EXHIBIT 2.1
ACQUISITION CREDIT AGREEMENT
dated as of October 25, 1999
among
TRANSIT GROUP, INC.,
VARIOUS FINANCIAL INSTITUTIONS
and
BANK ONE, NA,
as Agent
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS.................................... 1
ARTICLE II
THE CREDITS................................... 14
2.1. Commitment........................................................... 14
2.2. Required Payments; Termination....................................... 14
2.3. Ratable Loans........................................................ 15
2.4. Types of Advances.................................................... 15
2.5. Commitment Fee; Reductions in Aggregate Commitment................... 15
2.6. Minimum Amount of Each Advance....................................... 16
2.7. Optional Principal Payments.......................................... 16
2.8. Method of Selecting Types and Interest Periods for New Advances...... 16
2.9. Conversion and Continuation of Outstanding Advances.................. 16
2.10. Changes in Interest Rate, etc........................................ 17
2.11. Rates Applicable After Default....................................... 17
2.12. Method of Payment.................................................... 18
2.13. Noteless Agreement; Evidence of Indebtedness......................... 18
2.14. Telephonic Notices................................................... 19
2.15. Interest Payment Dates; Interest and Fee Basis....................... 19
2.16. Notification of Advances, Interest Rates, Prepayments
and Commitment Reductions............................................ 19
2.17. Lending Installations................................................ 19
2.18. Non-Receipt of Funds by the Agent.................................... 20
ARTICLE III
YIELD PROTECTION; TAXES.......................... 20
3.1. Yield Protection..................................................... 20
3.2. Changes in Capital Adequacy Regulations.............................. 21
3.3. Availability of Types of Advances.................................... 21
3.4. Funding Indemnification.............................................. 21
3.5. Taxes................................................................ 22
3.6. Lender Statements; Survival of Indemnity............................. 23
ARTICLE IV
CONDITIONS PRECEDENT............................. 24
4.1. Initial Credit Extension............................................. 24
4.2. Each Credit Extension................................................ 25
ARTICLE V
REPRESENTATIONS AND WARRANTIES........................ 26
5.1. Existence and Standing............................................... 26
5.2. Authorization and Validity........................................... 26
5.3. No Conflict; Government Consent...................................... 26
5.4. Financial Statements................................................. 27
5.5. Material Adverse Change.............................................. 27
5.6. Taxes................................................................ 27
5.7. Litigation and Contingent Obligations................................ 27
5.8. Subsidiaries......................................................... 27
5.9. ERISA................................................................ 27
5.10. Accuracy of Information.............................................. 28
5.11. Regulation U......................................................... 28
5.12. Material Agreements.................................................. 28
5.13. Compliance With Laws................................................. 28
5.14. Ownership of Properties.............................................. 28
5.15. Plan Assets; Prohibited Transactions................................. 28
5.16. Environmental Matters................................................ 28
5.17. Investment Company Act............................................... 29
5.18. Public Utility Holding Company Act................................... 29
5.19. Year 2000............................................................ 29
5.20. Post-Retirement Benefits............................................. 29
5.21. Solvency............................................................. 29
ARTICLE VI
COVENANTS................................ 30
6.1. Financial Reporting.................................................. 30
6.2. Use of Proceeds...................................................... 31
6.3. Notice of Default.................................................... 31
6.4. Conduct of Business.................................................. 31
6.5. Taxes................................................................ 32
6.6. Insurance............................................................ 32
6.7. Compliance with Laws................................................. 32
6.8. Maintenance of Properties............................................ 32
6.9. Inspection; Collateral Audit......................................... 32
6.10. Dividends............................................................ 32
6.11. Indebtedness......................................................... 33
6.12. Merger............................................................... 33
6.13. Sale of Assets....................................................... 33
6.14. Investments and Acquisitions......................................... 33
6.15. Liens................................................................ 34
6.16. Year 2000............................................................ 35
6.17. Affiliates........................................................... 35
6.18. No Amendment to GECC Convertible Preferred Stock; No
Issuance of Additional Redeemable Stock.............................. 35
6.19. Sale of Accounts..................................................... 35
6.20. Sale and Leaseback Transactions and other Off-Balance
Sheet Liabilities.................................................... 35
6.21. Contingent Obligations............................................... 35
6.22. Letters of Credit.................................................... 35
6.23. Prepayment of Other Debt............................................. 35
6.24. Financial Covenants.................................................. 36
6.24.1 Fixed Charge Coverage Ratio................................. 36
6.24.2 Leverage Ratio.............................................. 36
6.24.3 Minimum Consolidated Net Worth.............................. 36
6.24.4 Asset Coverage Ratio........................................ 36
6.25. Additional Subsidiaries; Further Assurances.......................... 36
ARTICLE VII
DEFAULTS.................................. 37
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES............... 40
8.1. Acceleration......................................................... 40
8.2. Amendments........................................................... 40
8.3. Preservation of Rights............................................... 41
ARTICLE IX
GENERAL PROVISIONS........................... 41
9.1. Survival of Representations.......................................... 41
9.2. Governmental Regulation.............................................. 41
9.3. Headings............................................................. 41
9.4. Entire Agreement..................................................... 41
9.5. Several Obligations; Benefits of this Agreement...................... 41
9.6. Expenses; Indemnification............................................ 42
9.7. Numbers of Documents................................................. 42
9.8. Accounting........................................................... 42
9.9. Severability of Provisions........................................... 42
9.10. Nonliability of Lenders.............................................. 43
9.11. Confidentiality...................................................... 43
9.12. Nonreliance.......................................................... 43
9.13. Disclosure........................................................... 43
ARTICLE X
THE AGENT................................ 44
10.1. Appointment; Nature of Relationship.................................. 44
10.2. Powers............................................................... 44
10.3. General Immunity..................................................... 44
10.4. No Responsibility for Loans, Recitals, etc........................... 44
10.5. Action on Instructions of Lenders.................................... 45
10.6. Employment of Agents and Counsel..................................... 45
10.7. Reliance on Documents; Counsel....................................... 45
10.8. Agent's Reimbursement and Indemnification............................ 45
10.9. Notice of Default.................................................... 46
10.10. Rights as a Lender................................................... 46
10.11. Lender Credit Decision............................................... 46
10.12. Successor Agent...................................................... 46
10.13. Agent's Fee.......................................................... 47
10.14. Delegation to Affiliates............................................. 47
10.15. Execution of Collateral Documents.................................... 47
10.16. Collateral Releases.................................................. 47
ARTICLE XI
SETOFF; RATABLE PAYMENTS.......................... 48
11.1. Setoff............................................................... 48
11.2. Ratable Payments..................................................... 48
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS............ 48
12.1. Successors and Assigns............................................... 48
12.2. Participations....................................................... 49
12.2.1 Permitted Participants; Effect.............................. 49
12.2.2 Voting Rights............................................... 49
12.2.3 Benefit of Setoff........................................... 49
12.3. Assignments.......................................................... 50
12.3.1 Permitted Assignments....................................... 50
12.3.2 Effect; Effective Date...................................... 50
12.4. Dissemination of Information......................................... 51
12.5. Tax Treatment........................................................ 51
ARTICLE XIII
NOTICES................................. 51
13.1. Notices................................................................. 51
13.2. Change of Address....................................................... 51
ARTICLE XIV
COUNTERPARTS.............................. 52
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL........ 52
15.1. CHOICE OF LAW........................................................ 52
15.2. CONSENT TO JURISDICTION.............................................. 52
15.3. WAIVER OF JURY TRIAL................................................. 52
SCHEDULES
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Pricing Schedule
Schedule 1 Guarantors and Other Investments
Schedule 2 Liens and Indebtedness
EXHIBITS
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EXHIBIT A Form of Opinion of Counsel
EXHIBIT B Form of Compliance Certificate
EXHIBIT C Form of Assignment Agreement
EXHIBIT D Form of Transfer Instructions
EXHIBIT E Form of Note
ACQUISITION CREDIT AGREEMENT
This Acquisition Agreement, dated as of October 25, 1999, is among Transit
Group, Inc., a Florida corporation, the Lenders and Bank One, NA, a national
banking association having its principal office in Chicago, Illinois, as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
-----------
As used in this Agreement:
"Account Debtor" means any Person who is obligated to a Credit Party under,
with respect to, or on account of an Account Receivable.
"Account Receivable" means, with respect to any Person, any right of such
person to payment for goods sold or leased or for services rendered, whether or
not evidenced by an instrument or chattel paper and whether or not yet earned by
performance.
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, corporation or limited liability company, or division
thereof, whether through purchase of assets, merger or otherwise or (ii)
directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power for
the election of directors (other than securities having such power only by
reason of the happening of a contingency) or a majority (by percentage or voting
power) of the outstanding ownership interests of a partnership or limited
liability company.
"Advance" means a borrowing hereunder, (i) made by the Lenders on the same
Borrowing Date, or (ii) converted or continued by the Lenders on the same date
of conversion or continuation, consisting, in either case, of the aggregate
amount of the several Loans of the same Type and, in the case of Eurodollar
Loans, for the same Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One in its capacity as contractual representative of the
Lenders pursuant to Article X, and not in its individual capacity as a Lender,
and any successor Agent appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced from time to time pursuant to the terms hereof.
"Aggregate Outstanding Credit Exposure" means, at any time, the aggregate
of the Outstanding Credit Exposure of all the Lenders.
"Agreement" means this credit agreement, as it may be amended or modified
and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 5.4.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the sum
of the Federal Funds Effective Rate for such day plus 1/2% per annum.
"AmSouth Credit Agreement" means the $33,000,000 Line of Credit Agreement
dated November 5, 1998 between the Borrower and AmSouth Bank, as amended or
modified from time to time.
"Applicable Fee Rate" means, at any time, the percentage rate per annum at
which Commitment Fees are accruing on the unused portion of the Aggregate
Commitment at such time as set forth in the Pricing Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Arranger" means Banc One Capital Markets, Inc., a Delaware corporation,
and its successors, in its capacity as Lead Arranger and Sole Book Runner.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Asset Coverage Ratio" is defined in Section 6.24.4.
"Authorized Officer" means any of the Chief Executive Officer, the
President, or any Vice President of the Borrower, acting singly.
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"Available Aggregate Commitment" means, at any time, the Aggregate
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Bank One" means Bank One, NA, a national banking association having its
principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Borrower" means Transit Group, Inc., a Florida corporation, and its
successors and permitted assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago and New York for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Chicago for the conduct of substantially all of their commercial lending
activities and interbank wire transfers can be made on the Fedwire system.
"Capital Expenditures" means, without duplication, any expenditures for any
purchase or other acquisition of any asset which would be classified as a fixed
or capital asset on a consolidated balance sheet of the Borrower and its
Subsidiaries prepared in accordance with Agreement Accounting Principles
excluding (i) expenditures of insurance proceeds to rebuild or replace any asset
after a casualty loss, (ii) leasehold improvement expenditures for which the
Borrower or a Subsidiary is reimbursed promptly by the lessor and (iii)
expenditures which would otherwise constitute a Capital Expenditure made in
connection with a Permitted Acquisition.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Cash Equivalent Investments" means (i) short-term obligations of, or fully
guaranteed by, the United States of America or mutual funds limited to the same,
(ii) commercial paper rated A-1 or better by S&P or P-1 or better by ▇▇▇▇▇'▇,
(iii) demand deposit accounts maintained in the ordinary course of business, and
(iv) certificates of deposit issued by and time deposits with commercial banks
(whether domestic or foreign) having capital and surplus in excess of
$100,000,000; provided in each case that the same provides for payment of both
principal and
3
interest (and not principal alone or interest alone) and is not subject to any
contingency regarding the payment of principal or interest.
"Change in Control" means (i) any Person or group (within the meaning of
Rule 13d-5 under the Securities and Exchange Act of 1934), excluding ▇▇▇▇▇
▇▇▇▇▇, any member of his immediate family and any trust therefor or Affiliate
thereof, shall be or become the beneficial owner (within the meaning of Rule
13d-3 under the Securities and Exchange Act of 1934) of issued and outstanding
capital stock of the Borrower representing 20% or more of the voting power in
elections for directors of the Borrower on a fully diluted basis or (ii) a
majority of the members of the Board of Directors of the Borrower shall cease to
be Continuing Members.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral Documents" means, collectively, the Pledge and Security
Agreement and any other document executed in connection with or pursuant
thereto.
"Collateral Shortfall Amount" is defined in Section 8.1.
"Commitment" means, for each Lender, the obligation of such Lender to make
Loans to the Borrower in an aggregate amount not exceeding the amount set forth
opposite its signature below or as set forth in any Notice of Assignment
relating to any assignment that has become effective pursuant to Section 12.3.2,
as such amount may be modified from time to time pursuant to the terms hereof.
"Consolidated Capital Expenditures" means, with reference to any period,
the Capital Expenditures of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated EBITDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Interest Expense, (ii) expense for taxes paid, (iii) depreciation, (iv)
amortization and (v) extraordinary losses incurred other than in the ordinary
course of business, minus, to the extent included in Consolidated Net Income,
extraordinary gains realized other than in the ordinary course of business, all
calculated for the Borrower and its Subsidiaries on a consolidated basis.
"Consolidated Indebtedness" means at any time the Indebtedness of the
Borrower and its Subsidiaries calculated on a consolidated basis as of such
time.
"Consolidated Interest Expense" means, with reference to any period, the
interest expense of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) after taxes of the Borrower and its Subsidiaries calculated on
a consolidated basis for such period.
4
"Consolidated Net Worth" means at any time the consolidated stockholders'
equity of the Borrower and its Subsidiaries calculated on a consolidated basis
as of such time.
