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EXHIBIT 10.60
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$18,000,000
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
between
▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc.,
as Borrower
and
The Lenders From Time
To Time a Party Hereto,
as Lenders
with
Bank of America, N.A.,
as Agent
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Dated as of July 28, 2000
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS; AMENDMENT AND RESTATEMENT........2
Section 1.1 Definitions...........................................2
Section 1.2 Accounting Terms.....................................21
Section 1.3 Time Period Computations.............................21
Section 1.4 Amendment and Restatement............................21
ARTICLE II GENERAL PROVISIONS OF REVOLVING CREDIT
FACILITY..............................................................22
Section 2.1 The Revolving Loans..................................22
(a) Revolving Loan Borrowings............................22
(b) The Revolving Notes; Maturity........................22
Section 2.2 Revolving Loan Borrowing Procedures..................23
(a) Notice of Revolving Borrowing........................23
(b) Making of Revolving Loans............................24
(c) Failure to Fund by Lender............................24
(d) Maximum Number of LIBOR Loans Outstanding
at Anytime...........................................25
Section 2.3 Standby Letters of Credit............................25
(a) Generally............................................25
(b) Standby Letter of Credit Fees; Maturity..............25
(c) Standby Letter of Credit Request Procedure...........26
(d) Letter of Credit Participations......................26
(e) Standby Letter of Credit Drawings Constitute
Revolving Loans......................................29
Section 2.4 Swing Line Loan Subfacility..........................29
(a) Swing Line Subfacility...............................30
(b) The Swing Line Note; Maturity........................30
(c) Swing Line Loan Borrowing Procedure..................30
(d) Interest on Swing Line Loans.........................31
(e) Repayment of Swing Line Loans........................31
(f) Optional Prepayment of Swing Line Loans..............32
Section 2.5 Mandatory Reduction of Revolving Loan Commitment;
Termination of Revolving Loan Commitment.............33
ARTICLE III INTEREST, FEES AND REPAYMENT....................................33
Section 3.1 Interest on the Revolving Loans......................33
(a) ABR..................................................33
(b) LIBOR Rate...........................................33
Section 3.2 Regulatory Changes...................................33
Section 3.3 Interest after Due Date..............................34
Section 3.4 Payment and Computations.............................34
(a) Payments.............................................35
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(b) Computations of Interest.............................35
(c) Interest on Loans....................................35
(d) Application of Payments; Apportionment..............35
Section 3.5 Payment at Maturity Date.............................37
Section 3.6 Prepayments; Certain Early Repayments................37
(a) Mandatory Prepayment of Revolving Loans,
Swing Line Loans and Standby Letters of Credit.......37
(b) Optional Prepayments of Revolving Loans..............38
(c) Optional Prepayment Procedure........................38
Section 3.7 Unused Portion Fee and Administrative Fee............38
(a) Unused Portion Fee...................................38
(b) Administrative Fee...................................39
Section 3.8 LIBOR Conversion.....................................39
(a) Conversion...........................................39
(b) Notice of LIBOR to Borrower..........................40
(c) Successive Notice of LIBOR Conversion................40
Section 3.9 Breakage, etc........................................40
Section 3.10 Inability to Determine Interest Rate for
LIBOR Loans..........................................40
ARTICLE IV CONDITIONS PRECEDENT.............................................41
Section 4.1 Conditions Precedent to Effective Date...............41
(i) Delivery of Certain Documents, Instruments, etc......41
(A) Revolving Notes..................................41
(B) Validity of Existing Security Agreements.........42
(C) Amended and Restated Subsidiary Guarantee........42
(D) Swing Line Note..................................42
(E) Subsidiary Security Agreements...................42
(F) Financing Statements.............................42
(G) Legal Opinions...................................42
(H) Resolutions......................................43
(I) Charter Documents................................43
(J) Incumbency Certificate...........................43
(K) Compliance Certificate...........................43
(L) Insurance........................................43
(ii) Financial Disclosure.............................44
(iii)Financial Statements.................................44
(iv) Legal Matters........................................44
(v) Schedules............................................45
(vi) Due Diligence........................................45
(vii)Fee..................................................45
(viii)Miscellaneous.......................................45
Section 4.2 Further Conditions Precedent to Revolving Loans and
Standby Letters of Credit............................45
