for
any Interest Period therefor,
14
the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
appearing on Reuters Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 A.M. (London time) two (2) Business
Days prior to the first day of such Interest Period for a term comparable to
such Interest Period; provided, however, if more than one rate is specified on
Reuters Screen LIBO Page, the applicable rate shall be the arithmetic mean of
all such rates (rounded upwards, if necessary, to the nearest 1/100 of 1%). If,
for any reason, neither of such rates is available, then "LIBOR" shall mean the
rate per annum at which, as determined by the Administrative Agent, Dollars in
an amount comparable to the Loans then requested are being offered to leading
banks at approximately 11:00 A.M. London time, two (2) Business Days prior to
the commencement of the applicable Interest Period for settlement in immediately
available funds by leading banks in the London interbank market for a period
equal to the Interest Period selected.
"LIBOR Lending Office" shall mean, initially, the office of each Lender
designated as such Lender's LIBOR Lending Office in such Lender's Administrative
Details Form; and thereafter, such other office of such Lender as such Lender
may from time to time specify to the Administrative Agent and the Borrower as
the office of such Lender at which the LIBOR Rate Loans of such Lender are to be
made.
"LIBOR Rate" shall mean a rate per annum (rounded upwards, if necessary,
to the next higher 1/100th of 1%) determined by the Administrative Agent
pursuant to the following formula:
LIBOR
LIBOR Rate = ------------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan" shall mean Loans the rate of interest applicable to
which is based on the LIBOR Rate.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Capital Lease having
substantially the same economic effect as any of the foregoing).
"Loan" shall mean a Revolving Loan, the Term Loan, and/or a Swingline
Loan, as appropriate.
"LOC Commitment" shall mean the commitment of the Issuing Lender to issue
Letters of Credit and with respect to each Lender, the commitment of such Lender
to purchase participation interests in the Letters of Credit up to such Lender's
LOC Commitment as specified in the Lender Commitment Letter, as such amount may
be reduced from time to time in accordance with the provisions hereof.
"LOC Committed Amount" shall mean, collectively, the aggregate amount of
all of the LOC Commitments of the Lenders to issue and participate in Letters of
Credit as referenced in
15
Section 2.2 and, individually, the amount of each Lender's LOC Commitment as
specified in its Lender Commitment Letter or in the Commitment Transfer
Supplement.
"LOC Documents" shall mean, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in connection
therewith, any application therefor, and any agreements, instruments, guarantees
or other documents (whether general in application or applicable only to such
Letter of Credit) governing or providing for (i) the rights and obligations of
the parties concerned or (ii) any collateral security for such obligations.
"LOC Obligations" shall mean, at any time, the sum of (i) the maximum
amount which is, or at any time thereafter may become, available to be drawn
under Letters of Credit then outstanding, assuming compliance with all
requirements for drawings referred to in such Letters of Credit plus (ii) the
aggregate amount of all drawings under Letters of Credit honored by the Issuing
Lender but not theretofore reimbursed.
"Mandatory LOC Borrowing" shall have the meaning set forth in Section
2.3(e).
"Mandatory Swingline Borrowing" shall have the meaning set forth in
Section 2.4(b)(ii).
"Material Adverse Effect" shall mean a material adverse effect on (a) the
business, operations, property, condition (financial or otherwise) or prospects
of the Borrower or of the Credit Parties and their Subsidiaries taken as a
whole, (b) the ability of the Borrower or any Guarantor to perform its
obligations, when such obligations are required to be performed, under this
Credit Agreement, any of the Notes or any other Credit Document or (c) the
validity or enforceability of this Credit Agreement, any of the Notes or any of
the other Credit Documents or the rights or remedies of the Administrative Agent
or the Lenders hereunder or thereunder.
"Material Contract" shall mean any contract or other arrangement, whether
written or oral, to which any Credit Party or any of its Subsidiaries is a party
as to which the breach, nonperformance, cancellation or failure to renew by any
party thereto could reasonably be expected to have a Material Adverse Effect.
"Materials of Environmental Concern" shall mean any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" shall mean the Revolving Commitment Termination Date or
the Term Loan Maturity Date, as applicable.
"Medicaid" shall mean that entitlement program under Title XIX of the
Social Security Act that provides federal grants to states for medical
assistance based on specific eligibility criteria.
"Medicaid Certification" shall mean certification by a state agency or
other such entity administering the Medicaid program that a health care provider
or supplier is in compliance with
16
all the conditions of participation set forth in the Medicaid Regulations.
"Medicaid Provider Agreement" shall mean an agreement entered into between
a state agency or other such entity administering the Medicaid program and a
health care provider or supplier under which the health care provider or
supplier agrees to provide services for Medicaid patients in accordance with the
terms of the agreement and Medicaid Regulations.
"Medicaid Regulations" shall mean, collectively, (i) all federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting the medical assistance program established by Title XIX of the Social
Security Act and any statutes succeeding thereto; (ii) all applicable provisions
of all federal rules, regulations, manuals and orders of all Governmental
Authorities promulgated pursuant to or in connection with the statutes described
in clause (i) above and all federal administrative, reimbursement and other
guidelines of all Governmental Authorities having the force of law promulgated
pursuant to or in connection with the statutes described in clause (i) above;
(iii) all state statutes and plans for medical assistance enacted in connection
with the statutes and provisions described in clauses (i) and (ii) above; and
(iv) all applicable provisions of all rules, regulations, manuals and orders of
all Governmental Authorities promulgated pursuant to or in connection with the
statutes described in clause (iii) above and all state administrative,
reimbursement and other guidelines of all Governmental Authorities having the
force of law promulgated pursuant to or in connection with the statutes
described in clause (ii) above, in each case as may be amended, supplemented or
otherwise modified from time to time.
"Medical Reimbursement Programs" shall mean Medicare, Medicaid and CHAMPUS
programs and any other healthcare program operated by or financed in whole or in
part by any foreign, domestic, federal, state or local government and any other
non-government funded third party payor programs.
"Medicare Certification" shall mean certification by CMS or an entity
under contract with CMS that the health care provider or supplier is in
compliance with all of the conditions of participation set forth in the Medicare
Regulations.
"Medicare Provider Agreement" shall mean an agreement entered into between
CMS or other such entity administering the Medicare program on behalf of CMS,
and a health care provider or supplier under which the health care provider or
supplier agrees to provide services for Medicare patients in accordance with the
terms of the agreement and Medicare Regulations.
"Medicare" shall mean that government-sponsored entitlement program under
Title XVIII of the Social Security Act that provides for a health insurance
system for eligible elderly and disabled individuals.
"Medicare Regulations" shall mean, collectively, all Federal statutes
(whether set forth in Title XVIII of the Social Security Act or elsewhere)
affecting the health insurance program for the aged and disabled established by
Title XVIII of the Social Security Act and any statutes succeeding thereto;
together with all applicable provisions of all rules, regulations, manuals and
orders and administrative, reimbursement and other guidelines having the force
of law of all
17
Governmental Authorities (including, without limitation, the United States
Department of Health and Human Services ("HHS"), CMS, the Office of the
Inspector General for HHS (the "OIG"), or any person succeeding to the functions
of any of the foregoing) promulgated pursuant to or in connection with any of
the foregoing having the force of law, as each may be amended, supplemented or
otherwise modified from time to time.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Mortgage Instrument" shall mean any mortgage, deed of trust or deed to
secure debt executed by a Credit Party in favor of the Administrative Agent, for
the benefit of the Lenders, pursuant to the terms of Section 4.1(e)(i), 5.10 or
5.12, as the same may be amended, modified, restated or supplemented from time
to time.
"Mortgage Policy" shall mean, with respect to any Mortgage Instrument, an
ALTA mortgagee title insurance policy issued by a title company acceptable to
the Administrative Agent in such amount as reasonably approved by the
Administrative Agent, assuring the Administrative Agent that such Mortgage
Instrument creates a valid and enforceable first priority mortgage lien on the
applicable Mortgaged Property, free and clear of all defects and encumbrances
except Permitted Liens, which Mortgage Policy shall be in form and substance
reasonably satisfactory to the Administrative Agent and shall provide for
affirmative insurance and such reinsurance as the Administrative Agent may
reasonably request.
"Mortgaged Property" shall mean any owned or leased real property of a
Credit Party with respect to which such Credit Party executes a Mortgage
Instrument in favor of the Administrative Agent.
"Multiemployer Plan" shall mean a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" shall mean the aggregate cash proceeds received by any
Credit Party or any Subsidiary in respect of any Asset Disposition, Equity
Issuance or Debt Issuance, net of (a) direct costs paid or payable as a result
thereof (including, without limitation, reasonable legal, accounting and
investment banking fees, and sales commissions) and (b) taxes paid or payable as
a result thereof; it being understood that "Net Cash Proceeds" shall include,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received by any Credit Party or any Subsidiary in respect
of any Asset Disposition, Equity Issuance or Debt Issuance.
"Note" or "Notes" shall mean the Revolving Notes, the Term Notes and/or
the Swingline Note, collectively, separately or individually, as appropriate.
"Notice of Borrowing" shall mean a request for a Revolving Loan borrowing
pursuant to Section 2.1(b)(i) or a Swingline Loan borrowing pursuant to Section
2.4(b)(i), as appropriate, in substantially the form attached as Schedule
2.1(b)(i).
18
"Notice of Conversion/Extension" shall mean the written notice of
conversion of a LIBOR Rate Loan to an Alternate Base Rate Loan or an Alternate
Base Rate Loan to a LIBOR Rate Loan, or extension of a LIBOR Rate Loan, in each
case substantially in the form of Schedule 2.10.
"Obligations" shall mean, collectively, Loans and LOC Obligations.
"Operating Lease" shall mean, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any property (whether real, personal or mixed) which is not a
Capital Lease other than any such lease in which that Person is the lessor.
"Participant" shall have the meaning set forth in Section 9.6(b).
"Participation Interest" shall mean the purchase by a Revolving Lender of
a participation interest in Letters of Credit as provided in Section 2.3 and in
Swingline Loans as provided in Section 2.4.
"Participant Register" shall have the meaning set forth in Section 9.6(d).
"Patent License" shall mean all agreements, whether written or oral,
providing for the grant by or to a Credit Party of any right to manufacture, use
or sell any invention covered by a Patent, including, without limitation, any
thereof referred to in Schedule 3.16.
"Patents" shall mean (a) all letters patent of the United States or any
other country and all reissues and extensions thereof, including, without
limitation, any thereof referred to in Schedule 3.16, and (b) all applications
for letters patent of the United States or any other country and all divisions,
continuations and continuations-in-part thereof, including, without limitation,
any thereof referred to in Schedule 3.16.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Permitted Acquisition" shall mean an acquisition or any series of related
acquisitions by a Credit Party of (a) all or substantially all of the assets or
a majority of the outstanding Voting Stock or economic interests of a Person
that is incorporated, formed or organized in the United States or (b) any
division, line of business or other business unit of a Person that is
incorporated, formed or organized in the United States (such Person or such
division, line of business or other business unit of such Person shall be
referred to herein as the "Target"), in each case that is a type of business (or
assets used in a type of business) permitted to be engaged in by the Credit
Parties and their Subsidiaries pursuant to Section 6.3 hereof, so long as (i) no
Default or Event of Default shall then exist or would exist after giving effect
thereto, (ii) the Credit Parties shall demonstrate to the reasonable
satisfaction of the Administrative Agent and the Required Lenders that, after
giving effect to the acquisition on a pro forma basis, the Credit Parties are in
compliance with each of the financial covenants set forth in Section 5.9, (iii)
the Administrative Agent, on behalf of the Lenders, shall have received (or
shall receive in
19
connection with the closing of such acquisition) a first priority perfected
security interest in all property (including, without limitation, Capital Stock
and real estate) acquired with respect to the Target in accordance with the
terms of Sections 5.10 and 5.12 and the Target, if a Person, shall have executed
a Joinder Agreement in accordance with the terms of Section 5.10, (iv) the
Administrative Agent and the Lenders shall have received (A) a description of
the material terms of such acquisition, (B) audited financial statements (or, if
unavailable, management-prepared financial statements) of the Target for its two
(2) most recent fiscal years and for any fiscal quarters ended within the fiscal
year to date and (C) consolidated projected income statements of the Borrower
and its consolidated Subsidiaries (giving effect to such acquisition), all in
form and substance reasonably satisfactory to the Administrative Agent, (v) the
Target shall have earnings before interest, taxes, depreciation and amortization
for the four (4) fiscal quarter period prior to the acquisition date in an
amount greater than $0, (vi) such acquisition shall not be a "hostile"
acquisition and shall have been approved by the Board of Directors and/or
shareholders of the applicable Credit Party and the Target, (vii) the Borrower
shall have satisfied the requirements set forth in Sections 5.14(a) and (b),
(viii) after giving effect to such acquisition, there shall be at least
$10,000,000 of Accessible Borrowing Availability under the Revolving Committed
Amount and (ix) the aggregate consideration (including without limitation equity
consideration, earn outs or deferred compensation or non-competition
arrangements and the amount of Indebtedness and other liabilities assumed by the
Credit Parties and their Subsidiaries) paid by the Credit Parties and their
Subsidiaries (A) in connection with any individual acquisition shall not exceed
$20,000,000 and (B) for all acquisitions made during any twelve-month period
shall not exceed $30,000,000.
"Permitted Investments" shall mean:
(i) cash and Cash Equivalents;
(ii) receivables owing to the Borrower or any of its Subsidiaries or
any receivables and advances to suppliers, in each case if created,
acquired or made in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms;
(iii) Investments in and loans by any Credit Party to any other
Credit Party;
(iv) loans and advances to employees in the ordinary course of
business in an aggregate amount not to exceed $1,000,000 at any time
outstanding and not in violation of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 or any
other Requirement of Law;
(v) Investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary course of business;
(vi) Investments, acquisitions or transactions permitted under
Section 6.4(b);
20
(vii) Investments existing as of the Closing Date, as set forth on
Schedule 1.1-2 and any refinancing or replacement of any such Investment
in a principal or initial amount not to exceed the principal or
outstanding amount of such Investment (plus accrued interest thereon) at
the time of such refinancing or replacement; provided that such
refinancing or replacement Investment shall (A) have substantially the
same tenor and be substantially the same type of Investment as the
Investment refinanced or replaced or other Permitted Investment and (B)
have the same or higher rating or credit quality as the Investment
refinanced or replaced or other Permitted Investment;
(viii) Permitted Acquisitions; and
(ix) additional loan advances and/or Investments of a nature not
contemplated by the foregoing clauses hereof, provided that such loans,
advances and/or Investments made pursuant to this clause (ix) shall not
exceed an aggregate amount of $5,000,000.
"Permitted Liens" shall mean:
(i) Liens created by or otherwise existing, under or in connection
with this Credit Agreement or the other Credit Documents in favor of the
Lenders;
(ii) Liens in favor of a Hedging Agreement Provider in connection
with a Secured Hedging Agreement, but only if such Hedging Agreement
Provider and the Administrative Agent, on behalf of the Lenders, shall
share pari passu in the collateral subject to such Liens;
(iii) Liens securing purchase money Indebtedness and Capital Lease
Obligations to the extent permitted under Section 6.1(c); provided, that
(A) any such Lien attaches to such property concurrently with or within
thirty (30) days after the acquisition thereof and (B) such Lien attaches
solely to the property so acquired in such transaction;
(iv) Liens for taxes, assessments, charges or other governmental
levies not yet due or as to which the period of grace (not to exceed
ninety (90) days), if any, related thereto has not expired or which are
being contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books of the
any Credit Party or its Subsidiaries, as the case may be, in conformity
with GAAP;
(v) carriers', warehousemen's, landlord'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 sixty
(60) days or which are being contested in good faith by appropriate
proceedings;
(vi) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or self-insurance
arrangements incurred in the ordinary course of business;
21
(vii) 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;
(viii) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any Lien
referred to in the foregoing clauses; provided that such extension,
renewal or replacement Lien shall be limited to all or a part of the
property which secured the Lien so extended, renewed or replaced;
(ix) Liens existing on the Closing Date and set forth on Schedule
1.1-3; provided that (a) no such Lien shall at any time be extended to
cover property or assets other than the property or assets subject thereto
on the Closing Date and (b) the principal amount of the Indebtedness
secured by such Liens shall not be extended, renewed, refunded or
refinanced;
(x) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other similar
charges or encumbrances not, in any material respect, impairing the use of
the encumbered Property for its intended purposes; and
(xi) Liens on equipment arising from precautionary UCC financing
statements relating to the lease of such equipment to the extent permitted
by this Credit Agreement.
"Person" shall mean an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.
"Plan" shall mean, at any particular time, any employee benefit plan which
is covered by Title IV of ERISA and in respect of which any Credit Party or a
Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Pledge Agreement" shall mean the Amended and Restated Pledge Agreement
dated as of the Closing Date executed by the Credit Parties in favor of the
Administrative Agent, as amended, modified, restated, amended and restated,
extended, replaced, increased or supplemented from time to time.
"Prime Rate" shall have the meaning set forth in the definition of
Alternate Base Rate.
"Pro Forma Basis" shall mean, with respect to any transaction, that such
transaction shall be deemed to have occurred as of the first day of the
twelve-month period ending as of the most recent quarter end preceding the date
of such transaction.
"Properties" shall have the meaning set forth in Section 3.10(a).
22
"Purchasing Lender" shall have the meaning set forth in Section 9.6(c).
"Recovery Event" shall mean the receipt by any Credit Party or any of its
Subsidiaries of any cash insurance proceeds or condemnation award payable by
reason of theft, loss, physical destruction or damage, taking or similar event
with respect to any of their property or assets.
"Register" shall have the meaning set forth in Section 9.6(d).
"Reimbursement Obligation" shall mean the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 2.3(d) for amounts drawn under
Letters of Credit.
"Reorganization" shall mean, with respect to any Multiemployer Plan, the
condition that such Plan is in reorganization within the meaning of such term as
used in Section 4241 of ERISA.
"Reportable Event" shall mean any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the thirty-day notice
period is waived under PBGC Reg. ss.4043.
"Required Lenders" shall mean, at any time, Lenders holding in the
aggregate a majority of (i) the Commitments (and Participation Interests
therein) or (ii) if the Commitments have been terminated, the outstanding Loans
and Participation Interests (including the Participation Interests of the
Issuing Lender in any Letters of Credit and of the Swingline Lender in Swingline
Loans) provided, however, that if any Lender shall be a Defaulting Lender at
such time, then there shall be excluded from the determination of Required
Lenders, Obligations (including Participation Interests) owing to such
Defaulting Lender and such Defaulting Lender's Commitments, or after termination
of the Commitments, the principal balance of the Obligations owing to such
Defaulting Lender.
"Requirement of Law" shall mean, as to any Person, the certificate or
articles of incorporation and by-laws or other organizational or governing
documents of such Person, and each law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"Responsible Officer" shall mean, as to any Credit Party, any of the
President, the Chief Executive Officer, the Chief Financial Officer or any
Vice-President of such Credit Party.
"Restricted Payments" shall mean (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
any Credit Party or any of their Subsidiaries, now or hereafter outstanding, (b)
any redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of Capital
Stock of any Credit Party or any of their Subsidiaries, now or hereafter
outstanding, (c) any payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of any class of
Capital Stock of any Credit Party or any of their Subsidiaries, now or hereafter
outstanding, (d) any payment with respect to
23
any earnout obligation, (e) any payment or prepayment of principal of, premium,
if any, or interest on, redemption, purchase, retirement, defeasance, sinking
fund or similar payment with respect to, any Subordinated Indebtedness or (f)
the payment by any Credit Party or any of their Subsidiaries of any management,
advisory or consulting fee to any Person or of any salary, bonus or other form
of compensation to any Person who is directly or indirectly a significant
partner, shareholder, owner or executive officer of any such Person, to the
extent such salary, bonus or other form of compensation is not included in the
corporate overhead of such Credit Party or such Subsidiary.
"Revolving Commitment" shall mean, with respect to each Revolving Lender,
the commitment of such Revolving Lender to make Revolving Loans in an aggregate
principal amount at any time outstanding up to an amount equal to such Revolving
Lender's Revolving Commitment Percentage of the Revolving Committed Amount.
"Revolving Commitment Percentage" shall mean, for each Revolving Lender,
the percentage identified as its Revolving Commitment Percentage in its Lender
Commitment Letter or in the Commitment Transfer Supplement pursuant to which
such Lender became a Lender hereunder, as such percentage may be modified in
connection with any assignment made in accordance with the provisions of Section
9.6(c).
"Revolving Commitment Termination Date" shall mean November 14, 2010
"Revolving Committed Amount" shall have the meaning set forth in Section
2.1(a).
"Revolving Lender" shall mean, as of any date of determination, a Lender
holding a Revolving Commitment on such date.
"Revolving Loans" shall have the meaning set forth in Section 2.1.
"Revolving Note" or "Revolving Notes" shall mean the promissory notes of
the Borrower in favor of each of the Revolving Lenders evidencing the Revolving
Loans provided pursuant to Section 2.1(e), individually or collectively, as
appropriate, as such promissory notes may be amended, modified, restated,
amended and restated, extended, replaced, increased or supplemented from time to
time.
"S&P" shall mean Standard & Poor's Ratings Group, a division of The McGraw
Hill, Inc.
"Sanctioned Country" shall mean a country subject to a sanctions program
identified on the list maintained by OFAC and available at
▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇▇▇▇ /ofac/sanctions/index.html, or as
otherwise published form time to time.
"Sanctioned Person" shall mean (a) a Person named on the list of
"Specially Designated Nationals and Blocked Persons" maintained by OFAC
available at ▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇/▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇▇▇▇/▇▇▇▇/▇▇▇/▇▇▇▇▇.▇▇▇▇, or as
otherwise published from time to time, or (b) (i) an agency of the government of
a Sanctioned Country, (ii) an organization
24
controlled by a Sanctioned Country, or (iii) a person resident in a Sanctioned
Country, to the extent subject to a sanctions program administered by OFAC.
"Scheduled Funded Debt Payments" shall mean, as of any date of
determination for the Borrower and its Subsidiaries, the sum of all scheduled
payments of principal on Funded Debt for the applicable period ending on the
date of determination (including the principal component of payments due on
Capital Leases during the applicable period ending on the date of
determination).
"SEC" shall mean the Securities and Exchange Commission or any successor
Governmental Authority.
"SEC Letter" shall mean that certain letter, dated July 12, 2004, from the
SEC to the Borrower relating to the Borrower's acquisition of Bioglan
Pharmaceuticals, Inc.
"SEC Rule 2a-7" shall have the meaning set forth in the definition of Cash
Equivalents.
"Secured Hedging Agreement" shall mean any Hedging Agreement between a
Credit Party and a Hedging Agreement Provider, as amended, modified,
supplemented, extended or restated from time to time.
"Securities Exchange Act" shall mean the Securities Exchange Act of 1934,
together with any amendment thereto or replacement thereof and any rules or
regulations promulgated thereunder.
"Security Agreement" shall mean the Amended and Restated Security
Agreement dated as of the Closing Date executed by the Credit Parties in favor
of the Administrative Agent, as amended, modified, restated, amended and
restated, extended, replaced, increased or supplemented from time to time.
"Security Documents" shall mean the Security Agreement, the Pledge
Agreement and such other documents executed and delivered in connection with the
attachment and perfection of the Administrative Agent's security interests and
liens arising thereunder, including, without limitation, UCC financing
statements, and patent, trademark and copyright filings.
"Single Employer Plan" shall mean any Plan which is not a Multiemployer
Plan.
"Subordinated Indebtedness" shall mean unsecured Indebtedness incurred by
any Credit Party on terms and conditions acceptable to the Administrative Agent,
which Indebtedness shall be specifically subordinated in right of payment to the
prior payment of the Credit Party Obligations on terms acceptable to the
Administrative Agent and the Required Lenders; provided that, in any event, such
Indebtedness shall (a) mature at least 180 days after the Maturity Date and (b)
have covenants and defaults no more restrictive than the covenants and defaults
hereunder.
25
"Subsidiary" shall mean, as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Credit Agreement shall
refer to a Subsidiary or Subsidiaries of the Borrower.
"Swingline Commitment" shall mean the commitment of the Swingline Lender
to make Swingline Loans in an aggregate principal amount at any time outstanding
up to the Swingline Committed Amount, and the commitment of the Revolving
Lenders to purchase Participation Interests in the Swingline Loans as provided
in Section 2.4(b)(ii), as such amounts may be reduced from time to time in
accordance with the provisions hereof.
"Swingline Committed Amount" shall have the meaning set forth in Section
2.4(a).
"Swingline Lender" shall mean Wachovia and any successor in such capacity.
"Swingline Loan" or "Swingline Loans" shall have the meaning set forth in
Section 2.4(a).
"Swingline Note" shall mean the promissory note of the Borrower in favor
of the Swingline Lender evidencing the Swingline Loans provided pursuant to
Section 2.4(d), as such promissory note may be amended, modified, restated,
amended and restated, extended, replaced, increased or supplemented from time to
time.
"Tax Exempt Certificate" shall have the meaning set forth in Section
2.18(b).
"Taxes" shall have the meaning set forth in Section 2.18(a).
"Term Loan" shall have the meaning set forth in Section 2.2(a).
"Term Loan Commitment" shall mean, with respect to each Term Loan Lender,
the commitment of such Term Loan Lender to make its portion of the Term Loan in
a principal amount equal to such Term Loan Lender's Term Loan Commitment
Percentage of the Term Loan Committed Amount.
"Term Loan Commitment Percentage" shall mean, for any Term Loan Lender,
the percentage identified as its Term Loan Commitment Percentage as specified in
its Lender Commitment Letter or in the Commitment Transfer Supplement pursuant
to which such Lender became a Lender hereunder, as such percentage may be
modified in connection with any assignment made in accordance with the
provisions of Section 9.6(c).
"Term Loan Committed Amount" shall have the meaning set forth in Section
2.2(a).
26
"Term Loan Lender" shall mean, as of any date of determination, any Lender
that holds a portion of the outstanding Term Loan on such date.
"Term Loan Maturity Date" shall mean November 14, 2010.
"Term Note" or "Term Notes" shall mean the promissory notes of Borrower in
favor of each of the Term Loan Lenders evidencing the portion of the Term Loan
provided pursuant to Section 2.2(d), individually or collectively, as
appropriate, as such promissory notes may be amended, modified, restated,
amended and restated, extended, replaced, increased or supplemented from time to
time.
"Trademark License" shall mean any agreement, written or oral, providing
for the grant by or to a Credit Party of any right to use any Trademark,
including, without limitation, any thereof referred to in Schedule 3.16.
"Trademarks" shall mean (a) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, service marks,
elements of package or trade dress of goods or services, logos and other source
or business identifiers, together with the goodwill associated therewith, now
existing or hereafter adopted or acquired, all registrations and recordings
thereof, and all applications in connection therewith, whether in the United
States Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, including, without limitation, any thereof
referred to in Schedule 3.16, and (b) all renewals thereof, including, without
limitation, any thereof referred to in Schedule 3.16.
"Tranche" shall mean the collective reference to LIBOR Rate Loans whose
Interest Periods begin and end on the same day. A Tranche may sometimes be
referred to as a "LIBOR Tranche".
"Transfer Effective Date" shall have the meaning set forth in each
Commitment Transfer Supplement.
"Type" shall mean, as to any Loan, its nature as an Alternate Base Rate
Loan or LIBOR Rate Loan, as the case may be.
"UCC" shall mean the Uniform Commercial Code as in effect from time to
time in the State of New York.
"Voting Stock" shall mean, with respect to any Person, Capital Stock
issued by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
may be or have been suspended by the happening of such a contingency.
"Wachovia" shall mean Wachovia Bank, National Association, a national
banking association, together with its successors and/or assigns.
27
"Works" shall mean all works which are subject to copyright protection
pursuant to Title 17 of the United States Code.
Section 1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this
Credit Agreement shall have the defined meanings when used in the Notes or
other Credit Documents or any certificate or other document made or
delivered pursuant hereto.
(b) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Credit Agreement shall refer to this
Credit Agreement as a whole and not to any particular provision of this
Credit Agreement, and Section, subsection, Schedule and Exhibit references
are to this Credit Agreement unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
Section 1.3 Accounting Terms.
Unless otherwise specified herein, all accounting terms used herein shall
be interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP applied on a basis consistent with the most recent audited
consolidated financial statements of the Borrower delivered to the Lenders;
provided that, if the Borrower notifies the Administrative Agent that it wishes
to amend any covenant in Section 5.9 to eliminate the effect of any change in
GAAP on the operation of such covenant (or if the Administrative Agent notifies
the Borrower that the Required Lenders wish to amend Section 5.9 for such
purpose), then the Borrower's compliance with such covenant shall be determined
on the basis of GAAP in effect immediately before the relevant change in GAAP
became effective, until either such notice is withdrawn or such covenant is
amended in a manner satisfactory to the Borrower and the Required Lenders.