"Consolidated Rentals" means, with reference to any period, the Rentals of
the Borrower and its Subsidiaries calculated on a consolidated basis for such
period.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or the obligations of any such Person as general
partner of a partnership with respect to the liabilities of the partnership.
"Continuing Member" means a member of the Board of Directors of the
Borrower who either (a) was a member of the Borrower's Board of Directors on the
date of the initial Credit Extension hereunder and has been such continuously
thereafter or (b) became a member of such Board of Directors after the date of
the initial Credit Extension hereunder and whose election or nomination for
election was approved by a vote of the majority of the Continuing Members then
members of the Borrower's Board of Directors.
"Conversion/Continuation Notice" is defined in Section 2.9.
"Controlled Group" means all members of a controlled group of corporations
or other business entities and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any of
its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Corporate Base Rate" means a rate per annum equal to the corporate base
rate or prime rate of interest announced by Bank One or by its parent, BANK ONE
CORPORATION, from time to time, changing when and as said corporate base rate or
prime rate changes.
"Credit Extension" means the making of an Advance hereunder.
"Credit Extension Date" means the Borrowing Date for an Advance.
"Credit Party" means any of the Borrower and the Guarantors.
"Default" means an event described in Article VII.
"Dividends" means, with respect to the Borrower, dividends on its equity
securities and, without duplication, (i) payments in respect of such equity
securities, including without limitation payments in respect of interest under
such equity securities or in connection with any redemption,
5
purchase, retirement or defeasance of such equity securities and (ii) payments
of annual and cumulative dividends on the GECC Convertible Preferred Stock.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to (i) the
protection of the environment, (ii) the effect of the environment on human
health, (iii) emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or land, or (iv)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which, except as otherwise provided
in Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate appearing on Page 3750 of the
Dow ▇▇▇▇▇ (Telerate) Service (or on any successor or substitute page of such
Service, or any successor to or substitute for such Service, providing rate
quotations comparable to those currently provided on such page of such Service,
as determined by the Agent from time to time for purposes of providing
quotations of interest rates applicable to Dollar deposits in the London
interbank market) at approximately 11:00 a.m., London time, two Business Days
prior to the commencement of such Interest Period, as the rate for U.S. dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the "Eurodollar
Base Rate" with respect to such Eurodollar Loan for such Interest Period shall
be the rate determined by the Agent to be the rate at which Bank One or one of
its Affiliate banks offers to place deposits in U.S. dollars with first-class
banks in the London interbank market at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period, in the
approximate amount of Bank One's relevant Eurodollar Loan and having a maturity
equal to such Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable Margin.
"Excluded Taxes" means, in the case of each Lender or applicable Lending
Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii)
6
the jurisdiction in which the Agent's or such Lender's principal executive
office or such Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another document
is specifically referenced.
"Facility Termination Date" means October 25, 2004.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Fiscal Year" means the fiscal year of the Borrower and its Subsidiaries,
which period shall be the 12-month period ending on December 31 of each year.
References to a Fiscal Year with a number corresponding to any calendar year
(e.g., "Fiscal Year 1999") refer to the Fiscal Year ending on December 31 of
such calendar year.
"Fixed Charge Coverage Ratio" is defined in Section 6.24.1.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the Floating Rate.
"Foreign Subsidiary" means each Subsidiary of the Borrower that is
organized under the laws of a jurisdiction outside the United States of America.
"GECC Convertible Preferred Stock" means the Series A Convertible Preferred
Stock issued by the Borrower pursuant to that certain Purchase Agreement dated
as of May 13, 1999 by and between Transit Group, Inc. and GE Capital Equity
Investments, Inc.
"Guarantor" means each Subsidiary of the Borrower which has executed the
Guaranty, and each of their respective successors and permitted assigns.
7
"Guaranty" means that certain Guaranty dated as of the date hereof executed
by each Guarantor in favor of the Agent, for the ratable benefit of the Lenders,
as it may be amended or modified and in effect from time to time.
"Indebtedness" of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of Property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (iii) obligations,
whether or not assumed, secured by Liens or payable out of the proceeds or
production from Property now or hereafter owned or acquired by such Person, (iv)
obligations which are evidenced by notes, acceptances, or other instruments, (v)
obligations of such Person to purchase securities or other Property arising out
of or in connection with the sale of the same or substantially similar
securities or Property, (vi) Capitalized Lease Obligations, (vii) Contingent
Obligations, (viii) Operating Lease Obligations and (ix) any other obligation
for borrowed money or other financial accommodation which in accordance with
Agreement Accounting Principles would be shown as a liability on the
consolidated balance sheet of such Person.
"Interest Period" means, with respect to a Eurodollar Advance, a period of
seven days or one, two, three or six months commencing on a Business Day
selected by the Borrower pursuant to this Agreement. Such Interest Period shall
end on the day which corresponds numerically to such date one, two, three or six
months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Interest Period shall end on the last Business Day of such next, second, third
or sixth succeeding month. If an Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day, provided, however, that if said next succeeding
Business Day falls in a new calendar month, such Interest Period shall end on
the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade) or
contribution of capital by such Person; stocks, bonds, mutual funds, partnership
interests, notes, debentures or other securities owned by such Person; any
deposit accounts and certificate of deposit owned by such Person; and structured
notes, derivative financial instruments and other similar instruments or
contracts owned by such Person.
"LC Issuer" means Bank One (or any subsidiary or affiliate of Bank One
designated by Bank One) in its capacity as issuer of Letters of Credit under the
Working Capital Credit Agreement.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent, the
office, branch, subsidiary or affiliate of such Lender or the Agent listed on
the signature pages hereof or on a Schedule or otherwise selected by such Lender
or the Agent pursuant to Section 2.17.
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"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"Leverage Ratio" is defined in Section 6.24.2.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other Pledge and Security Agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, the interest of a
vendor or lessor under any conditional sale, Capitalized Lease or other title
retention agreement).
"Loan" means, with respect to a Lender, such Lender's loan made pursuant to
Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, the Working Capital Credit
Agreement, any Notes issued pursuant to Section 2.13, any notes issued pursuant
to the Working Capital Credit Agreement, the "Facility LC Applications" (as
defined in the Working Capital Credit Agreement), the Guaranty and the
Collateral Documents.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party, or (iii) the validity or enforceability of any of the Loan
Documents or the rights or remedies of the Agent, the LC Issuer or the Lenders
thereunder.
"Material Financial Obligation" is defined in Section 7.5.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" means any promissory note issued at the request of a Lender pursuant
to Section 2.13 in the form of Exhibit E-1.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Loans, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of
9
the Borrower to the Lenders or to any Lender, the Agent or any indemnified party
arising under the Loan Documents.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.
"Operating Lease Obligations" means, as at any date of determination, the
amounts for such operating lease obligations set forth in the most current Form
10-K filed by the Borrower with the Securities and Exchange Commission,
discounted in the case of each Operating Lease by applying a discount rate
(which shall be 10%) from the date on which each fixed lease payment is due
under such Operating Lease to the date of filing of such Form 10-K, adjusted for
any Operating Leases entered into after the date of filing of such Form 10-K.
"Other Taxes" is defined in Section 3.5(ii).
"Outstanding Credit Exposure" means, as to any Lender at any time, the
aggregate principal amount of its Loans outstanding at such time.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each fiscal quarter of the Borrower
and the Facility Termination Date.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Permitted Acquisition" means an Acquisition (i) which has been recommended
or approved by the board of directors or other governing body of the Person that
is the object of such Acquisition, (ii) which occurs when no Default or
Unmatured Default exists or will result therefrom, (iii) after giving effect to
which no Default or Unmatured Default will exist on a pro forma basis (assuming
that such Acquisition had occurred on the last day of the fiscal quarter most
recently ended from the date which is one year prior to the date of such
Acquisition), (iv) which is of a Person in the same general line of business as
the Borrower and its Subsidiaries, (v) the purchase price for which does not
exceed five times the cumulative net income plus, to the extent deducted from
revenues in determining such net income, interest expense, expense for taxes
paid or accrued, depreciation, amortization and extraordinary losses incurred
other than in the ordinary course of business, minus, to the extent included in
such net income, extraordinary gains realized other than in the ordinary course
of business, all calculated for the Person that is the object of such
Acquisition for the preceding four fiscal quarters, and (vi) the total
consideration for which (including assumed Indebtedness) does not exceed
$25,000,000 (with the cash component of such purchase price not to exceed
$7,500,000) without the consent of the Required Lenders.
10
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Pledge and Security Agreement" means that certain Pledge and Security
Agreement dated as of the date hereof executed by the Borrower and the
Guarantors in favor of the Agent, for the ratable benefit of the Lenders, as it
may be amended or modified and in effect from time to time.
"Pricing Schedule" means the Schedule attached hereto identified as such.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Pro Rata Share" means, with respect to a Lender, a portion equal to a
fraction the numerator of which is such Lender's Commitment and the denominator
of which is the Aggregate Commitment.
"Purchasers" is defined in Section 12.3.1.
"Rate Management Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.
"Rate Management Transaction" means any transaction (including an agreement
with respect thereto) now existing or hereafter entered into between the
Borrower and any Lender, any lender under the Working Capital Credit Agreement
or any Affiliate of any Lender or any such lender which is a rate swap, basis
swap, forward rate transaction, commodity swap, commodity option, equity or
equity index swap, equity or equity index option, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions) or any combination
thereof, whether linked to one or more interest rates, foreign currencies,
commodity prices, equity prices or other financial measures.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
11
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Rentals" of a Person means the aggregate fixed amounts payable by such
Person under any Operating Lease.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 66 2/3 %
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 66 2/3 % of the Aggregate Outstanding
Credit Exposure.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Revolving Credit Termination Balance" means the aggregate principal amount
of Advances outstanding on the Revolving Credit Termination Date after giving
effect to any Advances made or repaid on such date.
"Revolving Credit Termination Date" means October 23, 2000 or any earlier
date on which the Aggregate Commitment is reduced to zero or otherwise
terminated pursuant to the terms hereof.
"Schedule" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Secured Obligations" means the Obligations, the "Obligations" under and as
defined in the Working Capital Credit Agreement and the Rate Management
Obligations.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
12
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which (i) represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries as would be shown in
the consolidated financial statements of the Borrower and its Subsidiaries as at
the beginning of the twelvemonth period ending with the month in which such
determination is made, or (ii) is responsible for more than 10% of the
consolidated net sales or of the consolidated net income of the Borrower and its
Subsidiaries as reflected in the financial statements referred to in clause (i)
above.
"Taxes" means any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and any and all liabilities with respect to
the foregoing, but excluding Excluded Taxes.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested and unvested accrued benefits under all Single Employer Plans
exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Upfront Fees" means such fees to be paid to the Agent on the date of the
initial Credit Extension as shall be agreed to by the Borrower and the Arranger.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (ii) any partnership, limited liability company, association,
joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.
13
"Working Capital Credit Agreement" means the Credit Agreement dated as of
October 25, 1999 among the Borrower, certain lenders and Bank One as agent for
the lenders thereunder, as it may be amended or otherwise modified from time to
time.
"Year 2000 Issues" means anticipated costs, problems and uncertainties
associated with the inability of certain computer applications to effectively
handle data including dates on and after January 1, 2000, as such inability
affects the business, operations and financial condition of the Borrower and its
Subsidiaries and of the Borrower's and its Subsidiaries' material customers,
suppliers and vendors.
"Year 2000 Program" is defined in Section 5.19.
The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms. For purposes of calculating Consolidated
EBITDA, Consolidated Rentals, Consolidated Net Income, Consolidated Interest
Expense and expense for taxes paid or accrued for any period, any Person
heretofore or hereafter acquired by the Borrower or any Subsidiary during such
period shall be deemed to have been acquired on the first day of such period,
with pro forma adjustments limited to salaries, taxes and extraordinary charges
(as defined by generally accepted accounting principles) and other items
approved by the Agent in its reasonable discretion of such acquired Person
relating to any prior period.
ARTICLE II
THE CREDITS
-----------
2.1. Commitment. From and including the date of this Agreement and prior
----------
to the Revolving Credit Termination Date, each Lender severally agrees, on the
terms and conditions set forth in this Agreement, to make Loans to the Borrower,
provided that, after giving effect to the making of each such Loan, (x) such
Lender's Outstanding Credit Exposure shall not exceed its Commitment, and (y)
the Aggregate Outstanding Credit Exposure shall not exceed the Aggregate
Commitment. Subject to the terms of this Agreement, the Borrower may borrow,
repay and reborrow at any time prior to the Revolving Credit Termination Date.
The Commitments to extend credit hereunder shall expire on the Revolving Credit
Termination Date. Principal payments made on or after the Revolving Credit
Termination Date may not be reborrowed.
2.2. Required Payments; Termination.
------------------------------
(a) The Revolving Credit Termination Balance shall be payable in 16 equal
installments each equal to 1/16th of the Revolving Credit Termination Balance,
on each Payment Date, commencing on December 31, 2000 and ending on June 30,
2004, and on the Facility Termination Date. Any outstanding Advances and all
other unpaid Obligations shall be paid in full by the Borrower on the Facility
Termination Date.
(b) The Borrower shall prepay the Obligations in an amount equal to 100% of
the proceeds (net of ordinary expenses) of any sale, transfer or other
disposition of any asset of the Borrower or
14
any of its Subsidiaries which is permitted under the Loan Documents (other than
sales of inventory and assets in the ordinary course of business), such
prepayment to be made at the time the Borrower or such Subsidiary receives such
proceeds.