(i) Notice; Borrowing Base Certificate...................45
(ii) Payment of Obligations...............................46
(iii)No Material Adverse Change...........................46
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(iv) Representations and Warranties.......................46
(v) No Event of Default..................................46
(vi) Maximum Available Amount.............................46
(vii)Officer's Certificate................................47
ARTICLE V REPRESENTATIONS AND WARRANTIES....................................47
Section 5.1 Existence, Power and Authority.......................47
Section 5.2 Authorization; Enforceable Obligations...............47
Section 5.3 No Legal Bar.........................................48
Section 5.4 Consents.............................................48
Section 5.5 Litigation...........................................48
Section 5.6 No Default...........................................48
Section 5.7 Financial Condition..................................49
Section 5.8 Use of Proceeds......................................49
Section 5.9 Borrower Not an Investment Company...................49
Section 5.10 Taxes................................................49
Section 5.11 Environmental Matters................................49
Section 5.12 Subsidiaries.........................................50
Section 5.13 Computer Systems.....................................50
Section 5.14 Ownership of Property; Liens.........................51
Section 5.15 Public Utility Holding Company Act...................51
ARTICLE VI COVENANTS........................................................51
Section 6.1 Affirmative Covenants................................51
(a) Audited Annual Financials............................51
(b) Quarterly and Monthly Financial Statements and
Reports..............................................52
(i) Quarterly Financial Statements.......................52
(ii) Monthly Borrowing Base Certificate;
Receivables and Payables Report, etc.................52
(c) Exchange Act and Securities Act Filings..............53
(d) Tax Forms............................................53
(e) Funded Debt to EBITDA Ratio..........................53
(f) Minimum EBITDA.......................................54
(g) Fixed Charge Coverage Ratio..........................54
(h) Proceeds.............................................55
(i) Payment of Debts and Taxes...........................55
(j) Conduct of Business..................................55
(k) Preservation of Corporate Existence..................56
(l) Books and Records....................................56
(m) Insurance............................................56
(n) Compliance with Laws.................................57
(o) Lending Relationship with the Agent..................57
(p) Borrower Ownership of Subsidiaries...................58
(q) Notice of Default....................................58
(r) Notice of Environmental Claims.......................58
(s) Seniority............................................58
(t) Lien Search..........................................58
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(u) Maximum Available Amount.............................59
(v) Pledge of Stock of Foreign Subsidiaries..............59
(w) Execution of Subsidiary Security Agreements
After the Effective Date.............................59
(x) Merger with PA Consulting Limited....................59
(y) Examination of the Borrower's Records................60
Section 6.2 Negative Covenants...................................60
(a) Liens................................................60
(b) Indebtedness.........................................61
(c) Capital Stock........................................62
(d) Loan.................................................63
(e) No Merger or Acquisition.............................64
(f) Fiscal Year..........................................66
(g) Advances to Subsidiaries and Affiliates..............66
(h) Creation of Subsidiaries.............................66
(i) Disposition of Assets................................67
(j) Permitted Investments................................67
ARTICLE VII EVENTS OF DEFAULT...............................................67
Section 7.1 Events of Default....................................67
ARTICLE VIII THE AGENT......................................................72
Section 8.1 Appointment of Agent.................................72
(a) Appointment Generally................................72
(b) Agent Acts for Lenders...............................72
Section 8.2 Nature of Duties; Non-Reliance on Agent and other
Lenders..............................................72
Section 8.3 Rights, Exculpation, Etc.............................73
Section 8.4 Reliance; Notice of Default..........................74
Section 8.5 Indemnification......................................75
Section 8.6 The Agent Individually...............................75
Section 8.7 Successor Agent; Resignation of Agent................76
Section 8.8 Certain Matters Requiring the Consent of all
Lenders..............................................76
Section 8.9 Defaulting Lenders Vote Not Counted..................77
ARTICLE IX MISCELLANEOUS....................................................78
Section 9.1 Amendments and Waivers; Cumulative Remedies..........78
Section 9.2 Survival of Representations and Warranties...........78
Section 9.3 Supervening Illegality...............................78
Section 9.4 No Reduction in Payments.............................79