The Borrower shall deliver to the Administrative Agent and each Lender at
the same time as the delivery of any annual or quarterly financial statements
given in accordance with the provisions of Section 5.1, (i) a description in
reasonable detail of any material change in the application of accounting
principles employed in the preparation of such financial statements from those
applied in the most recently preceding quarterly or annual financial statements
as to which no objection shall have been made in accordance with the provisions
above and (ii) a reasonable estimate of the effect on the financial statements
on account of such changes in application.
Section 1.4 Time References.
Unless otherwise specified, all references herein to times of day shall be
references to Eastern time (daylight or standard, as applicable).
28
ARTICLE II
THE LOANS; AMOUNT AND TERMS
Section 2.1 Revolving Loans.
(a) Revolving Commitment. During the Commitment Period, subject to
the terms and conditions hereof, each Revolving Lender severally, but not
jointly, agrees to make revolving credit loans ("Revolving Loans") to the
Borrower from time to time in an aggregate principal amount of up to
THIRTY MILLION DOLLARS ($30,000,000) (as such aggregate maximum amount may
be reduced from time to time as provided in Section 2.6, the "Revolving
Committed Amount") for the purposes hereinafter set forth; provided,
however, that (i) with regard to each Revolving Lender individually, the
sum of such Revolving Lender's Revolving Commitment Percentage of the
aggregate principal amount of outstanding Revolving Loans plus the
aggregate principal amount of outstanding Swingline Loans plus LOC
Obligations shall not exceed such Revolving Lender's Revolving Commitment
and (ii) with regard to the Revolving Lenders collectively, the sum of the
aggregate principal amount of outstanding Revolving Loans plus the
aggregate principal amount of outstanding Swingline Loans plus LOC
Obligations shall not exceed the Revolving Committed Amount. Revolving
Loans may consist of Alternate Base Rate Loans or LIBOR Rate Loans, or a
combination thereof, as the Borrower may request, and may be repaid and
reborrowed in accordance with the provisions hereof; provided, however,
Revolving Loans made on the Closing Date or on any of the three (3)
Business Days following the Closing Date may only consist of Alternate
Base Rate Loans unless the Borrower delivers a funding indemnity letter to
the Administrative Agent at least three (3) Business Days prior to the
Closing Date. LIBOR Rate Loans shall be made by each Revolving Lender at
its LIBOR Lending Office and Alternate Base Rate Loans at its Domestic
Lending Office.
(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower shall request a
Revolving Loan borrowing by delivering a written Notice of Borrowing
(or telephone notice promptly confirmed in writing by delivery of a
written Notice of Borrowing, which delivery may be by facsimile) to
the Administrative Agent not later than 11:00 A.M. on the Business
Day prior to the date of the requested borrowing in the case of
Alternate Base Rate Loans, and on the third Business Day prior to
the date of the requested borrowing in the case of LIBOR Rate Loans.
Each such Notice of Borrowing shall be irrevocable and shall specify
(A) that a Revolving Loan is requested, (B) the date of the
requested borrowing (which shall be a Business Day), (C) the
aggregate principal amount to be borrowed, (D) whether the borrowing
shall be comprised of Alternate Base Rate Loans, LIBOR Rate Loans or
a combination thereof, and if LIBOR Rate Loans are requested, the
Interest Period(s) therefor. If the Borrower shall fail to specify
in any such Notice of Borrowing (I) an applicable Interest Period in
the case of a LIBOR Rate Loan,
29
then such notice shall be deemed to be a request for an Interest
Period of one (1) month, or (II) the type of Revolving Loan
requested, then such notice shall be deemed to be a request for an
Alternate Base Rate Loan hereunder. The Administrative Agent shall
give notice to each Revolving Lender promptly upon receipt of each
Notice of Borrowing, the contents thereof and each such Revolving
Lender's share thereof.
(ii) Minimum Amounts. Each Revolving Loan shall be in a
minimum aggregate amount of $1,000,000 and in integral multiples of
$500,000 in excess thereof (or the remaining amount of the Revolving
Committed Amount, if less).
(iii) Advances. Each Revolving Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing available to
the Administrative Agent for the account of the Borrower at the
office of the Administrative Agent specified in Section 9.2, or at
such other office as the Administrative Agent may designate in
writing, by 1:00 P.M. on the date specified in the applicable Notice
of Borrowing in Dollars and in funds immediately available to the
Administrative Agent. Such borrowing will then be made available to
the Borrower by the Administrative Agent by crediting the account of
the Borrower on the books of such office with the aggregate of the
amounts made available to the Administrative Agent by the Revolving
Lenders and in like funds as received by the Administrative Agent.
(c) Repayment. The principal amount of all Revolving Loans shall be
due and payable in full on the Revolving Commitment Termination Date,
unless accelerated sooner pursuant to Section 7.2.
(d) Interest. Subject to the provisions of Section 2.9, Revolving
Loans shall bear interest as follows:
(i) Alternate Base Rate Loans. During such periods as
Revolving Loans shall be comprised of Alternate Base Rate Loans,
each such Alternate Base Rate Loan shall bear interest at a per
annum rate equal to the sum of the Alternate Base Rate plus the
Applicable Percentage; and
(ii) LIBOR Rate Loans. During such periods as Revolving Loans
shall be comprised of LIBOR Rate Loans, each such LIBOR Rate Loan
shall bear interest at a per annum rate equal to the sum of the
LIBOR Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each
Interest Payment Date.
(e) Revolving Notes; Covenant to Pay. The Borrower's obligation to
pay each Revolving Lender's Revolving Loans shall be evidenced by a duly
executed promissory note of the Borrower to such Revolving Lender in
substantially the form of
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Schedule 2.1(e). The Borrower covenants and agrees to pay the Revolving
Loans in accordance with the terms of this Credit Agreement and the
Revolving Notes.
Section 2.2 Term Loan.
(a) Term Loan. Subject to the terms and conditions hereof and in
reliance upon the representations and warranties set forth herein, each
Term Loan Lender severally agrees to make available to the Borrower on the
Closing Date such Term Loan Lender's Term Loan Commitment Percentage of a
term loan in Dollars (the "Term Loan") in the aggregate principal amount
of EIGHTY MILLION DOLLARS ($80,000,000) (the "Term Loan Committed Amount")
for the purposes hereinafter set forth. The Term Loan may consist of
Alternate Base Rate Loans or LIBOR Rate Loans, or a combination thereof,
as Borrower may request; provided that on the Closing Date the Term Loan
shall bear interest at the Alternate Base Rate unless the Borrower
delivers a funding indemnity letter to the Administrative Agent at least
three (3) Business Days prior to the Closing Date. LIBOR Rate Loans shall
be made by each Term Loan Lender at its LIBOR Lending Office and Alternate
Base Rate Loans at its Domestic Lending Office. Amounts repaid or prepaid
on the Term Loan may not be reborrowed.
(b) Repayment of Term Loan. The principal amount of the Term Loan
shall be repaid in twenty (20) consecutive quarterly installments and on
the Term Loan Maturity Date (as reduced pursuant to Section 2.7), unless
accelerated sooner pursuant to Section 7.2, as follows:
31
=====================================================================
Principal Amortization Term Loan
Payment Date Principal Amortization Payment
---------------------------------------------------------------------
December 31, 2005 $2,000,000
---------------------------------------------------------------------
March 31, 2006 $2,000,000
---------------------------------------------------------------------
June 30, 2006 $2,000,000
---------------------------------------------------------------------
September 30, 2006 $2,000,000
---------------------------------------------------------------------
December 31, 2006 $3,000,000
---------------------------------------------------------------------
March 31, 2007 $3,000,000
---------------------------------------------------------------------
June 30, 2007 $3,000,000
---------------------------------------------------------------------
September 30, 2007 $3,000,000
---------------------------------------------------------------------
December 31, 2007 $4,000,000
---------------------------------------------------------------------
March 31, 2008 $4,000,000
---------------------------------------------------------------------
June 30, 2008 $4,000,000
---------------------------------------------------------------------
September 30, 2008 $4,000,000
---------------------------------------------------------------------
December 31, 2008 $5,000,000
---------------------------------------------------------------------
March 31, 2009 $5,000,000
---------------------------------------------------------------------
June 30, 2009 $5,000,000
---------------------------------------------------------------------
September 30, 2009 $5,000,000
---------------------------------------------------------------------
December 31, 2009 $6,000,000
---------------------------------------------------------------------
March 31, 2010 $6,000,000
---------------------------------------------------------------------
June 30, 2010 $6,000,000
---------------------------------------------------------------------
September 30, 2010 $6,000,000
---------------------------------------------------------------------
Term Loan Remaining Principal Balance of the
Maturity Date Term Loan
---------------------------------------------------------------------
(c) Interest on the Term Loan. Subject to the provisions of Section
2.9, the Term Loan shall bear interest as follows:
(i) Alternate Base Rate Loans. During such periods as the Term
Loan shall be comprised of Alternate Base Rate Loans, each such
Alternate Base Rate Loan shall bear interest at a per annum rate
equal to the sum of the Alternate Base Rate plus the Applicable
Percentage; and
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(ii) LIBOR Rate Loans. During such periods as the Term Loan
shall be comprised of LIBOR Rate Loans, each such LIBOR Rate Loan
shall bear interest at a per annum rate equal to the sum of the
LIBOR Rate plus the Applicable Percentage.
(d) Term Notes; Covenant to Pay. The Borrower's obligation to pay
each Term Loan Lender's Term Loan shall be evidenced, upon such Term Loan
Lender's request, by a Term Note made payable to such Lender in
substantially the form of Schedule 2.2(d). The Borrower covenants and
agrees to pay the Term Loan in accordance with the terms of this Credit
Agreement and the Term Notes.
Section 2.3 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and of the
LOC Documents, if any, and any other terms and conditions which the
Issuing Lender may reasonably require, during the Commitment Period the
Issuing Lender shall issue, and the Revolving Lenders shall participate
in, Letters of Credit for the account of the Borrower from time to time
upon request in a form acceptable to the Issuing Lender; provided,
however, that (i) the aggregate amount of LOC Obligations shall not at any
time exceed TWO MILLION FIVE HUNDRED THOUSAND DOLLARS ($2,500,000) (the
"LOC Committed Amount"), (ii) the sum of the aggregate principal amount of
outstanding Revolving Loans plus the aggregate principal amount of
outstanding Swingline Loans plus LOC Obligations shall not at any time
exceed the Revolving Committed Amount, (iii) all Letters of Credit shall
be denominated in Dollars and (iv) Letters of Credit shall be issued for
lawful corporate purposes and may be issued as standby letters of credit,
including in connection with workers' compensation and other insurance
programs, and trade letters of credit. Except as otherwise expressly
agreed upon by all the Revolving Lenders, no Letter of Credit shall have
an original expiry date more than twelve (12) months from the date of
issuance; provided, however, so long as no Default or Event of Default has
occurred and is continuing and subject to the other terms and conditions
to the issuance of Letters of Credit hereunder, the expiry dates of
Letters of Credit may be extended annually or periodically from time to
time on the request of the Borrower or by operation of the terms of the
applicable Letter of Credit to a date not more than twelve (12) months
from the date of extension; provided, further, that no Letter of Credit,
as originally issued or as extended, shall have an expiry date extending
beyond the date that is thirty (30) days prior to the Revolving Commitment
Termination Date. Each Letter of Credit shall comply with the related LOC
Documents. The issuance and expiry date of each Letter of Credit shall be
a Business Day. Any Letters of Credit issued hereunder shall be in a
minimum original face amount of $100,000 or such lesser amount as approved
by the Issuing Lender and the Administrative Agent. Wachovia shall be the
Issuing Lender on all Letters of Credit issued on or after the Closing
Date.
(b) Notice and Reports. The request for the issuance of a Letter of
Credit shall be submitted to the Issuing Lender at least five (5) Business
Days prior to the requested date of issuance. The Issuing Lender will
promptly upon request provide to the
33
Administrative Agent for dissemination to the Revolving Lenders a detailed
report specifying the Letters of Credit which are then issued and
outstanding and any activity with respect thereto which may have occurred
since the date of any prior report, and including therein, among other
things, the account party, the beneficiary, the face amount, expiry date
as well as any payments or expirations which may have occurred. The
Issuing Lender will further provide to the Administrative Agent promptly
upon request copies of the Letters of Credit. The Issuing Lender will
provide to the Administrative Agent promptly upon request a summary report
of the nature and extent of LOC Obligations then outstanding.
(c) Participations. Each Revolving Lender upon issuance of a Letter
of Credit shall be deemed to have purchased without recourse a risk
participation from the Issuing Lender in such Letter of Credit and the
obligations arising thereunder and any collateral relating thereto, in
each case in an amount equal to its Revolving Commitment Percentage of the
obligations under such Letter of Credit and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and not as
surety, and be obligated to pay to the Issuing Lender therefor and
discharge when due, its Revolving Commitment Percentage of the obligations
arising under such Letter of Credit; provided that any Person that becomes
a Revolving Lender after the Closing Date shall be deemed to have
purchased a risk participation in all outstanding Letters of Credit on the
date it becomes a Revolving Lender hereunder and any Letter of Credit
issued on or after such date, in each case in accordance with the
foregoing terms. Without limiting the scope and nature of each Revolving
Lender's participation in any Letter of Credit, to the extent that the
Issuing Lender has not been reimbursed as required hereunder or under any
LOC Document, each such Revolving Lender shall pay to the Issuing Lender
its Revolving Commitment Percentage of such unreimbursed drawing pursuant
to and in accordance with the provisions of subsection (d) hereof. The
obligation of each Revolving Lender to so reimburse the Issuing Lender
shall be absolute and unconditional and shall not be affected by the
occurrence of a Default, an Event of Default or any other occurrence or
event. Any such reimbursement shall not relieve or otherwise impair the
obligation of the Borrower to reimburse the Issuing Lender under any
Letter of Credit, together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of
Credit, the Issuing Lender will promptly notify the Borrower and the
Administrative Agent. The Borrower shall reimburse the Issuing Lender on
the day of drawing under any Letter of Credit (with the proceeds of a
Revolving Loan obtained hereunder or otherwise) in same day funds as
provided herein or in the LOC Documents. If the Borrower shall fail to
reimburse the Issuing Lender as provided herein, the unreimbursed amount
of such drawing shall bear interest at a per annum rate equal to the ABR
Default Rate. Unless the Borrower shall immediately notify the Issuing
Lender and the Administrative Agent of its intent to otherwise reimburse
the Issuing Lender, the Borrower shall be deemed to have requested a
Revolving Loan in the amount of the drawing as provided in subsection (e)
hereof, the proceeds of which will be used to satisfy the Reimbursement
Obligations. The Borrower's Reimbursement Obligations hereunder shall be
absolute and unconditional under all circumstances irrespective of any
rights of set-off, counterclaim
34
or defense to payment the Borrower may claim or have against the Issuing
Lender, the Administrative Agent, the Lenders, the beneficiary of the
Letter of Credit drawn upon or any other Person, including without
limitation any defense based on any failure of the Borrower to receive
consideration or the legality, validity, regularity or unenforceability of
the Letter of Credit. The Issuing Lender will promptly notify the other
Revolving Lenders of the amount of any unreimbursed drawing and each
Revolving Lender shall promptly pay to the Administrative Agent for the
account of the Issuing Lender in Dollars and in immediately available
funds, the amount of such Revolving Lender's Revolving Commitment
Percentage of such unreimbursed drawing. Such payment shall be made on the
day such notice is received by such Revolving Lender from the Issuing
Lender if such notice is received at or before 2:00 P.M., otherwise such
payment shall be made at or before 12:00 Noon on the Business Day next
succeeding the day such notice is received. If such Revolving Lender does
not pay such amount to the Issuing Lender in full upon such request, such
Revolving Lender shall, on demand, pay to the Administrative Agent for the
account of the Issuing Lender interest on the unpaid amount during the
period from the date of such drawing until such Revolving Lender pays such
amount to the Issuing Lender in full at a rate per annum equal to, if paid
within three (3) Business Days of the date of drawing, the Federal Funds
Effective Rate and thereafter at a rate equal to the Alternate Base Rate.
Each Revolving Lender's obligation to make such payment to the Issuing
Lender, and the right of the Issuing Lender to receive the same, shall be
absolute and unconditional, shall not be affected by any circumstance
whatsoever and without regard to the termination of this Credit Agreement
or the Commitments hereunder, the existence of a Default or Event of
Default or the acceleration of the Credit Party Obligations hereunder and
shall be made without any offset, abatement, withholding or reduction
whatsoever.
(e) Repayment with Revolving Loans. On any day on which the Borrower
shall have requested, or been deemed to have requested, a Revolving Loan
to reimburse a drawing under a Letter of Credit, the Administrative Agent
shall give notice to the Revolving Lenders that a Revolving Loan has been
requested or deemed requested in connection with a drawing under a Letter
of Credit, in which case a Revolving Loan borrowing comprised entirely of
Alternate Base Rate Loans (each such borrowing, a "Mandatory LOC
Borrowing") shall be immediately made (without giving effect to any
termination of the Commitments pursuant to Section 7.2) pro rata based on
each Revolving Lender's respective Revolving Commitment Percentage
(determined before giving effect to any termination of the Commitments
pursuant to Section 7.2) and the proceeds thereof shall be paid directly
to the Issuing Lender for application to the respective LOC Obligations.
Each Revolving Lender hereby irrevocably agrees to make such on the day
such notice is received by the Revolving Lenders from the Administrative
Agent if such notice is received at or before 2:00 P.M., otherwise such
payment shall be made at or before 12:00 Noon on the Business Day next
succeeding the date such notice is received, in each case notwithstanding
(i) the amount of Mandatory LOC Borrowing may not comply with the minimum
amount for borrowings of Revolving Loans otherwise required hereunder,
(ii) whether any conditions specified in Section 4.2 are then satisfied,
(iii) whether a Default or an Event of Default then exists, (iv) the
failure of any such request or deemed request for Revolving Loan to be
made by the time
35
otherwise required in Section 2.1(b), (v) the date of such Mandatory LOC
Borrowing, or (vi) any reduction in the Revolving Committed Amount after
any such Letter of Credit may have been drawn upon; provided, however,
that in the event any such Mandatory LOC Borrowing should be less than the
minimum amount for borrowings of Revolving Loans otherwise provided in
Section 2.1(b)(ii), the Borrower shall pay to the Administrative Agent for
its own account an administrative fee of $500. In the event that any
Mandatory LOC Borrowing cannot for any reason be made on the date
otherwise required above (including, without limitation, the occurrence of
a Bankruptcy Event), then each such Revolving Lender hereby agrees that it
shall forthwith fund (as of the date the Mandatory LOC Borrowing would
otherwise have occurred, but adjusted for any payments received from the
Borrower on or after such date and prior to such purchase) its
Participation Interests in the LOC Obligations; provided, further, that in
the event any Revolving Lender shall fail to fund its Participation
Interest on the day the Mandatory LOC Borrowing would otherwise have
occurred, then the amount of such Revolving Lender's unfunded
Participation Interest therein shall bear interest payable by such
Revolving Lender to the Issuing Lender upon demand, at the rate equal to,
if paid within three (3) Business Days of such date, the Federal Funds
Effective Rate, and thereafter at a rate equal to the Alternate Base Rate.
(f) Modification, Extension. The issuance of any supplement,
modification, amendment, renewal, or extension to any Letter of Credit
shall, for purposes hereof, be treated in all respects the same as the
issuance of a new Letter of Credit hereunder.
(g) UCP and ISP98. Unless otherwise expressly agreed by the Issuing
Lender and the Borrower, when a Letter of Credit is issued, (i) the rules
of the "International Standby Practices 1998," as most recently published
by the Institute of International Banking Law & Practice at the time of
issuance, shall apply to each standby Letter of Credit and (ii) the rules
of the Uniform Customs and Practice for Documentary Credits, as most
recently published by the International Chamber of Commerce at the time of
issuance, shall apply to each commercial Letter of Credit.
(h) Conflict with LOC Documents. In the event of any conflict
between this Credit Agreement and any LOC Document (including any letter
of credit application), this Credit Agreement shall control.
(i) Designation of Subsidiaries as Account Parties. Notwithstanding
anything to the contrary set forth in this Credit Agreement, including
without limitation Section 2.3(a), a Letter of Credit issued hereunder may
contain a statement to the effect that such Letter of Credit is issued for
the account of a Subsidiary of the Borrower; provided that,
notwithstanding such statement, the Borrower shall be the actual account
party for all purposes of this Credit Agreement for such Letter of Credit
and such statement shall not affect the Borrower's Reimbursement
Obligations hereunder with respect to such Letter of Credit.
36
Section 2.4 Swingline Loan Subfacility.
(a) Swingline Commitment. During the Commitment Period, subject to
the terms and conditions hereof, the Swingline Lender, in its individual
capacity, agrees to make certain revolving credit loans in Dollars to the
Borrower (each a "Swingline Loan" and, collectively, the "Swingline
Loans") for the purposes hereinafter set forth; provided, however, (i) the
aggregate principal amount of Swingline Loans outstanding at any time
shall not exceed FIVE MILLION DOLLARS ($5,000,000) (the "Swingline
Committed Amount"), and (ii) the sum of the aggregate principal amount of
outstanding Revolving Loans plus the aggregate principle amount of
outstanding Swingline Loans plus LOC Obligations shall not exceed the
Revolving Committed Amount. Swingline Loans hereunder may be repaid and
reborrowed in accordance with the provisions hereof.
(b) Swingline Loan Borrowings.
(i) Notice of Borrowing and Disbursement. The Swingline Lender
will make Swingline Loans available to the Borrower on any Business
Day upon delivery of a Notice of Borrowing by the Borrower to the
Administrative Agent not later than 2:00 P.M. on such Business Day.
Swingline Loan borrowings hereunder shall be made in minimum amounts
of $100,000 and in integral amounts of $100,000 in excess thereof.
Such borrowing will then be made available to the Borrower by the
Swingline Lender on the date (which shall be a Business Day)
specified in the applicable Notice of Borrowing) by the end of such
Business Day) by funding the account of the Borrower set forth in
the Account Designation Letter the aggregate amount of the Swingline
Loans requested.
(ii) Repayment of Swingline Loans. Each Swingline Loan
borrowing shall be due and payable on the Revolving Commitment
Termination Date. The Swingline Lender may, at any time, in its sole
discretion, by written notice to the Borrower and the Administrative
Agent, demand repayment of its Swingline Loans by way of a Revolving
Loan borrowing, in which case the Borrower shall be deemed to have
requested a Revolving Loan borrowing comprised entirely of Alternate
Base Rate Loans in the amount of such Swingline Loans; provided,
however, that, in the following circumstances, any such demand shall
also be deemed to have been given one (1) Business Day prior to each
of (A) the Revolving Commitment Termination Date, (B) the occurrence
of a Bankruptcy Event, (C) upon acceleration of the Credit Party
Obligations hereunder, whether on account of a Bankruptcy Event or
any other Event of Default, and (D) the exercise of remedies in
accordance with the provisions of Section 7.2 hereof (each such
Revolving Loan borrowing made on account of any such deemed request
therefor as provided herein being hereinafter referred to as
"Mandatory Swingline Borrowing"). Each Revolving Lender hereby
irrevocably agrees to make such Revolving Loans promptly upon any
such request or deemed request on account of each Mandatory
Swingline Borrowing in the amount and in the manner specified in the
preceding sentence on the date such notice is received by such
37
Revolving Lender from the Administrative Agent if such notice is
received at or before 2:00 P.M., otherwise such payment shall be
made at or before 12:00 Noon on the Business Day next succeeding the
date such notice is received, in each case notwithstanding (1) the
amount of Mandatory Swingline Borrowing may not comply with the
minimum amount for borrowings of Revolving Loans otherwise required
hereunder, (2) whether any conditions specified in Section 4.2 are
then satisfied, (3) whether a Default or an Event of Default then
exists, (4) failure of any such request or deemed request for
Revolving Loans to be made by the time otherwise required in Section
2.1(b)(i), (5) the date of such Mandatory Swingline Borrowing, or
(6) any reduction in the Revolving Committed Amount or termination
of the Revolving Commitments immediately prior to such Mandatory
Swingline Borrowing or contemporaneously therewith. In the event
that any Mandatory Swingline Borrowing cannot for any reason be made
on the date otherwise required above (including, without limitation,
as a result of the commencement of a proceeding under the Bankruptcy
Code), then each Revolving Lender hereby agrees that it shall
forthwith purchase (as of the date the Mandatory Swingline Borrowing
would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such
purchase) from the Swingline Lender such Participation Interest in
the outstanding Swingline Loans as shall be necessary to cause each
such Revolving Lender to share in such Swingline Loans ratably based
upon its respective Revolving Commitment Percentage (determined
before giving effect to any termination of the Commitments pursuant
to Section 7.2); provided that (x) all interest payable on the
Swingline Loans shall be for the account of the Swingline Lender
until the date as of which the respective Participation Interest is
purchased, and (y) at the time any purchase of a Participation
Interest pursuant to this sentence is actually made, the purchasing
Revolving Lender shall be required to pay to the Swingline Lender
interest on the principal amount of such Participation Interest
purchased for each day from and including the day upon which the
Mandatory Swingline Borrowing would otherwise have occurred to but
excluding the date of payment for such Participation Interest, at
the rate equal to, if paid within three (3) Business Days of the
date of the Mandatory Swingline Borrowing, the Federal Funds
Effective Rate, and thereafter at a rate equal to the Alternate Base
Rate.
(c) Interest on Swingline Loans. Subject to the provisions of
Section 2.9, Swingline Loans shall bear interest at a per annum rate equal
to the Alternate Base Rate plus the Applicable Percentage for Revolving
Loans that are Alternate Base Rate Loans. Interest on Swingline Loans
shall be payable in arrears on each Interest Payment Date.
(d) Swingline Note; Covenant to Pay. The Swingline Loans shall be
evidenced by a duly executed promissory note of the Borrower to the
Swingline Lender in the original amount of the Swingline Committed Amount
and substantially in the form of Schedule 2.4(d). The Borrower covenants
and agrees to pay the Swingline Loans in accordance with the terms of this
Credit Agreement and the Swingline Note.
38
Section 2.5 Fees.
(a) Commitment Fee. In consideration of the Revolving Commitments,
the Borrower agrees to pay to the Administrative Agent for the ratable
benefit of the Revolving Lenders a commitment fee (the "Commitment Fee")
in an amount equal to one-half of one percent (0.50%) per annum on the
average daily unused amount of the Revolving Committed Amount. For
purposes of computation of the Commitment Fee, LOC Obligations shall be
considered usage of the Revolving Committed Amount but Swingline Loans
shall not be considered usage of the Revolving Committed Amount. The
Commitment Fee shall be payable quarterly in arrears on the last Business
Day of each calendar quarter.
(b) Letter of Credit Fees. In consideration of the LOC Commitments,
the Borrower agrees to pay to the Administrative Agent, for the ratable
benefit of the Revolving Lenders, a fee (the "Letter of Credit Fee") equal
to the Applicable Percentage per annum on the average daily maximum amount
available to be drawn under each Letter of Credit from the date of
issuance to the date of expiration. In addition to such Letter of Credit
Fee, the Borrower agrees to pay to the Issuing Lender, for its own account
and without sharing by the other Lenders, an additional fronting fee (the
"Fronting Fee") of one-quarter of one percent (0.25%) per annum on the
average daily maximum amount available to be drawn under each such Letter
of Credit issued by it. The Letter of Credit Fee and the Fronting Fee
shall be payable quarterly in arrears on the last Business Day of each
calendar quarter.
(c) Issuing Lender Fees. In addition to the Letter of Credit Fees
and Fronting Fees payable pursuant to subsection (b) hereof, the Borrower
shall pay to the Issuing Lender for its own account without sharing by the
other Lenders the reasonable and customary charges from time to time of
the Issuing Lender with respect to the amendment, transfer,
administration, cancellation and conversion of, and drawings under, such
Letters of Credit (collectively, the "Issuing Lender Fees").
(d) Administrative Fee. The Borrower agrees to pay to the
Administrative Agent the annual administrative fee as described in the Fee
Letter.
Section 2.6 Commitment Reductions.
(a) Voluntary Reductions. The Borrower shall have the right to
terminate or permanently reduce the unused portion of the Revolving
Committed Amount at any time or from time to time upon not less than five
(5) Business Days' prior notice to the Administrative Agent (which shall
notify the Lenders thereof as soon as practicable) of each such
termination or reduction, which notice shall specify the effective date
thereof and the amount of any such reduction which shall be in a minimum
amount of $1,000,000 or a whole multiple of $500,000 in excess thereof and
shall be irrevocable and effective upon receipt by the Administrative
Agent, provided that no such reduction or termination shall be permitted
if after giving effect thereto, and to any prepayments of the Loans made
on the effective date thereof, the sum of the outstanding Revolving
39
Loans plus outstanding Swingline Loans plus LOC Obligations would exceed
the Revolving Committed Amount.