(c) The Borrower shall prepay the Obligations in an amount equal to 75% of
the proceeds (net of ordinary expenses) of any sale of common stock, preferred
stock, warrant or other equity interest in the Borrower, such prepayment to be
made at the time the Borrower or such Subsidiary receives such proceeds,
provided that the foregoing shall not apply to the first $50,000,000 in proceeds
of a public equity offering occurring within 12 months of the date hereof.
(d) Any prepayment made on or after the Revolving Credit Termination Date
pursuant to Section 2.3(b) or (c) shall be applied to the principal installments
of the Revolving Credit Termination Balance in the inverse order of maturity.
2.3. Ratable Loans. Each Advance hereunder shall consist of Loans made
-------------
from the several Lenders ratably according to their Pro Rata Shares.
2.4. Types of Advances. The Advances may be Floating Rate Advances or
-----------------
Eurodollar Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.8 and 2.9.
2.5. Commitment Fee; Reductions in Aggregate Commitment.
--------------------------------------------------
(a) The Borrower agrees to pay to the Agent for the account of each Lender
according to its Pro Rata Share a commitment fee at a per annum rate equal to
the Applicable Fee Rate on the average daily Available Aggregate Commitment from
the date hereof to and including the Revolving Credit Termination Date, payable
on each Payment Date occurring in June and December hereafter, commencing with
the June 30, 2000 Payment Date, and on the Revolving Credit Termination Date.
All accrued commitment fees shall be payable on the effective date of any
termination of the obligations of the Lenders to make Credit Extensions
hereunder.
(b) The Borrower may permanently reduce the Aggregate Commitment in whole,
or in part ratably among the Lenders in integral multiples of $3,000,000, upon
at least five Business Days' written notice to the Agent, which notice shall
specify the amount of any such reduction, provided, however, that the amount of
the Aggregate Commitment may not be reduced below the Aggregate Outstanding
Credit Exposure.
(c) The Aggregate Commitment shall automatically be permanently reduced
from time to time by the amount of any prepayment made prior to the Revolving
Credit Termination Date pursuant to Section 2.2(b) or (c).
2.6. Minimum Amount of Each Advance. Each Eurodollar Advance shall be in
------------------------------
the minimum amount of $3,000,000 (and in multiples of $100,000 if in excess
thereof), and each Floating Rate Advance shall be in the minimum amount of
$3,000,000 (and in multiples of $100,000
15
if in excess thereof), provided, however, that any Floating Rate Advance may be
in the amount of the Available Aggregate Commitment.
2.7. Optional Principal Payments. The Borrower may from time to time pay,
---------------------------
without penalty or premium, all outstanding Floating Rate Advances, or, in a
minimum aggregate amount of $1,000,000 or any integral multiple of $100,000 in
excess thereof, any portion of the outstanding Floating Rate Advances upon two
Business Days' prior notice to the Agent. The Borrower may from time to time
pay, subject to the payment of any funding indemnification amounts required by
Section 3.4 but without penalty or premium, all outstanding Eurodollar Advances,
or, in a minimum aggregate amount of $1,000,000 or any integral multiple of
$100,000 in excess thereof, any portion of the outstanding Eurodollar Advances
upon three Business Days' prior notice to the Agent. Principal prepayments made
on or after the Revolving Credit Termination Date shall be applied to the
principal installments payable under Section 2.2(a) in the inverse order of
maturity.
2.8. Method of Selecting Types and Interest Periods for New Advances. The
---------------------------------------------------------------
Borrower shall select the Type of Advance and, in the case of each Eurodollar
Advance, the Interest Period applicable thereto from time to time. The Borrower
shall give the Agent irrevocable notice (a "Borrowing Notice") not later than
10:00 a.m. (Chicago time) at least one Business Day before the Borrowing Date of
each Floating Rate Advance and three Business Days before the Borrowing Date for
each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period applicable
thereto.
Not later than noon (Chicago time) on each Borrowing Date, each Lender shall
make available its Loan or Loans in funds immediately available in Chicago to
the Agent at its address specified pursuant to Article XIII. The Agent will
make the funds so received from the Lenders available to the Borrower at the
Agent's aforesaid address.
2.9. Conversion and Continuation of Outstanding Advances. Floating Rate
---------------------------------------------------
Advances shall continue as Floating Rate Advances unless and until such Floating
Rate Advances are converted into Eurodollar Advances pursuant to this Section
2.9 or are repaid in accordance with Section 2.7. Each Eurodollar Advance shall
continue as a Eurodollar Advance until the end of the then applicable Interest
Period therefor, at which time such Eurodollar Advance shall be automatically
converted into a Floating Rate Advance unless (x) such Eurodollar Advance is or
was repaid in accordance with Section 2.7 or (y) the Borrower shall have given
the Agent a Conversion/Continuation Notice (as defined below) requesting that,
at the end of such Interest Period, such Eurodollar Advance continue as a
Eurodollar Advance for the same or another Interest Period. Subject to the
terms of Section 2.6, the Borrower may elect from time to time to convert all or
any part of a Floating Rate Advance into a Eurodollar Advance. The Borrower
shall give the
16
Agent irrevocable notice (a "Conversion/Continuation Notice") of each conversion
of a Floating Rate Advance into a Eurodollar Advance or continuation of a
Eurodollar Advance not later than 10:00 a.m. (Chicago time) at least three
Business Days prior to the date of the requested conversion or continuation,
specifying:
(i) the requested date, which shall be a Business Day, of such conversion
or continuation,
(ii) the aggregate amount and Type of the Advance which is to be converted
or continued, and
(iii) the amount of such Advance which is to be converted into or continued
as a Eurodollar Advance and the duration of the Interest Period applicable
thereto.
2.10. Changes in Interest Rate, etc. Each Floating Rate Advance shall bear
------------------------------
interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is automatically converted from a
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.9, to but
excluding the date it is paid or is converted into a Eurodollar Advance pursuant
to Section 2.9 hereof, at a rate per annum equal to the Floating Rate for such
day. Changes in the rate of interest on that portion of any Advance maintained
as a Floating Rate Advance will take effect simultaneously with each change in
the Alternate Base Rate. Each Eurodollar Advance shall bear interest on the
outstanding principal amount thereof from and including the first day of the
Interest Period applicable thereto to (but not including) the last day of such
Interest Period at the interest rate determined by the Agent as applicable to
such Eurodollar Advance based upon the Borrower's selections under Sections 2.8
and 2.9 and otherwise in accordance with the terms hereof. No Interest Period
may end after the Facility Termination Date. The Borrower shall select Interest
Periods so that it is not necessary to repay any portion of a Eurodollar Advance
prior to the last day of the applicable Interest Period in order to make a
mandatory repayment required pursuant to Section 2.2.
2.11. Rates Applicable After Default. Notwithstanding anything to the
------------------------------
contrary contained in Section 2.8 or 2.9, during the continuance of a Default or
Unmatured Default the Required Lenders may, at their option, by written notice
to the Borrower (which notice may be revoked at the option of the Required
Lenders notwithstanding any provision of Section 8.2 requiring unanimous consent
of the Lenders to changes in interest rates), declare that no Advance may be
made as, converted into or continued as a Eurodollar Advance. During the
continuance of a Default the Required Lenders may, at their option, by written
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that (i)
each Eurodollar Advance shall bear interest for the remainder of the applicable
Interest Period at the rate otherwise applicable to such Interest Period plus 2%
per annum and (ii) each Floating Rate Advance shall bear interest at a rate per
annum equal to the Floating Rate in effect from time to time plus 2% per annum,
provided that, during the continuance of a Default under Section 7.6 or 7.7, the
interest rates set forth in clauses (i) and (ii) above shall be applicable to
all Credit Extensions without any election or action on the part of the Agent or
any Lender.
17
2.12. Method of Payment. All payments of the Obligations hereunder shall
-----------------
be made, without setoff, deduction, or counterclaim, in immediately available
funds to the Agent at the Agent's address specified pursuant to Article XIII, or
at any other Lending Installation of the Agent specified in writing by the Agent
to the Borrower, by noon (local time) on the date when due and shall be applied
ratably by the Agent among the Lenders. Each payment delivered to the Agent for
the account of any Lender shall be delivered promptly by the Agent to such
Lender in the same type of funds that the Agent received at its address
specified pursuant to Article XIII or at any Lending Installation specified in a
notice received by the Agent from such Lender. The Agent is hereby authorized to
charge the account of the Borrower maintained with Bank One for each payment of
principal, interest and fees as it becomes due hereunder.
2.13. Noteless Agreement; Evidence of Indebtedness. (i) Each Lender shall
--------------------------------------------
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.
(ii) The Agent shall also maintain accounts in which it will record (a)
the amount of each Loan made hereunder, the Type thereof and the Interest Period
with respect thereto, (b) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder,
and (c) the amount of any sum received by the Agent hereunder from the Borrower
and each Lender's share thereof.
(iii) The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) above shall be prima facie evidence of the existence and
amounts of the Obligations therein recorded; provided, however, that the failure
of the Agent or any Lender to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Borrower to repay the Obligations
in accordance with their terms.
(iv) Any Lender may request that its Loans be evidenced by a promissory
note (a "Note"). In such event, the Borrower shall prepare, execute and deliver
to such Lender a Note payable to the order of such Lender substantially in the
form of Exhibit E hereto. Thereafter, the Loans evidenced by such Note and
interest thereon shall at all times (including after any assignment pursuant to
Section 12.3) be represented by one or more Notes payable to the order of the
payee named therein or any assignee pursuant to Section 12.3, except to the
extent that any such Lender or assignee subsequently returns any such Note for
cancellation and requests that such Loans once again be evidenced as described
in paragraphs (i) and (ii) above.
2.14. Telephonic Notices. The Borrower hereby authorizes the Lenders and
------------------
the Agent to extend, convert or continue Advances, effect selections of Types of
Advances and to transfer funds based on telephonic notices made by any person or
persons the Agent or any Lender in good faith believes to be acting on behalf of
the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by
18
an Authorized Officer. If the written confirmation differs in any material
respect from the action taken by the Agent and the Lenders, the records of the
Agent and the Lenders shall govern absent manifest error.
2.15. Interest Payment Dates; Interest and Fee Basis. Interest accrued on
----------------------------------------------
each Floating Rate Advance shall be payable on each Payment Date, commencing
with the first such date to occur after the date hereof, on any date on which
the Floating Rate Advance is prepaid, whether due to acceleration or otherwise,
and at maturity. Interest accrued on that portion of the outstanding principal
amount of any Floating Rate Advance converted into a Eurodollar Advance on a day
other than a Payment Date shall be payable on the date of conversion. Interest
accrued on each Eurodollar Advance shall be payable on the last day of its
applicable Interest Period, on any date on which the Eurodollar Advance is
prepaid, whether by acceleration or otherwise, and at maturity. Interest
accrued on each Eurodollar Advance having an Interest Period longer than three
months shall also be payable on the last day of each three-month interval during
such Interest Period. Interest and commitment fees shall be calculated for
actual days elapsed on the basis of a 360-day year, except that interest on
Floating Rate Advances accruing at a rate based on the Corporate Base Rate shall
be computed on the basis of a 365- or 366-day year, as applicable. Interest
shall be payable for the day an Advance is made but not for the day of any
payment on the amount paid if payment is received prior to noon (local time) at
the place of payment. If any payment of principal of or interest on an Advance
shall become due on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day and, in the case of a principal
payment, such extension of time shall be included in computing interest in
connection with such payment.
2.16. Notification of Advances, Interest Rates, Prepayments and Commitment
--------------------------------------------------------------------
Reductions. Promptly after receipt thereof, the Agent will notify each Lender of
----------
the contents of each Aggregate Commitment reduction notice, Borrowing Notice,
Conversion/Continuation Notice, and repayment notice received by it hereunder.
The Agent will notify each Lender of the interest rate applicable to each
Eurodollar Advance promptly upon determination of such interest rate and will
give each Lender prompt notice of each change in the Alternate Base Rate.
2.17. Lending Installations. Each Lender may book its Loans at any Lending
---------------------
Installation selected by such Lender, and may change its Lending Installation
from time to time. All terms of this Agreement shall apply to any such Lending
Installation and the Loans and any Notes issued hereunder shall be deemed held
by each Lender for the benefit of any such Lending Installation. Each Lender
may, by written notice to the Agent and the Borrower in accordance with Article
XIII, designate replacement or additional Lending Installations through which
Loans will be made by it and for whose account Loan payments are to be made.
2.18. Non-Receipt of Funds by the Agent. Unless the Borrower or a Lender,
---------------------------------
as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption.
If such Lender or the Borrower, as the case may be, has not in fact
19
made such payment to the Agent, the recipient of such payment shall, on demand
by the Agent, repay to the Agent the amount so made available together with
interest thereon in respect of each day during the period commencing on the date
such amount was so made available by the Agent until the date the Agent recovers
such amount at a rate per annum equal to (x) in the case of payment by a Lender,
the Federal Funds Effective Rate for such day for the first three days and,
thereafter, the interest rate applicable to the relevant Loan or (y) in the case
of payment by the Borrower, the interest rate applicable to the relevant Loan.