Section 9.5 Stamp Taxes..........................................79
Section 9.6 Notices..............................................79
Section 9.7 Governing Law........................................80
Section 9.8 Successors and Assigns; Participations; Assignments..80
(a) Successors and Assigns...............................81
(b) Participations.......................................81
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(c) Assignments..........................................81
Section 9.9 Affirmative Rate of Interest Permitted by Law........82
Section 9.10 Costs and Expenses; Indemnification..................82
Section 9.11 Set-Off; Suspension of Payment and Performance.......84
Section 9.12 Judicial Proceedings; Waiver of Jury Trial...........84
Section 9.13 Integration..........................................85
Section 9.14 Further Acts and Assurances..........................85
Section 9.15 No Fiduciary Relationship............................85
Section 9.16 Severability.........................................85
Section 9.17 Counterparts.........................................86
Section 9.18 Headings, Bold Type and Table of Contents............86
SCHEDULES
SCHEDULE I -- COMMITMENTS
SCHEDULE 5.5 -- LITIGATION
SCHEDULE 5.6 -- DEFAULTS
SCHEDULE 5.12 -- SUBSIDIARIES
SCHEDULE 5.14 -- REAL PROPERTY
SCHEDULE 6.2(b) -- CERTAIN INDEBTEDNESS
SCHEDULE 6.2(j) -- CERTAIN OTHER INVESTMENTS
EXHIBITS
Exhibit A Form of Pledge Agreement
Exhibit B Form of Revolving Note
Exhibit C Form of Subsidiary Guarantee
Exhibit D Form of Subsidiary Security Agreement
Exhibit E Form of Swing Line Note
Exhibit F Form of Borrowing Base Certificate
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AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
This AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated as of
July 28, 2000 (amending and restating in its entirety the Original Credit
Agreement (as defined below), and as amended, modified, or otherwise
supplemented from time to time, the "Agreement"), is between (i) ▇▇▇▇▇▇ BAILLY,
INC., a Delaware corporation (the "Borrower"), (ii) EACH LENDER FROM TIME TO
TIME A PARTY TO THIS AGREEMENT (each, a "Lender" and, collectively, the
"Lenders") and (iii) BANK OF AMERICA, N.A. (as successor to NationsBank, N.A.),
a national banking association and in its separate capacity as agent for the
Lenders hereunder (in such capacity, the "Agent").
W I T N E S S E T H:
WHEREAS, the Lenders, the Borrower and the Agent are parties to a
Revolving Credit Agreement, dated as of November 20, 1998 (as the same has been
amended, modified or supplemented from time to time, the "Original Credit
Agreement"), pursuant to which the Lenders have made available to the Borrower a
revolving line of credit for loans and letters of credit up to an aggregate of
$50,000,000 for general corporate purposes, including financing the general
working capital requirements and permitted acquisitions of the Borrower, in each
case upon the terms and subject to the conditions set forth therein;
WHEREAS, as of the date hereof, the Bank of America, N.A., as
successor to NationsBank, N.A., constitutes the sole Lender under the Original
Credit Agreement;
WHEREAS, the Borrower, the Lenders and the Agent desire to change
certain terms, conditions, covenants and other provisions contained in the
Original Credit Agreement, including reducing the loan commitment of the Lenders
from $50,000,000 to $18,000,000, and certain other agreements executed in
connection therewith by amending and restating the Original Credit Agreement in
its entirety upon the terms and conditions set forth herein and amending or
amending and restating, as the case may be, certain other Original Credit
Documents;
WHEREAS, to induce the Lenders and the Agent to enter into this
Agreement, (i) the Borrower has agreed to continue or cause to be continued the
security interests granted to the Agent, for the ratable benefit of the Lenders,
by the Borrower and certain subsidiaries under the Borrower Security Agreement
and the
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respective Subsidiary Security Agreements, and (ii) cause certain domestic
subsidiaries of the Borrower to enter into the Amended and Restated Guaranty;
WHEREAS, as a further inducement to cause the Lenders and the
Agent to enter into this Agreement, the Borrower has agreed, subject to the
terms and conditions contained herein, from time to time to pledge or cause to
be pledged to the Agent, for the ratable benefit of the Lenders, 65% of the
outstanding shares of capital stock of certain Foreign Subsidiaries of the
Borrower;
WHEREAS, the Lenders are willing to amend and restate the Original
Credit Agreement in its entirety and make the loans and issue the letters of
credit to the Borrower, and the Agent is willing to act as "Agent" in connection
therewith, upon the terms and subject to the conditions and provisions set forth
herein; and
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the Borrower, the Lenders and the
Agent hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS; AMENDMENT AND
RESTATEMENT
Section 1.1 Definitions. As used in this Agreement, and unless the
context requires a different meaning, the following terms shall have the
meanings indicated (such meanings to be, when appropriate, equally applicable to
both the singular and plural forms of the terms defined):
"ABR" means, for any day, the greater of (x) the Bank Prime Rate
as in effect on such day and (y) the Federal Funds Rate as in effect on
such day plus one-half of 1%.