(b) Swingline Committed Amount. If the Revolving Committed Amount is
reduced pursuant to Section 2.7(a) below the then Swingline Committed
Amount, the Swingline Committed Amount shall automatically be reduced by
an amount such that the Swingline Committed Amount equals the Revolving
Committed Amount.
(c) Revolving Commitment Termination Date. The Revolving Commitment,
the Swingline Commitment and the LOC Commitment shall automatically
terminate on the Revolving Commitment Termination Date.
Section 2.7 Prepayments.
(a) Optional Prepayments. The Borrower shall have the right to
prepay Loans in whole or in part from time to time; provided, however,
that (i) each partial prepayment of a Revolving Loan and the Term Loan
shall be in a minimum principal amount of $1,000,000 and integral
multiples of $500,000 in excess thereof (or the remaining outstanding
principal amount), and (ii) each partial prepayment of a Swingline Loan
shall be in a minimum principal amount of $100,000 and integral multiples
of $100,000 in excess thereof (or the remaining outstanding principal
amount). The Borrower shall give three (3) Business Days' irrevocable
notice in the case of LIBOR Rate Loans and one (1) Business Day's
irrevocable notice in the case of Alternate Base Rate Loans, to the
Administrative Agent (which shall notify the Lenders thereof as soon as
practicable). Amounts prepaid under this Section 2.7(a) shall be applied
to the outstanding Loans as the Borrower may elect; provided that (A) any
prepayment of the Term Loan shall be applied pro rata to the remaining
Term Loan amortization payments set forth in Section 2.2(b) and (B) each
Lender shall receive its pro rata share (except with respect to
prepayments of Swingline Loans) of any such prepayment based on its
Revolving Commitment Percentage or Term Loan Commitment Percentage, as
applicable. Within the foregoing parameters, prepayments under this
Section shall be applied first to Alternate Base Rate Loans and then to
LIBOR Rate Loans in direct order of Interest Period maturities. All
prepayments under this Section 2.7(a) shall be subject to Section 2.17,
but otherwise without premium or penalty; provided that any prepayment of
the outstanding Term Loan pursuant to this Section 2.7(a) (with proceeds
of a new tranche of term loans under this Credit Agreement or other
optional prepayment) (1) during the first year following the Closing Date
shall be made at 101% of par, and (2) thereafter shall be made at par.
Interest on the principal amount prepaid shall be payable on the next
occurring Interest Payment Date that would have occurred had such Loans
not been prepaid or, at the request of the Administrative Agent, interest
on the principal amount prepaid shall be payable on any date that a
prepayment is made hereunder through the date of prepayment. Amounts
prepaid on the Revolving Loans and the Swingline Loans may be reborrowed
in accordance with the terms hereof. Amounts prepaid on the Term Loans may
not be reborrowed.
40
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any time after the
Closing Date, the sum of the aggregate principal amount of
outstanding Revolving Loans plus the aggregate principal amount of
outstanding Swingline Loans plus LOC Obligations shall exceed the
Revolving Committed Amount, the Borrower immediately shall prepay
the Loans and cash collateralize the LOC Obligations in an amount
sufficient to eliminate such excess (such prepayment to be applied
as set forth in clause (vi) below).
(ii) Asset Dispositions. Promptly following any Asset
Disposition (or related series of Asset Dispositions), the Borrower
shall prepay the Loans and cash collateralize the LOC Obligations in
an aggregate amount equal to one hundred percent (100%) of the Net
Cash Proceeds derived from such Asset Disposition (or related series
of Asset Dispositions) (such prepayment to be applied as set forth
in clause (vi) below); provided, however, that such Net Cash
Proceeds shall not be required to be so applied to the extent the
Borrower delivers to the Administrative Agent promptly following
such Asset Disposition a certificate stating that it intends to use
such Net Cash Proceeds to acquire like assets used in the business
of the Borrower and its Subsidiaries within 180 days of the receipt
of such Net Cash Proceeds, it being expressly agreed that any Net
Cash Proceeds not so reinvested shall be applied to prepay the Loans
and cash collateralize the LOC Obligations immediately thereafter
(such prepayment to be applied as set forth in clause (vi) below).
(iii) Issuances. Immediately upon receipt by any Credit Party
of proceeds from (A) any Debt Issuance, the Borrower shall prepay
the Loans and cash collateralize the LOC Obligations in an aggregate
amount equal to one hundred percent (100%) of the Net Cash Proceeds
of such Debt Issuance to the Lenders (such prepayment to be applied
as set forth in clause (vi) below) or (B) any Equity Issuance, the
Borrower shall prepay the Loans and cash collateralize the LOC
Obligations in an aggregate amount equal to fifty percent (50%) of
the Net Cash Proceeds of such Equity Issuance (such prepayment to be
applied as set forth in clause (vi) below).
(iv) Recovery Event. Immediately upon receipt by any Credit
Party of proceeds from any Recovery Event, the Borrower shall prepay
the Loans and cash collateralize the LOC Obligations in an aggregate
amount equal to one hundred percent (100%) of such cash proceeds
(such prepayment to be applied as set forth in clause (vi) below);
provided, however, that, so long as no Default or Event of Default
has occurred and is continuing at the time of such Recovery Event,
(A) the Borrower and its Subsidiaries may retain Net Cash Proceeds
consisting of business interruption insurance proceeds and (B) any
other Net Cash Proceeds shall not be required to be so applied to
the extent the Borrower delivers to the Administrative Agent a
certificate stating that the Borrower intends to use such Net Cash
Proceeds to repair, restore or replace the assets subject to the
Recovery
41
Event within 180 days of the receipt of such Net Cash Proceeds, it
being expressly agreed that any Net Cash Proceeds not so reinvested
by the end of the applicable period shall be applied to repay the
Loans and/or cash collateralize the LOC Obligations immediately
thereafter (such prepayment to be applied as set forth in clause
(vi) below).
(v) Excess Cash Flow. Within ninety (90) days after the end of
each fiscal year (commencing with the fiscal year ending December
31, 2006), the Borrower shall prepay the Loans and cash
collateralize the LOC Obligations in an aggregate amount equal to
seventy-five percent (75%) of the Excess Cash Flow earned during
such prior fiscal year (such prepayments to be applied as set forth
in clause (vi) below).
(vi) Application of Mandatory Prepayments. All amounts
required to be paid pursuant to this Section 2.7(b) shall be applied
as follows: (A) with respect to all amounts prepaid pursuant to
Sections 2.8(b)(i), (1) first, to the outstanding Swingline Loans,
(2) second, to the outstanding Revolving Loans and (3) third (after
all Revolving Loans have been repaid), to a cash collateral account
in respect of LOC Obligations, and (B) with respect to all amounts
prepaid pursuant to Sections 2.8(b)(ii), (iii), (iv) and (v), (1)
first, to the remaining Term Loan amortization payments set forth in
Section 2.2(b) on pro rata basis, (2) second, to the outstanding
Swingline Loans (without a corresponding permanent reduction in the
Revolving Committed Amount), (3) third, to the outstanding Revolving
Loans (without a corresponding permanent reduction in the Revolving
Committed Amount) and (4) fourth (after all Revolving Loans have
been repaid), to a cash collateral account in respect of LOC
Obligations. Within the parameters of the applications set forth
above, prepayments shall be applied first to Alternate Base Rate
Loans and then to LIBOR Rate Loans in direct order of Interest
Period maturities. Each Lender shall receive its pro rata share
(except with respect to prepayments of Swingline Loans) of any such
prepayment based on its Revolving Commitment Percentage or Term Loan
Commitment Percentages, as applicable. All prepayments under this
Section 2.7(b) shall be subject to Section 2.17, but otherwise
without premium or penalty; provided that any mandatory prepayment
of the outstanding Term Loan made pursuant to Section 2.7(b)(ii) or
Section 2.7(b)(iii)(A) (x) during the first year following the
Closing Date shall be made at 101% of par, and (y) thereafter shall
be made at par.
(c) Hedging Obligations Unaffected. Any repayment or prepayment made
pursuant to this Section 2.7 shall not affect the Borrower's obligation to
continue to make payments under any Secured Hedging Agreement, which shall
remain in full force and effect notwithstanding such repayment or
prepayment, subject to the terms of such Secured Hedging Agreement.
42
Section 2.8 Lending Offices.
LIBOR Rate Loans shall be made by each Lender at its LIBOR Lending Office
and Alternate Base Rate Loans at its Domestic Lending Office.
Section 2.9 Default Rate.
Upon the occurrence, and during the continuance, of an Event of Default,
at the discretion of the Required Lenders, the principal of and, to the extent
permitted by law, interest on the Loans and any other amounts owing hereunder or
under the other Credit Documents shall bear interest, payable on demand, at a
per annum rate two percent (2%) greater than the rate which would otherwise be
applicable (or if no rate is applicable, whether in respect of interest, fees or
other amounts, then the ABR Default Rate).
Section 2.10 Conversion Options.
(a) The Borrower may, in the case of Revolving Loans and the Term
Loan, elect from time to time to convert all or any portion of an
Alternate Base Rate Loan to a LIBOR Rate Loan by giving the Administrative
Agent at least three (3) Business Days' prior irrevocable written notice
of such election; provided that (i) no Alternate Base Rate Loan or portion
thereof may be converted into a LIBOR Rate Loan when any Default or Event
of Default has occurred and is continuing and (ii) conversions shall be in
an aggregate principal amount of (A) in the case of Revolving Loans
$1,000,000 or a whole multiple of $500,000 in excess thereof and (B) in
the case of the Term Loan, $2,000,000 or a whole multiple of $1,000,000 in
excess thereof. In addition, the Borrower may elect from time to time to
convert all or any portion of a LIBOR Rate Loan to an Alternate Base Rate
Loan by giving the Administrative Agent irrevocable written notice thereof
by 11:00 A.M. one (1) Business Date prior to the proposed date of
conversion. A form of Notice of Conversion/Extension is attached as
Schedule 2.10. If the date upon which an Alternate Base Rate Loan is to be
converted to a LIBOR Rate Loan is not a Business Day, then such conversion
shall be made on the next succeeding Business Day and during the period
from such last day of an Interest Period to such succeeding Business Day
such Loan shall bear interest as if it were an Alternate Base Rate Loan.
LIBOR Rate Loans may only be converted to Alternate Base Rate Loans on the
last day of the applicable Interest Period. If the date upon which a LIBOR
Rate Loan is to be converted to an Alternate Base Rate Loan is not a
Business Day, then such conversion shall be made on the next succeeding
Business Day and during the period from such last day of an Interest
Period to such succeeding Business Day such Loan shall bear interest as if
it were an Alternate Base Rate Loan.
(b) Any LIBOR Rate Loans may be continued as such upon the
expiration of an Interest Period with respect thereto by compliance by the
Borrower with the notice provisions contained in Section 2.10(a);
provided, that no LIBOR Rate Loan may be continued as such when any
Default or Event of Default has occurred and is continuing, in which case
such Loan shall be automatically converted to an Alternate Base Rate Loan
at the end of the applicable Interest Period with respect thereto. If the
Borrower shall fail
43
to give timely notice of an election to continue a LIBOR Rate Loan, or the
continuation of LIBOR Rate Loans is not permitted hereunder, such LIBOR
Rate Loans shall be automatically converted to Alternate Base Rate Loans
at the end of the applicable Interest Period with respect thereto.
Section 2.11 Computation of Interest and Fees.
(a) Interest payable hereunder with respect to Alternate Base Rate Loans
based on the Prime Rate shall be calculated on the basis of a year of 365 days
(or 366 days, as applicable) for the actual days elapsed. All other fees,
interest and all other amounts payable hereunder shall be calculated on the
basis of a 360-day year for the actual days elapsed. The Administrative Agent
shall as soon as practicable notify the Borrower and the Lenders of each
determination of a LIBOR Rate on the Business Day of the determination thereof.
Any change in the interest rate on a Loan resulting from a change in the
Alternate Base Rate shall become effective as of the opening of business on the
day on which such change in the Alternate Base Rate shall become effective. The
Administrative Agent shall as soon as practicable notify the Borrower and the
Lenders of the effective date and the amount of each such change.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Credit Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the computations used by the Administrative Agent
in determining any interest rate.
(c) It is the intent of the Lenders and the Credit Parties to conform to
and contract in strict compliance with applicable usury law from time to time in
effect. All agreements between the Lenders and the Credit Parties are hereby
limited by the provisions of this subsection which shall override and control
all such agreements, whether now existing or hereafter arising and whether
written or oral. In no way, nor in any event or contingency (including but not
limited to prepayment or acceleration of the maturity of any Credit Party
Obligation), shall the interest taken, reserved, contracted for, charged, or
received under this Credit Agreement, under the Notes or otherwise, exceed the
maximum nonusurious amount permissible under applicable law. If, from any
possible construction of any of the Credit Documents or any other document,
interest would otherwise be payable in excess of the maximum nonusurious amount,
any such construction shall be subject to the provisions of this paragraph and
such interest shall be automatically reduced to the maximum nonusurious amount
permitted under applicable law, without the necessity of execution of any
amendment or new document. If any Lender shall ever receive anything of value
which is characterized as interest on the Loans under applicable law and which
would, apart from this provision, be in excess of the maximum nonusurious
amount, an amount equal to the amount which would have been excessive interest
shall, without penalty, be applied to the reduction of the principal amount
owing on the Loans and not to the payment of interest, or refunded to the
Borrower or the other payor thereof if and to the extent such amount which would
have been excessive exceeds such unpaid principal amount of the Loans. The right
to demand
44
payment of the Loans or any other Indebtedness evidenced by any of the Credit
Documents does not include the right to receive any interest which has not
otherwise accrued on the date of such demand, and the Lenders do not intend to
charge or receive any unearned interest in the event of such demand. All
interest paid or agreed to be paid to the Lenders with respect to the Loans
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full stated term (including any renewal or
extension) of the Loans so that the amount of interest on account of such
Indebtedness does not exceed the maximum nonusurious amount permitted by
applicable law.
Section 2.12 Pro Rata Treatment and Payments.
(a) Allocation of Payments Prior to Exercise of Remedies. Each
borrowing of Revolving Loans and any reduction of the Revolving
Commitments shall be made pro rata according to the respective Revolving
Commitment Percentages of the Lenders. Unless otherwise specified herein,
each payment under this Credit Agreement or any Note shall be applied,
first, to any fees then due and owing by the Borrower pursuant to Section
2.5, second, to interest then due and owing hereunder and under the Notes
and, third, to principal then due and owing hereunder and under the Notes.
Each payment on account of any fees pursuant to Section 2.5 shall be made
pro rata in accordance with the respective amounts due and owing (except
as to the Fronting Fees, the Issuing Lender Fees and the administrative
fees referenced in Section 2.5(d)). Subject to Section 2.2(b), each
payment (other than prepayments) by the Borrower on account of principal
of and interest on the Revolving Loans and on the Term Loan shall be
applied to such Loans as directed by the Borrower or otherwise applied in
accordance with the terms of Section 2.7(a) hereof. Each optional
prepayment on account of principal of the Loans shall be applied an
accordance with Section 2.7(a); provided, that prepayments made pursuant
to Section 2.15 shall be applied in accordance with such Section. Each
optional prepayment on account of principal of the Loans shall be applied
in accordance with Section 2.7(a) and each mandatory prepayment on account
of principal of the Loans shall be applied in accordance with Section
2.7(b)(vi). All payments (including prepayments) to be made by the
Borrower on account of principal, interest and fees shall be made without
defense, set-off or counterclaim (except as provided in Section 2.18(b))
and shall be made to the Administrative Agent for the account of the
Lenders at the Administrative Agent's office specified in Section 9.2 in
Dollars and in immediately available funds not later than 1:00 P.M. on the
date when due. The Administrative Agent shall distribute such payments to
the Lenders entitled thereto promptly upon receipt in like funds as
received. If any payment hereunder (other than payments on the LIBOR Rate
Loans) becomes due and payable on a day other than a Business Day, such
payment shall be extended to the next succeeding Business Day, and, with
respect to payments of principal, interest thereon shall be payable at the
then applicable rate during such extension. If any payment on a LIBOR Rate
Loan becomes due and payable on a day other than a Business Day, such
payment date shall be extended to the next succeeding Business Day unless
the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the
immediately preceding Business Day.
45
(b) Allocation of Payments After Exercise of Remedies.
Notwithstanding any other provisions of this Credit Agreement to the
contrary, after the exercise of remedies (other than the invocation of
default interest pursuant to Section 2.9) by the Administrative Agent or
the Lenders pursuant to Section 7.2 (or after the Commitments shall
automatically terminate and the Loans (with accrued interest thereon) and
all other amounts under the Credit Documents shall automatically become
due and payable in accordance with the terms of such Section), all amounts
collected or received by the Administrative Agent or any Lender on account
of the Credit Party Obligations or any other amounts outstanding under any
of the Credit Documents or in respect of the Collateral shall be paid over
or delivered as follows (irrespective of whether the following costs,
expenses, fees, interest, premiums, scheduled periodic payments or Credit
Party Obligations are allowed, permitted or recognized as a claim in any
proceeding resulting from the occurrence of a Bankruptcy Event):
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys'
fees) of the Administrative Agent in connection with enforcing the
rights of the Lenders under the Credit Documents and any protective
advances made by the Administrative Agent with respect to the
Collateral under or pursuant to the terms of the Collateral
Documents;
SECOND, to payment of any fees owed to the Administrative
Agent and the Issuing Lender;
THIRD, to the payment of all of the Credit Party Obligations
consisting of accrued fees and interest;
FOURTH, to the payment of the outstanding principal amount of
the Credit Party Obligations, including the payment or cash
collateralization of the outstanding LOC Obligations and, with
respect to any Secured Hedging Agreement, any fees, premiums,
scheduled periodic payments, breakage, termination or other payments
due under such Secured Hedging Agreement and any interest accrued
thereon;
FIFTH, to the payment of the outstanding principal amount of
the Credit Party Obligations, including the payment or cash
collateralization of the outstanding LOC Obligations, and with
respect to any Secured Hedging Agreement, any breakage, termination
or other payments due under such Secured Hedging Agreement and any
interest accrued thereon;
SIXTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under the Credit
Documents or otherwise and not repaid pursuant to clauses "FIRST"
through "FIFTH" above; and
46
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in
the numerical order provided until exhausted prior to application to the
next succeeding category; (ii) each of the Lenders and any Hedging
Agreement Providers shall receive an amount equal to its pro rata share
(based on the proportion that the then outstanding Loans and LOC
Obligations held by such Lender or the outstanding obligations payable to
such Hedging Agreement Provider bears to the aggregate then outstanding
Loans, LOC Obligations and obligations payable under all Secured Hedging
Agreements) of amounts available to be applied pursuant to clauses
"THIRD", "FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent that
any amounts available for distribution pursuant to clause "FIFTH" above
are attributable to the issued but undrawn amount of outstanding Letters
of Credit, such amounts shall be held by the Administrative Agent in a
cash collateral account and applied (A) first, to reimburse the Issuing
Lender from time to time for any drawings under such Letters of Credit and
(B) then, following the expiration of all Letters of Credit, to all other
obligations of the types described in clauses "FIFTH" and "SIXTH" above in
the manner provided in this Section 2.12(b). Notwithstanding the foregoing
terms of this Section 2.12(b), only Collateral proceeds and payments under
the Guaranty (as opposed to ordinary course principal, interest and fee
payments hereunder) shall be applied to obligations under any Secured
Hedging Agreement.
Section 2.13 Non-Receipt of Funds by the Administrative Agent.
(a) Unless the Administrative Agent shall have been notified in
writing by a Lender prior to the date a Loan is to be made by such Lender
(which notice shall be effective upon receipt) that such Lender does not
intend to make the proceeds of such Loan available to the Administrative
Agent, the Administrative Agent may assume that such Lender has made such
proceeds available to the Administrative Agent on such date, and the
Administrative Agent may in reliance upon such assumption (but shall not
be required to) make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the
Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent will promptly notify the Borrower, and
the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to
recover from such Lender or the Borrower, as the case may be, interest on
such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to the
Borrower to the date such corresponding amount is recovered by the
Administrative Agent at a per annum rate equal to (i) from the Borrower at
the applicable rate for the applicable borrowing pursuant to the Notice of
Borrowing and (ii) from such Lender at the Federal Funds Effective Rate.
(b) Unless the Administrative Agent shall have been notified in
writing by the Borrower, prior to the date on which any payment is due
from the Borrower hereunder
47
(which notice shall be effective upon receipt) that the Borrower does not
intend to make such payment, the Administrative Agent may assume that the
Borrower has made such payment when due, and the Administrative Agent may
in reliance upon such assumption (but shall not be required to) make
available to each Lender on such payment date an amount equal to the
portion of such assumed payment to which such Lender is entitled
hereunder, and if the Borrower has not in fact made such payment to the
Administrative Agent, such Lender shall, on demand, repay to the
Administrative Agent the amount made available to such Lender. If such
amount is repaid to the Administrative Agent on a date after the date such
amount was made available to such Lender, such Lender shall pay to the
Administrative Agent on demand interest on such amount in respect of each
day from the date such amount was made available by the Administrative
Agent to such Lender to the date such amount is recovered by the
Administrative Agent at a per annum rate equal to the Federal Funds
Effective Rate.
(c) A certificate of the Administrative Agent submitted to the
Borrower or any Lender with respect to any amount owing under this Section
2.13 shall be conclusive in the absence of manifest error.
Section 2.14 Inability to Determine Interest Rate.
Notwithstanding any other provision of this Credit Agreement, if (i) the
Administrative Agent shall reasonably determine (which determination shall be
conclusive and binding absent manifest error) that, by reason of circumstances
affecting the relevant market, reasonable and adequate means do not exist for
ascertaining LIBOR for such Interest Period, or (ii) the Required Lenders shall
reasonably determine (which determination shall be conclusive and binding absent
manifest error) that the LIBOR Rate does not adequately and fairly reflect the
cost to such Lenders of funding LIBOR Rate Loans that the Borrower has requested
be outstanding as a LIBOR Tranche during such Interest Period, the
Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrower, and the Lenders at least
two (2) Business Days prior to the first day of such Interest Period. Unless the
Borrower shall have notified the Administrative Agent upon receipt of such
telephone notice that it wishes to rescind or modify its request regarding such
LIBOR Rate Loans, any Loans that were requested to be made as LIBOR Rate Loans
shall be made as Alternate Base Rate Loans and any Loans that were requested to
be converted into or continued as LIBOR Rate Loans shall remain as or be
converted into Alternate Base Rate Loans. Until any such notice has been
withdrawn by the Administrative Agent, no further Loans shall be made as,
continued as, or converted into, LIBOR Rate Loans for the Interest Periods so
affected.
Section 2.15 Illegality.
Notwithstanding any other provision of this Credit Agreement, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof by the relevant Governmental Authority to any Lender shall
make it unlawful for such Lender or its LIBOR Lending Office to make or maintain
LIBOR Rate Loans as contemplated by this Credit Agreement or to obtain in the
interbank eurodollar market through its LIBOR Lending Office the funds with
which to make such Loans, (a) such Lender shall promptly notify the
Administrative
48
Agent and the Borrower thereof, (b) the commitment of such Lender hereunder to
make LIBOR Rate Loans or continue LIBOR Rate Loans as such shall forthwith be
suspended until the Administrative Agent shall give notice that the condition or
situation which gave rise to the suspension shall no longer exist, and (c) such
Lender's Loans then outstanding as LIBOR Rate Loans, if any, shall be converted
on the last day of the Interest Period for such Loans or within such earlier
period as required by law to Alternate Base Rate Loans. The Borrower hereby
agrees promptly to pay any Lender, upon its demand, any additional amounts
necessary to compensate such Lender for actual and direct costs (but not
including anticipated profits) reasonably incurred by such Lender including, but
not limited to, any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its LIBOR Rate Loans hereunder. A
certificate as to any additional amounts payable pursuant to this Section
submitted by such Lender, through the Administrative Agent, to the Borrower
shall be conclusive in the absence of manifest error. Each Lender agrees to use
reasonable efforts (including reasonable efforts to change its LIBOR Lending
Office) to avoid or to minimize any amounts which may otherwise be payable
pursuant to this Section; provided, however, that such efforts shall not cause
the imposition on such Lender of any additional costs or legal or regulatory
burdens deemed by such Lender in its sole discretion to be material.
Section 2.16 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Lender with
any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date
hereof:
(i) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit, any Participation
Interest therein or any application relating thereto, any LIBOR Rate
Loan made by it, or change the basis of taxation of payments to such
Lender in respect thereof (except for changes in the rate of tax on
the overall net income of such Lender);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against
assets held by, deposits or other liabilities in or for the account
of, advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the LIBOR Rate hereunder;
or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to
such Lender of making or maintaining LIBOR Rate Loans or the Letters of
Credit (or the Participations Interests therein) or to reduce any amount
receivable hereunder or under any Note, then, in any such case, the
Borrower shall promptly pay such Lender, upon its demand, any additional
amounts necessary to compensate such Lender for such additional cost or
reduced amount receivable which such Lender reasonably deems to be
material as determined by such Lender with respect to its LIBOR Rate Loans
or Letters of Credit. A
49
certificate as to any additional amounts payable pursuant to this Section
submitted by such Lender, through the Administrative Agent, to the
Borrower shall be conclusive in the absence of manifest error. Each Lender
agrees to use reasonable efforts (including reasonable efforts to change
its Domestic Lending Office or LIBOR Lending Office, as the case may be)
to avoid or to minimize any amounts which might otherwise be payable
pursuant to this paragraph of this Section; provided, however, that such
efforts shall not cause the imposition on such Lender of any additional
costs or legal or regulatory burdens deemed by such Lender in its sole
discretion to be material.
(b) If any Lender shall have reasonably determined that the adoption
of or any change in any Requirement of Law regarding capital adequacy or
in the interpretation or application thereof or compliance by such Lender
or any corporation controlling such Lender with any request or directive
regarding capital adequacy (whether or not having the force of law) from
any central bank or Governmental Authority made subsequent to the date
hereof does or shall have the effect of reducing the rate of return on
such Lender's or such corporation's capital as a consequence of its
obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount reasonably deemed
by such Lender in its sole discretion to be material, then from time to
time, within fifteen days after demand by such Lender, the Borrower shall
pay to such Lender such additional amount as shall be certified by such
Lender as being required to compensate it for such reduction. Such a
certificate as to any additional amounts payable under this Section
submitted by a Lender (which certificate shall include a description of
the basis for the computation), through the Administrative Agent, to the
Borrower shall be conclusive absent manifest error.
(c) The agreements in this Section 2.16 shall survive the
termination of this Credit Agreement and payment of the Notes and all
other amounts payable hereunder.
Section 2.17 Indemnity.
The Borrower hereby agrees to indemnify each Lender and to hold such
Lender harmless from any funding loss or expense which such Lender may sustain
or incur as a consequence of (a) the failure of the Borrower to pay the
principal amount of or interest on any Loan by such Lender in accordance with
the terms hereof, (b) the failure of the Borrower to accept a borrowing after
the Borrower has given a notice in accordance with the terms hereof, (c) the
failure of the Borrower to make any prepayment after the Borrower has given a
notice in accordance with the terms hereof, and/or (d) the making by the
Borrower of a prepayment of a Loan, or the conversion thereof, on a day which is
not the last day of the Interest Period with respect thereto, in each case
including, but not limited to, any such loss or expense arising from interest or
fees payable by such Lender to lenders of funds obtained by it in order to
maintain its Loans hereunder, but excluding any such loss or expense due to such
Lender's gross negligence or willful misconduct. A certificate as to any
additional amounts payable pursuant to this Section submitted by any Lender,
through the Administrative Agent, to the Borrower (which certificate must be
delivered to the Administrative Agent within thirty (30) days following such
default,
50
prepayment or conversion) shall be conclusive in the absence of manifest error.
The agreements in this Section shall survive termination of this Credit
Agreement and payment of the Notes and all other amounts payable hereunder.
Section 2.18 Taxes.