ARTICLE III
YIELD PROTECTION; TAXES
-----------------------
3.1. Yield Protection. If, on or after the date of this Agreement, the
----------------
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(i) subjects any Lender or any applicable Lending Installation to any
Taxes, or changes the basis of taxation of payments (other than with respect to
Excluded Taxes) to any Lender in respect of its Eurodollar Loans, or
(ii) imposes or increases or deems applicable any reserve, assessment,
insurance charge, special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and assessments taken into
account in determining the interest rate applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to increase the
cost to any Lender or any applicable Lending Installation of making, funding or
maintaining its Eurodollar Loans or reduces any amount receivable by any Lender
or any applicable Lending Installation in connection with its Eurodollar Loans,
or requires any Lender or any applicable Lending Installation to make any
payment calculated by reference to the amount of Eurodollar Loans held or
interest received by it, by an amount deemed material by such Lender,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation, as the case may be, of making or maintaining
its Eurodollar Loans or Commitment or to reduce the return received by such
Lender or applicable Lending Installation in connection with such Eurodollar
Loans or Commitment then, within 15 days of written demand by such Lender, the
Borrower shall pay such Lender such additional amount or amounts as will
compensate such Lender for such increased cost or reduction in amount received.
20
3.2. Changes in Capital Adequacy Regulations. If a Lender determines the
---------------------------------------
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporation controlling such Lender
is increased as a result of a Change, then, within 15 days of written demand by
such Lender, the Borrower shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender reasonably determines is attributable to
this Agreement, its Outstanding Credit Exposure or its Commitment to make Loans
hereunder (after taking into account such Lender's policies as to capital
adequacy). "Change" means (i) any change after the date of this Agreement in
the Risk-Based Capital Guidelines or (ii) any adoption of or change in any other
law, governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law) after the
date of this Agreement which affects the amount of capital required or expected
to be maintained by any Lender or any Lending Installation or any corporation
controlling any Lender. "Risk-Based Capital Guidelines" means (i) the risk-
based capital guidelines in effect in the United States on the date of this
Agreement, including transition rules, and (ii) the corresponding capital
regulations promulgated by regulatory authorities outside the United States
implementing the July 1988 report of the Basle Committee on Banking Regulation
and Supervisory Practices Entitled "International Convergence of Capital
Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
3.3. Availability of Types of Advances. If any Lender determines that
---------------------------------
maintenance of its Eurodollar Loans at a suitable Lending Installation would
violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders reasonably determine that
(i) deposits of a type and maturity appropriate to match fund Eurodollar
Advances are not available or (ii) the interest rate applicable to Eurodollar
Advances does not accurately reflect the cost of making or maintaining
Eurodollar Advances, then the Agent shall suspend the availability of Eurodollar
Advances and require any affected Eurodollar Advances to be repaid or converted
to Floating Rate Advances, subject to the payment of any funding indemnification
amounts required by Section 3.4.
3.4. Funding Indemnification. If any payment of a Eurodollar Advance
-----------------------
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Eurodollar
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain such Eurodollar Advance.
3.5. Taxes. (i) All payments by the Borrower to or for the account of any
-----
Lender or the Agent hereunder or under any Note shall be made free and clear of
and without deduction for any and all Taxes. If the Borrower shall be required
by law to deduct any Taxes from or in respect of any sum payable hereunder to
any Lender or the Agent, (a) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 3.5) such Lender or the Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (b) the Borrower
21
shall make such deductions, (c) the Borrower shall pay the full amount deducted
to the relevant authority in accordance with applicable law and (d) the Borrower
shall furnish to the Agent the original copy of a receipt evidencing payment
thereof within 30 days after such payment is made.
(ii) In addition, the Borrower hereby agrees to pay any present or future
stamp or documentary taxes and any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any Note or
from the execution or delivery of, or otherwise with respect to, this Agreement
or any Note ("Other Taxes").
(iii) The Borrower hereby agrees to indemnify the Agent and each Lender for
the full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed on amounts payable under this Section 3.5) paid by
the Agent or such Lender and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. Payments due under this
indemnification shall be made within 30 days of the date the Agent or such
Lender makes written demand therefor pursuant to Section 3.6.
(iv) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof (each a "Non-U.S. Lender") agrees that it
will, not less than ten Business Days after the date of this Agreement, (i)
deliver to each of the Borrower and the Agent two duly completed copies of
United States Internal Revenue Service Form 1001 or 4224, certifying in either
case that such Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes, and
(ii) deliver to each of the Borrower and the Agent a United States Internal
Revenue Form W-8 or W-9, as the case may be, and certify that it is entitled to
an exemption from United States backup withholding tax. Each Non-U.S. Lender
further undertakes to deliver to each of the Borrower and the Agent (x) renewals
or additional copies of such form (or any successor form) on or before the date
that such form expires or becomes obsolete, and (y) after the occurrence of any
event requiring a change in the most recent forms so delivered by it, such
additional forms or amendments thereto as may be reasonably requested by the
Borrower or the Agent. All forms or amendments described in the preceding
sentence shall certify that such Lender is entitled to receive payments under
this Agreement without deduction or withholding of any United States federal
income taxes, unless an event (including without limitation any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form or amendment with respect to it and such Lender advises the Borrower and
the Agent that it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed to provide
the Borrower with an appropriate form pursuant to clause (iv), above (unless
such failure is due to a change in treaty, law or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
occurring subsequent to the date on which a form originally was required to be
provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 3.5 with respect to Taxes imposed by the United States; provided
that, should a Non-U.S. Lender which is otherwise exempt from or subject to a
reduced rate of withholding tax become subject to Taxes
22
because of its failure to deliver a form required under clause (iv), above, the
Borrower shall take such steps as such Non-U.S. Lender shall reasonably request
to assist such Non-U.S. Lender to recover such Taxes.
(vi) Any Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any Note
pursuant to the law of any relevant jurisdiction or any treaty shall deliver to
the Borrower (with a copy to the Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law as will permit such payments to be made without withholding or at
a reduced rate.
(vii) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political subdivision
thereof asserts a claim that the Agent did not properly withhold tax from
amounts paid to or for the account of any Lender (because the appropriate form
was not delivered or properly completed, because such Lender failed to notify
the Agent of a change in circumstances which rendered its exemption from
withholding ineffective, or for any other reason), such Lender shall indemnify
the Agent fully for all amounts paid, directly or indirectly, by the Agent as
tax, withholding therefor, or otherwise, including penalties and interest, and
including taxes imposed by any jurisdiction on amounts payable to the Agent
under this subsection, together with all costs and expenses related thereto
(including attorneys fees and time charges of attorneys for the Agent, which
attorneys may be employees of the Agent). The obligations of the Lenders under
this Section 3.5(vii) shall survive the payment of the Obligations and
termination of this Agreement.
3.6. Lender Statements; Survival of Indemnity. To the extent reasonably
----------------------------------------
possible, each Lender shall designate an alternate Lending Installation with
respect to its Eurodollar Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of
Eurodollar Advances under Section 3.3, so long as such designation is not, in
the judgment of such Lender, disadvantageous to such Lender. Each Lender shall
deliver a written statement of such Lender to the Borrower (with a copy to the
Agent) as to the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such
written statement shall set forth in reasonable detail the calculations upon
which such Lender determined such amount and shall be final, conclusive and
binding on the Borrower in the absence of manifest error. Determination of
amounts payable under such Sections in connection with a Eurodollar Loan shall
be calculated as though each Lender funded its Eurodollar Loan through the
purchase of a deposit of the type and maturity corresponding to the deposit used
as a reference in determining the Eurodollar Rate applicable to such Loan,
whether in fact that is the case or not. Unless otherwise provided herein, the
amount specified in the written statement of any Lender shall be payable on
demand after receipt by the Borrower of such written statement. The obligations
of the Borrower under Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of
the Obligations and termination of this Agreement.
23
ARTICLE IV
CONDITIONS PRECEDENT
--------------------
4.1. Initial Credit Extension. The Lenders shall not be required to make
------------------------
the initial Credit Extension hereunder unless such initial Credit Extension
occurs prior to October 22, 1999, the Upfront Fees are paid to the Lenders in
immediately available funds and the Borrower has furnished to the Agent with
sufficient copies for the Lenders:
(i) Copies of the articles or certificate of incorporation of the
Borrower and each Guarantor, together with all amendments, and a certificate of
good standing, each certified by the appropriate governmental officer in its
jurisdiction of incorporation.
(ii) Copies, certified by the Secretary or Assistant Secretary of the
Borrower and each Guarantor, of its bylaws and of its Board of Directors'
resolutions and of resolutions or actions of any other body authorizing the
execution of the Loan Documents to which the Borrower or such Guarantor is a
party.
(iii) An incumbency certificate, executed by the Secretary or Assistant
Secretary of the Borrower and each Guarantor, which shall identify by name and
title and bear the signatures of the Authorized Officers and any other officers
of the Borrower or such Guarantor authorized to sign the Loan Documents to which
the Borrower or such Guarantor is a party, upon which certificate the Agent and
the Lenders shall be entitled to rely until informed of any change in writing by
the Borrower or such Guarantor.
(iv) A certificate, signed by the chief financial officer of the
Borrower, stating that on the initial Credit Extension Date no Default or
Unmatured Default has occurred and is continuing.
(v) A written opinion of the Borrower's counsel, addressed to the
Lenders in substantially the form of Exhibit A.
(vi) Any Notes requested by a Lender pursuant to Section 2.13 payable to
the order of each such requesting Lender.
(vii) Written money transfer instructions, in substantially the form of
Exhibit D, addressed to the Agent and signed by an Authorized Officer, together
with such other related money transfer authorizations as the Agent may have
reasonably requested.
(viii) Information satisfactory to the Agent and the Required Lenders
regarding the Borrower's Year 2000 Program.
(ix) The Pledge and Security Agreement and the Guaranty.
24
(x) Evidence reasonably satisfactory to the Agent that all obligations,
liabilities and Indebtedness under the AmSouth Credit Agreement have been paid
in full and all commitments thereunder have terminated and all liens granted in
connection therewith have been released, including any UCC termination
statements or releases executed in connection therewith.
(xi) Evidence satisfactory to the Agent that the Borrower and each
Subsidiary have fully cooperated with the Agent's syndication efforts including,
without limitation, by providing the Agent with information regarding the
Borrower's and such Subsidiary's operations and prospects and such other
information as the Agent deems reasonably necessary to successfully syndicate
the Loans hereunder.
(xii) A final copy of the Working Capital Credit Agreement.
(xiii) Such other documents as any Lender or its counsel may have
reasonably requested.
4.2. Each Credit Extension. The Lenders shall not be required to make any
---------------------
Credit Extension unless on the applicable Credit Extension Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V are true
and correct as of such Credit Extension Date except to the extent any such
representation or warranty is stated to relate solely to an earlier date, in
which case such representation or warranty shall have been true and correct on
and as of such earlier date.
(iii) All legal matters incident to the making of such Credit Extension
shall be reasonably satisfactory to the Lenders and their counsel.
Each Borrowing Notice with respect to each such Credit Extension shall
constitute a representation and warranty by the Borrower that the conditions
contained in Sections 4.2(i) and (ii) have been satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Lenders that:
5.1. Existence and Standing. Each of the Borrower and its Subsidiaries is
----------------------
a corporation, partnership (in the case of Subsidiaries only) or limited
liability company duly and properly incorporated or organized, as the case may
be, validly existing and (to the extent such concept applies to such entity) in
good standing under the laws of its jurisdiction of incorporation or
25
organization and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.
5.2. Authorization and Validity. The Borrower and each Guarantor has the
--------------------------
power and authority and legal right to execute and deliver the Loan Documents to
which it is a party and to perform its obligations thereunder. The execution
and delivery by the Borrower and each Guarantor of the Loan Documents to which
it is a party and the performance of its obligations thereunder have been duly
authorized by proper corporate proceedings, and the Loan Documents to which the
Borrower and such Guarantor is a party constitute legal, valid and binding
obligations of the Borrower or such Guarantor, as the case may be, enforceable
against the Borrower or such Guarantor, as the case may be, in accordance with
their terms, except as enforceability may be limited by bankruptcy, insolvency
or similar laws affecting the enforcement of creditors' rights generally.
5.3. No Conflict; Government Consent. Neither the execution and delivery
-------------------------------
by the Borrower or any Guarantor of the Loan Documents to which it is a party,
nor the consummation of the transactions therein contemplated, nor compliance
with the provisions thereof will violate (i) any law, rule, regulation, order,
writ, judgment, injunction, decree or award binding on the Borrower or any of
its Subsidiaries or (ii) the Borrower's or any Subsidiary's articles or
certificate of incorporation, partnership agreement, certificate of partnership,
articles or certificate of organization, bylaws, or operating or other
management agreement, as the case may be, or (iii) the provisions of any
indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in, or
require, the creation or imposition of any Lien in, of or on the Property of the
Borrower or a Subsidiary pursuant to the terms of any such indenture, instrument
or agreement. No order, consent, adjudication, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, or other action in respect of any governmental or public body or
authority, or any subdivision thereof, which has not been obtained by the
Borrower or any of its Subsidiaries, is required to be obtained by the Borrower
or any of its Subsidiaries in connection with the execution and delivery of the
Loan Documents, the borrowings under this Agreement, the payment and performance
by the Borrower of the Obligations or the legality, validity, binding effect or
enforceability of any of the Loan Documents.
5.4. Financial Statements. The December 31, 1998 and June 30, 1999
--------------------
consolidated financial statements of the Borrower and its Subsidiaries
heretofore delivered to the Lenders were prepared in accordance with generally
accepted accounting principles in effect on the date such statements were
prepared and fairly present the consolidated financial condition and operations
of the Borrower and its Subsidiaries at such date and the consolidated results
of their operations for the period then ended.
5.5. Material Adverse Change. Since June 30, 1999 there has been no change
-----------------------
in the business, Property, prospects, condition (financial or otherwise) or
results of operations of the Borrower and its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect.