"ABR Loan" shall mean any Revolving Loan bearing interest based on
the Applicable ABR Rate.
"Accumulated Funding Deficiency" has the meaning ascribed to that
term in ERISA Section 302.
"Acquisition Consideration" shall mean the aggregate consideration
paid for any Acquisition Party, including without limitation all cash,
cash equivalents, the value of all capital stock, the aggregate amount of
all promissory notes (or other instruments of indebtedness) issued, the
amount of Acquisition Party debt assumed, or otherwise, and whether such
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consideration shall be paid at closing or be deferred or subject to
earnouts or any other contingency.
"Acquisition Party" has the meaning specified in Section 6.2(e) of
this Agreement.
"Administrative Fee" shall have the meaning specified in Section
3.7(b) hereof.
"Administrative Fee Letter" shall have the meaning specified in
Section 3.7(b) hereof.
"Affiliate" means, with respect to a Person, any other Person
that, directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such
first Person. For purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" or "under
common control with"), as applied to any Person, means the possession,
directly or indirectly, of the power to vote 10% or more of the
securities having voting power for the election of directors of such
Person or otherwise to direct or cause the direction of the management
and policies of that Person, whether through the ownership of voting
securities or by contract or otherwise.
"Agent" has the meaning specified in the preamble of this
Agreement and shall include any successor Agent appointed pursuant to
Section 8.7 hereof.
"Agent Lending Office" or "Lending Office of the Agent" means the
Agent's offices at Bank of America, N.A., care of ▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇,
VA-200-05-02, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such
other office in the United States of America of Agent as it may from time
to time designate to the Borrower or the Lenders by written notice.
"Agreement" shall have the meaning specified in the preamble
hereof.
"Applicable ABR Rate" means, for any period, in the event the
Funded Debt to EBITDA ratio calculated pursuant to Section 6.1(e) hereof
is (a) less than 1.00 to 1.00, then the ABR plus 0.00%, (b) greater than
or equal to 1.00 to 1.00 but less than 2.00 to 1.00, then the ABR plus
0.25%, (c) greater than or equal to 2.00 to 1.00 but less than 3.00 to
1.00, then the ABR plus 0.50%, and (d) greater than or equal to 3.00 to
1.00, then the ABR plus 0.75%. The Applicable ABR Rate for any Fiscal
Quarter shall be determined based on the financial statements delivered
by the Borrower during the immediately
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preceding Fiscal Quarter; provided, however, that if such financial
statements are not delivered when due, then the highest Applicable ABR
Rate shall apply.
"Applicable L/C Margin" means, for any period, in the event the
Funded Debt to EBITDA ratio calculated pursuant to Section 6.1(e) hereof
is (a) less than 1.00 to 1.00, then 1.50%, (b) greater than or equal to
1.00 to 1.00 but less than 2.00 to 1.00, then 1.75%, (c) greater than or
equal to 2.00 to 1.00 but less than 3.00 to 1.00, then 2.00%, and (d)
greater than or equal to 3.00 to 1.00, then 2.25%. The Applicable L/C
Margin for any Fiscal Quarter shall be determined based on the financial
statements delivered by the Borrower during the immediately preceding
Fiscal Quarter; provided, however, that if such financial statements are
not delivered when due, then the highest Applicable L/C Margin shall
apply.