(a) All payments made by the Borrower hereunder or under any Note
will be, except as provided in Section 2.18(b), made free and clear of,
and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever
nature now or hereafter imposed by any Governmental Authority or by any
political subdivision or taxing authority thereof or therein with respect
to such payments (but excluding any tax imposed on or measured by the net
income or profits of a Lender pursuant to the laws of the jurisdiction in
which it is organized or the jurisdiction in which the principal office or
applicable lending office of such Lender is located or any subdivision
thereof or therein) and all interest, penalties or similar liabilities
with respect thereto (all such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges being referred to collectively
as "Taxes"). If any Taxes are so levied or imposed, the Borrower agrees to
pay the full amount of such Taxes, and such additional amounts as may be
necessary so that every payment of all amounts due under this Credit
Agreement or under any Note, after withholding or deduction for or on
account of any Taxes, will not be less than the amount provided for herein
or in such Note. The Borrower will furnish to the Administrative Agent as
soon as practicable after the date the payment of any Taxes is due
pursuant to applicable law certified copies (to the extent reasonably
available and required by law) of tax receipts evidencing such payment by
the Borrower. The Borrower agrees to indemnify and hold harmless each
Lender, and reimburse such Lender upon its written request, for the amount
of any Taxes so levied or imposed and paid by such Lender.
(b) Each Lender that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) agrees to deliver to the
Borrower and the Administrative Agent on or prior to the Closing Date, or
in the case of a Lender that is an assignee or transferee of an interest
under this Credit Agreement pursuant to Section 9.6(d) (unless the
respective Lender was already a Lender hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to
such Lender, (i) if the Lender is a "bank" within the meaning of Section
881(c)(3)(A) of the Code, two accurate and complete original signed copies
of Internal Revenue Service Form ▇-▇▇▇▇, ▇-▇▇▇▇ or W-8IMY (or successor
forms) certifying such Lender's entitlement to a complete exemption from
United States withholding tax with respect to payments to be made under
this Credit Agreement and under any Note, or (ii) if the Lender is not a
"bank" within the meaning of Section 881(c)(3)(A) of the Code, Internal
Revenue Service Form ▇-▇▇▇▇, ▇-▇▇▇▇ or W-8IMY as set forth in clause (i)
above, or (x) a certificate in substantially the form of Schedule 2.18
(any such certificate, a "Tax Exempt Certificate") and (y) two accurate
and complete original signed copies of Internal Revenue Service Form
W-8BEN (or successor form) certifying such Lender's entitlement to an
exemption from United States withholding tax with respect to payments of
interest to be made under this Credit Agreement and under any Note. In
addition, each Lender
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agrees that it will deliver upon the Borrower's request updated versions
of the foregoing, as applicable, whenever the previous certification has
become obsolete or inaccurate in any material respect, together with such
other forms as may be required in order to confirm or establish the
entitlement of such Lender to a continued exemption from or reduction in
United States withholding tax with respect to payments under this Credit
Agreement and any Note. Notwithstanding anything to the contrary contained
in Section 2.18(a), but subject to the immediately succeeding sentence,
(x) the Borrower shall be entitled, to the extent it is required to do so
by law, to deduct or withhold Taxes imposed by the United States (or any
political subdivision or taxing authority thereof or therein) from
interest, fees or other amounts payable hereunder for the account of any
Lender which is not a United States person (as such term is defined in
Section 7701(a)(30) of the Code) for U.S. federal income tax purposes to
the extent that such Lender has not provided to the Borrower U.S. Internal
Revenue Service Forms that establish a complete exemption from such
deduction or withholding and (y) the Borrower shall not be obligated
pursuant to Section 2.18(a) hereof to gross-up payments to be made to a
Lender in respect of Taxes imposed by the United States if (I) such Lender
has not provided to the Borrower the Internal Revenue Service Forms
required to be provided to the Borrower pursuant to this Section 2.18(b)
or (II) in the case of a payment, other than interest, to a Lender
described in clause (ii) above, to the extent that such Forms do not
establish a complete exemption from withholding of such Taxes.
Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 2.18, the Borrower agrees to pay
additional amounts and to indemnify each Lender in the manner set forth in
Section 2.18(a) (without regard to the identity of the jurisdiction
requiring the deduction or withholding) in respect of any amounts deducted
or withheld by it as described in the immediately preceding sentence as a
result of any changes after the Closing Date in any applicable law,
treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of Taxes.
(c) Each Lender agrees to use reasonable efforts (including
reasonable efforts to change its Domestic Lending Office or LIBOR Lending
Office, as the case may be) to avoid or to minimize any amounts which
might otherwise be payable pursuant to this Section; provided, however,
that such efforts shall not cause the imposition on such Lender of any
additional costs or legal or regulatory burdens deemed by such Lender in
its reasonable discretion to be material.
(d) If the Borrower pays any additional amount pursuant to this
Section 2.18 with respect to a Lender, such Lender shall use reasonable
efforts to obtain a refund of tax or credit against its tax liabilities on
account of such payment; provided that such Lender shall have no
obligation to use such reasonable efforts if either (i) it is in an excess
foreign tax credit position or (ii) it believes in good faith, in its sole
discretion, that claiming a refund or credit would cause adverse tax
consequences to it. In the event that such Lender receives such a refund
or credit, such Lender shall pay to the Borrower an amount that such
Lender reasonably determines is equal to the net tax benefit obtained by
such Lender as a result of such payment by the Borrower. In the event that
no refund or credit is obtained with respect to the Borrower's payments to
such Lender pursuant to this
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Section 2.18, then such Lender shall upon request provide a certification
that such Lender has not received a refund or credit for such payments.
Nothing contained in this Section 2.18 shall require a Lender to disclose
or detail the basis of its calculation of the amount of any tax benefit or
any other amount or the basis of its determination referred to in the
proviso to the first sentence of this Section 2.18 to the Borrower or any
other party.
(e) The agreements in this Section 2.18 shall survive the
termination of this Credit Agreement and the payment of the Notes and all
other amounts payable hereunder.
Section 2.19 Indemnification; Nature of Issuing Lender's Duties.
(a) In addition to its other obligations under Section 2.3, the
Borrower hereby agrees to protect, indemnify, pay and save the Issuing
Lender and each Revolving Lender harmless from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and expenses
(including reasonable attorneys' fees) that the Issuing Lender or such
Revolving Lender may incur or be subject to as a consequence, direct or
indirect, of (i) the issuance of any Letter of Credit or (ii) the failure
of the Issuing Lender to honor a drawing under a Letter of Credit as a
result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or governmental authority
(all such acts or omissions, herein called "Government Acts").
(b) As between the Borrower and the Issuing Lender and each
Revolving Lender, the Borrower shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the beneficiary thereof.
Neither the Issuing Lender nor any Revolving Lender shall be responsible:
(i) for the form, validity, sufficiency, accuracy, genuineness or legal
effect of any document submitted by any party in connection with the
application for and issuance of any Letter of Credit, even if it should in
fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (ii) for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, that may prove to be invalid or ineffective
for any reason; (iii) for failure of the beneficiary of a Letter of Credit
to comply fully with conditions required in order to draw upon a Letter of
Credit; (iv) for errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex
or otherwise, whether or not they be in cipher; (v) for errors in
interpretation of technical terms; (vi) for any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under a Letter of Credit or of the proceeds thereof; and (vii) for
any consequences arising from causes beyond the control of the Issuing
Lender or any Revolving Lender, including, without limitation, any
Government Acts. None of the above shall affect, impair, or prevent the
vesting of the Issuing Lender's rights or powers hereunder.
(c) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
the Issuing Lender or any Revolving Lender, under or in connection with
any Letter of Credit or the related certificates, if taken or omitted in
the absence of gross negligence or willful misconduct,
53
shall not put such Issuing Lender or such Revolving Lender under any
resulting liability to the Borrower. It is the intention of the parties
that this Credit Agreement shall be construed and applied to protect and
indemnify the Issuing Lender and each Revolving Lender against any and all
risks involved in the issuance of the Letters of Credit, all of which
risks are hereby assumed by the Borrower, including, without limitation,
any and all risks of the acts or omissions, whether rightful or wrongful,
of any Government Authority. The Issuing Lender and the Revolving Lenders
shall not, in any way, be liable for any failure by the Issuing Lender or
anyone else to pay any drawing under any Letter of Credit as a result of
any Government Acts or any other cause beyond the control of the Issuing
Lender and the Revolving Lenders.
(d) Nothing in this Section 2.19 is intended to limit the
Reimbursement Obligation of the Borrower contained in Section 2.3(d)
hereof. The obligations of the Borrower under this Section 2.19 shall
survive the termination of this Credit Agreement. No act or omissions of
any current or prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Issuing Lender and the Revolving
Lenders to enforce any right, power or benefit under this Credit
Agreement.
(e) Notwithstanding anything to the contrary contained in this
Section 2.19, the Borrower shall have no obligation to indemnify the
Issuing Lender or any Revolving Lender in respect of any liability
incurred by the Issuing Lender or such Revolving Lender arising out of the
gross negligence or willful misconduct of the Issuing Lender (including
action not taken by the Issuing Lender or such Revolving Lender), as
determined by a court of competent jurisdiction or pursuant to
arbitration.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Credit Agreement and to make the
Extensions of Credit herein provided for, the Credit Parties hereby represent
and warrant to the Administrative Agent and to each Lender that:
Section 3.1 Financial Condition.
The Borrower has delivered the following financial statements and
projections to the Administrative Agent and the Lenders, in form and substance
reasonably satisfactory to the Administrative Agent:
(a) unaudited balance sheets and the related statements of income
and of cash flows of the Borrower and its consolidated Subsidiaries for
the fiscal year ended December 31, 2004;
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(b) unaudited balance sheets and the related statements of income
and of cash flows of the Borrower and its consolidated Subsidiaries for
fiscal quarter ended June 30, 2005;
(c) unaudited monthly balance sheets and related statements of
income for the Borrower and its consolidated Subsidiaries through the
month most recently ended prior to the Closing Date for which such
statements are available;
(d) an opening balance sheet of the Borrower and its consolidated
Subsidiaries as of June 30, 2005 giving effect to the initial Loans
hereunder and the other transactions to occur on the Closing Date; and
(e) six-year projections (consisting of projected balance sheets and
statements of income and cash flows prepared by the Borrower) of the
Borrower and its consolidated Subsidiaries, which shall have been prepared
in good faith based upon reasonable assumptions.
The financial statements referred to in subsections (a), (b), (c), and (d)
above are complete and correct and present fairly the financial condition of the
Borrower and its Subsidiaries as of such dates. All such financial statements,
including the related schedules and notes thereto, have been prepared in
accordance with GAAP applied consistently throughout the periods involved
(except as disclosed therein).
Section 3.2 No Change.
Since December 31, 2003 there has been no development or event which has
had or could reasonably be expected to have a Material Adverse Effect.
Section 3.3 Corporate Existence; Compliance with Law.
Each of the Borrower and the other Credit Parties (a) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization; (b) has the requisite power and authority and the
legal right to own and operate all its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged;
(c) is duly qualified to conduct business and in good standing under the laws of
(i) the jurisdiction of its organization, (ii) the jurisdiction where its chief
executive office is located and (iii) and each other jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification except to the extent that the failure to so qualify
or be in good standing in any such other jurisdiction could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect; and
(d) is in compliance with all Requirements of Law except to the extent that the
failure to comply therewith could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect; provided, however,
that the Borrower is not in compliance with certain SEC requirements as set
forth in the SEC Letter but such non-compliance could not reasonably be expected
to have a Material Adverse Effect. Without limiting the generality of the
foregoing, each of the Borrower and the other Credit Parties represents that:
55
(i) (A) There is no Credit Party or individual employed by any
Credit Party who may reasonably be expected to have criminal culpability
or to be excluded or suspended from participation in any Medical
Reimbursement Program for their corporate or individual actions or
failures to act where such culpability, exclusion and/or suspension has or
could be reasonably expected to result in a Material Adverse Effect; and
(B) there is no member of management continuing to be employed by any
Credit Party who may reasonably be expected to have individual culpability
for matters under investigation by any Governmental Authority unless such
member of management has been, within a reasonable period of time after
discovery of such actual or potential culpability, either suspended or
removed from positions of responsibility related to those activities under
challenge by the Governmental Authority and where such failure to suspend
or remove such Person has or could be reasonably expected to result in a
Material Adverse Effect;
(ii) Current billing policies, arrangements, protocols and
instructions comply with requirements of Medical Reimbursement Programs
and are administered by properly trained personnel except where any such
failure to comply could not reasonably be expected to result in a Material
Adverse Effect; and
(iii) Current medical director compensation arrangements, if any,
and other arrangements with referring physicians, if any, comply with
state and federal self-referral and anti-kickback laws, including without
limitation 42 U.S.C. Section 1320a-7b(b)(1) - (b)(2) and 42 U.S.C. Section
1395nn, except where any such failure to comply could not reasonably be
expected to result in a Material Adverse Effect.
Section 3.4 Corporate Power; Authorization; Enforceable Obligations.
Each of the Borrower and the other Credit Parties has full power and
authority and the legal right to make, deliver and perform the Credit Documents
to which it is party and has taken all necessary limited liability company or
corporate action to authorize the execution, delivery and performance by it of
the Credit Documents to which it is party. No consent or authorization of,
filing with, notice to or other act by or in respect of, any Governmental
Authority or any other Person (except as it may relate to immaterial contracts)
is required in connection with the borrowings hereunder or with the execution,
delivery or performance of any Credit Document by the Borrower or the other
Credit Parties (other than those which have been obtained) or with the validity
or enforceability of any Credit Document against the Borrower or the other
Credit Parties (except such filings as are necessary in connection with the
perfection of the Liens created by such Credit Documents). Each Credit Document
to which it is a party has been duly executed and delivered on behalf of the
Borrower and the other Credit Parties, as the case may be. Each Credit Document
to which it is a party constitutes a legal, valid and binding obligation of the
Borrower and the other Credit Parties, as the case may be, enforceable against
the Borrower and such other Credit Party, as the case may be, in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
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Section 3.5 No Legal Bar; No Default.
The execution, delivery and performance of the Credit Documents, the
borrowings thereunder and the use of the proceeds of the Loans will not violate
(a) any Requirement of Law or any material Contractual Obligation of the
Borrower or any other Credit Party (except those as to which waivers or consents
have been obtained), (b) conflict with, result in a breach of or constitute a
default under any approval or consent from any Governmental Authority relating
to such Person, and (c) will not result in, or require, the creation or
imposition of any Lien on any Credit Party's properties or revenues pursuant to
any Requirement of Law or Contractual Obligation other than the Liens arising
under or contemplated in connection with the Credit Documents. Neither the
Borrower nor any other Credit Party is in default under or with respect to any
of its Contractual Obligations in any respect which could reasonably be expected
to have a Material Adverse Effect. No Default or Event of Default has occurred
and is continuing.
Section 3.6 No Material Litigation.
No litigation, investigation, claim, criminal prosecution, civil
investigative demand, imposition of criminal or civil fines and penalties, or
any other proceeding of or before any arbitrator or Governmental Authority
including but not limited to those regulatory agencies responsible for
licensing, accrediting or issuing Medicare or Medicaid certifications is pending
or, to the best knowledge of the Credit Parties, threatened by or against any
Credit Party or any of its Subsidiaries or against any of its or their
respective properties or revenues (a) with respect to the Credit Documents or
any Extension of Credit or any of the transactions contemplated hereby, or (b)
which, if adversely determined, could individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 3.7 Investment Company Act; PUHCA; Etc..
Neither the Borrower nor any other Credit Party 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 other Credit Party is subject to regulation under the Public Utility
Holding Company Act of 1935, as amended, the Federal Power Act, the Interstate
Commerce Act or any federal or state statute or regulation limiting its ability
to incur the Credit Party Obligations.
Section 3.8 Margin Regulations.
No part of the proceeds of any Extension of Credit hereunder will be used
directly or indirectly for any purpose which violates, which would be
inconsistent with or which would require any Lender to make any filing in
accordance with, the provisions of Regulation T, U or X of the Board of
Governors of the Federal Reserve System as now and from time to time hereafter
in effect. The Credit Parties and their Subsidiaries taken as a group do not own
"margin stock" except as identified in the financial statements referred to in
Section 3.1 and the aggregate value of all "margin stock" owned by the Credit
Parties and their Subsidiaries taken as a group does not exceed twenty-five
percent (25%) of the value of their assets.
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Section 3.9 ERISA.
Neither a Reportable Event nor an "accumulated funding deficiency" (within
the meaning of Section 412 of the Code or Section 302 of ERISA) has occurred
during the five-year period prior to the date on which this representation is
made or deemed made with respect to any Plan, and each Plan has complied in all
material respects with the applicable provisions of ERISA and the Code, except
to the extent that any such occurrence or failure to comply would not reasonably
be expected to have a Material Adverse Effect. No termination of a Single
Employer Plan has occurred resulting in any liability that has remained
underfunded, and no Lien in favor of the PBGC or a Plan has arisen, during such
five-year period which could reasonably be expected to have a Material Adverse
Effect. The present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation is
made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by an amount which, as determined in accordance with GAAP,
could reasonably be expected to have a Material Adverse Effect. Neither any
Credit Party nor any Commonly Controlled Entity is currently subject to any
liability for a complete or partial withdrawal from a Multiemployer Plan which
could reasonably be expected to have a Material Adverse Effect.
Section 3.10 Environmental Matters.
(a) To the best knowledge of the Borrower and the other Credit
Parties, the facilities and properties owned, leased or operated by the
Borrower and the other Credit Parties or any of their Subsidiaries (the
"Properties") do not contain any Materials of Environmental Concern in
amounts or concentrations which (i) constitute a violation of, or (ii)
could give rise to liability on behalf of any Credit Party under, any
Environmental Law, which could reasonably be expected to result in a
Material Adverse Effect.
(b) To the best knowledge of the Borrower and the other Credit
Parties, the Properties and all operations of the Borrower and the other
Credit Parties and/or their Subsidiaries at the Properties are in
compliance, and have in the last five (5) years (or in the case of leased
Property, during the period of time that the applicable Credit Party have
leased such Property), been in compliance, in all material respects with
all applicable Environmental Laws, and there is no contamination at, under
or about the Properties or violation of any Environmental Law with respect
to the Properties or the business operated by the Borrower and the other
Credit Parties or any of their Subsidiaries (the "Business") for which any
Credit Party could reasonably be expected to have liability that could
result in a Material Adverse Effect.
(c) Neither the Borrower nor any of the other Credit Parties has
received any written or actual notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the
Properties or the Business, nor does the Borrower or any of the other
Credit Parties nor any of their Subsidiaries have knowledge or reason to
believe that any such notice will be received or is being threatened.
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(d) To the best knowledge of the Borrower and the other Credit
Parties, Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a
location which could give rise to liability on behalf of any Credit Party
under any Environmental Law, nor, to the knowledge of any Credit Party,
have any Materials of Environmental Concern been generated, treated,
stored or disposed of at, on or under any of the Properties in violation
of, or in a manner that could give rise to liability on behalf of any
Credit Party under, any applicable Environmental Law which could
reasonably be expected to result in a Material Adverse Effect.
(e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Borrower and the other Credit
Parties, threatened, under any Environmental Law to which the Borrower or
any other Credit Party or any Subsidiary is or will be named as a party
with respect to the Properties or the Business, nor to the knowledge of
any Credit Party are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect
to the Properties or the Business pursuant to which any Credit Party would
have liability which could reasonably be expected to have a Material
Adverse Effect.
(f) To the best knowledge of the Borrower and the other Credit
Parties, there has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or
related to the operations of the Borrower or any other Credit Party or any
Subsidiary in connection with the Properties or otherwise in connection
with the Business, in violation of or in amounts or in a manner that could
give rise to liability on behalf of any Credit Party under Environmental
Laws which could reasonably be expected to result in a Material Adverse
Effect.
Section 3.11 Use of Proceeds.
The proceeds of the Extensions of Credit shall be used solely by the
Borrower to (i) repay certain existing indebtedness (including the Convertible
Bonds), (ii) pay any fees and expenses owing to the Lenders and the
Administrative Agent in connection with this Credit Agreement and (iii) provide
for working capital and other general corporate purposes, including Permitted
Acquisitions and permitted capital expenditures.
Section 3.12 Subsidiaries; Joint Ventures; Partnerships.
Set forth on Schedule 3.12 is a complete and accurate list of all
Subsidiaries, joint ventures and partnerships of the Credit Parties. Information
on the attached Schedule includes state of incorporation or organization; the
number of shares of each class of Capital Stock or other equity interests
outstanding; the number and percentage of outstanding shares of each class of
Capital Stock; and the number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and similar rights. The
outstanding Capital Stock and other equity interests of all such Subsidiaries is
validly issued, fully paid and non-assessable and is
59
owned, free and clear of all Liens (other than those arising under or
contemplated in connection with the Credit Documents). The Borrower may update
Schedule 3.12 from time to time by providing a replacement Schedule 3.12 to the
Administrative Agent.
Section 3.13 Ownership.
Each Credit Party and its Subsidiaries is the owner of, and has good and
marketable title to, all of its respective assets, except as may be permitted
pursuant Section 6.13 hereof, and a valid and enforceable leasehold interest in
all of its leased real property, and none of such assets is subject to any Lien
other than Permitted Liens.
Section 3.14 Indebtedness.
Except as otherwise permitted under Section 6.1, the Credit Parties and
their Subsidiaries have no Indebtedness.
Section 3.15 Taxes.
Each of the Credit Parties and its Subsidiaries has filed, or caused to be
filed, all tax returns (federal, state, local and foreign) required to be filed
and paid (a) all amounts of taxes shown thereon to be due (including interest
and penalties) and (b) all other taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) owing by it, except for such taxes (i) which are not yet
delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. Neither any of the Credit Parties nor any of its
Subsidiaries are aware as of the Closing Date of any proposed tax assessments
against it or any of its Subsidiaries which could reasonably be expected to have
a Material Adverse Effect.
Section 3.16 Intellectual Property.
Each of the Credit Parties and its Subsidiaries owns, or has the legal
right to use, all Intellectual Property to conduct its business as currently
conducted, except to the extent that the failure thereof in the aggregate could
not reasonably be expected to have a Material Adverse Effect. Set forth on
Schedule 3.16 is a list of all Intellectual Property owned by each of the Credit
Parties and its Subsidiaries or that each of the Credit Parties or any of its
Subsidiaries has the right to use. Except as disclosed on Schedule 3.16 hereto,
(a) and except for the licensed Intellectual Property as disclosed on Schedule
3.16, the specified Credit Party has the right to use the material Intellectual
Property disclosed on Schedule 3.16 hereto in perpetuity and without payment of
royalties, (b) all registrations with and applications to Governmental
Authorities in respect of the material Intellectual Property owned by the Credit
Parties, and to the knowledge of the Credit Parties, the material licensed
Intellectual Property, are valid and in full force and effect and are not
subject to the payment of any taxes or maintenance fees to maintain their
validity or effectiveness, and (c) there are no restrictions on the direct or
indirect transfer of any material Intellectual Property, or any interest
therein, held by any of the Credit Parties in respect of any such material
Intellectual Property which has not been obtained. To the knowledge of the
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Credit Parties: (i) none of the Credit Parties is in default (or with the giving
of notice or lapse of time or both, would be in default) under any license to
use such material Intellectual Property; (ii) no claim has been asserted and is
pending by any Person challenging or questioning the use of any such material
Intellectual Property or the validity or effectiveness of any such material
Intellectual Property, nor do the Credit Parties or any of their Subsidiaries
know of any such claim which could reasonably be expected to have a Material
Adverse Effect; and, to the knowledge of the Credit Parties or any of their
Subsidiaries, the use of such material Intellectual Property by any of the
Credit Parties or any of its Subsidiaries does not infringe on the rights of any
Person, in each case which could reasonably be expected to have a Material
Adverse Effect. The Credit Parties have recorded or deposited with and paid to
the United States Copyright Office, the Register of Copyrights, the Copyrights
Royalty Tribunal or other Governmental Authority, all notices, statements of
account, royalty fees and other documents and instruments required to be
recorded or deposited by any of the Credit Parties under the terms and
conditions of any Contractual Obligation of the Credit Parties applicable to the
Intellectual Property and/or under Title 17 of the United States Code and the
rules and regulations issued thereunder (collectively, the "Copyright Act"), and
are not liable to any Person for copyright infringement under the Copyright Act
or any other law, rule, regulation, contract or license as a result of their
business operations. Schedule 3.16 may be updated from time to time by the
Borrower to include new Intellectual Property by giving written notice thereof
to the Administrative Agent.
Section 3.17 Solvency.
The fair saleable value of each Credit Party's assets, measured on a going
concern basis, exceeds all of its probable liabilities, including those to be
incurred pursuant to this Credit Agreement. None of the Credit Parties (a) has
unreasonably small capital in relation to the business in which it is or
proposes to be engaged or (b) has incurred, or believes that it will incur after
giving effect to the transactions contemplated by this Credit Agreement, debts
beyond its ability to pay such debts as they become due. In executing the Credit
Documents and consummating the transactions contemplated thereby, none of the
Credit Parties intends to hinder, delay or defraud either present or future
creditors or other Persons to which one or more of the Credit Parties is or will
become indebted.
Section 3.18 Investments.
All Investments of each of the Credit Parties and its Subsidiaries are
Permitted Investments.
Section 3.19 Location of Collateral.
Set forth on Schedule 3.19(a) is a list of the Properties of the Credit
Parties and their Subsidiaries as of the Closing Date with street address,
county and state where located. Set forth on Schedule 3.19(b) is a list of all
locations where any tangible personal property of the Credit Parties and their
Subsidiaries with a fair market value in excess of $25,000 is located as of the
Closing Date, including county and state where located. Set forth on Schedule
3.19(c) is the chief executive office and principal place of business of each of
the Credit Parties and their
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Subsidiaries and the State of incorporation or organization of each such Person
as of the Closing Date.
Section 3.20 Brokers' Fees.
None of the Credit Parties or any of its Subsidiaries has any obligation
to any Person in respect of any finder's, broker's, investment banking or other
similar fee in connection with any of the transactions contemplated under the
Credit Documents other than the closing and other fees payable pursuant to this
Credit Agreement and as set forth in the Fee Letter.
Section 3.21 Labor Matters.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of any of the Credit Parties or any of its Subsidiaries
as of the Closing Date, other than as set forth in Schedule 3.21 hereto, and
none of the Credit Parties or any of its Subsidiaries (i) has suffered any
strikes, walkouts, work stoppages or other material labor difficulty within the
last five (5) years, other than as set forth in Schedule 3.21 hereto or (ii) has
knowledge of any potential or pending strike, walkout or work stoppage. Other
than as set forth on Schedule 3.21, no unfair labor practice complaint is
pending against any Credit Party or any of its Subsidiaries or, to the best
knowledge of the Credit Parties, before any Governmental Authority.
Section 3.22 Security Documents.
The Security Documents create valid security interest in, and Liens on,
the Collateral purported to be covered thereby. Except as set forth in the
Security Documents, such security interests and Liens are currently (or will be,
upon (a) the filing of appropriate financing statements with the Secretary of
State of the state of incorporation for each Credit Party, the filing of
appropriate assignments or notices with the United States Patent and Trademark
Office and the United States Copyright Office, and the recordation of the
applicable Mortgage Instruments (if any), in each case in favor of the
Administrative Agent, on behalf of the Lenders, and (b) the Administrative
Agent, obtaining Control (as defined in the Security Agreement) over those items
of Collateral in which a security interest is perfected through Control)
perfected security interest and Liens, prior to all other Liens other than
Permitted Liens.
Section 3.23 Accuracy and Completeness of Information.
All factual information heretofore, contemporaneously or hereafter
furnished by or on behalf of any Credit Party or any of its Subsidiaries to the
Administrative Agent or any Lender for purposes of or in connection with this
Credit Agreement or any other Credit Document, or any transaction contemplated
hereby or thereby, is or will be true and accurate in all material respects and
not incomplete by omitting to state any material fact necessary to make such
information not misleading. There is no fact now known to the Borrower, any
other Credit Party or any of their Subsidiaries which has, or could reasonably
be expected to have, a Material Adverse Effect which fact has not been set forth
herein, in the financial statements of the Borrower and its Subsidiaries
furnished to the Administrative Agent and/or the Lenders, or in
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any certificate, opinion or other written statement made or furnished by any
Credit Party to the Administrative Agent and/or the Lenders.
Section 3.24 Fraud and Abuse.