26
5.6. Taxes. The Borrower and its Subsidiaries have filed all United States
-----
federal tax returns and all other tax returns which are required to be filed and
have paid all taxes due pursuant to said returns or pursuant to any assessment
received by the Borrower or any of its Subsidiaries, except such taxes, if any,
as are being contested in good faith and as to which adequate reserves have been
provided in accordance with Agreement Accounting Principles and as to which no
Lien exists. The United States income tax returns of the Borrower and its
Subsidiaries have been filed with the Internal Revenue Service through the
Fiscal Year ended December 31, 1998. No tax liens have been filed and no claims
are being asserted with respect to any such taxes. The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate.
5.7. Litigation and Contingent Obligations. There is no litigation,
-------------------------------------
arbitration, governmental investigation, proceeding or inquiry pending or, to
the knowledge of any of their officers, threatened against or affecting the
Borrower or any of its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect or which seeks to prevent, enjoin or delay the making of
any Credit Extensions. Other than any liability incident to any litigation,
arbitration or proceeding which could not reasonably be expected to have a
Material Adverse Effect, the Borrower has no material contingent obligations not
provided for or disclosed in the financial statements referred to in Section
5.4.
5.8. Subsidiaries. Schedule 1 contains an accurate list of all
------------
Subsidiaries of the Borrower as of the date of this Agreement, setting forth
their respective jurisdictions of organization and the percentage of their
respective capital stock or other ownership interests owned by the Borrower or
other Subsidiaries. All of the issued and outstanding shares of capital stock
or other ownership interests of such Subsidiaries have been (to the extent such
concepts are relevant with respect to such ownership interests) duly authorized
and issued and are fully paid and nonassessable.
5.9. ERISA. There are no Unfunded Liabilities of any Single Employer Plan.
-----
Neither the Borrower nor any other member of the Controlled Group has incurred,
or is reasonably expected to incur, any withdrawal liability to Multiemployer
Plans. Each Plan complies in all material respects with all applicable
requirements of law and regulations, no Reportable Event has occurred with
respect to any Plan, neither the Borrower nor any other member of the Controlled
Group has withdrawn from any Plan or initiated steps to do so, and no steps have
been taken to reorganize or terminate any Plan.
5.10. Accuracy of Information. No information, exhibit or report furnished
-----------------------
by the Borrower or any of its Subsidiaries to the Agent or to any Lender in
connection with the negotiation of, or compliance with, the Loan Documents
contained any material misstatement of fact or omitted to state a material fact
or any fact necessary to make the statements contained therein, taken as a
whole, not misleading.
5.11. Regulation U. Margin stock (as defined in Regulation U) constitutes
------------
less than 25% of the value of those assets of the Borrower and its Subsidiaries
which are subject to any limitation on sale, pledge, or other restriction
hereunder.
27
5.12. Material Agreements. Neither the Borrower nor any Subsidiary is a
-------------------
party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.
5.13. Compliance With Laws. The Borrower and its Subsidiaries have complied
--------------------
with all applicable statutes, rules, regulations, orders and restrictions of any
domestic or foreign government or any instrumentality or agency thereof having
jurisdiction over the conduct of their respective businesses or the ownership of
their respective Property except for any failure to comply with any of the
foregoing which could not reasonably be expected to have a Material Adverse
Effect.
5.14. Ownership of Properties. Except as set forth on Schedule 2, on the
-----------------------
date of this Agreement, the Borrower and its Subsidiaries will have good title,
free of all Liens other than those permitted by Section 6.15, to all of the
Property and assets reflected in the Borrower's most recent consolidated
financial statements provided to the Agent as owned by the Borrower and its
Subsidiaries.
5.15. Plan Assets; Prohibited Transactions. The Borrower is not an entity
------------------------------------
deemed to hold "plan assets" within the meaning of 29 C.F.R. (S) 2510.3-101 of
an employee benefit plan (as defined in Section 3(3) of ERISA) which is subject
to Title I of ERISA or any plan (within the meaning of Section 4975 of the
Code), and neither the execution of this Agreement nor the making of Credit
Extensions hereunder gives rise to a prohibited transaction within the meaning
of Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business, the
---------------------
officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, the Borrower has
concluded that Environmental Laws cannot reasonably be expected to have a
Material Adverse Effect. Neither the Borrower nor any Subsidiary has received
any notice to the effect that its operations are not in material compliance with
any of the requirements of applicable Environmental Laws or are the subject of
any federal or state investigation evaluating whether any remedial action is
needed to respond to a release of any toxic or hazardous waste or substance into
the environment, which noncompliance or remedial action could reasonably be
expected to have a Material Adverse Effect.
5.17. Investment Company Act. Neither the Borrower nor any Subsidiary is an
----------------------
"investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
28
5.18. Public Utility Holding Company Act. Neither the Borrower nor any
----------------------------------
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19. Year 2000. The Borrower has made a full and complete assessment of
---------
the Year 2000 Issues and has a realistic and achievable program for remediating
the Year 2000 Issues on a timely basis (the "Year 2000 Program"). Based on such
assessment and on the Year 2000 Program the Borrower does not reasonably
anticipate that Year 2000 Issues will have a Material Adverse Effect.
5.20. Post-Retirement Benefits. There are no post-retirement medical and
------------------------
insurance benefits payable by the Borrower and its Subsidiaries to its employees
and former employees.
5.21. Solvency. (i) Immediately after the consummation of the transactions
--------
to occur on the date hereof and immediately following the making of each Loan,
if any, made on the date hereof and after giving effect to the application of
the proceeds of such Loans, (a) the fair value of the assets of the Borrower and
its Subsidiaries on a consolidated basis, at a fair valuation, will exceed the
debts and liabilities, subordinated, contingent or otherwise, of the Borrower
and its Subsidiaries on a consolidated basis; (b) the present fair saleable
value of the Property of the Borrower and its Subsidiaries on a consolidated
basis will be greater than the amount that will be required to pay the probable
liability of the Borrower and its Subsidiaries on a consolidated basis on their
debts and other liabilities, subordinated, contingent or otherwise, as such
debts and other liabilities become absolute and matured; (c) the Borrower and
its Subsidiaries on a consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) the Borrower and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.
(ii) The Borrower does not intend to, or to permit any of its Subsidiaries
to, and does not believe that it or any of its Subsidiaries will, incur debts
beyond its ability to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it or any such Subsidiary and
the timing of the amounts of cash to be payable on or in respect of its
Indebtedness or the Indebtedness of any such Subsidiary.
ARTICLE VI
COVENANTS
---------
During the term of this Agreement, unless the Required Lenders shall otherwise
consent in writing:
6.1. Financial Reporting. The Borrower will maintain, for itself and each
-------------------
Subsidiary, a system of accounting established and administered in accordance
with generally accepted accounting principles, and furnish to the Lenders:
29
(i) Within 90 days after the close of each of its fiscal years, an
unqualified audit report certified by independent certified public accountants
acceptable to the Lenders, prepared on a consolidated basis in accordance with
Agreement Accounting Principles, including balance sheets as of the end of such
period, related profit and loss and reconciliation of surplus statements, and a
statement of cash flows for itself and its Subsidiaries, accompanied by (a) any
management letter prepared by said accountants, (b) a certificate of said
accountants that, in the course of their examination necessary for their
certification of the foregoing, they have obtained no knowledge of any Default
or Unmatured Default in respect of Section 6.11 (iii) or 6.24, or if, in the
opinion of such accountants, any such Default or Unmatured Default shall exist,
stating the nature and status thereof and (c) profit and loss statements on a
consolidating basis for itself and its Subsidiaries, certified by its chief
financial officer.
(ii) Within 45 days after the close of the first three quarterly periods
of each of its fiscal years, for itself and its Subsidiaries, consolidated
unaudited balance sheets as at the close of each such period and consolidated
and consolidating profit and loss and reconciliation of surplus statements and a
statement of cash flows for the period from the beginning of such fiscal year to
the end of such quarter, all certified by its chief financial officer.
(iii) Together with the financial statements required under Sections 6.1(i)
and (ii), a compliance certificate in substantially the form of Exhibit B signed
by its chief financial officer showing the calculations necessary to determine
compliance with this Agreement and stating that no Default or Unmatured Default
exists, or if any Default or Unmatured Default exists, stating the nature and
status thereof.
(iv) Within 270 days after the close of each fiscal year, a statement of
the Unfunded Liabilities of each Single Employer Plan, certified as correct by
an actuary enrolled under ERISA.
(v) As soon as possible and in any event within 10 days after the
Borrower knows that any Reportable Event has occurred with respect to any Plan,
a statement, signed by the chief financial officer of the Borrower, describing
said Reportable Event and the action which the Borrower proposes to take with
respect thereto.
(vi) As soon as possible and in any event within 15 days after receipt by
the Borrower, a copy of (a) any written notice or claim to the effect that the
Borrower or any of its Subsidiaries is or may be liable to any Person as a
result of the release by the Borrower, any of its Subsidiaries, or any other
Person of any toxic or hazardous waste or substance into the environment, and
(b) any written notice alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the Borrower or any of its
Subsidiaries, which, in either case, could reasonably be expected to have a
Material Adverse Effect.
(vii) Promptly upon the furnishing thereof to the shareholders of the
Borrower, copies of all financial statements, reports and proxy statements so
furnished.
30
(viii) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular reports which the
Borrower or any of its Subsidiaries files with the Securities and Exchange
Commission.
(ix) As soon as available, but in any event within 60 days after the
beginning of each Fiscal Year of the Borrower, a copy of the plan and forecast
(including a projected consolidated balance sheet and funds flow statement and a
projected consolidated and consolidating income statement) of the Borrower for
such fiscal year.
(x) Within 30 days after the end of each month, an Accounts Receivable
aging report.
(xi) Such other information (including nonfinancial information) as the
Agent or any Lender may from time to time reasonably request.
6.2. Use of Proceeds. The Borrower will, and will cause each Subsidiary
---------------
to, use the proceeds of the Credit Extensions for Permitted Acquisitions and to
refinance up to $4,100,000 of Indebtedness incurred in connection with the
acquisition of KJ Transportation, Inc. The Borrower will not, nor will it
permit any Subsidiary to, use any of the proceeds of the Advances to purchase or
carry any "margin stock" (as defined in Regulation U) or to make any other
Acquisition.
6.3. Notice of Default. The Borrower will, and will cause each Subsidiary
-----------------
to, give prompt notice in writing to the Agent of the occurrence of any Default
or Unmatured Default and of any other development, financial or otherwise
(including, without limitation, developments with respect to Year 2000 Issues),
which could reasonably be expected to have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
-------------------
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and do all things necessary to remain duly incorporated or organized,
validly existing and (to the extent such concept applies to such entity) in good
standing as a domestic corporation, partnership or limited liability company in
its jurisdiction of incorporation or organization, as the case may be, and
maintain all requisite authority to conduct its business in each jurisdiction in
which its business is conducted.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to, timely
-----
file complete and correct United States federal and applicable foreign, state
and local tax returns required by law and pay when due all taxes, assessments
and governmental charges and levies upon it or its income, profits or Property,
except those which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been set aside in accordance
with Agreement Accounting Principles. At any time that the Borrower or any of
its Subsidiaries is organized as a limited liability company, each such limited
liability company will qualify for partnership tax treatment under United States
federal tax law.
6.6. Insurance. The Borrower will, and will cause each Subsidiary to,
---------
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts
31
and covering such risks as is consistent with sound business practice, and the
Borrower will furnish to any Lender upon request full information as to the
insurance carried.
6.7. Compliance with Laws. The Borrower will, and will cause each
--------------------
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, all Environmental Laws.
6.8. Maintenance of Properties. The Borrower will, and will cause each
-------------------------
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times.
6.9. Inspection; Collateral Audit. The Borrower will, and will cause each
----------------------------
Subsidiary to, permit the Agent and the Lenders, by their respective
representatives and agents, to (a) inspect any of the Property, books and
financial records of the Borrower and each Subsidiary, to examine and make
copies of the books of accounts and other financial records of the Borrower and
each Subsidiary, and to discuss the affairs, finances and accounts of the
Borrower and each Subsidiary with, and to be advised as to the same by, their
respective officers at such reasonable times and intervals as the Agent or any
Lender may designate and (b) conduct a collateral audit with respect to the
Borrower and its Subsidiaries (i) within 90 days following the date of this
Agreement and (ii) on a semiannual basis for the first year following the date
of this Agreement (provided that the Agent and the Lenders may thereafter
--------
request an annual collateral audit in their reasonable discretion), all at the
Borrower's expense.
6.10. Dividends. The Borrower will not, nor will it permit any Subsidiary
---------
to, declare or pay any Dividends or make any distributions on its capital stock
(other than dividends payable in its own capital stock) or redeem, repurchase or
otherwise acquire or retire any of its capital stock at any time outstanding,
except that, (i) so long as no Default or Unmatured Default exists or would
result from the following, the Borrower may redeem its redeemable capital stock
in an amount not to exceed $30,000,000 in the aggregate, (ii) so long as no
Default or Unmatured Default exists or would result from the following, the
Borrower may pay dividends on the GECC Convertible Preferred Stock, and (iii)
any Subsidiary may declare and pay dividends or make distributions to the
Borrower or to a Wholly-Owned Subsidiary.
6.11. Indebtedness. The Borrower will not, nor will it permit any
------------
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(i) The Loans.
(ii) Indebtedness existing on the date hereof and described in Schedule 2.
(iii) After the date of this Agreement, (A) Purchase money Indebtedness for
equipment, including Capitalized Leases, (B) Operating Lease Obligations, (C)
subordinated seller notes and (D)
32
the approximately $6,000,000 Rocor seller note, not to exceed $75,000,000 in
aggregate principal amount outstanding at any time for all Indebtedness under
clauses (A), (B), (C) and (D).