"Applicable LIBOR Rate" means, for any period, in the event the
Funded Debt to EBITDA ratio calculated pursuant to Section 6.1(e) hereof
is (a) less than 1.00 to 1.00, LIBOR plus 1.50%, (b) greater than or
equal to 1.00 to 1.00 but less than 2.00 to 1.00, LIBOR plus 1.75%, (c)
greater than or equal to 2.00 to 1.00 but less than 3.00 to 1.00, LIBOR
plus 2.00%, and (d) greater than or equal to 3.00 to 1.00, LIBOR plus
2.25%. The Applicable LIBOR Rate for any Fiscal Quarter shall be
determined based on the financial statements delivered by the Borrower
during the immediately preceding Fiscal Quarter; provided, however, that
if such financial statements are not delivered when due, then the highest
Applicable LIBOR Rate shall apply.
"Applicable Swing Line Rate" means, for any period, in the event
the Funded Debt to EBITDA ratio calculated pursuant to Section 6.1(e)
hereof is (a) less than 1.00 to 1.00, the Base Swing Line Rate plus
1.80%, (b) greater than or equal to 1.00 to 1.00 but less than 2.00 to
1.00, the Base Swing Line Rate plus 2.05%, (c) greater than or equal to
2.00 to 1.00 but less than 3.00 to 1.00, the Base Swing Line Rate plus
2.30%, and (d) greater than or equal to 3.00 to 1.00, the Base Swing Line
Rate LIBOR plus 2.55%. The Applicable Swing Line Rate for any Fiscal
Quarter shall be determined based on the financial statements delivered
by the Borrower during the immediately preceding Fiscal Quarter;
provided, however, that if such financial statements are not delivered
when due, then the highest Applicable Swing Line Rate shall apply.
"Authorized Officer" means any of the Chief Executive Officer,
Chief Financial Officer or Treasurer of any Person which is a
corporation, partnership, or other business organization.
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"Autoborrow Services Agreement" shall have the meaning specified
in Section 2.4(c) hereof.
"Bank Prime Rate" means, for any period, a fluctuating interest
rate per annum equal to the rate of interest publicly announced by the
Agent as its prime rate in effect from time to time (which rate may not
be the lowest rate of interest charged by the Agent to commercial
borrowers).
"Bankruptcy Code" shall mean Title 11 of the United States Code or
any similar or successor federal law for the relief of debtors, as the
same may be amended from time to time.
"Base Swing Line Rate" means, with respect to any Swing Line Loan
on any day, a fluctuating interest rate per annum equal to "30-day LIBOR"
as quoted in The Wall Street Journal on the Business Day immediately
preceding the date of determination. Any change in the rate of interest
on a Swing Line Loan resulting in a change in "30-day LIBOR" shall be
effective as of the opening of business on the day on which such change
is effective. If "30-day LIBOR" shall not be so quoted for such
immediately preceding Business Day, then the most recently quoted "30-day
LIBOR" shall apply.
"Benefit Plan" means any employee benefit plan (including a
Multiemployer Plan), the funding requirements of which (under ERISA
Section 302 or Section 412 of the Code) are, or at any time within six
years immediately preceding the time in question were, in whole or in
part, the responsibility of the Borrower or an ERISA Affiliate.
"Borrower" has the meaning specified in the preamble of this
Agreement.
"Borrower Account" means the bank account of the Borrower
maintained with the Agent for general purposes and assigned the account
number designated by the Agent in writing to the Borrower.
"Borrower Security Agreement" means the Security Agreement, dated
as of November 20, 1998, executed and delivered by the Borrower in favor
of the Agent, as the same may be amended, modified or supplemented from
time to time.
"Borrowing Base" means, as of any date of determination, the sum
of (i) 75% of all Eligible Billed Receivables plus (ii) 25% of Eligible
Unbilled Receivables unless the amount computed pursuant to this clause
(ii) shall
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exceed $5,000,000, in which case the amount of this clause (ii) shall
equal $5,000,000.