Neither the Credit Parties nor, to the knowledge of the officers of the
Credit Parties, any of their officers or directors, have engaged in any
activities which are prohibited under federal Medicare and Medicaid statutes, 42
U.S.C. ss.1320a-7b, or 42 U.S.C. ss.1395nn or the regulations promulgated
pursuant to such statutes or related state or local statutes or regulations, or
which are prohibited by binding rules of professional conduct, including but not
limited to the following: (a) knowingly and willfully making or causing to be
made a false statement or representation of a material fact in any applications
for any benefit or payment; (b) knowingly and willfully making or causing to be
made any false statement or representation of a material fact for use in
determining rights to any benefit or payment; (c) failing to disclose knowledge
by a claimant of the occurrence of any event affecting the initial or continued
right to any benefit or payment on its own behalf or on behalf of another with
the intent to secure such benefit or payment fraudulently; (d) knowingly and
willfully soliciting or receiving any remuneration (including any kickback,
bribe or rebate), directly or indirectly, overtly or covertly, in cash or in
kind or offering to pay such remuneration (i) in return for referring an
individual to a Person for the furnishing or arranging for the furnishing of any
item or service for which payment may be made in whole or in part by Medicare,
Medicaid or other applicable third party payors, or (ii) in return for
purchasing, leasing or ordering or arranging for or recommending the purchasing,
leasing or ordering of any good, facility, service, or item for which payment
may be made in whole or in part by Medicare, Medicaid or other applicable third
party payors.
Section 3.25 Licensing and Accreditation.
Each of the Credit Parties and their Subsidiaries has, to the extent
applicable: (a) obtained and maintains in good standing all required licenses;
(b) to the extent prudent and customary in the industry in which it is engaged,
obtained and maintains accreditation from all generally recognized accrediting
agencies; (c) obtained and maintains Medicaid Certification and Medicare
Certification; and (d) entered into and maintains in good standing its Medicare
Provider Agreement and its Medicaid Provider Agreement, if any, except as to
(a), (b), and (c) above to the extent that any such noncompliance could not
reasonably be expected to have a Material Adverse Effect. To the knowledge of
the officers of the Credit Parties, all such required licenses are in full force
and effect on the date hereof and have not been revoked or suspended or
otherwise limited.
Section 3.26 Other Regulatory Protection.
Each of the Credit Parties and their Subsidiaries represent that it does
not manufacture pharmaceutical products and is in compliance with all rules,
regulations and other requirements of the Food and Drug Administration ("FDA"),
the Drug Enforcement Administration ("DEA"), the Federal Trade Commission
("FTC"), the Occupational Safety and Health Administration ("OSHA"), the
Department of Agriculture ("USDA"), the Consumer Product Safety Commission, the
United States Customs Service and the United States Postal Service and other
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state or federal regulatory authorities or jurisdictions in which any of the
Credit Parties or any of its Subsidiaries do business or distribute and market
pharmaceutical products, except to the extent that any such noncompliance would
not have a Material Adverse Effect. Except as so disclosed, neither the FDA, the
DEA, the FTC, OSHA, the USDA, the Consumer Product Safety Commission, nor any
other such regulatory authority has requested (or, to the Credit Parties'
knowledge, are considering requesting) any product recalls or other enforcement
actions that (a) if not complied with would result in a Material Adverse Effect
and (b) with which the Credit Parties have not complied within the time period
(as may be extended) allowed.
Section 3.27 Material Contracts.
Schedule 3.27 sets forth a true and correct and complete list of all Material
Contracts currently in effect. All of the Material Contracts are in full force
and effect and to the knowledge of the Credit Parties no material defaults
currently exist thereunder. The Borrower may update Schedule 3.27 from time to
time by providing a replacement Schedule 3.27 to the Administrative Agent.
Section 3.28 Insurance.
The insurance coverage of the Credit Parties and their Subsidiaries as of
the Closing Date is outlined as to carrier, policy number, expiration date, type
and amount on Schedule 3.28 and such insurance coverage complies with the
requirements set forth in Section 5.5(b) or has been otherwise approved by the
Administrative Agent.
Section 3.29 Reimbursement from Third Party Payors.
The accounts receivable of the Credit Parties have been and will continue
to be adjusted to reflect the reimbursement policies (both those most recently
published in writing as well as those not in writing which have been verbally
communicated) of third party payors such as Medicare, Medicaid, Blue Cross/Blue
Shield, private insurance companies, health maintenance organizations, preferred
provider organizations, alternative delivery systems, managed care systems,
government contacting agencies and other third party payors, in each case in a
manner which could reasonably be expected not to have a Material Adverse Effect.
In particular, accounts receivable relating to third party payors do not and
shall not exceed amounts any obligee is entitled to receive under any capitation
arrangement, fee schedule, discount formula, cost-based reimbursement or other
adjustment or limitation to its usual charges, in each case which could
reasonably be expected to have a Material Adverse Effect.
Section 3.30 Other Agreements.
No Credit Party or Subsidiary thereof is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in (i) any Medicaid Provider Agreement, Medicare Provider Agreement or
other agreement or instrument to which a Credit Party or any of its Subsidiaries
is a party, which default has resulted in, or if not remedied within any
applicable grace period could result in, the revocation, termination,
cancellation or suspension of Medicaid Certification or Medicare Certification
of any Credit Party or any of its Subsidiaries and which could reasonably be
expected to have a Material Adverse Effect; or
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(ii) any other agreement or instrument to which any Credit Party or any of its
Subsidiaries is a party, which default as to items (i) and (ii) above has, or if
not remedied within any applicable grace period could reasonably be expected to
have, a Material Adverse Effect.
Section 3.31 Classification as Senior Indebtedness.
The Credit Party Obligations constitute "Senior Indebtedness" and
"Designated Senior Indebtedness" (or any similar terms) under and as defined in
any agreement governing the outstanding Subordinated Indebtedness, and the
subordination provisions set forth in each such agreement are legally valid and
enforceable against the parties thereto.
Section 3.32 Foreign Assets Control Regulations, Etc.
None of the Credit Parties and none of their Subsidiaries is an "enemy" or
an "ally of the enemy" within the meaning of Section 2 of the Trading with the
Enemy Act of the United States of America (50 U.S.C. App. ▇▇.▇▇. 1 et seq.), as
amended. None of the Credit Parties and none of their Subsidiaries is in
violation of (a) the Trading with the Enemy Act, as amended, (b) any of the
foreign assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive
order relating thereto or (c) the Patriot Act (as defined in Section 9.19). None
of the Credit Parties (i) is a blocked person described in section 1 of the
Anti-Terrorism Order or (ii) to the best of its knowledge, engages in any
dealings or transactions, or is otherwise associated, with any such blocked
person.
Section 3.33 Compliance with OFAC Rules and Regulations.
None of the Credit Parties or their Subsidiaries or their respective
Affiliates (i) is a Sanctioned Person, (ii) has more than 15% of its assets in
Sanctioned Countries, or (iii) derives more than 15% of its operating income
from investments in, or transactions with Sanctioned Persons or Sanctioned
Countries. No part of the proceeds of any Extension of Credit hereunder will be
used directly or indirectly to fund any operations in, finance any investments
or activities in or make any payments to, a Sanctioned Person or a Sanctioned
Country.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.1 Conditions to Closing Date and Initial Extensions of Credit.
This Agreement shall become effective upon, and the obligation of each
Lender to make the initial Revolving Loans, Term Loan and the Swingline Loans on
the Closing Date is subject to, the satisfaction of the following conditions
precedent:
(a) Execution of Agreements. The Administrative Agent shall have
received (i) counterparts of this Credit Agreement, (ii) for the account
of each applicable Revolving Lender, a Revolving Note, (iii) for the
account of each Term Loan Lender that
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requests a Term Note, a Term Note, (iv) for the account of the Swingline
Lender, the Swingline Note, and (v) counterparts of the Security
Agreement, the Pledge Agreement, each Mortgage Instrument and each other
Credit Document to be executed on the Closing Date, in each case
conforming to the requirements of this Credit Agreement and executed by a
duly authorized officer of each party thereto, and in each case in form
and substance satisfactory to the Lenders.
(b) Authority Documents. The Administrative Agent shall have
received the following:
(i) Articles of Incorporation/Charter Documents/Partnership
Agreements. Copies of the articles of incorporation, partnership
agreement or other charter documents, as applicable, of each Credit
Party certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state of its incorporation
or organization.
(ii) Resolutions. Copies of resolutions of the board of
directors or other comparable managing body of each Credit Party
approving and adopting the Credit Documents, the transactions
contemplated therein and authorizing execution and delivery thereof,
certified by a secretary or assistant secretary of such Credit Party
(pursuant to a secretary's certificate in substantially the form of
Schedule 4.1-1 attached hereto) as of the Closing Date to be true
and correct and in force and effect as of such date.
(iii) Bylaws/Operating Agreement. A copy of the bylaws or
comparable operating agreement of each Credit Party certified by a
secretary or assistant secretary of such Credit Party (pursuant to a
secretary's certificate in substantially the form of Schedule 4.1-1
attached hereto) as of the Closing Date to be true and correct and
in force and effect as of such date.
(iv) Good Standing. Copies of (i) certificates of good
standing, existence or its equivalent with respect to the each
Credit Party certified as of a recent date by the appropriate
Governmental Authorities of the state of incorporation or
organization and each other state in which the failure to so qualify
and be in good standing could reasonably be expected to have a
Material Adverse Effect and (ii) a certificate indicating payment of
all corporate franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities.
(v) Incumbency. An incumbency certificate of each Credit Party
certified by a secretary or assistant secretary (pursuant to a
secretary's certificate in substantially the form of Schedule 4.1-1
attached hereto) to be true and correct as of the Closing Date.
(c) Legal Opinions of Counsel. The Administrative Agent shall have
received opinions of legal counsel (including local counsel to the extent
required by the
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Administrative Agent) for the Credit Parties, dated the Closing Date and
addressed to the Administrative Agent and the Lenders, which opinions
shall provide, among other things, that the Credit Parties and their
Subsidiaries are in compliance with all regulatory requirements, corporate
instruments and material agreements on the Closing Date after giving
effect to the transactions contemplated herein and shall otherwise be in
form and substance acceptable to the Administrative Agent.
(d) Personal Property Collateral. The Administrative Agent shall
have received, in form and substance satisfactory to the Administrative
Agent:
(i) searches of Uniform Commercial Code filings in the
jurisdiction of the chief executive office of each Credit Party, the
State of incorporation or organization of each Credit Party and each
jurisdiction where any Collateral is located or where a filing would
need to be made in order to perfect the Administrative Agent's
security interest in the Collateral, copies of the financing
statements on file in such jurisdictions and evidence that no Liens
exist other than Permitted Liens;
(ii) UCC financing statements for each appropriate
jurisdiction as is necessary, in the Administrative Agent's sole
discretion, to perfect the Administrative Agent's security interest
in the Collateral;
(iii) duly executed consents as are necessary, in the
Administrative Agent's sole discretion, to perfect the Lenders'
security interest in the Collateral;
(iv) in the case of any warehouse, plant or other real
property material to the Credit Parties' business that is leased by
a Credit Party, such estoppel letters, consents and waivers from the
landlords on real property leased by the Borrower or any of its
Subsidiaries as reasonably requested by the Administrative Agent;
(v) all stock certificates, if any, evidencing the Capital
Stock pledged to the Administrative Agent pursuant to the Pledge
Agreement, together with duly executed in blank undated stock powers
attached thereto;
(vi) searches of ownership of Intellectual Property in the
appropriate governmental offices and such patent/trademark/copyright
filings as requested by the Administrative Agent in order to perfect
the Administrative Agent's security interest in the Intellectual
Property;
(vii) such patent/trademark/copyright filings as requested by
the Administrative Agent in order to perfect the Administrative
Agent's security interest in the Intellectual Property;
(viii) all instruments and chattel paper in the possession of
any of the Credit Parties, together with allonges or assignments as
may be necessary or
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appropriate to perfect the Administrative Agent's security interest
in the Collateral;
(ix) such duly executed Deposit Account Control Agreements as
requested by the Administrative Agent with respect to Collateral for
which a control agreement is required for perfection of the
Administrative Agent's security interest under the Uniform
Commercial Code; and
(x) copies of the Material Contracts, certified by an officer
of the Borrower to be true and correct copies of such documents as
of the Closing Date, and to the extent required by the
Administrative Agent, a collateral assignment of any Material
Contract and a consent thereto from any applicable third party.
(e) Real Property Collateral. The Administrative Agent shall have
received, in form and substance satisfactory to the Administrative Agent
and the Lenders:
(i) fully executed and notarized Mortgage Instruments
encumbering the Mortgaged Properties listed in Schedule 4.1-4;
(ii) a title report obtained by the Credit Parties in respect
of each of the Mortgaged Properties listed in Schedule 4.1-4;
(iii) a Mortgage Policy with respect to each of the Mortgaged
Properties listed in Schedule 4.1-4;
(iv) evidence as to (A) whether any Mortgaged Property listed
in Schedule 4.1-4 is in an area designated by the Federal Emergency
Management Agency as having special flood or mud slide hazards (a
"Flood Hazard Property") and (B) if any such Mortgaged Property is a
Flood Hazard Property, (1) whether the community in which such
Mortgaged Property is located is participating in the National Flood
Insurance Program, (2) the applicable Credit Party's written
acknowledgment of receipt of written notification from the
Administrative Agent (x) as to the fact that such Mortgaged Property
is a Flood Hazard Property and (y) as to whether the community in
which each such Flood Hazard Property is located is participating in
the National Flood Insurance Program and (z) copies of insurance
policies or certificates of insurance of the Credit Parties
evidencing flood insurance reasonably satisfactory to the
Administrative Agent and naming the Administrative Agent as sole
loss payee on behalf of the Lenders;
(v) Surveys of the Mortgaged Properties listed in Schedule
4.1-4;
(vi) reasonably satisfactory phase I environmental reports
with respect to each of the Mortgaged Properties listed in Schedule
4.1-4, together with reliance letters with respect to such reports
in favor of the Lenders; and
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(vii) an opinion of counsel to the Credit Parties for each
jurisdiction in which the Mortgaged Properties are located.
(f) Liability, Casualty, Property and Business Interruption
Insurance. The Administrative Agent shall have received copies of
insurance policies or certificates of insurance evidencing liability,
casualty and property insurance meeting the requirements set forth herein
or in the Security Documents and business interruption insurance
satisfactory to the Administrative Agent. The Administrative Agent shall
be named as loss payee or mortgagee, as its interest may appear, and/or
additional insured with respect to any such insurance providing liability
coverage or coverage in respect of any Collateral, and each provider of
any such insurance shall agree, by endorsement upon the policy or policies
issued by it or by independent instruments furnished to the Administrative
Agent, that it will give the Administrative Agent thirty (30) days prior
written notice before any such policy or policies shall be altered or
canceled.
(g) Fees. The Administrative Agent and the Lenders shall have
received all fees, if any, owing pursuant to the Fee Letter and Section
2.5.
(h) Litigation. Except as set forth on Schedule 4.1-2 and other than
the SEC inquiry and class action lawsuits that have been disclosed to the
Administrative Agent and the Lenders, which in any event could not be
reasonably expected to have a Material Adverse Effect, there shall not
exist pending or, to the knowledge of the Credit Parties', threatened
litigation, investigation, claim, criminal prosecution, civil
investigative demand, imposition of criminal or civil fines and penalties,
or any other proceeding of or before any arbitrator or Governmental
Authority, including but not limited to those regulatory agencies
responsible for licensing, accrediting or issuing Medicare or Medicaid
certifications, by or against any Credit Party or any of its Subsidiaries
or against any of its or their respective properties or revenues (a)
affecting or relating to the Credit Documents or any Loan or any of the
transactions contemplated hereby, or (b) affecting or relating to any
Credit Party or any of its Subsidiaries, that has not been settled,
dismissed, vacated, discharged or terminated prior to the Closing Date.
(i) Solvency Certificate. The Administrative Agent shall have
received an officer's certificate prepared by the chief financial officer
of the Borrower as to the financial condition, solvency and related
matters of each Credit Party, in each case after giving effect to the
initial borrowings under the Credit Documents, in substantially the form
of Schedule 4.1-3 hereto.
(j) Account Designation Letter. The Administrative Agent shall have
received the executed Account Designation Letter in the form of Schedule
1.1-1 hereto.
(k) Notice of Borrowing. The Administrative Agent shall have
received a Notice of Borrowing with respect to the Revolving Loans to be
made on the Closing Date.
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(l) Corporate Structure. The corporate, capital and ownership
structure of the Credit Parties and their Subsidiaries shall be as
described in Schedule 3.12, and shall otherwise be satisfactory to the
Administrative Agent and the Lenders. The Administrative Agent and the
Lenders shall be satisfied with the management of the Credit Parties and
their Subsidiaries and with all legal, tax, accounting, business and other
matters relating to the Credit Parties and their Subsidiaries.
(m) Consents. The Administrative Agent shall have received evidence
that all governmental, shareholder, board of director and material third
party consents and approvals necessary in connection with the Credit
Documents and other transactions contemplated hereby have been obtained
and all applicable waiting periods have expired without any action being
taken by any authority that could restrain, prevent or impose any material
adverse conditions on such transactions or that could seek or threaten any
of such transactions.
(n) Compliance with Laws. The financings and other transactions
contemplated hereby shall be in compliance in all material respects with
all applicable laws and regulations (including all applicable securities
and banking laws, rules and regulations); provided, however, that the
Borrower is not in compliance with certain SEC requirements as set forth
in the SEC Letter but such non-compliance could not reasonably be expected
to have a Material Adverse Effect.
(o) Bankruptcy. There shall be no bankruptcy or insolvency
proceedings with respect to the any Credit Party or any of its
Subsidiaries.
(p) Material Adverse Effect. Except as disclosed to the Lenders in
the Confidential Information Memorandum dated September, 2005, the minutes
from the Special Meeting of the Board of Directors of the Borrower held on
September 7, 2005 and the written presentation by the Borrower to the
Lenders dated October 3, 2005, no material adverse change shall have
occurred since December 31, 2003 in the business, properties, operations
or financial condition of the Borrower or of the Credit Parties and their
Subsidiaries taken as a whole.
(q) Minimum Consolidated EBITDA. The Administrative Agent shall have
received evidence satisfactory thereto provided by the Borrower that
Consolidated EBITDA of the Borrower and its Subsidiaries as of June 30,
2005 utilizing unaudited financial information, as set forth on Schedule
4.1-5, was no less than $37,500,000.
(r) Financial Statements. The Administrative Agent shall have
received copies of the financial statements referred to in Section 3.1
hereof, each in form and substance satisfactory to it.
(s) Termination of Existing Indebtedness. All existing Indebtedness
(except for Indebtedness set forth on Schedule 6.1(b), but specifically
including the Convertible Bonds) for borrowed money of the Borrower and
its Subsidiaries shall have been repaid
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in full and all commitments relating thereto shall have been terminated
and all Liens relating thereto shall have been terminated.
(t) Officer's Certificates. The Administrative Agent shall have
received a certificate executed by a Responsible Officer of the Borrower
as of the Closing Date stating that (i) no action, suit, investigation or
proceeding is pending or, to the knowledge of any Credit Party, threatened
in any court or before any arbitrator or governmental instrumentality that
purports to affect any Credit Party or any other transaction contemplated
by the Credit Documents, if such action, suit, investigation or proceeding
could reasonably be expected to have a Material Adverse Effect and (ii)
immediately after giving effect to this Credit Agreement (including the
initial Extensions of Credit hereunder), the other Credit Documents and
all the transactions contemplated therein to occur on such date, (A) no
Default or Event of Default exists, (B) all representations and warranties
contained herein and in the other Credit Documents are true and correct in
all material respects, and (C) the Credit Parties are in compliance with
each of the initial financial covenant levels set forth in Section 5.9(a)
- (c), calculated as of June 30, 2005 utilizing unaudited financial
information, in each case after giving effect to the initial borrowings
under the Credit Documents on a pro forma basis, and demonstrating
compliance with such financial covenants.
(u) Patriot Act Certificate. The Administrative Agent shall have
received a certificate satisfactory thereto, for benefit of itself and the
Lenders, provided by the Borrower that sets forth information required by
the Patriot Act (as defined in Section 9.19) including, without
limitation, the identity of the Borrower, the name and address of the
Borrower and other information that will allow the Administrative Agent or
any Lender, as applicable, to identify the Borrower in accordance with the
Patriot Act.
(v) Final Reports. The Administrative Agent shall have received the
final reports of FTI Consulting, Inc. (either written or verbal), if
available, and Capstone Advisory Group, LLC, each in form and substance
satisfactory to the Administrative Agent.
(w) Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Credit Agreement
shall be reasonably satisfactory in form and substance to the
Administrative Agent and its counsel.
Section 4.2 Conditions to All Extensions of Credit.
The obligation of each Lender to make any Extension of Credit hereunder is
subject to the satisfaction of the following conditions precedent on the date of
making such Extension of Credit:
(a) Representations and Warranties. The representations and
warranties made by the Credit Parties herein, in the Security Documents or
which are contained in any certificate furnished at any time under or in
connection herewith (i) that contain a materiality qualification shall be
true and correct on and as of the date of such Extension
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of Credit as if made on and as of such date and (ii) that do not contain a
materiality qualification shall be true and correct in all material
respects on and as of the date of such Extension of Credit as if made on
and as of such date.
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on such date or after giving effect
to the Extension of Credit to be made on such date unless such Default or
Event of Default shall have been waived in accordance with this Credit
Agreement.
(c) Compliance with Commitments. Immediately after giving effect to
the making of any such Extension of Credit (and the application of the
proceeds thereof), (i) the sum of the aggregate principal amount of
outstanding Revolving Loans plus the aggregate principal amount of
outstanding Swingline Loans plus LOC Obligations shall not exceed the
Revolving Committed Amount, (ii) the LOC Obligations shall not exceed the
LOC Committed Amount and (iii) the Swingline Loans shall not exceed the
Swingline Committed Amount.
(d) Additional Conditions to Extensions of Credit. If such Extension
of Credit is made pursuant to Sections 2.1, 2.2, 2.3 or 2.4 all conditions
set forth in such Section shall have been satisfied.
Each request for an Extension of Credit and each acceptance by the
Borrower of any such Extension of Credit shall be deemed to constitute a
representation and warranty by the Borrower as of the date of such Extension of
Credit that the applicable conditions in subsections (a) through (d) of this
Section have been satisfied.
ARTICLE V
AFFIRMATIVE COVENANTS
The Credit Parties hereby covenant and agree that on the Closing Date, and
thereafter for so long as this Credit Agreement is in effect and until the
Commitments have terminated, no Note remains outstanding and unpaid and the
Credit Party Obligations, together with interest, Commitment Fees and all other
amounts owing to the Administrative Agent or any Lender hereunder, are paid in
full, the Credit Parties shall, and shall cause each of their Subsidiaries, to:
Section 5.1 Financial Statements.
Furnish to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. Subject to the terms of Section
5.14(a), as soon as available, and in any event no later than the earlier
of (i) the date the Borrower is required by the SEC to deliver its Form
10-K for any fiscal year of the Borrower and (ii) ninety (90) days after
the end of each fiscal year of the Borrower, a copy of the consolidated
and consolidating balance sheet of the Borrower and its consolidated
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Subsidiaries as at the end of such fiscal year and the related
consolidated and consolidating statements of income and retained earnings
and of cash flows of the Borrower and its consolidated Subsidiaries for
such year, audited (with respect to the consolidated statements only) by a
firm of independent certified public accountants of nationally recognized
standing reasonably acceptable to the Administrative Agent, in each case
setting forth in comparative form consolidated and consolidating figures
for the preceding fiscal year, reported on without a "going concern" or
like qualification or exception, or qualification indicating that the
scope of the audit was inadequate to permit such independent certified
public accountants to certify such financial statements without such
qualification;
(b) Quarterly Financial Statements. As soon as available, and in any
event no later than the earlier of (i) the date the Borrower is required
by the SEC to deliver its Form 10-Q for any fiscal quarter of the Borrower
and (ii) forty-five (45) days after the end of each of the fiscal quarters
of the Borrower, a company-prepared consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such period
and related company-prepared consolidated statements of income and
retained earnings and cash flows for the Borrower and its consolidated
Subsidiaries for such quarterly period and for the portion of the fiscal
year ending with such period, in each case setting forth in comparative
form consolidated figures for the corresponding period or periods of the
preceding fiscal year (subject to normal recurring year-end audit
adjustments) and including management discussion and analysis of operating
results inclusive of operating metrics in comparative form and a summary
of accounts receivable and accounts payable aging reports in form
satisfactory to the Lenders; provided that, with respect to the fiscal
quarter ending September 30, 2005, the Borrower shall deliver such
quarterly financial statements on or before November 30, 2005;
(c) Monthly Financial Statements. As soon as available and in any
event within thirty (30) days after the end of each fiscal month of the
Borrower from the Closing Date through the later of (i) March 31, 2006 and
(ii) the date the requirements set forth in Sections 5.14(a) and (b) have
been satisfied, a company-prepared consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such period
and related company-prepared consolidated statements of income and
retained earnings and cash flows for the Borrower and its consolidated
Subsidiaries for such monthly period and for the portion of the fiscal
year ending with such period, in each case setting forth in comparative
form consolidated figures for the corresponding period or periods of the
preceding fiscal year (subject to normal recurring year-end audit
adjustments); and
(d) Annual Budget Plan. As soon as available, but in any event
within forty-five days (45) after the end of each fiscal year, a copy of
the detailed annual budget or plan including cash flow projections of the
Borrower for the next fiscal year on a quarterly basis, in form and detail
reasonably acceptable to the Administrative Agent and the Required
Lenders, together with a summary of the material assumptions made in the
preparation of such annual budget or plan;
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all such financial statements to be complete and correct in all material
respects (subject, in the case of interim statements, to normal recurring
year-end audit adjustments) and to be prepared in reasonable detail and, in the
case of the annual and quarterly financial statements provided in accordance
with subsections (a) and (b) above, in accordance with GAAP applied consistently
throughout the periods reflected therein and further accompanied by a
description of, and an estimation of the effect on the financial statements on
account of, a change, if any, in the application of accounting principles as
provided in Section 1.3.
Section 5.2 Certificates; Other Information.
Furnish to the Administrative Agent and each of the Lenders:
(a) concurrently with the delivery of the financial statements
referred to in Section 5.1(a) above, a certificate of the independent
certified public accountants reporting on such financial statements
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate;
(b) concurrently with the delivery of the financial statements
referred to in Sections 5.1(a) and 5.1(b) above, a certificate of a
Responsible Officer stating that, to the best of such Responsible
Officer's knowledge, during such period each of the Credit Parties
observed or performed in all material respects all of its covenants and
other agreements, and satisfied in all material respects every condition,
contained in this Credit Agreement to be observed, performed or satisfied
by it, and that such Responsible Officer has obtained no knowledge of any
Default or Event of Default except as specified in such certificate and
such certificate shall include the calculations in reasonable detail
required to indicate compliance with Section 5.9 as of the last day of
such period ("Compliance Certificate");
(c) concurrently with or prior to the delivery of the financial
statements referred to in Sections 5.1(a) and 5.1(b) above, (i) an updated
copy of Schedule 3.12 if the Borrower or any of its Subsidiaries has
formed or acquired a new Subsidiary since the Closing Date or since
Schedule 3.12 was last updated, as applicable, (ii) an updated copy of
Schedule 3.16 if the Borrower or any of its Subsidiaries has registered,
applied for registration of, acquired or otherwise obtained ownership of
any new Intellectual Property since the Closing Date or since Schedule
3.16 was last updated, as applicable, and (iii) an updated copy of
Schedule 3.27 if any new Material Contract has been entered into since the
Closing Date or since Schedule 3.27 was last updated, as applicable,
together with a copy of each new Material Contract;
(d) within ten (10) days after the same are sent, copies of all
reports (other than those otherwise provided pursuant to Section 5.1 and
those which are of a promotional nature) and other financial information
which the Borrower sends to its members and equity holders, and within ten
(10) days after the same are filed, copies of all financial statements and
non-confidential reports which the Borrower may make to, or
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file with the Securities and Exchange Commission or any successor or
analogous Governmental Authority;
(e) within ninety (90) days after the end of each fiscal year of the
Borrower, a certificate containing information regarding the amount of all
Asset Dispositions, Debt Issuances, and Equity Issuances that were made
during the prior fiscal year and amounts received in connection with any
Recovery Event during the prior fiscal year;
(f) promptly upon receipt thereof, a copy of any other report or
"management letter" submitted by independent accountants to any Credit
Party or any of its Subsidiaries in connection with any annual, interim or
special audit of the books of such Person; and
(g) promptly, such additional financial and other information as the
Administrative Agent, on behalf of any Lender, may from time to time
reasonably request.
Section 5.3 Payment of Obligations.
Pay, discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, all its taxes (Federal, state, local and
any other taxes) and all its other obligations and liabilities of whatever
nature and any additional costs that are imposed as a result of any failure to
so pay, discharge or otherwise satisfy such obligations and liabilities, except
when the amount or validity of such obligations, liabilities and costs is
currently being contested in good faith by appropriate proceedings and reserves,
if applicable, in conformity with GAAP with respect thereto have been provided
on the books of the Borrower or its Subsidiaries, as the case may be or except
to the extent that failure to so pay, discharge or otherwise satisfy such
obligations and liabilities could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 5.4 Conduct of Business and Maintenance of Existence.