(iv) Indebtedness arising under the Working Capital Credit Agreement.
(v) Indebtedness arising under interest rate, fuel management or hedging
agreements between the Borrower and any Person entered into in the ordinary
course of business and not for speculation.
6.12. Merger. The Borrower will not, nor will it permit any Subsidiary to,
------
merge or consolidate with or into any other Person, except that a Subsidiary may
merge into the Borrower or a Wholly-Owned Subsidiary.
6.13. Sale of Assets. The Borrower will not, nor will it permit any
--------------
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(i) Sales of inventory and revenue equipment in the ordinary course of
business.
(ii) Leases, sales or other dispositions of its Property that, together
with all other Property of the Borrower and its Subsidiaries previously leased,
sold or disposed of (other than inventory in the ordinary course of business) as
permitted by this Section during the twelve month period ending with the month
in which any such lease, sale or other disposition occurs, do not constitute a
Substantial Portion of the Property of the Borrower and its Subsidiaries.
6.14. Investments and Acquisitions. The Borrower will not, nor will it
----------------------------
permit any Subsidiary to, make or suffer to exist any Investments, or
commitments therefor, or to become or remain a partner in any partnership or
joint venture, or to make any Acquisition of any Person, except:
(i) Cash Equivalent Investments.
(ii) Existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule 1.
(iii) Permitted Acquisitions.
(iv) Investments in the ordinary course of business in connection with the
formation of new Subsidiaries in similar lines of business as the Borrower and
its existing Subsidiaries.
6.15. Liens. The Borrower will not, nor will it permit any Subsidiary to,
-----
create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies on its
Property if the same shall not at the time be delinquent or thereafter can be
paid without penalty, or are being
33
contested in good faith and by appropriate proceedings and for which adequate
reserves in accordance with Agreement Accounting Principles shall have been set
aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than 60 days past due.
(iii) Liens arising out of pledges or deposits under worker's compensation
laws, unemployment insurance, old age pensions, or other social security or
retirement benefits, or similar legislation.
(iv) Utility easements, building restrictions and such other encumbrances
or charges against real property as are of a nature generally existing with
respect to properties of a similar character and which do not in any material
way affect the marketability of the same or interfere with the use thereof in
the business of the Borrower or its Subsidiaries.
(v) Liens existing on the date hereof and described in Schedule 2.
(vi) Liens in favor of the Agent, for the benefit of the Lenders, granted
pursuant to any Collateral Document.
(vii) Liens covering equipment (but not other assets) securing
Indebtedness incurred or assumed for the purpose of financing such equipment and
permitted under Section 6.11(iii); provided that (A) any such Lien attaches to
such equipment concurrently with or within 60 days after the acquisition
thereof, (B) such Lien attaches solely to such equipment so acquired in such
transaction, and (C) the principal amount of the Indebtedness secured thereby
does not exceed 100% of the cost of such equipment.
(viii) Liens with respect to Indebtedness assumed in connection with
Permitted Acquisitions.
6.16. Year 2000. The Borrower will take and will cause each of its
---------
Subsidiaries to take all such actions as are reasonably necessary to
successfully implement the Year 2000 Program and to assure that Year 2000 Issues
will not have a Material Adverse Effect. At the request of the Agent or any
Lender, the Borrower will provide a description of the Year 2000 Program,
together with any updates or progress reports with respect thereto.
6.17. Affiliates. The Borrower will not, and will not permit any
----------
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than the Borrower or such Subsidiary would obtain in a
comparable arm's-length transaction.
34
6.18. No Amendment to GECC Convertible Preferred Stock; No Issuance of
----------------------------------------------------------------
Additional Redeemable Stock. The Borrower will not (a) amend the terms,
---------------------------
preferences, rights and limitations of the GECC Convertible Preferred Stock in
any manner having the effect of increasing the amount of dividends thereon or
redemptions thereof or providing for any earlier payment in respect of dividends
or redemptions or otherwise in respect of such stock or (b) issue any redeemable
shares of stock after the date of this Agreement.
6.19. Sale of Accounts. The Borrower will not, nor will it permit any
----------------
Subsidiary to, sell or otherwise dispose of any notes receivable or accounts
receivable, with or without recourse.
6.20. Sale and Leaseback Transactions and other Off-Balance Sheet
-----------------------------------------------------------
Liabilities. The Borrower will not, nor will it permit any Subsidiary to, enter
-----------
into or suffer to exist any (i) Sale and Leaseback Transaction or (ii) any other
transaction pursuant to which it incurs or has incurred Off-Balance Sheet
Liabilities, except with respect to revenue equipment in the ordinary course of
business.
6.21. Contingent Obligations. The Borrower will not, nor will it permit
----------------------
any Subsidiary to, make or suffer to exist any Contingent Obligations
(including, without limitation, any Contingent Obligation with respect to the
obligations of a Subsidiary) exceeding at any time $5,000,000 in the aggregate,
except (i) by endorsement of instruments for deposit or collection in the
ordinary course of business, (ii) the "Reimbursement Obligations" under and as
defined in the Working Capital Agreement and (iii) the Guaranty.
6.22. Letters of Credit. The Borrower will not, nor will it permit any
-----------------
Subsidiary to, apply for or become liable upon or in respect of any letter of
credit, except for "Facility LCs" under and as defined in the Working Capital
Agreement.
6.23. Prepayment of Other Debt. If an Unmatured Default or a Default has
------------------------
occurred, Borrower will not, nor will it permit any Subsidiary to, prepay any
Indebtedness (including, without limitation, the GECC Convertible Preferred
Stock) other than the Obligations.
6.24. Financial Covenants.
-------------------
6.24.1 Fixed Charge Coverage Ratio. The Borrower will not permit
---------------------------
the ratio, determined as of the end of each of its fiscal quarters for the
then most-recently ended four fiscal quarters, of (i) Consolidated EBITDA,
plus Consolidated Rentals, minus 10% of Consolidated Capital Expenditures
to (ii) Consolidated Interest Expense, plus Consolidated Rentals, plus
current maturities of principal Indebtedness, plus expense for taxes paid,
plus Dividends, all calculated for the Borrower and its Subsidiaries on a
consolidated basis, to be less than (a) 1.25 to 1.0 for the fiscal quarters
in Fiscal Years 1999 and 2000, (b) 1.30 to 1.0 for the fiscal quarters in
Fiscal Year 2001, (c) 1.40 to 1.0 for the fiscal quarters in Fiscal Year
2002 and (d) 1.50 to 1.0 for the fiscal quarters in Fiscal Years 2003 and
2004.
35
6.24.2 Leverage Ratio. The Borrower will not permit the ratio (the
--------------
"Leverage Ratio") determined as of the end of each of its fiscal quarters,
of (i) Consolidated Indebtedness to (ii) Consolidated EBITDA plus
Consolidated Rentals for the then most-recently ended four fiscal quarters
to be greater than (a) 3.25 to 1.0 for the fiscal quarters in Fiscal Years
1999 and 2000 and (b) 3.00 to 1.0 for the fiscal quarters in Fiscal Years
2001, 2002, 2003 and 2004.
6.24.3 Minimum Consolidated Net Worth. The Borrower will at all
------------------------------
times maintain Consolidated Net Worth of not less than the sum of (i)
$74,300,000, plus (ii) 50% of Consolidated Net Income earned in each fiscal
quarter beginning with the quarter ending September 30, 1999 (without
deduction for losses) and (iii) 100% of the net cash proceeds of equity
issued by the Borrower on or after July 1, 1999.
6.24.3 Asset Coverage Ratio. The Borrower will not at any time
--------------------
permit the ratio (the "Asset Coverage Ratio") of (i) the sum of (a)
aggregate Accounts Receivable and (b) the book value of all assets (other
than intangible assets) to (ii) the remainder of (a) Consolidated
Indebtedness less (b) Contingent Obligations (except to the extent shown on
any consolidated balance sheet of the Borrower delivered pursuant to
Section 6.1(i) and (ii)) less (c) Operating Lease Obligations (except to
the extent shown on any consolidated balance sheet of the Borrower
delivered pursuant to Section 6.1(i) and (ii)) to be less than 1.0 to 1.0
at any time.
6.25. Additional Subsidiaries; Further Assurances. The Borrower will cause
-------------------------------------------
each Subsidiary existing on the date hereof and each additional Subsidiary
acquired or created after the date hereof to execute a counterpart of the
Guaranty, and grant to the Agent for the benefit of the Agent and the Lenders
perfected security interests in all of its personal property (and, to the extent
included in "Eligible Real Estate" under and as defined in the Working Capital
Credit Agreement, real property) as collateral to secure the Obligations, in
each case pursuant to the applicable Collateral Documents (subject only to Liens
in favor of other Persons permitted under Section 6.15), provided that no
--------
Foreign Subsidiary shall have an obligation to execute a counterpart of the
Guaranty or to grant any security interest in its personal property, and
provided further that neither the Borrower nor any Subsidiary shall be required
-------- -------
to pledge more than 65% of the stock of any Foreign Subsidiary. The Borrower
agrees to take and to cause each Guarantor to take such actions as the Agent or
the Required Lenders may from time to time reasonably request to establish and
maintain perfected security interests in all of their personal property (and, to
the extent included in "Eligible Real Estate" under and as defined in the
Working Capital Credit Agreement, real property), including without limitation
the perfection of the Agent's security interest in all such personal property
covered by certificates of title within 60 days following the date of the
initial Credit Extension (subject to Liens in favor of other Persons permitted
under Section 6.15).
36
ARTICLE VII
DEFAULTS
--------
The occurrence of any one or more of the following events shall constitute a
Default:
7.1. Any representation or warranty made or deemed made by or on behalf of
the Borrower or any of its Subsidiaries to the Lenders or the Agent under or in
connection with this Agreement, the Working Capital Credit Agreement, any Credit
Extension, or any certificate or information delivered in connection with this
Agreement or any other Loan Document shall be materially false on the date as of
which made.
7.2. Nonpayment of principal of any Loan when due, nonpayment of any
Reimbursement Obligation within one Business Day after the same becomes due, or
nonpayment of interest upon any Loan or of any commitment fee or other
obligations under any of the Loan Documents within five days after the same
becomes due.
7.3. The breach by the Borrower of any of the terms or provisions of
Article VI, Section 6.2, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.16, 6.17, 6.18,
6.19, 6.20 or 6.24.
7.4. The breach by the Borrower (other than a breach which constitutes a
Default under another Section of this Article VII) of any of the terms or
provisions of this Agreement which is not remedied within 30 days after written
notice from the Agent or any Lender.
7.5. Failure of the Borrower or any of its Subsidiaries to pay when due
any Indebtedness or any amounts under any interest rate, fuel management or
hedging agreement aggregating in excess of $5,000,000 ("Material Financial
Obligation"); or the default by the Borrower or any of its Subsidiaries in the
performance (beyond the applicable grace period with respect thereto, if any) of
any term, provision or condition contained in any agreement under which any such
Material Financial Obligation was created or is governed, or any other event
shall occur or condition exist, the effect of which default or event is to
cause, or to permit the holder or holders of such Material Financial Obligation
to cause, such Material Financial Obligation to become due prior to its stated
maturity; or any Material Financial Obligation of the Borrower or any of its
Subsidiaries shall be declared to be due and payable or required to be prepaid
or repurchased (other than by a regularly scheduled payment) prior to the stated
maturity thereof; or the Borrower or any of its Subsidiaries shall not pay, or
admit in writing its inability to pay, its debts generally as they become due.
7.6. The Borrower or any of its Subsidiaries shall (i) have an order for
relief entered with respect to it under the Federal bankruptcy laws as now or
hereafter in effect, (ii) make an assignment for the benefit of creditors, (iii)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (iv) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it
37
or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief of debtors or fail to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, (v) take any
corporate or partnership action to authorize or effect any of the foregoing
actions set forth in this Section 7.6 or (vi) fail to contest in good faith any
appointment or proceeding described in Section 7.7.
7.7. Without the application, approval or consent of the Borrower or any
of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section
7.6(iv) shall be instituted against the Borrower or any of its Subsidiaries and
such appointment continues undischarged or such proceeding continues undismissed
or unstayed for a period of 30 consecutive days.
7.8. Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of, all or any portion of the
Property of the Borrower and its Subsidiaries which, when taken together with
all other Property of the Borrower and its Subsidiaries so condemned, seized,
appropriated, or taken custody or control of, during the twelvemonth period
ending with the month in which any such action occurs, constitutes a Substantial
Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within 30 days to
pay, bond or otherwise discharge one or more (i) judgments or orders for the
payment of money in excess of $5,000,000 (or the equivalent thereof in
currencies other than U.S. Dollars) in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
7.10. The Unfunded Liabilities of all Single Employer Plans shall exceed in
the aggregate $1,000,000 or any Reportable Event shall occur in connection with
any Plan.
7.11. The Borrower or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan in an amount which, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
the Borrower or any other member of the Controlled Group as withdrawal liability
(determined as of the date of such notification), exceeds $1,000,000 or requires
payments exceeding $500,000 per annum.
7.12. The Borrower or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of Title IV
of ERISA, if as a result of such reorganization or termination the aggregate
annual contributions of the Borrower and the other members of the Controlled
Group (taken as a whole) to all Multiemployer Plans which are then in
reorganization or being terminated have been or will be increased over the
amounts contributed to such Multiemployer Plans for the respective plan years of
each such Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount exceeding $1,000,000.