"Borrowing Base Certificate" shall have the meaning specified in
Section 6.1(b)(ii) hereof.
"Borrowing Notice" has the meaning specified in Section 2.2(a) of
this Agreement.
"Breakage Period" has the meaning specified in Section 3.9 of this
Agreement.
"Business Day" means any day on which commercial banks are open
for business (and not required or authorized by law to close) in Fairfax
County, Virginia, and Charlotte, North Carolina.
"Capital Expenditures" shall mean all expenditures classified as
capital expenditures in accordance with GAAP.
"Capital Lease" of any Person shall mean any lease of any property
(whether real, personal or mixed) by such Person (as lessee or guarantor
or other surety) which would, in accordance with GAAP, be required to be
classified and accounted for as a capital lease on a balance sheet of
such Person.
"Cash Flow" shall mean, with respect to any Person for any period
of determination, such Person's EBITDA plus rental and lease expense less
Capital Expenditures, as determined in accordance with GAAP.
"Change in Control" means one or more of the following events:
(a) if any Person (including a person as defined in Section
3(a)(9), Section 13(d) or Section 14(d) of the Exchange Act) is or
becomes the owner or beneficial owner, directly or indirectly, of
securities of the Borrower representing thirty-three and one-third
percent (33-1/3%) or more of the combined voting power of the
Borrower's then outstanding securities (the term "beneficial
owner" as used herein shall include but not be limited to any
person with the attributes or interests described in Rule 13d-3
(as now in effect or as amended) promulgated under the Exchange
Act); or
(b) (i) the shareholders of the Borrower approve one or
more mergers, consolidations or combinations of the Borrower with
any other corporations or entities which, if consummated prior to
the
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Maturity Date, would result in (A) the voting securities of the
Borrower outstanding on the date hereof (together with any
voting securities issued by the Borrower permitted under Section
6.2(c) herein) representing less than 50% of the combined voting
power of the voting securities of the Borrower or such surviving
entity immediately after consummation of any such merger,
consolidation or combination, or (B) after giving effect to such
merger, consolidation or combination, a change in the person
holding the Office of Chief Executive Officer of the Borrower
relative to the person holding such respective office immediately
prior to giving effect to such merger, consolidation or
combination, or (ii) the shareholders of the Borrower approve a
plan of liquidation of the Borrower or an agreement for the sale,
disposition or transfer by the Borrower of all or substantially
all the assets of the Borrower;
provided, however, that, in the event the Borrower merges or consolidates
(or enters into any similar transaction) with PA Holdings Limited or any
Subsidiary thereof (including PA Holdings, Inc., then such event shall
not constitute a Change in Control hereunder unless, not later than
thirty (30) days following the effective date of such merger or
consolidation (or similar transaction), the Required Lenders shall have
given the termination notice described in Section 6.1(x) hereof.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time, and any successor Federal statute.
"Commitment" shall mean, with respect to each Lender's commitment
to make Revolving Loans and to issue (or participate in the issuance of)
Standby Letters of Credit, the aggregate Dollar amount set forth on
Schedule I hereto opposite such Lender's name under the heading
"Commitment" or assigned to it in accordance with Section 9.8(c), as such
amount may be reduced or otherwise adjusted from time to time in
accordance with the provisions of this Agreement.
"Contingent Obligations" means, with respect to any Person, any
obligation of such Person guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent (a) to purchase any
such primary obligation or any property constituting direct or indirect
security therefor, (b) to advance or supply funds (i) for the purchase or
payment of any such primary obligation or (ii) to maintain the net worth
or solvency or the primary obligor, (c) to
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purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the
primary obligor to make payment of such primary obligation or (d)
otherwise to assure or hold harmless the owner of such primary obligation
against loss in respect thereof. The amount of any Contingent Obligation
shall be deemed to be an amount equal to the stated or determinable
amount (based on the maximum reasonably anticipated net liability in
respect thereof as determined by the Borrower in good faith) of the
primary obligation or portion thereof in respect of which such Contingent
Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated net liability in respect thereof (assuming such
person is required to perform thereunder) as determined by the Borrower
in good faith.