Continue to engage in business of the same general type as now conducted
by it on the Closing Date and preserve, renew and keep in full force and effect
its corporate existence and good standing and take all reasonable action to
maintain all rights, privileges and franchises necessary or desirable in the
normal conduct of its business; comply with all Contractual Obligations and
Requirements of Law applicable to it except to the extent that failure to comply
therewith could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
Section 5.5 Maintenance of Property; Insurance.
(a) Keep all material property useful and necessary in its business
in good working order and condition (ordinary wear and tear and
obsolescence excepted);
(b) Maintain with financially sound and reputable insurance
companies insurance on all its material property (including without
limitation its material tangible
75
Collateral) in at least such amounts and against at least such risks as
are usually insured against in the same general area by companies engaged
in the same or a similar business (including, without limitation,
liability, property, casualty and business interruption insurance); and
furnish to the Administrative Agent, upon written request, full
information as to the insurance carried. The Administrative Agent shall be
named as loss payee or mortgagee, as its interest may appear, and the
Administrative Agent shall be named as an additional insured with respect
to any such liability insurance and any property or casualty insurance
providing coverage in respect of any Collateral, and each provider of any
such insurance shall agree, by endorsement upon the policy or policies
issued by it or by independent instruments furnished to the Administrative
Agent, that it will give the Administrative Agent thirty (30) days prior
written notice before any such policy or policies shall be altered or
canceled, and that no act or default of any Credit Party or any of its
Subsidiaries or any other Person shall affect the rights of the
Administrative Agent or the Lenders under such policy or policies; and
(c) In case of any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party
shall promptly give written notice thereof to the Administrative Agent
generally describing the nature and extent of such damage or destruction.
In case of any loss, damage to or destruction of the Collateral of any
Credit Party or any part thereof, such Credit Party, whether or not the
insurance proceeds, if any, received on account of such damage or
destruction shall be sufficient for that purpose, at such Credit Party's
cost and expense, will promptly repair or replace the Collateral of such
Credit Party so lost, damaged or destroyed to the extent such Collateral
is reasonably necessary for such Credit Party's business.
Section 5.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its businesses and activities; and
permit, during regular business hours and upon reasonable notice by the
Administrative Agent or any Lender, the Administrative Agent or any Lender to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records (other than materials protected by the attorney-client
privilege and materials which the Borrower may not disclose without violation of
a confidentiality obligation binding upon it) at any reasonable time and as
often as may reasonably be desired, and to discuss the business, operations,
properties and financial and other condition of the Credit Parties and their
Subsidiaries with officers and employees of the Credit Parties and their
Subsidiaries and with its independent certified public accountants, in each case
at the Borrower's expense.
Section 5.7 Notices.
Give notice in writing to the Administrative Agent (which shall promptly
transmit such notice to each Lender) of:
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(a) promptly, but in any event within two (2) Business Days after
any Credit Party knows or has reason to know thereof, the occurrence of
any Default or Event of Default;
(b) promptly, but in any event within three (3) Business Days after
any Credit Party knows or has reason to know thereof, any default or event
of default under any Contractual Obligation of any Credit Party or any of
its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect or involve a monetary claim in excess of $1,000,000;
(c) promptly, but in any event within three (3) Business Days after
any Credit Party knows or has reason to know thereof, any litigation, or
any investigation or proceeding known to a Credit Party (i) affecting any
Credit Party or any of its Subsidiaries which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect, (ii)
affecting, or with respect to, this Credit Agreement, any other Credit
Document or any security interest or Lien created thereunder or (iii)
involving an environmental claim or potential liability under
Environmental Laws in excess of $1,000,000.
(d) as soon as possible and in any event within thirty (30) days
after any Credit Party knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to
any Plan, a failure to make any required contribution to a Plan, the
creation of any Lien in favor of the PBGC (other than a Permitted Lien) or
a Plan or any withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the institution of
proceedings or the taking of any other action by the PBGC or any Credit
Party, or any Commonly Controlled Entity or any Multiemployer Plan, with
respect to the withdrawal from, or the terminating, Reorganization or
Insolvency of, any Plan;
(e) promptly, of the institution of any investigation or proceeding
against any Credit Party to suspend, revoke or terminate or which may
result in the termination of any Medicaid Provider Agreement, Medicaid
Certification, Medicare Provider Agreement, Medicare Certification or
exclusion from any Medical Reimbursement Program;
(f) promptly, after any Credit Party becomes involved in a pending
civil or criminal investigation, criminal action or civil proposed
debarment, exclusion or other sanctioning action related to any Federal or
state healthcare program;
(g) promptly, but in any event within three (3) Business Days after
any Credit Party knows or has reason to know thereof, any formal or
informal inquiry or investigation of a Credit Party by the SEC or any
written correspondence received from the SEC regarding any existing formal
or informal inquiry or investigation of a Credit Party; and
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(h) promptly, any other development or event which could reasonably
be expected to have a Material Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto. In
the case of any notice of a Default or Event of Default, the Borrower shall
specify that such notice is a Default or Event of Default notice on the face
thereof.
Section 5.8 Environmental Laws.
(a) Comply in all material respects with, and ensure compliance in
all material respects by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply in all material
respects with and maintain, and ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws except to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all
lawful orders and directives of all Governmental Authorities regarding
Environmental Laws except to the extent that the same are being contested
in good faith by appropriate proceedings and the pendency of such
proceedings could not reasonably be expected to have a Material Adverse
Effect; and
(c) Defend, indemnify and hold harmless the Administrative Agent and
the Lenders, and their respective employees, agents, officers and
directors and affiliates, from and against any and all claims, demands,
penalties, fines, liabilities, settlements, damages, costs and expenses of
whatever kind or nature known or unknown, contingent or otherwise, arising
out of, or in any way relating to the violation of, noncompliance with or
liability under, any Environmental Law applicable to the operations of the
any Credit Party or any of its Subsidiaries or the Properties, or any
orders, requirements or demands of Governmental Authorities related
thereto, including, without limitation, reasonable attorney's and
consultant's fees, investigation and laboratory fees, response costs,
court costs and litigation expenses, except to the extent that any of the
foregoing arise out of the gross negligence or willful misconduct of the
party seeking indemnification therefor. The agreements in this paragraph
shall survive repayment of the Notes and all other amounts payable
hereunder and the termination of the Commitments and the Credit
Documents..
Section 5.9 Financial Covenants.
Comply with the following financial covenants:
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(a) Maximum Leverage Ratio. The Leverage Ratio as of the end of each
fiscal quarter of the Borrower, beginning with the fiscal quarter ended
September 30, 2005, for the twelve (12) month period ending on any date of
determination, shall be less than or equal 2.50 to 1.00.
(b) Minimum Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio as of the end of each fiscal quarter of the Borrower, beginning with
the fiscal quarter ended September 30, 2005, for the twelve (12) month
period ending on any date of determination, shall be greater than or equal
to 1.50 to 1.00.
(c) Minimum Cash Balance. The Borrower shall have not less than
$25,000,000 of unrestricted cash and Cash Equivalents on its balance sheet
at all times, in an account(s) in which the Administrative Agent has a
perfected security interest under the UCC.
(d) Minimum Consolidated EBITDA. Upon receipt of the audited
financial statements for the fiscal year ended 2004, Consolidated EBITDA
for the Borrower and its Subsidiaries' shall have been at least
$42,200,000 for such period after giving effect to the acquisition of
Bioglan Pharmaceuticals, Inc. on a pro forma basis.
For purposes of computing the financial covenants set forth in this
Section 5.9 for any applicable test period, any Permitted Acquisition or sale of
assets (including a stock sale) permitted pursuant to Section 6.4(a)(vi) that is
consummated during such test period shall have been deemed to have taken place
as of the first day of such test period.
Section 5.10 Additional Guarantors.
Cause each of their Domestic Subsidiaries that is not an Immaterial
Subsidiary, whether newly formed, after acquired or otherwise existing, to
promptly become a Guarantor hereunder by way of execution of a Joinder
Agreement; provided that the Credit Parties shall have no more than five (5)
Immaterial Subsidiaries at any time that are not Guarantors. The Credit Party
Obligations shall be secured by, among other things, a first priority perfected
security interest in the Collateral of such new Guarantor and a pledge of 100%
of the Capital Stock of such new Guarantor and its Domestic Subsidiaries and 65%
(or such higher percentage that would not result in material adverse tax
consequences for such new Guarantor) of the voting Capital Stock and 100% of the
non-voting Capital Stock of its first-tier Foreign Subsidiaries. In connection
with the foregoing, the Credit Parties shall deliver to the Administrative Agent
such Security Documents, legal opinions and related documents as the
Administrative Agent may reasonably request with respect to such Collateral and
with respect to the Joinder Agreement executed by the new Guarantor.
Section 5.11 Compliance with Law.
(a) Comply with all laws, rules, regulations and orders, and all
applicable restrictions imposed by all Governmental Authorities,
applicable to it and its Property if noncompliance with any such law,
rule, regulation, order or restriction could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect;
79
(b) conform with and duly observe in all material respects all laws,
rules and regulations and all other valid requirements of any regulatory
authority with respect to the conduct of its business, including without
limitation Titles XVIII and XIX of the Social Security Act, Medicare
Regulations, Medicaid Regulations, and all laws, rules and regulations of
Governmental Authorities, pertaining to the business of the Credit Parties
if noncompliance with any such law, rule, regulation, order or restriction
could reasonably be expected to have a Material Adverse Effect; and
(c) obtain and maintain all licenses, permits, certifications and
approvals of all applicable Governmental Authorities as are required for
the conduct of its business as currently conducted and herein
contemplated, including without limitation professional licenses, Medicaid
Certifications and Medicare Certifications, if failure to do so could have
a Material Adverse Effect.
Specifically, but without limiting the foregoing, and except where any
such failure to comply could not reasonably be expected to have a Material
Adverse Effect: (i) billing policies, arrangements, protocols and instructions
will comply with reimbursement requirements under Medicare, Medicaid and other
Medical Reimbursement Programs and will be administered by properly trained
personnel; and (ii) medical director compensation arrangements and other
arrangements with referring physicians will comply with applicable state and
federal self-referral and anti-kickback laws, including without limitation 42
U.S.C. Section 1320a-7b(b)(1) - (b)(2) 42 U.S.C. and 42 U.S.C. Section 1395nn.
Section 5.12 Pledged Assets.
Cause such Person's real property and tangible and intangible personal
property to be subject at all times to a first priority, perfected Lien (subject
in each case to Permitted Liens) in favor of the Administrative Agent pursuant
to the terms and conditions of the Security Documents or such other security
documents as the Administrative Agent shall reasonably request. Each Credit
Party shall, and shall cause each of its Subsidiaries to, adhere to the
covenants set forth in the Security Documents.
Section 5.13 Covenants Regarding Patents, Trademarks and Copyrights.
(a) Notify the Administrative Agent promptly if it knows or has
reason to know that any application, letters patent or registration
relating to any Patent, Patent License, Trademark or Trademark License of
the Credit Parties or any of their Subsidiaries may become abandoned, or
of any adverse determination or development (including, without
limitation, the institution of, or any such determination or development
in, any proceeding in the United States Patent and Trademark Office or any
court) regarding a Credit Party's or any of its Subsidiary's ownership of
any Patent or Trademark, its right to patent or register the same, or to
enforce, keep and maintain the same, or its rights under any Patent
License or Trademark License.
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(b) Notify the Administrative Agent promptly after it knows or has
reason to know of any adverse determination or development (including,
without limitation, the institution of, or any such determination or
development in, any proceeding in any court) regarding any Copyright or
Copyright License of the Credit Parties or any of their Subsidiaries,
whether (i) such Copyright or Copyright License may become invalid or
unenforceable prior to its expiration or termination, or (ii) such Credit
Party's or any of its Subsidiary's ownership of such Copyright, its right
to register the same or to enforce, keep and maintain the same, or its
rights under such Copyright License, may become affected.
(c) (i) Promptly notify the Administrative Agent of any filing by
any Credit Party or any of its Subsidiaries, either itself or through any
agent, employee, licensee or designee (but in no event later than the
fifteenth day following such filing), of any application for registration
of any Intellectual Property with the United States Copyright Office or
United States Patent and Trademark Office or any similar office or agency
in any other country or any political subdivision thereof.
(ii) Concurrently with the delivery of quarterly and annual
financial statements of the Borrower pursuant to Section 5.1 hereof,
provide the Administrative Agent and its counsel a complete and
correct list of all Intellectual Property owned by or licensed to
the Credit Parties or any of their Subsidiaries other than
Intellectual Property previously disclosed in writing to the
Administrative Agent and the Lenders on Schedule 3.16 or otherwise.
(iii) Upon request of the Administrative Agent, execute and
deliver any and all agreements, instruments, documents, and papers
as the Administrative Agent may reasonably request to evidence the
Administrative Agent's security interest in the Intellectual
Property referred to in clauses (i) and (ii) and the general
intangibles relating thereto or represented thereby, including,
without limitation, the goodwill of the Credit Parties and their
Subsidiaries relating thereto or represented thereby (or such other
Intellectual Property or the general intangibles relating thereto or
represented thereby as the Administrative Agent may reasonably
request).
(d) Take all actions that are reasonably necessary (including,
without limitation, in any proceeding before the United States Patent and
Trademark Office or the United States Copyright Office) to maintain each
material item of Intellectual Property of the Credit Parties and their
Subsidiaries, including, without limitation, payment of maintenance fees,
filing of applications for renewal, affidavits of use, affidavits of
incontestability and opposition, interference and cancellation
proceedings.
(e) In the event that any Credit Party becomes aware that any
Intellectual Property is infringed, misappropriated or diluted by a third
party in any material respect, notify the Administrative Agent promptly
after it learns thereof and, unless the Credit Parties shall reasonably
determine that such Intellectual Property is not material to the business
of the Credit Parties and their Subsidiaries taken as a whole, promptly
▇▇▇ for
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infringement, misappropriation or dilution and to recover any and all
damages for such infringement, misappropriation or dilution, and take such
other actions as the Credit Parties shall reasonably deem appropriate
under the circumstances to protect such Intellectual Property.
Section 5.14 Post-Closing Covenants.
(a) No later than December 31, 2005 the Borrower shall deliver to
the Lenders the balance sheets and the related statements of income and of
cash flows of the Borrower for the fiscal year ended December 31, 2004,
audited by a firm of independent certified public accountants of
nationally recognized standing reasonably acceptable to the Administrative
Agent, setting forth in comparative form consolidated and consolidating
figures for the preceding fiscal year, reported on without a "going
concern" or like qualification or exception, or qualification indicating
that the scope of the audit was inadequate to permit such independent
certified public accountants to certify such financial statements without
a "going concern" or like qualification or exception, such financial
statements to be acceptable to the Administrative Agent.
(b) The Borrower shall be a current filer and shall be in compliance
with all SEC regulations by March 31, 2006.
(c) Within thirty (30) days after the Closing Date (or such extended
period of time as agreed to by the Administrative Agent in its reasonable
discretion), the Credit Parties shall use their good faith efforts to
deliver to the Administrative Agent account control agreements with
respect to the deposit accounts and securities accounts of the Credit
Parties listed on Schedule 6.14.
(d) Upon the request of the Administrative Agent, promptly perform
or cause to be performed any and all acts and execute or cause to be
executed any and all documents for filing under the provisions of the UCC
or any other Requirement of Law which are necessary or advisable to
maintain in favor of the Administrative Agent, for the benefit of the
Lenders, Liens on the Collateral that are duly perfected in accordance
with the requirements of, or the obligations of the Credit Parties under,
the Credit Documents and all applicable Requirements of Law.
ARTICLE VI
NEGATIVE COVENANTS
The Credit Parties hereby covenant and agree that on the Closing Date, and
thereafter for so long as this Credit Agreement is in effect and until the
Commitments have terminated, no Note remains outstanding and unpaid and the
Credit Party Obligations, together with interest, Commitment Fee and all other
amounts owing to the Administrative Agent or any Lender hereunder, are paid in
full that:
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Section 6.1 Indebtedness.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising or existing under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness of the Borrower and its Subsidiaries existing as of
the Closing Date as referenced in the financial statements referenced in
Section 3.1 (and set out more specifically in Schedule 6.1(b)) hereto and
renewals, refinancings or extensions thereof in a principal amount not in
excess of that outstanding as of the date of such renewal, refinancing or
extension;
(c) Indebtedness of the Borrower and its Subsidiaries incurred after
the Closing Date consisting of Capital Leases or Indebtedness incurred to
provide all or a portion of the purchase price or cost of construction of
an asset provided that (i) such Indebtedness when incurred shall not
exceed the purchase price or cost of construction of such asset; (ii) no
such Indebtedness shall be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of such refinancing;
and (iii) the total amount of all such Indebtedness shall not exceed
$5,000,000 at any time outstanding;
(d) Unsecured intercompany Indebtedness among the Credit Parties,
provided that any such Indebtedness shall be (i) fully subordinated to the
Credit Party Obligations hereunder on terms reasonably satisfactory to the
Administrative Agent and (ii) evidenced by promissory notes which shall be
pledged to the Administrative Agent as Collateral for the Credit Party
Obligations;
(e) Indebtedness and obligations owing under Secured Hedging
Agreements and other Hedging Agreements entered into in order to manage
existing or anticipated interest rate or exchange rate risks and not for
speculative purposes;
(f) Indebtedness and obligations of Credit Parties owing under
documentary letters of credit for the purchase of goods or other
merchandise (but not under standby, direct pay or other letters of credit
except for the Letters of Credit hereunder) generally;
(g) Guaranty Obligations in respect of Indebtedness of a Credit
Party to the extent such Indebtedness is permitted to exist or be incurred
pursuant to this Section 6.1;
(h) Subordinated Indebtedness in a principal amount not exceeding
$30,000,000 in the aggregate at any time outstanding; and
(i) other Indebtedness of the Borrower and its Subsidiaries which
does not exceed $2,500,000 in the aggregate at any time outstanding.
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Section 6.2 Liens.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
contract, create, incur, assume or permit to exist any Lien with respect to any
of its property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or hereafter acquired, except for Permitted
Liens. Notwithstanding the foregoing, if a Credit Party shall ▇▇▇▇▇ ▇ ▇▇▇▇ on
any of its assets in violation of this Section 6.2, then it shall be deemed to
have simultaneously granted an equal and ratable Lien on any such assets in
favor of the Administrative Agent for the ratable benefit of the Lenders and the
Hedging Agreement Providers, to the extent such a Lien has not already been
granted to the Administrative Agent.
Section 6.3 Nature of Business.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
alter the character of its business in any material respect from that conducted
as of the Closing Date.
Section 6.4 Consolidation, Merger, Sale or Purchase of Assets, etc.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
(a) dissolve, liquidate or wind up its affairs, sell, transfer,
lease or otherwise dispose of its property or assets or agree to do so at
a future time except the following, without duplication, shall be
expressly permitted:
(i) the sale, transfer, lease or other disposition of
inventory and materials in the ordinary course of business
(ii) the conversion of cash into Cash Equivalents and Cash
Equivalents into cash;
(iii) (A) the disposition of property or assets as a direct
result of a Recovery Event or (B) the sale, lease, transfer or other
disposition of machinery, parts and equipment no longer used or
useful in the conduct of the business of the Borrower or any of its
Subsidiaries, so long as the net proceeds therefrom are used to
replace such machinery, parts and equipment or to purchase or
otherwise acquire new assets or property within 180 days of receipt
of the net proceeds;
(iv) the sale, lease or transfer of property or assets (for
fair market value) between the Borrower and any Guarantor;
(v) the sale, lease or transfer of property or assets from a
Credit Party other than the Borrower to another Credit Party;
(vi) the sale, lease or transfer of property or assets not to
exceed $1,000,000 in the aggregate in any fiscal year; and
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(vii) the voluntary termination of Hedging Agreements;
provided, that, in the case of clauses (i), (iii) and (vi) above, at least
seventy-five percent (75%) of the consideration received therefor by the
Borrower or any other Credit Party is in the form of cash or Cash
Equivalents; provided, further, that with respect to sales of assets
permitted hereunder only, the Administrative Agent shall be entitled,
without the consent of the Required Lenders, to release its Liens relating
to the particular assets sold; or
(b) (i) purchase, lease or otherwise acquire (in a single
transaction or a series of related transactions) the property or assets of
any Person (other than purchases or other acquisitions of inventory,
leases, licenses, Intellectual Property, materials, property and equipment
in the ordinary course of business, except as otherwise limited or
prohibited herein) or (ii) enter into any transaction of merger or
consolidation, except for (A) investments or acquisitions permitted
pursuant to Section 6.5, and (B) the merger or consolidation of a Credit
Party with and into another Credit Party; provided that if the Borrower is
a party thereto, the Borrower will be the surviving corporation.
Section 6.5 Advances, Investments and Loans.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
make any Investment except for Permitted Investments.
Section 6.6 Transactions with Affiliates.
Except as permitted in subsection (iv) of the definition of Permitted
Investments, each of the Credit Parties will not, nor will it permit any
Subsidiary to, enter into any transaction or series of transactions, whether or
not in the ordinary course of business, with any officer, director, shareholder
or Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person other
than an officer, director, shareholder or Affiliate.
Section 6.7 Ownership of Subsidiaries; Restrictions.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
create, form or acquire any Subsidiaries, except for (a) Domestic Subsidiaries,
other than certain Immaterial Subsidiaries, which are joined as Additional
Credit Parties in accordance with the terms hereof and (b) Immaterial
Subsidiaries, subject to the terms of Section 5.10. The Borrower will not sell,
transfer, pledge or otherwise dispose of any Capital Stock or other equity
interests in any of its Subsidiaries, nor will it permit any of its Subsidiaries
to issue, sell, transfer, pledge or otherwise dispose of any of their Capital
Stock or other equity interests, except in a transaction permitted by Section
6.4.
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Section 6.8 Fiscal Year; Organizational Documents; Material Contracts.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
change its fiscal year or its accounting policies. Each of the Credit Parties
will not, nor will it permit any Subsidiary to, amend, modify or change its
articles of incorporation (or corporate charter or other similar organizational
document) or bylaws (or other similar document) without the prior written
consent of the Administrative Agent. Each of the Credit Parties will not, nor
will it permit any Subsidiary to, without the prior written consent of the
Administrative Agent, amend, modify, cancel or terminate or fail to renew or
extend or permit the amendment, modification, cancellation or termination of any
of the Material Contracts, except in the event that such amendments,
modifications, cancellations or terminations could not reasonably be expected to
have a Material Adverse Effect. The Borrower will not, without the prior written
consent of the Required Lenders, amend, modify, waive or extend or permit the
amendment, modification, waiver or extension of any Subordinated Indebtedness or
of any documentation governing or evidencing such Subordinated Indebtedness in a
manner that is adverse to the interests of the Lenders or the issuer of such
Subordinated Indebtedness. Each of the Credit Parties will not, without giving
30 days' prior written notice to the Administrative Agent, change its state of
incorporation, organization or formation or have more than one state of
incorporation, organization or formation.
Section 6.9 Limitation on Restricted Actions.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any such Person to
(a) pay dividends or make any other distributions to any Credit Party on its
Capital Stock or with respect to any other interest or participation in, or
measured by, its profits, (b) pay any Indebtedness or other obligation owed to
any Credit Party, (c) make loans or advances to any Credit Party, (d) sell,
lease or transfer any of its properties or assets to any Credit Party, or (e)
act as a Guarantor and pledge its assets pursuant to the Credit Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (a)-(d) above) for such
encumbrances or restrictions existing under or by reason of (i) this Credit
Agreement and the other Credit Documents, (ii) applicable law, (iii) any
document or instrument governing Indebtedness incurred pursuant to Section
6.1(c); provided that any such restriction contained therein relates only to the
asset or assets constructed or acquired in connection therewith, or (iv) any
Permitted Lien or any document or instrument governing any Permitted Lien;
provided that any such restriction contained therein relates only to the asset
or assets subject to such Permitted Lien.
Section 6.10 Restricted Payments.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
directly or indirectly, declare, order, make or set apart any sum for or pay any
Restricted Payment, except (a) to make dividends payable solely in the same
class of Capital Stock of such Person, (b) to make dividends or other
distributions payable to any Credit Party (directly or indirectly through
Subsidiaries), and (c) so long as (i) no Default or Event of Default shall have
occurred and be continuing or would result therefrom and (ii) the Borrower has
satisfied the requirements set
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forth in Sections 5.14(a) and (b), the Borrower may repurchase shares of its
Capital Stock in an aggregate amount not to exceed $3,000,000 during the term of
this Credit Agreement.
Section 6.11 Sale Leasebacks.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
directly or indirectly become or remain liable as lessee or as guarantor or
other surety with respect to any lease, whether an operating lease or a Capital
Lease, of any property (whether real, personal or mixed), whether now owned or
hereafter acquired, (a) which any Credit Party or any Subsidiary has sold or
transferred or is to sell or transfer to a Person which is not another Credit
Party or Subsidiary or (b) which any Credit Party or any Subsidiary intends to
use for substantially the same purpose as any other property which has been sold
or is to be sold or transferred by such Credit Party or such Subsidiary to
another Person which is not another Credit Party or Subsidiary in connection
with such lease.
Section 6.12 No Further Negative Pledges.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
enter into, assume or become subject to any agreement prohibiting or otherwise
restricting the creation or assumption of any Lien upon its properties or
assets, whether now owned or hereafter acquired, or requiring the grant of any
security for such obligation if security is given for some other obligation,
except (a) pursuant to this Credit Agreement and the other Credit Documents, (b)
pursuant to any document or instrument governing Indebtedness incurred pursuant
to Section 6.1(c); provided that any such restriction contained therein relates
only to the asset or assets constructed or acquired in connection therewith and
(c) in connection with any Permitted Lien or any document or instrument
governing any Permitted Lien; provided that any such restriction contained
therein relates only to the asset or assets subject to such Permitted Lien.
Section 6.13 Operating Lease Obligations.
Each of the Credit Parties will not, nor will it permit any Subsidiary to,
enter into, assume or permit to exist any obligations for the payment of rent
under Operating Leases which in the aggregate for all such Persons would exceed
$3,250,000 in any fiscal year.
Section 6.14 Deposit Account Control Agreements; Additional Bank Accounts.
Each of the Credit Parties will not, nor will it permit any Subsidiary to
(a) open, maintain or otherwise have any checking, savings or other accounts at
any bank or other financial institution, or any other account where money is or
may be deposited or maintained with any Person, other than (i) the accounts set
forth on Schedule 6.14, (ii) demand deposit accounts established after the
Closing Date that are subject to a Deposit Account Control Agreement, (iii)
other demand deposit accounts established after the Closing Date solely as
payroll and other zero balance accounts and (iv) other deposit accounts
established after the Closing Date, so long as at any time the balance in any
such account does not exceed $100,000 and the aggregate balance in all such
accounts does not exceed $250,000, and (b) from and after the Closing Date,
deposit or transfer money into any account set forth on Schedule 6.14.