38
7.13. The Borrower or any of its Subsidiaries shall (i) be the subject of
any proceeding or investigation pertaining to the release by the Borrower, any
of its Subsidiaries or any other Person of any toxic or hazardous waste or
substance into the environment, or (ii) violate any Environmental Law, which, in
the case of an event described in clause (i) or clause (ii), could reasonably be
expected to have a Material Adverse Effect.
7.14. Any Change in Control shall occur.
7.15. The occurrence of any "default", as defined in any Loan Document
(other than this Agreement) or the breach of any of the terms or provisions of
any Loan Document (other than this Agreement), which default or breach continues
beyond any period of grace therein provided.
7.16. Nonpayment by the Borrower or any Subsidiary of any Rate Management
Obligation within 1 day after such obligation is due or the breach by the
Borrower or any Subsidiary of any term, provision or condition contained in any
Rate Management Transaction, which default or breach continues beyond any period
of grace therein provided.
7.17. The Guaranty shall fail to remain in full force or effect or any
action shall be taken to discontinue or to assert the invalidity or
unenforceability of the Guaranty, or any Guarantor shall fail to comply with any
of the terms or provisions of the Guaranty, or any Guarantor shall deny that it
has any further liability under the Guaranty, or shall give notice to such
effect.
7.18. Any Collateral Document shall for any reason fail to create a valid
and perfected security interest in any collateral purported to be covered
thereby, except as permitted by the terms of any Collateral Document, or any
Collateral Document shall fail to remain in full force or effect or any action
shall be taken to discontinue or to assert the invalidity or unenforceability of
any Collateral Document, or the Borrower shall fail to comply with any of the
terms or provisions of any Collateral Document.
7.19. The representations and warranties set forth in Section 5.15 shall at
any time not be true and correct in any material respect.
7.20. The Borrower or any Subsidiary shall fail to pay when due any
obligation with respect to a Letter of Credit.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1. Acceleration. If any Default described in Section 7.6 or 7.7 occurs
------------
with respect to the Borrower, the obligations of the Lenders to make Loans
hereunder shall automatically terminate
39
and the Obligations shall immediately become due and payable without any
election or action on the part of the Agent or any Lender and the Borrower will
be and become thereby unconditionally obligated, without any further notice, act
or demand, to pay to the Agent an amount in immediately available funds an
amount equal to the Secured Obligations.
If any other Default occurs, the Required Lenders (or the Agent with the consent
of the Required Lenders) may (a) terminate or suspend the obligations of the
Lenders to make Loans hereunder, or declare the Obligations to be due and
payable, or both, whereupon the Obligations shall become immediately due and
payable, without presentment, demand, protest or notice of any kind, all of
which the Borrower hereby expressly waives , and (b) upon notice to the Borrower
and in addition to the continuing right to demand payment of all amounts payable
under this Agreement, make demand on the Borrower to pay, and the Borrower will,
forthwith upon such demand and without any further notice or act, pay to the
Agent an amount equal to the Secured Obligations.
8.2. Amendments. Subject to the provisions of this Article VIII, the
----------
Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:
(i) Extend the final maturity of any Loan to a date after the Facility
Termination Date or postpone any regularly scheduled payment of principal of any
Loan or forgive all or any portion of the principal amount thereof or reduce the
rate or extend the time of payment of interest or fees thereon.
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Revolving Credit Termination Date or the Facility
Termination Date, or reduce the amount or extend the payment date for, the
mandatory payments required under Section 2.2, or increase the amount of the
Aggregate Commitment or the Commitment of any Lender hereunder, or permit the
Borrower to assign its rights under this Agreement.
(iv) Amend this Section 8.2.
(v) Release any guarantor of any Obligations or, except as provided in
the Collateral Documents, release all or substantially all of the Collateral.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive payment
of the fee required under Section 12.3.2 without obtaining the consent of any
other party to this Agreement.
8.3 Preservation of Rights. No delay or omission of the Lenders or the
----------------------
Agent to exercise any right under the Loan Documents shall impair such right or
be construed to be a waiver of any
40
Default or an acquiescence therein, and the making of a Credit Extension
notwithstanding the existence of a Default or the inability of the Borrower to
satisfy the conditions precedent to such Credit Extension shall not constitute
any waiver or acquiescence. Any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then only
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Agent and the Lenders until the Obligations have been paid in
full.
ARTICLE IX
GENERAL PROVISIONS
------------------
9.1. Survival of Representations. All representations and warranties of
---------------------------
the Borrower contained in this Agreement shall survive the making of the Credit
Extensions herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to the
-----------------------
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. Headings. Section headings in the Loan Documents are for convenience
--------
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
9.4. Entire Agreement. The Loan Documents embody the entire agreement and
----------------
understanding among the Borrower, the Agent and the Lenders and supersede all
prior agreements and understandings among the Borrower, the Agent and the
Lenders relating to the subject matter thereof other than the fee letter
described in Section 10.13.
9.5. Several Obligations; Benefits of this Agreement. The respective
-----------------------------------------------
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Agent is authorized to act as such). The failure of any Lender to perform any
of its obligations hereunder shall not relieve any other Lender from any of its
obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns, provided, however, that the parties
hereto expressly agree that the Arranger shall enjoy the benefits of the
provisions of Sections 9.6, 9.10 and 10.11 to the extent specifically set forth
therein and shall have the right to enforce such provisions on its own behalf
and in its own name to the same extent as if it were a party to this Agreement.
9.6. Expenses; Indemnification. (i) The Borrower shall reimburse the
-------------------------
Agent and the Arranger for any reasonable costs, internal charges and out-of-
pocket expenses (including actual attorneys' fees and time charges of attorneys
for the Agent, which attorneys may be employees of
41
the Agent) paid or incurred by the Agent or the Arranger in connection with the
preparation, negotiation, execution, delivery, syndication, review, amendment,
modification, and administration of the Loan Documents. The Borrower also agrees
to reimburse the Agent, the Arranger and the Lenders for any reasonable costs,
internal charges and out-of-pocket expenses (including actual attorneys' fees
and time charges of attorneys for the Agent, the Arranger and the Lenders, which
attorneys may be employees of the Agent, the Arranger or the Lenders) paid or
incurred by the Agent, the Arranger or any Lender in connection with the
collection and enforcement of the Loan Documents.
(ii) The Borrower hereby further agrees to indemnify the Agent, the
Arranger, each Lender, their respective affiliates, and each of their directors,
officers and employees against all losses, claims, damages, penalties,
judgments, liabilities and expenses (including, without limitation, all expenses
of litigation or preparation therefor whether or not the Agent, the Arranger,
any Lender or any affiliate is a party thereto) which any of them may pay or
incur arising out of or relating to this Agreement, the other Loan Documents,
the transactions contemplated hereby or the direct or indirect application or
proposed application of the proceeds of any Credit Extension hereunder except to
the extent that they are determined in a final non-appealable judgment by a
court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of the party seeking indemnification. The obligations of
the Borrower under this Section 9.6 shall survive the termination of this
Agreement.
9.7. Numbers of Documents. All statements, notices, closing documents, and
--------------------
requests hereunder shall be furnished to the Agent with sufficient counterparts
so that the Agent may furnish one to each of the Lenders.
9.8. Accounting. Except as provided to the contrary herein, all accounting
----------
terms used herein shall be interpreted and all accounting determinations
hereunder shall be made in accordance with Agreement Accounting Principles.
9.9. Severability of Provisions. Any provision in any Loan Document that
--------------------------
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.10. Nonliability of Lenders. The relationship between the Borrower on the
-----------------------
one hand and the Lenders and the Agent on the other hand shall be solely that of
borrower and lender. Neither the Agent, the Arranger nor any Lender shall have
any fiduciary responsibilities to the Borrower. Neither the Agent, the Arranger
nor any Lender undertakes any responsibility to the Borrower to review or inform
the Borrower of any matter in connection with any phase of the Borrower's
business or operations. The Borrower agrees that neither the Agent, the Arranger
nor any Lender shall have liability to the Borrower (whether sounding in tort,
contract or otherwise) for losses suffered by the Borrower in connection with,
arising out of, or in any way related to, the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event
42
occurring in connection therewith, unless it is determined in a final
non-appealable judgment by a court of competent jurisdiction that such losses
resulted from the gross negligence or willful misconduct of the party from which
recovery is sought. Neither the Agent, the Arranger nor any Lender shall have
any liability with respect to, and the Borrower hereby waives, releases and
agrees not to ▇▇▇ for, any special, indirect or consequential damages suffered
by the Borrower in connection with, arising out of, or in any way related to the
Loan Documents or the transactions contemplated thereby.
9.11. Confidentiality. Each Lender agrees to hold any confidential
---------------
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which such Lender is a party, (vi) to such Lender's direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, and (vii)
permitted by Section 12.4.
9.12. Nonreliance. Each Lender hereby represents that it is not relying on
-----------
or looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Credit
Extensions provided for herein.
9.13. Disclosure. The Borrower and each Lender hereby (i) acknowledge and
----------
agree that Bank One and/or its Affiliates from time to time may hold investments
in, make other loans to or have other relationships with the Borrower and its
Affiliates, and (ii) waive any liability of Bank One or such Affiliate of Bank
One to the Borrower or any Lender, respectively, arising out of or resulting
from such investments, loans or relationships other than liabilities arising out
of the gross negligence or willful misconduct of Bank One or its Affiliates.
ARTICLE X
THE AGENT
---------
10.1. Appointment; Nature of Relationship. Bank One, NA is hereby appointed
-----------------------------------
by each of the Lenders as its contractual representative (herein referred to as
the "Agent") hereunder and under each other Loan Document, and each of the
Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the
43
Lenders, (ii) is a "representative" of the Lenders within the meaning of Section
9-105 of the Uniform Commercial Code and (iii) is acting as an independent
contractor, the rights and duties of which are limited to those expressly set
forth in this Agreement and the other Loan Documents. Each of the Lenders hereby
agrees to assert no claim against the Agent on any agency theory or any other
theory of liability for breach of fiduciary duty, all of which claims each
Lender hereby waives.
10.2. Powers. The Agent shall have and may exercise such powers under the
------
Loan Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
----------------
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent nor any
------------------------------------------
of its directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into, or verify (a) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (b) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; (f) the
value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of the Borrower or any
guarantor of any of the Obligations or of any of the Borrower's or any such
guarantor's respective Subsidiaries. The Agent shall have no duty to disclose
to the Lenders information that is not required to be furnished by the Borrower
to the Agent at such time, but is voluntarily furnished by the Borrower to the
Agent (either in its capacity as Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all cases be
---------------------------------
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be
44
indemnified to its satisfaction by the Lenders pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.
10.6. Employment of Agents and Counsel. The Agent may execute any of its
--------------------------------
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled to rely
------------------------------
upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree to
-----------------------------------------
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not
reimbursed by the Borrower for which the Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (ii) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents
(including, without limitation, for any expenses incurred by the Agent in
connection with any dispute between the Agent and any Lender or between two or
more of the Lenders) and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of the Loan
Documents or any other document delivered in connection therewith or the
transactions contemplated thereby (including, without limitation, for any such
amounts incurred by or asserted against the Agent in connection with any dispute
between the Agent and any Lender or between two or more of the Lenders), or the
enforcement of any of the terms of the Loan Documents or of any such other
documents, provided that (i) no Lender shall be liable for any of the foregoing
to the extent any of the foregoing is found in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from the gross negligence
or willful misconduct of the Agent and (ii) any indemnification required
pursuant to Section 3.5(vii) shall, notwithstanding the provisions of this
Section 10.8, be paid by the relevant Lender in accordance with the provisions
thereof. The obligations of the Lenders under this Section 10.8 shall survive
payment of the Obligations and termination of this Agreement.
10.9. Notice of Default. The Agent shall not be deemed to have knowledge or
-----------------
notice of the occurrence of any Default or Unmatured Default hereunder unless
the Agent has received written notice from a Lender or the Borrower referring to
this Agreement describing such Default or
45
Unmatured Default and stating that such notice is a "notice of default". In the
event that the Agent receives such a notice, the Agent shall give prompt notice
thereof to the Lenders.
10.10. Rights as a Lender. In the event the Agent is a Lender, the Agent
------------------
shall have the same rights and powers hereunder and under any other Loan
Document with respect to its Commitment and its Loans as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent
and its Affiliates may accept deposits from, lend money to, and generally engage
in any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person. The Agent, in its
individual capacity, is not obligated to remain a Lender.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
----------------------
independently and without reliance upon the Agent, the Arranger or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and
without reliance upon the Agent, the Arranger or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and the other Loan Documents.
10.12. Successor Agent. The Agent may resign at any time by giving written
---------------
notice thereof to the Lenders and the Borrower, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Borrower and the Lenders, a successor Agent with (so long as no
Default or Unmatured Default shall have occurred and be continuing) the consent
of the Borrower (such consent not to be unreasonably withheld). If no successor
Agent shall have been so appointed by the Required Lenders within thirty days
after the resigning Agent's giving notice of its intention to resign, then the
resigning Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Agent. Notwithstanding the previous sentence, the Agent may at any
time without the consent of the Borrower or any Lender, appoint any of its
Affiliates which is a commercial bank as a successor Agent hereunder. If the
Agent has resigned or been removed and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers,
46
privileges and duties of the resigning or removed Agent. Upon the effectiveness
of the resignation or removal of the Agent, the resigning or removed Agent shall
be discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation or removal of an Agent,
the provisions of this Article X shall continue in effect for the benefit of
such Agent in respect of any actions taken or omitted to be taken by it while it
was acting as the Agent hereunder and under the other Loan Documents. In the
event that there is a successor to the Agent by merger, or the Agent assigns its
duties and obligations to an Affiliate pursuant to this Section 10.12, then the
term "Corporate Base Rate" as used in this Agreement shall mean the prime rate,
base rate or other analogous rate of the new Agent.