"Consolidated Cash Flow" shall mean, for any period of
determination, the Cash Flow of the Borrower and its Consolidated
Subsidiaries, taken as a whole.
"Consolidated Fixed Charges" shall mean, for any period of
determination, the sum of the Borrower's and its Consolidated
Subsidiaries' interest expense contractually due, lease and rental
expenses, dividends paid, declared or accumulated on any class of capital
stock and payments of principal due (during the period as to which such
computation relates) under any Indebtedness, as determined in accordance
with GAAP.
"Consolidated Subsidiary" means, with respect to any Person at any
time, any Subsidiary or other Person the accounts of which would be
consolidated with those of such first Person in its consolidated
financial statements as of such time.
"Credit Agreement Related Claim" means any claim (whether civil,
criminal or administrative and whether sounding in tort, contract or
otherwise) in any way arising out of, related to, or connected with this
Agreement or any other Credit Document or the relationships established
hereunder or thereunder.
"Credit Documents" means this Agreement, the Revolving Notes, the
Swing Line Note, the Borrower Security Agreement, each Subsidiary
Security Agreement, each Pledge Agreement executed and delivered by a
Pledgor pursuant to Section 6.1(w) hereof, the Subsidiary Guarantee and
the Administrative Fee Letter.
"Credit Party" shall mean the Borrower and each Subsidiary thereof
that is a party to any Credit Document.
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"Default Rate" means the rate of interest applicable under Section
3.3 of this Agreement from time to time.
"Dollars", "U.S.$" and the sign "$" mean such coin or currency of
the United States of America as at the time shall constitute legal tender
for the payment of public and private debts.
"Domestic Subsidiary" shall mean any Subsidiary that is created
under the laws of any State of the United States of America or the
District of Columbia.
"Drawing" has the meaning specified in Section 2.3(e) of this
Agreement.
"EBITDA" shall mean, with respect to any Person for any period of
determination, all of such Person's and its Consolidated Subsidiaries'
earnings before interest (which shall consist of both interest income and
interest expense), taxes, depreciation and amortization, extraordinary
gains, non-cash, non-recurring compensatory charges incurred in
connection with acquisitions, and non-cash, non-recurring charges in
respect of the write-down of assets of any Person who has been acquired
by the Borrower or any Subsidiary thereof or the write-down of assets of
the Borrower or any Subsidiary thereof on account of and in connection
with the acquisition by the Borrower or any Subsidiary thereof (as
permitted hereunder) of any Acquisition Party, as determined in
accordance with GAAP; provided, however, that, for the purposes of
calculating EBITDA and solely with respect to any Affiliate or
unconsolidated subsidiary of such Person, (i) EBITDA shall include the
income of such Affiliate or unconsolidated subsidiary only to the extent
such Person receives such income from such Affiliate, or unconsolidated
subsidiary and (ii) EBITDA shall exclude the losses of such Affiliate or
unconsolidated subsidiary except to the extent such Affiliate or
unconsolidated subsidiary shall have received from such Person funds in
respect of such losses; and, provided, further, that EBITDA shall be
computed without deduction of amounts expensed in respect of payments
made or to be made to ▇▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇
▇▇▇▇▇, III, under their respective employment agreements with the
Borrower up to an amount of, respectively, $3,040.800, $2,376,304 and
$2,671.032.
"Effective Date" has the meaning specified in Section 4.1 of this
Agreement.