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ARTICLE VII
EVENTS OF DEFAULT
Section 7.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment Default. (i) The Borrower shall fail to pay any
principal on any Loan or Note when due (whether at maturity, by reason of
acceleration or otherwise) in accordance with the terms thereof or hereof;
(ii) the Borrower shall fail to pay any Reimbursement Obligation when due
(whether at maturity, by reason of acceleration or otherwise) in
accordance with the terms hereof; (iii) the Borrower shall fail to pay any
interest on any Loan or Note or any fee or other amount payable hereunder
when due (whether at maturity, by reason of acceleration or otherwise) in
accordance with the terms thereof or hereof and such failure shall
continue unremedied for three (3) Business Days; or (iv) any Guarantor
shall fail to pay on the Guaranty in respect of any of the foregoing
(after giving effect to any applicable grace period); or
(b) Misrepresentation. Any representation or warranty made or deemed
made herein, in the Security Documents or in any of the other Credit
Documents or which is contained in any certificate, document or financial
or other statement furnished at any time under or in connection with this
Credit Agreement shall prove to have been incorrect, false or misleading
in any material respect on or as of the date made or deemed made; or
(c) Covenant Default. (i) Any Credit Party shall fail to perform,
comply with or observe any term, covenant or agreement applicable to it
contained in Section 5.1(a), Section 5.1(b), Section 5.2, Section 5.4,
Section 5.7(a), Section 5.9, Section 5.14(a), Section 5.14(b) or Article
VI hereof; or (ii) any Credit Party shall fail to comply with Section
5.1(c) or Section 5.1(d) and such breach or failure to comply is not cured
within ten (10) Business Days of its occurrence; or (iii) any Credit Party
shall fail to comply with any other covenant, contained in this Credit
Agreement or the other Credit Documents or any other agreement, document
or instrument among any Credit Party, the Administrative Agent and the
Lenders or executed by any Credit Party in favor of the Administrative
Agent or the Lenders (other than as described in Sections 7.1(a), 7.1(b),
7.1(c)(i) or 7.1(c)(ii) above), and in the event such breach or failure to
comply is capable of cure, is not cured within thirty (30) days of its
occurrence; or
(d) Debt Cross-Default. Any Credit Party or any of its Subsidiaries
shall (i) default in any payment of principal of or interest on any
Indebtedness (other than the Credit Party Obligations) in a principal
amount outstanding of at least $1,000,000 in the aggregate for the Credit
Parties and their Subsidiaries beyond the period of grace (not to
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exceed thirty (30) days), if any, provided in the instrument or agreement
under which such Indebtedness was created; or (ii) default in the
observance or performance of any other agreement or condition relating to
any Indebtedness in a principal amount outstanding of at least $1,000,000
in the aggregate for the Credit Parties and their Subsidiaries or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event shall occur or condition exist, the effect of
which default or other event or condition is to cause, or to permit the
holder or holders of such Indebtedness or beneficiary or beneficiaries of
such Indebtedness (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 become due prior to its stated
maturity; or (iii) breach or default in any material respect under any
Secured Hedging Agreement; or
(e) Other Cross-Default. The Credit Parties or any of their
Subsidiaries shall default in (i) the payment when due under any Material
Contract or (ii) in the performance or observance, of any obligation or
condition of any Material Contract and such failure to perform or observe
such other obligation or condition continues unremedied for a period of
thirty (30) days after notice of the occurrence of such default unless,
but only as long as, the existence of any such default is being contested
by the Borrower or such Subsidiary in good faith by appropriate
proceedings and adequate reserves in respect thereof have been established
on the books of the Borrower or such Subsidiary to the extent required by
GAAP.
(f) Bankruptcy Event. (i) The Borrower or any of the Borrower's
Subsidiaries shall commence any case, proceeding or other action (A) under
any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization or relief of debtors,
seeking to have an order for relief entered with respect to it, or seeking
to adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition
or other relief with respect to it or its debts, or (B) seeking
appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets,
or the Borrower or any Subsidiary shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the
Borrower or any of the Borrower's Subsidiaries any case, proceeding or
other action of a nature referred to in clause (i) above which (A) results
in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a
period of sixty (60) days; or (iii) there shall be commenced against the
Borrower or any of the Borrower's Subsidiaries any case, proceeding or
other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its
assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending
appeal within sixty (60) days from the entry thereof; or (iv) the Borrower
or any of the Borrower's Subsidiaries shall take any action in furtherance
of, or indicating its consent to, approval of, or acquiescence in, any of
the acts set forth in clauses (i), (ii), or (iii) above; or (v) the
Borrower or any of its Subsidiaries shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay its debts as
they become due; or
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(g) Judgment Default. One or more judgments or decrees shall be
entered against any Credit Party or any of its Subsidiaries involving in
the aggregate a liability (to the extent not paid when due or covered by
insurance) of $1,000,000 or more and all such judgments or decrees shall
not have been paid and satisfied, vacated, discharged, stayed or bonded
pending appeal within thirty (30) days from the entry thereof; or
(h) ERISA Default. (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan (other than
a Permitted Lien) shall arise on the assets of any Credit Party or any
Commonly Controlled Entity, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed, or
a trustee shall be appointed, to administer or to terminate, any Single
Employer Plan, which Reportable Event or commencement of proceedings or
appointment of a trustee is, in the reasonable opinion of the Required
Lenders, likely to result in the termination of such Plan for purposes of
Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA, (v) any Credit Party or any of its
Subsidiaries or any Commonly Controlled Entity shall, or in the reasonable
opinion of the Required Lenders is likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of,
any Multiemployer Plan or (vi) any other similar event or condition shall
occur or exist with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other such
events or conditions, if any, has or could reasonably be expected to have
a Material Adverse Effect; or
(i) Change of Control. There shall occur a Change of Control; or
(j) Failure of Guaranty. The Guaranty or any provision thereof shall
cease to be in full force and effect or any Guarantor or any Person acting
by or on behalf of any Guarantor shall deny or disaffirm any Guarantor's
obligations under the Guaranty; or
(k) Failure of Credit Documents. Any other Credit Document shall
fail to be in full force and effect or to give the Administrative Agent
and/or the Lenders the security interests, liens, rights, powers, priority
and privileges purported to be created thereby (except as such documents
may be terminated or no longer in force and effect in accordance with the
terms thereof, other than those indemnities and provisions which by their
terms shall survive), or any Credit Party or any Person acting by or on
behalf of any Credit Party shall assert in writing any of the foregoing or
shall (i) deny or disaffirm such Person's obligations under this Credit
Agreement or any other Credit Document or (ii) assert the invalidity or
lack of perfection or priority of any Lien granted to the Administrative
Agent pursuant to the Security Documents; or
(l) Subordinated Indebtedness Default. Any default (which is not
waived or cured within the applicable period of grace) or event of default
shall occur under any document governing or evidencing any Subordinated
Indebtedness or the subordination
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provisions contained therein shall cease to be in full force and effect or
to give the Lenders the rights, powers and privileges purported to be
created thereby; or
(m) Medical Reimbursement Program Suspension. Any Credit Party shall
be suspended or excluded from (i) any Medicaid Provider Agreement,
Medicaid Certification, Medicare Provider Agreement, Medicare
Certification or (ii) any Medical Reimbursement Program, where such
exclusion or suspension arises from fraud or other claims or allegations
which could reasonably be expected to have a Material Adverse Effect.
Section 7.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, then, and in any such event,
(a) if such event is a Bankruptcy Event, automatically the Commitments shall
immediately terminate and the Loans (with accrued interest thereon), and all
other amounts under the Credit Documents (including without limitation the
maximum amount of all contingent liabilities under Letters of Credit) shall
immediately become due and payable, and the Borrower shall immediately pay to
the Administrative Agent cash collateral as security for the LOC Obligations for
subsequent drawings under then outstanding Letters of Credit in an amount equal
to the maximum amount which may be drawn under such Letters of Credit and (ii)
the Administrative Agent may exercise on behalf of the Lenders all of its other
rights and remedies under this Credit Agreement, the other Credit Documents and
applicable law, and (b) if such event is any other Event of Default, any or all
of the following actions may be taken: (i) with the written consent of the
Required Lenders, the Administrative Agent may, or upon the written request of
the Required Lenders, the Administrative Agent shall, by notice to the Borrower
declare the Commitments to be terminated forthwith, whereupon the Commitments
shall immediately terminate; (ii) the Administrative Agent may, or upon the
written request of the Required Lenders, the Administrative Agent shall, by
notice of default to the Borrower, declare the Loans (with accrued interest
thereon) and all other amounts owing under this Credit Agreement and the Notes
to be due and payable forthwith and direct the Borrower to pay to the
Administrative Agent cash collateral as security for the LOC Obligations for
subsequent drawings under then outstanding Letters of Credit in an amount equal
to the maximum amount of which may be drawn under Letters of Credit then
outstanding, whereupon the same shall immediately become due and payable; (iii)
exercise any rights or remedies of the Administrative Agent or the Lenders under
this Credit Agreement or any other Credit Document, including, without
limitation, any rights or remedies with respect to the Collateral; and (iv)
exercise any rights or remedies available to the Administrative Agent or Lenders
under applicable law.
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ARTICLE VIII
THE AGENT
Section 8.1 Appointment.
Each Lender hereby irrevocably designates and appoints Wachovia as the
Administrative Agent of such Lender under this Credit Agreement, and each such
Lender irrevocably authorizes Wachovia, as the Administrative Agent for such
Lender, to take such action on its behalf under the provisions of this Credit
Agreement and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Credit Agreement,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Credit
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or otherwise exist against the Administrative Agent.
Section 8.2 Delegation of Duties.
The Administrative Agent may execute any of its duties under this Credit
Agreement by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care. Without
limiting the foregoing, the Administrative Agent may appoint one of its
affiliates as its agent to perform the functions of the Administrative Agent
hereunder relating to the advancing of funds to the Borrower and distribution of
funds to the Lenders and to perform such other related functions of the
Administrative Agent hereunder as are reasonably incidental to such functions.
Section 8.3 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact, Subsidiaries or affiliates shall be (a)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Credit Agreement (except for its or such
Person's own gross negligence or willful misconduct) or (b) responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by any Credit Party or any officer thereof contained in this
Credit Agreement 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 Credit Agreement or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of any of the Credit
Documents or for any failure of any Credit Party to perform its obligations
hereunder or thereunder. The Administrative Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance by any Credit Party of any of the agreements contained in, or
conditions of, this Credit Agreement, or to inspect the properties, books or
records of any Credit Party.
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Section 8.4 Reliance by Administrative Agent.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document or
conversation believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation,
counsel to the Credit Parties), independent accountants and other experts
selected by the Administrative Agent. The Administrative Agent may deem
and treat the payee of any Note as the owner thereof for all purposes
unless an executed Commitment Transfer Supplement has been filed with the
Administrative Agent pursuant to Section 9.6(c) with respect to the Loans
evidenced by such Note. The Administrative Agent shall be fully justified
in failing or refusing to take any action under this Credit Agreement
unless it shall first receive such advice or concurrence of the Required
Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any
such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under any of the Credit
Documents in accordance with a request of the Required Lenders or all of
the Lenders, as may be required under this Credit Agreement, and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Notes.
(b) For purposes of determining compliance with the conditions
specified in Section 4.1, each Lender that has signed this Credit
Agreement shall be deemed to have consented to, approved or accepted or to
be satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to a Lender.
Section 8.5 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 hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Credit Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders; provided, however, that unless and until the
Administrative Agent shall have received such directions, 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 in the best interests of the Lenders except to the extent that
this Credit Agreement expressly requires that such action be taken, or not
taken, only with the consent or upon the authorization of the Required Lenders,
or all of the Lenders, as the case may be.
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Section 8.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representation or warranty to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
any Credit Party, shall be deemed to constitute any representation or warranty
by the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower or any other Credit Party and
made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Administrative Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Credit Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, operations, property, financial
and other condition and creditworthiness of the Borrower and the other Credit
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Borrower or any other Credit Party which may come into the possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
Section 8.7 Indemnification.
The Lenders agree to indemnify each of the Administrative Agent, Issuing
Lenders and the Swingline Lender in its capacity hereunder and their respective
Subsidiaries, Affiliates, officers, directors, employees, agents and
attorneys-in-fact acting on their behalf in such capacity (each an "Indemnified
Party") (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to such Lenders'
respective Commitment Percentages in effect on the date on which indemnification
is sought under this Section, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes
or any Reimbursement Obligation) be imposed on, incurred by or asserted against
such Indemnified Party in any way relating to or arising out of any Credit
Document or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by an Indemnified Party under or in connection with any of the foregoing;
provided, however, that no Lender shall be liable to an Indemnified Party for
the payment of any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements to the
extent resulting from such Indemnified Party's gross negligence or willful
misconduct, as determined by a court of competent jurisdiction. The agreements
in this Section 8.7 shall survive the termination of this Credit
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Agreement and payment of the Notes, any Reimbursement Obligation and all other
amounts payable hereunder.
Section 8.8 Administrative Agent in Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower and
the other Credit Parties as though the Administrative Agent were not the
Administrative Agent hereunder. With respect to the Loans made or renewed by it
and any Note issued to it, the Administrative Agent shall have the same rights
and powers under this Credit Agreement as any Lender and may exercise the same
as though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
Section 8.9 Successor Administrative Agent.
The Administrative Agent may resign as Administrative Agent upon thirty
(30) days' prior written notice to the Borrower and the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Credit
Agreement and the other Credit Documents, then the Required Lenders shall
appoint from among the Lenders a successor administrative agent for the Lenders,
which successor agent shall have capital of at least $500,000,000 and be
approved by the Borrower (such approval not to be unreasonably withheld) so long
as no Default or Event of Default has occurred and is continuing, whereupon such
successor administrative agent shall succeed to the rights, powers and duties of
the Administrative Agent, and the term "Administrative Agent" shall mean such
successor administrative agent effective upon such appointment and approval, and
the former Administrative Agent's rights, powers and duties as Administrative
Agent shall be terminated, without any other or further act or deed on the part
of such former Administrative Agent or any of the parties to this Credit
Agreement or any holders of the Notes. If no successor Administrative Agent has
accepted appointment as Administrative Agent within thirty (30) days after the
retiring Administrative Agent's giving notice of resignation, the retiring
Administrative Agent shall have the right, on behalf of the Lenders, to appoint
a successor administrative agent, which successor shall have capital of at least
$500,000,000 and be approved by the Borrower (such approval not to be
unreasonably withheld) so long as no Default or Event of Default has occurred
and is continuing. If no successor administrative agent has accepted appointment
as Administrative Agent within sixty (60) days after the retiring Administrative
Agent's giving notice of resignation, the retiring Administrative Agent's
resignation shall nevertheless become effective and the Lenders shall perform
all duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor administrative agent as provided for above.
After any retiring Administrative Agent's resignation as Administrative Agent,
the indemnification provisions of this Credit Agreement and the other Credit
Documents and the provisions of this Article VIII shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was Administrative
Agent under this Credit Agreement.
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Section 8.10 Other Agents.
None of the Lenders or other Persons identified on the facing page or
signature pages of this Credit Agreement as a "syndication agent,"
"co-syndication agent," "documentation agent," "co-documentation agent,"
"co-agent," "book manager," "book runner," "lead manager," "arranger," "lead
arranger" or "co-arranger" shall have any right, power, obligation, liability,
responsibility or duty under this Credit Agreement other than, in the case of
such Lenders, those applicable to all Lenders as such. Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on any of the Lenders or
other Persons so identified in deciding to enter into this Credit Agreement or
in taking or not taking action hereunder.
Section 8.11 Releases.
The Administrative Agent may release any Guarantor and any Lien on any
Collateral that is sold or otherwise disposed of in accordance with the terms of
this Credit Agreement or as otherwise permitted by the Lenders or Required
Lenders, as applicable.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendments, Waivers and Release of Collateral.
Neither this Credit Agreement, nor any of the Notes, nor any of the other
Credit Documents, nor any terms hereof or thereof may be amended, supplemented,
waived or modified except in accordance with the provisions of this Section nor
may the Borrower or any Guarantor be released except in accordance with the
provisions of this Section 9.1. The Required Lenders may, or, with the written
consent of the Required Lenders, the Administrative Agent may, from time to
time, (a) enter into with the Borrower or any other Credit Party written
amendments, supplements or modifications hereto and to the other Credit
Documents for the purpose of adding any provisions to this Credit Agreement or
the other Credit Documents or changing in any manner the rights of the Lenders
or of the Borrower or any other Credit Party hereunder or thereunder or (b)
waive, on such terms and conditions as the Required Lenders may specify in such
instrument, any of the requirements of this Credit Agreement or the other Credit
Documents or any Default or Event of Default and its consequences; provided,
however, that no such waiver and no such amendment, waiver, supplement,
modification or release shall:
(i) reduce the amount or extend the scheduled date of maturity
of any Loan or Note or any installment thereon, or reduce the stated
rate of any interest or fee payable hereunder (except in connection
with a waiver of interest at the increased post-default rate set
forth in Section 2.9, which shall be determined by a vote of the
Required Lenders) or extend the scheduled date of any payment
thereof or increase the amount or extend the expiration date of any
Lender's
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Commitment, in each case without the written consent of each Lender
directly affected thereby; provided that, it is understood and
agreed that no waiver, reduction or deferral of a mandatory
prepayment required pursuant to Section 2.7(b), nor any amendment of
Section 2.7(b) or the definitions of Asset Disposition, Debt
Issuance, Equity Issuance, Excess Cash Flow, or Recovery Event,
shall constitute a reduction of the amount of, or an extension of
the scheduled date of, any principal installment of any Loan or
Note; or
(ii) amend, modify or waive any provision of this Section 9.1,
without the written consent of all the Lenders directly affected
thereby; or
(iii) reduce the percentage specified in the definition of
Required Lenders, without the written consent of all the Lenders; or
(iv) amend, modify or waive any provision of Article VIII
without the written consent of the then Administrative Agent; or
(v) release the Borrower or all or substantially all of the
Guarantors from their respective obligations hereunder or under the
Guaranty, without the written consent of all of the Lenders and, to
the extent the Secured Hedging Agreements will cease to rank pari
passu with the Credit Party Obligations in connection therewith, all
of the Hedging Agreement Providers; or
(vi) release all or substantially all of the Collateral
without the written consent of all of the Lenders and, to the extent
the Secured Hedging Agreements will cease to rank pari passu with
the Credit Party Obligations in connection therewith, all of the
Hedging Agreement Providers; or
(vii) amend, modify or waive any provision of the Credit
Documents requiring consent, approval or request of the Required
Lenders or all Lenders, without the written consent of all of the
Required Lenders or Lenders as appropriate; or
(viii) without the consent of Lenders holding in the aggregate
more than fifty percent (50%) of the outstanding Revolving
Commitments (or if the Revolving Commitments have been terminated,
the outstanding Revolving Loans), amend, modify or waive any
provision in Section 4.2 or waive any Default or Event of Default
(or amend any Credit Document to effectively waive any Default or
Event of Default) if the effect of such waiver is that the Lenders
shall be required to fund Revolving Loans when such Lenders would
otherwise not be required to do so; or
(ix) amend, modify or waive any provision of the Credit
Documents affecting the rights or duties of the Administrative
Agent, the Issuing Lender or the Swingline Lender under any Credit
Document without the written consent of
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the Administrative Agent, the Issuing Lender and/or the Swingline
Lender, as applicable, in addition to the Lenders required
hereinabove to take such action; or
(x) require any Lender to make available Interest Periods with
a duration longer than 6 months without the consent of such Lender;
or
(xi) amend, modify or waive the order in which Credit Party
Obligations are paid in Section 2.7(b)(vi) or Section 2.12(b),
without the written consent of each Lender and each Hedging
Agreement Provider directly affected thereby; or
(xii) amend the definitions of "Credit Party Obligations,"
Secured Hedging Agreement," or "Hedging Agreement Provider" without
the consent of any Hedging Agreement Provider that would be
adversely affected thereby;
provided, further, that no amendment, waiver or consent affecting the rights or
duties of the Administrative Agent, the Issuing Lender or the Swingline Lender
under any Credit Document shall in any event be effective, unless in writing and
signed by the Administrative Agent, the Issuing Lender and/or the Swingline
Lender, as applicable, in addition to the Lenders required hereinabove to take
such action.
Any such waiver, any such amendment, supplement or modification and any
such release shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the other Credit Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. In the case of any waiver, the
Borrower, the other Credit Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
outstanding Loans and Notes and other Credit Documents, and any Default or Event
of Default permanently waived shall be deemed to be cured and not continuing;
but no such waiver shall extend to any subsequent or other Default or Event of
Default, or impair any right consequent thereon.
Notwithstanding any of the foregoing to the contrary, the consent of the
Borrower shall not be required for any amendment, modification or waiver of the
provisions of Article VIII (other than the provisions of Section 8.9); provided,
however, that the Administrative Agent will provide written notice to the
Borrower of any such amendment, modification or waiver.
Notwithstanding the fact that the consent of all the Lenders is required
in certain circumstances as set forth above, (x) each Lender is entitled to vote
as such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency proceeding.
Section 9.2 Notices.
Except as otherwise provided in Article II, all notices, requests and
demands to or upon the respective parties hereto to be effective shall be in
writing (including by telecopy), and,
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unless otherwise expressly provided herein, shall be deemed to have been duly
given or made (a) when delivered by hand, (b) when transmitted via telecopy (or
other facsimile device) to the number set out herein, (c) the Business Day
following the day on which the same has been delivered prepaid (or pursuant to
an invoice arrangement) to a reputable national overnight air courier service,
or (d) the third Business Day following the day on which the same is sent by
certified or registered mail, postage prepaid, in each case addressed as follows
in the case of the Borrower, the other Credit Parties and the Administrative
Agent, and in the case of each Lender, as set forth in such Lender's
Administrative Details Form or to such other address as may be hereafter
notified by the respective parties hereto and any future holders of the Notes:
The Borrower ▇▇▇▇▇▇▇ Pharmaceuticals, Inc.
and the other ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
Credit Parties: ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
Chief Financial Officer
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ (x510)
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Green, P.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
The Administrative Wachovia Bank, National Association,
Agent: as Administrative Agent
Charlotte Plaza
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Syndication Agency Services
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Wachovia Bank, National Association,
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ Santa ▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
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Section 9.3 No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, 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 provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
Section 9.4 Survival of Representations and Warranties.
All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Credit Agreement and the Notes
and the making of the Loans; provided that all such representations and
warranties shall terminate on the date upon which the Commitments have been
terminated and all amounts owing under the Credit Documents have been paid in
full.
Section 9.5 Payment of Expenses and Taxes.
The Credit Parties agree (a) to pay or reimburse the Administrative Agent
and the Arranger for all their reasonable out-of-pocket costs and expenses
incurred in connection with the development, preparation, negotiation, printing
and execution of, and any amendment, supplement or modification to, this Credit
Agreement and the other Credit Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, together with the reasonable fees
and disbursements of counsel to the Administrative Agent and the Arranger, (b)
to pay or reimburse each Lender and the Administrative Agent for all its costs
and expenses incurred in connection with the enforcement or preservation of any
rights under this Credit Agreement and the other Credit Documents, including,
without limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent and to the Lenders (including reasonable allocated costs of
in-house legal counsel), and (c) on demand, to pay, indemnify, and hold each
Lender, the Administrative Agent and the Arranger harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other similar taxes, if
any, which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, the Credit Documents and any
such other documents, (d) to pay, indemnify, and hold each Lender, the
Administrative Agent, the Arranger and their Affiliates and their respective
officers, directors, employees, partners, members, counsel, agents,
representatives, advisors and affiliates (collectively called the "Indemnitees")
harmless from and against, any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of the Credit Documents and any such
other documents and the use, or proposed use, of proceeds of the Loans and (e)
to pay any civil penalty or fine assessed by the U.S. Department of the
Treasury's Office of Foreign Assets Control against, and all reasonable costs
and expenses (including counsel fees and
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disbursements) incurred in connection with defense thereof by the Administrative
Agent or any Lender as a result of the funding of Loans, the issuance of Letters
of Credit, the acceptance of payments or of Collateral due under the Credit
Documents (all of the foregoing, collectively, the "Indemnified Liabilities");
provided, however, that the Borrower shall not have any obligation hereunder to
an Indemnitee with respect to Indemnified Liabilities arising from the gross
negligence or willful misconduct of such Indemnitee, as determined by a court of
competent jurisdiction pursuant to a final non-appealable judgment. The
agreements in this Section 9.5 shall survive repayment of the Loans, Notes and
all other amounts hereunder.
Section 9.6 Successors and Assigns; Participations; Purchasing Lenders.
(a) This Agreement shall be binding upon and inure to the benefit of
the Credit Parties, the Lenders, the Administrative Agent, all future
holders of the Notes and their respective successors and assigns, except
that the Borrower may not assign or transfer any of its rights or
obligations under this Credit Agreement or the other Credit Documents
without the prior written consent of each Lender.
(b) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time sell to one or more banks or
other entities ("Participants") participating interests in any Loan owing
to such Lender, any Note held by such Lender, any Commitment of such
Lender, or any other interest of such Lender hereunder. In the event of
any such sale by a Lender of participating interests to a Participant,
such Lender's obligations under this Credit Agreement to the other parties
to this Credit Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain
the holder of any such Note for all purposes under this Credit Agreement,
and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Credit Agreement. No Lender shall
transfer or grant any participation under which the Participant shall have
rights to approve any amendment to or waiver of this Credit Agreement or
any other Credit Document except to the extent such amendment or waiver
would (i) extend the scheduled maturity of any Loan or Note or any
installment thereon in which such Participant is participating, or reduce
the stated rate or extend the time of payment of interest or fees thereon
(except in connection with a waiver of interest at the increased
post-default rate set forth in Section 2.9, which shall be determined by a
vote of the Required Lenders) or reduce the principal amount thereof, or
increase the amount of the Participant's participation over the amount
thereof then in effect; provided that, it is understood and agreed that
(A) no waiver, reduction or deferral of a mandatory prepayment required
pursuant to Section 2.7(b), nor any amendment of Section 2.7(b) or the
definitions of Asset Disposition, Debt Issuance, Equity Issuance, Excess
Cash Flow, or Recovery Event, shall constitute a reduction of the amount
of, or an extension of the scheduled date of, the scheduled date of
maturity of, or any installment of, any Loan or Note, (B) a waiver of any
Default or Event of Default shall not constitute a change in the terms of
such participation, and (C) an increase in any Commitment or Loan shall be
permitted without consent of any participant if the Participant's
participation is not increased as a result thereof, (ii) release all or
substantially all of the Guarantors from
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their obligations under the Guaranty, (iii) release all or substantially
all of the Collateral, or (iv) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Credit
Agreement. In the case of any such participation, the Participant shall
not have any rights under this Credit Agreement or any of the other Credit
Documents (the Participant's rights against such Lender in respect of such
participation to be those set forth in the agreement executed by such
Lender in favor of the Participant relating thereto) and all amounts
payable by the Borrower hereunder shall be determined as if such Lender
had not sold such participation; provided that each Participant shall be
entitled to the benefits of Sections 2.15, 2.16, 2.17, 2.18 and 9.5 with
respect to its participation in the Commitments and the Loans outstanding
from time to time; provided further, that no Participant shall be entitled
to receive any greater amount pursuant to such Sections than the
transferor Lender would have been entitled to receive in respect of the
amount of the participation transferred by such transferor Lender to such
Participant had no such transfer occurred.
(c) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time, sell or assign to any Lender
or any Affiliate or Approved Fund and, with the consent of the
Administrative Agent and, so long as no Default or Event of Default has
occurred and is continuing, the Borrower (in each case, which consent
shall not be unreasonably withheld or delayed), to one or more additional
banks, insurance companies, funds or financial institutions or entities
(each such Lender, Affiliate, Approved Fund, bank, insurance company, fund
or financial institution or entity, a "Purchasing Lender"), all or any
part of its rights and obligations under this Credit Agreement and the
Notes in minimum amounts of (i) $2,000,000 with respect to its Revolving
Commitment or its Revolving Loans and (ii) $1,000,000 with respect to its
Term Loan Commitment (or, if less, the entire amount of such Lender's
obligations), pursuant to a Commitment Transfer Supplement, executed by
such Purchasing Lender and such transferor Lender (and, to the extent
required above, the Administrative Agent and the Borrower), and delivered
to the Administrative Agent for its acceptance and recording in the
Register; provided, however, that any sale or assignment to an existing
Lender or an Affiliate or Approved Fund of an existing Lender shall not
require the consent of the Administrative Agent or the Borrower nor shall
any such sale or assignment be subject to the minimum assignment amounts
specified herein and the amount of contemporaneous assignments in respect
of any assigning Lender and its Approved Funds shall be aggregated for
purposes of such requirement. Upon such execution, delivery, acceptance
and recording, from and after the Transfer Effective Date specified in
such Commitment Transfer Supplement, (A) the Purchasing Lender thereunder
shall be a party hereto and, to the extent provided in such Commitment
Transfer Supplement, have the rights and obligations of a Lender hereunder
with a Commitment as set forth therein, and (B) the transferor Lender
thereunder shall, to the extent provided in such Commitment Transfer
Supplement, be released from its obligations under this Credit Agreement
(and, in the case of a Commitment Transfer Supplement covering all or the
remaining portion of a transferor Lender's rights and obligations under
this Credit Agreement, such transferor Lender shall cease to be a party
hereto; provided, however, that such Lender shall still be entitled to any
indemnification rights that expressly survive hereunder). Such Commitment
Transfer Supplement shall
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be deemed to amend this Credit Agreement to the extent, and only to the
extent, necessary to reflect the addition of such Purchasing Lender and
the resulting adjustment of Commitment Percentages arising from the
purchase by such Purchasing Lender of all or a portion of the rights and
obligations of such transferor Lender under this Credit Agreement and the
Notes. On or prior to the Transfer Effective Date specified in such
Commitment Transfer Supplement, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the Notes
delivered to the Administrative Agent pursuant to such Commitment Transfer
Supplement new Notes to the order of such Purchasing Lender in an amount
equal to the Commitment assumed by it pursuant to such Commitment Transfer
Supplement and, unless the transferor Lender has not retained a Commitment
hereunder, new Notes to the order of the transferor Lender in an amount
equal to the Commitment retained by it hereunder. Such new Notes shall be
dated the Closing Date and shall otherwise be in the form of the Notes
replaced thereby. The Notes surrendered by the transferor Lender shall be
returned by the Administrative Agent to the Borrower marked "canceled".