10.13. Agent's Fee. The Borrower agrees to pay to the Agent, for its own
-----------
account, the fees agreed to by the Borrower and the Agent pursuant to that
certain letter agreement dated August 30, 1999, or as otherwise agreed from time
to time.
10.14. Delegation to Affiliates. The Borrower and the Lenders agree that
------------------------
the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
10.15. Execution of Collateral Documents. The Lenders hereby empower and
---------------------------------
authorize the Agent to execute and deliver to the Borrower on their behalf the
Pledge and Security Agreement(s) and all related financing statements and any
financing statements, agreements, documents or instruments as shall be necessary
or appropriate to effect the purposes of the Pledge and Security Agreement(s).
The Lenders acknowledge and consent to the Agent acting as collateral agent
under the Pledge and Security Agreement and the other Collateral Documents for
the other secured creditors thereunder in addition to the Lenders.
10.16. Collateral Releases. The Lenders hereby empower and authorize the
-------------------
Agent to execute and deliver to the Borrower on their behalf any agreements,
documents or instruments as shall be necessary or appropriate to effect any
releases of Collateral which shall be permitted by the terms hereof or of any
other Loan Document or which shall otherwise have been approved by the Required
Lenders (or, if required by the terms of Section 8.2, all of the Lenders) in
writing.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
------------------------
11.1. Setoff. In addition to, and without limitation of, any rights of the
------
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied
47
toward the payment of the Obligations owing to such Lender, whether or not the
Obligations, or any part thereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has
----------------
payment made to it upon its Outstanding Credit Exposure (other than payments
received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than
that received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Aggregate Outstanding Credit Exposure held by the
other Lenders so that after such purchase each Lender will hold its Pro Rata
Share of the Aggregate Outstanding Credit Exposure. If any Lender, whether in
connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts
which may be subject to setoff, such Lender agrees, promptly upon demand, to
take such action necessary such that all Lenders share in the benefits of such
collateral ratably in proportion to their respective Pro Rata Share of the
Aggregate Outstanding Credit Exposure. In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
-------------------------------------------------
12.1. Successors and Assigns. The terms and provisions of the Loan
----------------------
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. The parties to this Agreement acknowledge that clause (ii)
of this Section 12.1 relates only to absolute assignments and does not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by any Lender of all or any portion of its rights under
this Agreement and any Note to a Federal Reserve Bank; provided, however, that
no such pledge or assignment creating a security interest shall release the
transferor Lender from its obligations hereunder unless and until the parties
thereto have complied with the provisions of Section 12.3. The Agent may treat
the Person which made any Loan or which holds any Note as the owner thereof for
all purposes hereof unless and until such Person complies with Section 12.3;
provided, however, that the Agent may in its discretion (but shall not be
required to) follow instructions from the Person which made any Loan or which
holds any Note to direct payments relating to such Loan or Note to another
Person. Any assignee of the rights to any Loan or any Note agrees by acceptance
of such assignment to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of the
rights to any Loan (whether or not a Note has been issued in evidence thereof),
shall be conclusive and binding on any subsequent holder or assignee of the
rights to such Loan.
12.2. Participations.
--------------
48
12.2.1 Permitted Participants; Effect. 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 Outstanding Credit Exposure of such Lender,
any Note held by such Lender, any Commitment of such Lender or any other
interest of such Lender under the Loan Documents. In the event of any such
sale by a Lender of participating interests to a Participant, such Lender's
obligations under the Loan Documents shall remain unchanged, such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the owner of its
Outstanding Credit Exposure and the holder of any Note issued to it in
evidence thereof for all purposes under the Loan Documents, all amounts
payable by the Borrower under this Agreement shall be determined as if such
Lender had not sold such participating interests, and the Borrower and the
Agent shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under the Loan
Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right to
-------------
approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other than
any amendment, modification or waiver with respect to any Credit Extension
or Commitment in which such Participant has an interest which forgives
principal, interest, fees or reduces the interest rate or fees payable with
respect to any such Loan or Commitment, extends the Facility Termination
Date, postpones any date fixed for any regularly-scheduled payment of
principal of, or interest or fees on, any such Credit Extension or
Commitment, releases any guarantor of any such Credit Extension or releases
all or substantially all of the collateral, if any, securing any such
Credit Extension.
12.2.3 Benefit of Setoff. The Borrower agrees that each Participant
-----------------
shall be deemed to have the right of setoff provided in Section 11.1 in
respect of its participating interest in amounts owing under the Loan
Documents to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under the Loan Documents, provided
that each Lender shall retain the right of setoff provided in Section 11.1
with respect to the amount of participating interests sold to each
Participant. The Lenders agree to share with each Participant, and each
Participant, by exercising the right of setoff provided in Section 11.1,
agrees to share with each Lender, any amount received pursuant to the
exercise of its right of setoff, such amounts to be shared in accordance
with Section 11.2 as if each Participant were a Lender.
12.3. Assignments.
-----------
12.3.1 Permitted Assignments. Any Lender may, in the ordinary
---------------------
course of its business and in accordance with applicable law, at any time assign
to one or more banks or other entities ("Purchasers") all or any part of its
rights and obligations under the Loan Documents, provided that any such
--------
assignment must be done in conjunction with the assignment of an equivalent
percentage of such Lender's rights and obligations under the Working Capital
Credit Agreement. Such assignment shall be substantially in the form of Exhibit
C or in such other form as may be agreed to by the parties thereto. The consent
of
49
the Borrower and the Agent shall be required prior to an assignment
becoming effective with respect to a Purchaser which is not a Lender or an
Affiliate thereof; provided, however, that if a Default has occurred and is
continuing, the consent of the Borrower shall not be required. Such consent
shall not be unreasonably withheld or delayed. Each such assignment with
respect to a Purchaser which is not a Lender or an Affiliate thereof shall
(unless each of the Borrower and the Agent otherwise consents) be in an
amount not less than the lesser of (i) $5,000,000 or (ii) the remaining
amount of the assigning Lender's Commitment (calculated as at the date of
such assignment) or outstanding Loans (if the applicable Commitment has
been terminated).
12.3.2 Effect; Effective Date. Upon (i) delivery to the Agent of an
----------------------
assignment, together with any consents required by Section 12.3.1, and (ii)
payment of a $3,500 fee to the Agent for processing such assignment (unless
such fee is waived by the Agent), such assignment shall become effective on
the effective date specified in such assignment. The assignment shall
contain a representation by the Purchaser to the effect that none of the
consideration used to make the purchase of the Commitment and Outstanding
Credit Exposure under the applicable assignment agreement constitutes "plan
assets" as defined under ERISA and that the rights and interests of the
Purchaser in and under the Loan Documents will not be "plan assets" under
ERISA. On and after the effective date of such assignment, such Purchaser
shall for all purposes be a Lender party to this Agreement and any other
Loan Document executed by or on behalf of the Lenders and shall have all
the rights and obligations of a Lender under the Loan Documents, to the
same extent as if it were an original party hereto, and no further consent
or action by the Borrower, the Lenders or the Agent shall be required to
release the transferor Lender with respect to the percentage of the
Aggregate Commitment and Loans assigned to such Purchaser. Upon the
consummation of any assignment to a Purchaser pursuant to this Section
12.3.2, the transferor Lender, the Agent and the Borrower shall, if the
transferor Lender or the Purchaser desires that its Loans be evidenced by
Notes, make appropriate arrangements so that new Notes or, as appropriate,
replacement Notes are issued to such transferor Lender and new Notes or, as
appropriate, replacement Notes, are issued to such Purchaser, in each case
in principal amounts reflecting their respective Commitments, as adjusted
pursuant to such assignment.
12.4. Dissemination of Information. The Borrower authorizes each Lender to
----------------------------
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is transferred
-------------
to any Transferee which is organized under the laws of any jurisdiction other
than the United States or any State thereof, the transferor Lender shall cause
such Transferee, concurrently with the effectiveness of such transfer, to comply
with the provisions of Section 3.5(iv).
50
ARTICLE XII
NOTICES
-------
13.1. Notices. Except as otherwise permitted by Section 2.14 with respect
-------
to borrowing notices, all notices, requests and other communications to any
party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of the Borrower or the Agent, at its address or facsimile number set
forth on the signature pages hereof, (y) in the case of any Lender, at its
address or facsimile number set forth below its signature hereto or (z) in the
case of any party, at such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the Agent and the Borrower in
accordance with the provisions of this Section 13.1. Each such notice, request
or other communication shall be effective (i) if given by facsimile
transmission, when transmitted to the facsimile number specified in this Section
and confirmation of receipt is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, or (iii) if given by any other means, when delivered
(or, in the case of electronic transmission, received) at the address specified
in this Section; provided that notices to the Agent under Article II shall not
be effective until received.
13.2. Change of Address. The Borrower, the Agent and any Lender may each
-----------------
change the address for service of notice upon it by a notice in writing to the
other parties hereto.
ARTICLE XIV
COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrower, the Agent and the Lenders
and each party has notified the Agent by facsimile transmission or telephone
that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
------------------------------------------------------------
15.1. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
-------------
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION, 735 ILCS SECTION 105/5-1 ET
SEQ, BUT OTHERWISE WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE
STATE OF
51
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.2. CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
-----------------------
THE NONEXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER
HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A
COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT
THE RIGHT OF THE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER
IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE
BORROWER AGAINST THE AGENT OR ANY LENDER OR ANY AFFILIATE OF THE AGENT OR ANY
LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT
IN CHICAGO, ILLINOIS.
15.3. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER HEREBY
--------------------
WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
52
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have executed
this Agreement as of the date first above written.
TRANSIT GROUP, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: President and Chief Executive Officer
--------------------------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-1
Commitments
-----------
$11,999,999.99
BANK ONE, NA, Individually and as Agent
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------
Title: Vice President
-----------------------------
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-2
$6,666,666.67
AMSOUTH BANK
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
Title: Senior Vice President
--------------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-3
$6,666,666.67
BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Title: Vice President
----------------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ NE
19th Floor
GA1-006-19-12
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-4
$2,666,666.67
COMPASS BANK
By: /s/ T. ▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
Name: T. ▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
Title: Senior Vice President
--------------------------------
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: T. ▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-5
$4,000,000.00
BRANCH BANKING AND TRUST
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Title: Vice President
-------------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-6
$2,666,666.67
NATIONAL BANK OF CANADA
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇. ▇. ▇▇▇▇▇▇▇▇
---------------------------------
Title: Vice President
--------------------------------
By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------
Name: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------
Title: Vice President
--------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-7
$5,333,333.33
UNION BANK OF CALIFORNIA
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Title: Vice President
-----------------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
S-8
PRICING SCHEDULE
==============================================================================
APPLICABLE LEVEL I LEVEL II LEVEL III LEVEL IV LEVEL V LEVEL VI
MARGIN STATUS STATUS STATUS STATUS STATUS STATUS
==============================================================================
Eurodollar 1.50% 1.55% 1.625% 1.75% 1.875% 2.00%
Advances
==============================================================================
Floating 0.25% 0.30% 0.375% 0.50% 0.625% 0.75%
Rate
Advances
==============================================================================
===========================
USAGE USAGE
*50% **50%
===========================
Applicable 0.75% 0.50%
Fee Rate
===========================
* less than sign
** greater than or equal to sign
For the purposes of this Schedule, the following terms have the following
meanings, subject to the final paragraph of this Schedule:
LEVERAGE-BASED PRICING
"Financials" means the annual or quarterly financial statements of the
Borrower delivered pursuant to Section 6.1(i) or (ii).
"Level I Status" exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, the Leverage
Ratio is less than 2.00 to 1.00.
"Level II Status" exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (i) the
Borrower has not qualified for Level I Status and (ii) the Leverage Ratio is
less than or equal to 2.25 to 1.00.
"Level III Status" exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (i) the
Borrower has not qualified for Level I Status or Level II Status and (ii) the
Leverage Ratio is less than or equal to 2.50 to 1.00.
"Level IV Status" exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (i) the
Borrower has not qualified for Level I Status, Level II Status or Level III
Status and (ii) the Leverage Ratio is less than or equal to 2.75 to 1.00
"Level V Status" exists at any date if, as of the last day of the fiscal
quarter of the Borrower referred to in the most recent Financials, (i) the
Borrower has not qualified for Level I Status, Level II Status, Level III Status
or Level IV Status and (ii) the Leverage Ratio is less than or equal to 3.00 to
1.00.
"Level VI Status" exists at any date if the Borrower has not qualified for
Level I Status, Level II Status, Level III Status, Level IV Status or Level V
Status.
"Status" means either Level I Status, Level II Status, Level III Status,
Level IV Status, Level V Status or Level VI Status.
The Applicable Margin shall be determined in accordance with the foregoing
table based on the Borrower's Status as reflected in the then most recent
Financials. Adjustments, if any, to the Applicable Margin shall be effective
five Business Days after the Agent has received the applicable Financials. If
the Borrower fails to deliver the Financials to the Agent at the time required
pursuant to Section 6.1, then the Applicable Margin shall be the highest
Applicable Margin set forth in the foregoing table until five days after such
Financials are so delivered. Notwithstanding the foregoing, from the date of
the initial funding until the date on which the annual Financials for the Fiscal
Year ending December 31, 1999 have been delivered to the Agent, the Applicable
Margin shall be determined by reference to Level VI Status.