Notwithstanding anything to the contrary contained in this Section 9.6, a
Lender may assign any or all of its rights under this Credit Agreement to
an Affiliate or an Approved Fund of such Lender without delivering a
Commitment Transfer Supplement to the Administrative Agent; provided,
however, that (1) the Credit Parties and the Administrative Agent may
continue to deal solely and directly with such assigning Lender until a
Commitment Transfer Supplement has been delivered to the Administrative
Agent for recordation on the Register, (2) the failure of such assigning
lender to deliver a Commitment Transfer Supplement to the Administrative
Agent shall not affect the legality, validity or binding effect of such
assignment and (3) a Commitment Transfer Supplement between the assigning
Lender, an Affiliate or Approved Fund of such Lender shall be effective as
of the date specified in such Commitment Transfer Supplement.
(d) The Administrative Agent shall maintain at its address referred
to in Section 9.2 a copy of each Commitment Transfer Supplement delivered
to it and a register (the "Register") for the recordation of the names and
addresses of the Lenders and the Commitment of, and principal amount of
the Loans owing to, each Lender from time to time. A Loan (and the related
Note) recorded on the Register may be assigned or sold in whole or in part
upon registration of such assignment or sale on the Register. The entries
in the Register shall be conclusive, in the absence of manifest error, and
the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register as the owner of the Loan
recorded therein for all purposes of this Credit Agreement. The Register
shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice. In the
case of an assignment pursuant to the last sentence of Section 9.6(c) as
to which a Commitment Transfer Supplement is not delivered to the
Administrative Agent, the assigning Lender shall, acting solely for this
purpose as a non-fiduciary agent of the Credit Parties, maintain a
comparable register on behalf of the Credit Parties. In the event that any
Lender sells participations in a Loan recorded on the Register, such
Lender shall maintain a register on which it enters the name of all
participants in such Loans held by it (the "Participant Register"). A Loan
recorded on the Register (and the registered Note, if any, evidencing the
same) may be participated in whole or in part only by
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registration of such participation on the Participant Register (and each
registered Note shall expressly so provide). Any participation of such
Loan recorded on the Register (and the registered Note, if any, evidencing
the same) may be effected only by the registration of such participation
on the Participant Register.
(e) Upon its receipt of a duly executed Commitment Transfer
Supplement, together with payment to the Administrative Agent by the
transferor Lender or the Purchasing Lender, as agreed between them, of a
registration and processing fee of $3,500.00 for each Purchasing Lender
(other than a Purchasing Lender that is an Affiliate or an Approved Fund
of the transferor Lender) listed in such Commitment Transfer Supplement
and the Notes subject to such Commitment Transfer Supplement, the
Administrative Agent shall (i) accept such Commitment Transfer Supplement,
(ii) record the information contained therein in the Register and (iii)
give prompt notice of such acceptance and recordation to the Lenders and
the Borrower.
(f) The Borrower authorizes each Lender to disclose to any
Participant or Purchasing Lender (each, a "Transferee") and any
prospective Transferee any and all financial information in such Lender's
possession concerning the Borrower and its Affiliates which has been
delivered to such Lender by or on behalf of the Borrower pursuant to this
Credit Agreement or which has been delivered to such Lender by or on
behalf of the Borrower in connection with such Lender's credit evaluation
of the Borrower and its Subsidiaries prior to becoming a party to this
Credit Agreement, in each case subject to Section 9.15.
(g) At the time of each assignment pursuant to this Section 9.6 to a
Person which is not already a Lender hereunder and which is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code)
for Federal income tax purposes, the respective assignee Lender shall
provide to the Borrower and the Administrative Agent the appropriate
Internal Revenue Service Forms (and, if applicable, a Tax Exempt
Certificate) described in Section 2.18.
(h) Nothing herein shall prohibit any Lender from pledging or
assigning any of its rights under this Credit Agreement (including,
without limitation, any right to payment of principal and interest under
any Note) to secure obligations of such Lender, including without
limitation, (i) any pledge or assignment to secure obligations to a
Federal Reserve Bank and (ii) in the case of any Lender that is a fund or
trust or entity that invests in commercial bank loans in the ordinary
course of business, any pledge or assignment to any holders of obligations
owed, or securities issued, by such Lender including to any trustee for,
or any other representative of, such holders; it being understood that the
requirements for assignments set forth in this Section 9.6 shall not apply
to any such pledge or assignment of a security interest, except with
respect to any foreclosure or similar action taken by such pledgee or
assignee with respect to such pledge or assignment; provided that no such
pledge or assignment of a security interest shall release a Lender from
any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto and no such pledgee or assignee
shall have any voting rights under this Credit Agreement unless and until
the
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requirements for assignments set forth in this Section 9.6 are complied
with in connection with any foreclosure or similar action taken by such
pledgee or assignee.
Section 9.7 Adjustments; Set-off.
(a) Each Lender agrees that if any Lender (a "Benefited Lender")
shall at any time receive any payment of all or part of its Loans, or
interest thereon, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, a Bankruptcy Event or otherwise)
in a greater proportion than any such payment to or collateral received by
any other Lender, if any, in respect of such other Lender's Loans, or
interest thereon, such Benefited Lender shall purchase for cash from the
other Lenders a participating interest in such portion of each such other
Lender's Loan, or shall provide such other Lenders with the benefits of
any such collateral, or the proceeds thereof, as shall be necessary to
cause such Benefited Lender to share the excess payment or benefits of
such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such Benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of
such recovery, but without interest. The Borrower agrees that each Lender
so purchasing a portion of another Lender's Loans may exercise all rights
of payment (including, without limitation, rights of set-off) with respect
to such portion as fully as if such Lender were the direct holder of such
portion.
(b) In addition to any rights and remedies of the Lenders provided
by law (including, without limitation, other rights of set-off), each
Lender shall have the right, without prior notice to the Borrower or the
applicable Credit Party, any such notice being expressly waived by the
Credit Parties to the extent permitted by applicable law, upon the
occurrence of any Event of Default, to setoff and appropriate and apply
any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in
any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held by or owing to such
Lender or any branch or agency thereof to or for the credit or the account
of the Borrower or any other Credit Party, or any part thereof in such
amounts as such Lender may elect, against and on account of the Loans and
other Credit Party Obligations of the Borrower and the other Credit
Parties to the Administrative Agent and the Lenders and claims of every
nature and description of the Administrative Agent and the Lenders against
the Borrower and the other Credit Parties, in any currency, whether
arising hereunder, under any other Credit Document or any Secured Hedging
Agreement pursuant to the terms of this Credit Agreement, as such Lender
may elect, whether or not the Administrative Agent or the Lenders have
made any demand for payment and although such obligations, liabilities and
claims may be contingent or unmatured. The aforesaid right of set-off may
be exercised by such Lender against the Borrower, any other Credit Party
or against any trustee in bankruptcy, debtor in possession, assignee for
the benefit of creditors, receiver or execution, judgment or attachment
creditor of the Borrower or any other Credit Party, or against anyone else
claiming through or against the Borrower, any other Credit Party or any
such trustee in bankruptcy, debtor in possession, assignee for the benefit
of creditors, receiver, or execution, judgment or
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attachment creditor, notwithstanding the fact that such right of set-off
shall not have been exercised by such Lender prior to the occurrence of
any Event of Default. Each Lender agrees promptly to notify the Borrower
and the Administrative Agent after any such set-off and application made
by such Lender; provided, however, that the failure to give such notice
shall not affect the validity of such set-off and application.
Section 9.8 Table of Contents and Section Headings.
The table of contents and the Section and subsection headings herein are
intended for convenience only and shall be ignored in construing this Credit
Agreement.
Section 9.9 Counterparts.
This Agreement may be executed by one or more of the parties to this
Credit Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
agreement.
Section 9.10 Effectiveness.
This Credit Agreement shall become effective on the date on which all of
the parties have signed a copy hereof (whether the same or different copies) and
shall have delivered the same to the Administrative Agent pursuant to Section
9.2 or, in the case of the Lenders, shall have given to the Administrative Agent
written, telecopied or telex notice (actually received) at such office that the
same has been signed and mailed to it.
Section 9.11 Severability.
Any provision of this Credit Agreement which 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 hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
Section 9.12 Integration.
This Agreement and the other Credit Documents represent the agreement of
the Credit Parties, the Administrative Agent and the Lenders with respect to the
subject matter hereof, and there are no promises, undertakings, representations
or warranties by the Administrative Agent, the Credit Parties or any Lender
relative to the subject matter hereof not expressly set forth or referred to
herein or in the other Credit Documents.
Section 9.13 Governing Law.
This Agreement and, unless otherwise specified therein, the other Credit
Documents and the rights and obligations of the parties under this Credit
Agreement and the other Credit Documents shall be governed by, and construed and
interpreted in accordance with, the law of
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the State of New York without regard to conflict of laws principles thereof
(other than Sections 5-1401 and 5-1402 of The New York General Obligations Law).
Section 9.14 Consent to Jurisdiction and Service of Process.
All judicial proceedings brought against the Borrower and/or any other
Credit Party with respect to this Credit Agreement, any Note or any of the other
Credit Documents may be brought in any state or federal court of competent
jurisdiction in the State of New York, and, by execution and delivery of this
Credit Agreement, each of the Borrower and the other Credit Parties accepts, for
itself and in connection with its properties, generally and unconditionally, the
non-exclusive jurisdiction of the aforesaid courts and irrevocably agrees to be
bound by any final judgment rendered thereby in connection with this Credit
Agreement, any Note or any other Credit Document from which no appeal has been
taken or is available. Each of the Borrower and the other Credit Parties
irrevocably agrees that all service of process in any such proceedings in any
such court may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to it at its
address set forth in Section 9.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto, such service
being hereby acknowledged by the each of the Borrower and the other Credit
Parties to be effective and binding service in every respect. Each of the
Borrower, the other Credit Parties, the Administrative Agent and the Lenders
irrevocably waives any objection, including, without limitation, any objection
to the laying of venue based on the grounds of forum non conveniens which it may
now or hereafter have to the bringing of any such action or proceeding in any
such jurisdiction. Nothing herein shall affect the right to serve process in any
other manner permitted by law or shall limit the right of any Lender to bring
proceedings against the Borrower or the other Credit Parties in the court of any
other jurisdiction.
Section 9.15 Arbitration.
(a) Notwithstanding the provisions of Section 9.14 to the contrary,
upon demand of any party hereto, whether made before or within three (3)
months after institution of any judicial proceeding, any dispute, claim or
controversy arising out of, connected with or relating to this Credit
Agreement and other Credit Documents ("Disputes") between or among parties
to this Credit Agreement shall be resolved by binding arbitration as
provided herein. Institution of a judicial proceeding by a party does not
waive the right of that party to demand arbitration hereunder. Disputes
may include, without limitation, tort claims, counterclaims, disputes as
to whether a matter is subject to arbitration, claims brought as class
actions, claims arising from Credit Documents executed in the future, or
claims arising out of or connected with the transaction reflected by this
Credit Agreement.
Arbitration shall be conducted under and governed by the Commercial
Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association (the "AAA") and Title 9 of the U.S. Code. All arbitration
hearings shall be conducted in Charlotte, North Carolina. A hearing shall
begin within ninety (90) days of demand for arbitration and all hearings
shall be concluded within 120 days of demand for arbitration. These time
limitations may not be extended unless a party shows cause for extension
and then
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no more than a total extension of sixty (60) days. The expedited
procedures set forth in Rule 51 et seq. of the Arbitration Rules shall be
applicable to claims of less than $1,000,000. All applicable statutes of
limitation shall apply to any Dispute. A judgment upon the award may be
entered in any court having jurisdiction. Arbitrators shall be licensed
attorneys selected from the Commercial Financial Dispute Arbitration Panel
of the AAA. The parties hereto do not waive applicable Federal or state
substantive law except as provided herein. Notwithstanding the foregoing,
this arbitration provision does not apply to disputes under or related to
Hedging Agreements.
(b) Notwithstanding the preceding binding arbitration provisions,
the Administrative Agent, the Lenders, the Borrower and the other Credit
Parties agree to preserve, without diminution, certain remedies that the
Administrative Agent on behalf of the Lenders may employ or exercise
freely, independently or in connection with an arbitration proceeding or
after an arbitration action is brought. The Administrative Agent on behalf
of the Lenders shall have the right to proceed in any court of proper
jurisdiction or by self-help to exercise or prosecute the following
remedies, as applicable (i) all rights to foreclose against any real or
personal property or other security by exercising a power of sale granted
under Credit Documents or under applicable law or by judicial foreclosure
and sale, including a proceeding to confirm the sale; (ii) all rights of
self-help including peaceful occupation of real property and collection of
rents, set-off, and peaceful possession of personal property; (iii)
obtaining provisional or ancillary remedies including injunctive relief,
sequestration, garnishment, attachment, appointment of receiver and filing
an involuntary bankruptcy proceeding; and (iv) when applicable, a judgment
by confession of judgment. Preservation of these remedies does not limit
the power of an arbitrator to grant similar remedies that may be requested
by a party in a Dispute.
(c) The parties hereto agree that they shall not have a remedy of
punitive or exemplary damages against the other in any Dispute and hereby
waive any right or claim to punitive or exemplary damages they have now or
which may arise in the future in connection with any Dispute whether the
Dispute is resolved by arbitration or judicially.
(d) By execution and delivery of this Credit Agreement, each of the
parties hereto accepts, for itself and in connection with its properties,
generally and unconditionally, the non-exclusive jurisdiction relating to
any arbitration proceedings conducted under the Arbitration Rules in
Charlotte, North Carolina and irrevocably agrees to be bound by any final
judgment rendered thereby in connection with this Credit Agreement from
which no appeal has been taken or is available.
Section 9.16 Confidentiality.
The Administrative Agent and each of the Lenders agrees that during the
Commitment Period and for one (1) year thereafter, without the prior consent of
the Borrower, it will use its best efforts not to disclose any information with
respect to the Credit Parties which is furnished pursuant to this Credit
Agreement, any other Credit Document or any documents contemplated by or
referred to herein or therein and which is designated by the Borrower to the
Lenders in
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writing as confidential or as to which it is otherwise reasonably clear such
information is not public, except that any Lender may disclose any such
information (a) to its employees, Affiliates, auditors and counsel or to another
Lender, (b) as has become generally available to the public other than by a
breach of this Section 9.16, (c) as may be required or appropriate in any
report, statement or testimony submitted to any municipal, state or federal
regulatory body having or claiming to have jurisdiction over such Lender or to
the Federal Reserve Board or the Federal Deposit Insurance Corporation or the
Office of the Comptroller of the Currency or the National Association of
Insurance Commissioners or similar organizations (whether in the United States
or elsewhere) or their successors, (d) as may be required or appropriate in
response to any summons or subpoena or any law, order, regulation or ruling
applicable to such Lender, (e) to any prospective Participant or assignee or
pledgee in connection with any contemplated transfer pursuant to Section 9.6;
provided that such prospective transferee shall have been made aware of this
Section 9.16 and shall have agreed to be bound by its provisions as if it were a
party to this Credit Agreement, (f) to Gold Sheets and other similar bank trade
publications; such information to consist of deal terms and other information
regarding the credit facilities evidenced by this Credit Agreement customarily
found in such publications, (g) in connection with any suit, action or
proceeding for the purpose of defending itself, reducing its liability, or
protecting or exercising any of its claims, rights, remedies or interests under
or in connection with the Credit Documents or any Secured Hedging Agreement, (h)
to any direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty agrees to
be bound by the provisions of this Section 9.16), (i) any nationally recognized
rating agency that requires access to information about a Lender's investment
portfolio in connection with ratings issued with respect to such Lender, (j) to
a Person that is an investor or prospective investor in a Securitization (as
defined below) that agrees that its access to information regarding the Borrower
and the Loans is solely for purposes of evaluating an investment in such
Securitization; provided that such Person shall have been made aware of this
Section 9.16 and shall have agreed to be bound by its provisions as if it were a
party to this Credit Agreement, or (k) to a Person that is a trustee, collateral
manager, servicer, noteholder or secured party in a Securitization in connection
with the administration, servicing and reporting on the assets serving as
collateral for such Securitization; provided that such Person shall have been
made aware of this Section 9.16 and shall have agreed to be bound by its
provisions as if it were a party to this Credit Agreement. For purposes of this
Section "Securitization" shall mean a public or private offering by a Lender or
any of its affiliates or their respective successors and assigns, of securities
which represent an interest in, or which are collateralized in whole or in part
by, the Loans.
Section 9.17 Acknowledgments.
The Borrower and the other Credit Parties each hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of each Credit Document;
(b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower or any other Credit
Party arising out of or in
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connection with this Credit Agreement and the relationship between
Administrative Agent and Lenders, on one hand, and the Borrower and the
other Credit Parties, on the other hand, in connection herewith is solely
that of debtor and creditor; and
(c) no joint venture exists among the Lenders or among the Borrower
or the other Credit Parties and the Lenders.
Section 9.18 Waivers of Jury Trial; Waiver of Consequential Damages.
THE BORROWER, THE OTHER CREDIT PARTIES, THE ADMINISTRATIVE AGENT AND THE
LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
CREDIT AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Each of the Borrower, the other Credit Parties, the Administrative Agent and the
Lenders agree not to assert any claim against any other party to this Credit
Agreement or any their respective directors, officers, employees, attorneys,
Affiliates or agents, on any theory of liability, for special, indirect,
consequential or punitive damages arising out of or otherwise relating to any of
the transactions contemplated herein.
Section 9.19 Patriot Act Notice.
Each Lender and the Administrative Agent (for itself and not on behalf of
any other party) hereby notifies the Borrower that, pursuant to the requirements
of the USA Patriot Act, Title III of Pub. L. 107-56, signed into law October 26,
2001 (the "Patriot Act"), it is required to obtain, verify and record
information that identifies the Borrower, which information includes the name
and address of the Borrower and other information that will allow such Lender or
the Administrative Agent, as applicable, to identify the Borrower in accordance
with the Patriot Act.
ARTICLE X
GUARANTY
Section 10.1 The Guaranty.
In order to induce the Lenders to enter into this Credit Agreement and any
Hedging Agreement Provider to enter into any Secured Hedging Agreement and to
extend credit hereunder and thereunder and in recognition of the direct benefits
to be received by the Guarantors from the Extensions of Credit hereunder and any
Secured Hedging Agreement, each of the Guarantors hereby agrees with the
Administrative Agent, the Lenders and the Hedging Agreement Providers as
follows: the Guarantor hereby unconditionally and irrevocably jointly and
severally guarantees as primary obligor and not merely as surety the full and
prompt payment when due, whether upon maturity, by acceleration or otherwise, of
any and all indebtedness of the Borrower to the Administrative Agent, the
Lenders and the Hedging Agreement Providers. If any or all of the indebtedness
becomes due and payable hereunder or
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under any Secured Hedging Agreement, each Guarantor unconditionally promises to
pay such indebtedness to the Administrative Agent, the Lenders, the Hedging
Agreement Providers, or their respective order, or demand, together with any and
all reasonable expenses which may be incurred by the Administrative Agent or the
Lenders in collecting any of the Credit Party Obligations. The word
"indebtedness" is used in this Article X in its most comprehensive sense and
includes any and all advances, debts, obligations and liabilities of the
Borrower, including specifically all Credit Party Obligations, arising in
connection with this Credit Agreement, the other Credit Documents or any Secured
Hedging Agreement, in each case, heretofore, now, or hereafter made, incurred or
created, whether voluntarily or involuntarily, absolute or contingent,
liquidated or unliquidated, determined or undetermined, whether or not such
indebtedness is from time to time reduced, or extinguished and thereafter
increased or incurred, whether the Borrower may be liable individually or
jointly with others, whether or not recovery upon such indebtedness may be or
hereafter become barred by any statute of limitations, and whether or not such
indebtedness may be or hereafter become otherwise unenforceable.
Notwithstanding any provision to the contrary contained herein or in any
other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code).
Section 10.2 Bankruptcy.
Additionally, each of the Guarantors unconditionally and irrevocably
guarantees jointly and severally the payment of any and all Credit Party
Obligations of the Borrower to the Lenders and any Hedging Agreement Provider
whether or not due or payable by the Borrower upon the occurrence of any of the
events specified in Section 7.1(f), and unconditionally promises to pay such
Credit Party Obligations to the Administrative Agent for the account of the
Lenders and to any such Hedging Agreement Provider, or order, on demand, in
lawful money of the United States. Each of the Guarantors further agrees that to
the extent that the Borrower or a Guarantor shall make a payment or a transfer
of an interest in any property to the Administrative Agent, any Lender or any
Hedging Agreement Provider, which payment or transfer or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, or
otherwise is avoided, and/or required to be repaid to the Borrower or a
Guarantor, the estate of the Borrower or a Guarantor, a trustee, receiver or any
other party under any bankruptcy law, state or federal law, common law or
equitable cause, then to the extent of such avoidance or repayment, the
obligation or part thereof intended to be satisfied shall be revived and
continued in full force and effect as if said payment had not been made.
Section 10.3 Nature of Liability.
The liability of each Guarantor hereunder is exclusive and independent of
any security for or other guaranty of the Credit Party Obligations of the
Borrower whether executed by any such Guarantor, any other guarantor or by any
other party, and no Guarantor's liability hereunder shall be affected or
impaired by (a) any direction as to application of payment by the Borrower
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or by any other party, or (b) any other continuing or other guaranty,
undertaking or maximum liability of a guarantor or of any other party as to the
Credit Party Obligations of the Borrower, or (c) any payment on or in reduction
of any such other guaranty or undertaking, or (d) any dissolution, termination
or increase, decrease or change in personnel by the Borrower, or (e) any payment
made to the Administrative Agent, the Lenders or any Hedging Agreement Provider
on the Credit Party Obligations which the Administrative Agent, such Lenders or
such Hedging Agreement Provider repay the Borrower pursuant to court order in
any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and each of the Guarantors waives any right to the deferral or
modification of its obligations hereunder by reason of any such proceeding.
Section 10.4 Independent Obligation.
The obligations of each Guarantor hereunder are independent of the
obligations of any other Guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other Guarantor or the Borrower and whether or not
any other Guarantor or the Borrower is joined in any such action or actions.
Section 10.5 Authorization.
Each of the Guarantors authorizes the Administrative Agent, each Lender
and each Hedging Agreement Provider without notice or demand (except as shall be
required by applicable statute and cannot be waived), and without affecting or
impairing its liability hereunder, from time to time to (a) renew, compromise,
extend, increase, accelerate or otherwise change the time for payment of, or
otherwise change the terms of the Credit Party Obligations or any part thereof
in accordance with this Credit Agreement and any Secured Hedging Agreement, as
applicable, including any increase or decrease of the rate of interest thereon,
(b) take and hold security from any Guarantor or any other party for the payment
of this Guaranty or the Credit Party Obligations and exchange, enforce waive and
release any such security, (c) apply such security and direct the order or
manner of sale thereof as the Administrative Agent and the Lenders in their
discretion may determine and (d) release or substitute any one or more
endorsers, Guarantors, the Borrower or other obligors.
Section 10.6 Reliance.
It is not necessary for the Administrative Agent, the Lenders or any
Hedging Agreement Provider to inquire into the capacity or powers of the
Borrower or the officers, directors, members, partners or agents acting or
purporting to act on its behalf, and any Credit Party Obligations made or
created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder.
Section 10.7 Waiver.
(a) Each of the Guarantors waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent, any Lender
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or any Hedging Agreement Provider to (i) proceed against the Borrower, any
other guarantor or any other party, (ii) proceed against or exhaust any
security held from the Borrower, any other guarantor or any other party,
or (iii) pursue any other remedy in the Administrative Agent's, any
Lender's or any Hedging Agreement Provider's power whatsoever. Each of the
Guarantors waives any defense based on or arising out of any defense of
the Borrower, any other guarantor or any other party other than payment in
full of the Credit Party Obligations (other than contingent indemnity
obligations), including without limitation any defense based on or arising
out of the disability of the Borrower, any other guarantor or any other
party, or the unenforceability of the Credit Party Obligations or any part
thereof from any cause, or the cessation from any cause of the liability
of the Borrower other than payment in full of the Credit Party
Obligations. The Administrative Agent may, at its election, foreclose on
any security held by the Administrative Agent by one or more judicial or
nonjudicial sales (to the extent such sale is permitted by applicable
law), or exercise any other right or remedy the Administrative Agent or
any Lender may have against the Borrower or any other party, or any
security, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Credit Party Obligations have
been paid in full and the Commitments have been terminated. Each of the
Guarantors waives any defense arising out of any such election by the
Administrative Agent or any of the Lenders, even though such election
operates to impair or extinguish any right of reimbursement or subrogation
or other right or remedy of the Guarantors against the Borrower or any
other party or any security.
(b) Each of the Guarantors waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notice of protest, notices of dishonor, notices of
acceptance of this Guaranty, and notices of the existence, creation or
incurring of new or additional Credit Party Obligations. Each Guarantor
assumes all responsibility for being and keeping itself informed of the
Borrower's financial condition and assets, and of all other circumstances
bearing upon the risk of nonpayment of the Credit Party Obligations and
the nature, scope and extent of the risks which such Guarantor assumes and
incurs hereunder, and agrees that neither the Administrative Agent nor any
Lender shall have any duty to advise such Guarantor of information known
to it regarding such circumstances or risks.
(c) Each of the Guarantors hereby agrees it will not exercise any
rights of subrogation which it may at any time otherwise have as a result
of this Guaranty (whether contractual, under Section 509 of the U.S.
Bankruptcy Code, or otherwise) to the claims of the Lenders or any Hedging
Agreement Provider against the Borrower or any other guarantor of the
Credit Party Obligations of the Borrower owing to the Lenders or such
Hedging Agreement Provider (collectively, the "Other Parties") and all
contractual, statutory or common law rights of reimbursement, contribution
or indemnity from any Other Party which it may at any time otherwise have
as a result of this Guaranty until such time as the Credit Party
Obligations shall have been paid in full and the Commitments have been
terminated. Each of the Guarantors hereby further agrees not to exercise
any right to enforce any other remedy which the Administrative Agent, the
Lenders or any Hedging Agreement Provider now have or may hereafter have
against any Other Party, any endorser or any other guarantor of all or any
part of the Credit Party
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Obligations of the Borrower and any benefit of, and any right to
participate in, any security or collateral given to or for the benefit of
the Lenders and/or the Hedging Agreement Providers to secure payment of
the Credit Party Obligations of the Borrower until such time as the Credit
Party Obligations (other than contingent indemnity obligations) shall have
been paid in full and the Commitments have been terminated.
Section 10.8 Limitation on Enforcement.
The Lenders and the Hedging Agreement Providers agree that this Guaranty
may be enforced only by the action of the Administrative Agent acting upon the
instructions of the Required Lenders or such Hedging Agreement Provider (only
with respect to obligations under the applicable Secured Hedging Agreement) and
that no Lender or Hedging Agreement Provider shall have any right individually
to seek to enforce or to enforce this Guaranty, it being understood and agreed
that such rights and remedies may be exercised by the Administrative Agent for
the benefit of the Lenders under the terms of this Credit Agreement and for the
benefit of any Hedging Agreement Provider under any Secured Hedging Agreement.
The Lenders and the Hedging Agreement Providers further agree that this Guaranty
may not be enforced against any director, officer, employee or stockholder of
the Guarantors.
Section 10.9 Confirmation of Payment.
The Administrative Agent and the Lenders will, upon request after payment
of the indebtedness and obligations which are the subject of this Guaranty and
termination of the Commitments relating thereto, confirm to the Borrower, the
Guarantors or any other Person that such indebtedness and obligations have been
paid and the Commitments relating thereto terminated, subject to the provisions
of Section 10.2.
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IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement
to be duly executed and delivered by its proper and duly authorized officers as
of the day and year first above written.
BORROWER: ▇▇▇▇▇▇▇ PHARMACEUTICALS, INC.,
a Delaware corporation
By: /s/ R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------
Name: R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: CFO & Vice President
GUARANTORS: ▇▇▇▇ DERMATOLOGICS, INC.,
a New York corporation
By: /s/ R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------
Name: R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: CFO & Vice President
BIOGLAN PHARMACEUTICALS CORP.,
a Delaware corporation
By: /s/ R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------
Name: R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: CFO & Vice President
ADMINISTRATIVE AGENT
AND LENDERS: WACHOVIA BANK, NATIONAL ASSOCIATION,
as Administrative Agent and as a Lender
By: /s/ ▇▇▇▇▇ Santa ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ Santa ▇▇▇▇
Title: Director
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