"Eligible Billed Receivables" shall mean all billed accounts
receivable of each of the Borrower and each Domestic Subsidiary that is a
party to the
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Subsidiary Guarantee and a Subsidiary Security Agreement for the sale of
its goods or services under any contract with the United States of
America or any agency thereof or with commercial customers who are
located in and whose principal place of business is in the United States
of America, which accounts shall not be more than 90 days outstanding
from the date of invoice thereof, excluding, however, those billed
accounts receivable which are, unless otherwise consented to by the Agent
(which consent may be withheld in the Agent's sole discretion upon facts
then available to them and which determination shall be final and
binding), (i) arising out of sales not in the ordinary course of
business, (ii) based on terms other than those normal or customary in the
business of the Borrower or such Domestic Subsidiary, (iii) owing from
any Person who is an Affiliate or Subsidiary of the Borrower or such
Domestic Subsidiary, (iv) disputed by the account debtor, (v) notes
receivable and other non-trade account receivables or such Domestic
Subsidiary, (vi) subject to the Borrower or such Domestic Subsidiary
owing an amount to the account debtor, in which case the amount of billed
accounts receivable to be so included in "Eligible Billed Receivables"
shall be the amount, if any, by which (A) the receivable owing by such
account debtor to the Borrower or such Domestic Subsidiary exceeds (B)
the amount owing by the Borrower to such account debtor, (vii) owing from
any Person who is subject to any suit, lien, levy or judgment which could
affect the collectibility of such account, or who is subject to any
bankruptcy or insolvency proceeding, (viii) either in default or in
respect of which default is likely, (ix) dependent upon the occurrence of
a milestone, contract modification or the approval of auditors in order
to be billed, (x) not payable in Dollars, (xi) not pledged to the Agent
as collateral security for the Obligations and as to which the Agent
shall not have a perfected, first priority lien and security interest
therein, (xii) arising out of a consignment sale or (xiii) owing from an
account debtor as to which the Agent, in its good faith judgment,
determines (A) to be insolvent (or who has admitted to be insolvent), (B)
is reasonably likely to become insolvent within one year from any date of
determination, or (C) to be an unacceptable credit risk based on its then
current financial condition and prospects.
"Eligible Unbilled Receivables" shall mean all unbilled accounts
receivable of each of the Borrower and each Domestic Subsidiary that is a
party to the Subsidiary Guarantee and a Subsidiary Security Agreement for
the sale of its goods or services under any contract with the United
States of America or any agency thereof or with any commercial customer
who is located in and whose principal place of business is in the United
States of America, which unbilled accounts represent completed work by
the Borrower or such Domestic Subsidiary and, further, which shall be
billed by the
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Borrower or such Domestic Subsidiary no more than 30 days following the
date such unbilled accounts are included in the Borrowing Base,
excluding, however, those unbilled accounts receivable which are, unless
otherwise consented to by the Agent (which consent may be withheld in the
Agent's sole discretion upon facts then available to them and which
determination shall be final and binding), (i) arising out of sales not
in the ordinary course of business, (ii) based on terms other than those
normal or customary in the business of the Borrower or such Domestic
Subsidiary, (iii) owing from any Person who is an Affiliate or Subsidiary
of the Borrower or such Domestic Subsidiary, (iv) disputed by the account
debtor, (v) notes receivable and other non-trade account receivables,
(vi) subject to the Borrower or such Domestic Subsidiary owing an amount
to the account debtor, in which case the amount of unbilled accounts
receivable to be so included in "Eligible Unbilled Receivables" shall be
the amount, if any, by which (A) the receivable owing by such account
debtor to the Borrower or such Domestic Subsidiary exceeds (B) the amount
owing by the Borrower or such Domestic Subsidiary to such account debtor,
(vii) owing from any Person who is subject to any suit, lien, levy or
judgment which could affect the collectibility of such account, or who is
subject to any bankruptcy or insolvency proceeding, (viii) either in
default or in respect of which default is likely, (ix) dependent upon the
occurrence of a milestone, contract modification or the approval of
auditors in order to be billed, (x) not payable in Dollars, (xi) not
pledged to the Agent as collateral security for the Obligations and as to
which the Agent shall not have a perfected, first priority lien and
security interest therein, (xii) arising out of a consignment sale or
(xiii) owing from an account debtor as to which the Agent, in its good
faith judgment, determines (A) to be insolvent (or who has admitted to be
insolvent), (B) is reasonably likely to become insolvent within one year
from any date of determination, or (C) to be an unacceptable credit risk
based on its then current financial condition and prospects.
"Equity Rights" means, with respect to any Person, any
subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including without limitation any stockholders' or
voting trust agreements) for the issuance, sale, registration or voting
of, or securities convertible into, any additional shares of capital
stock of any class, or partnership or other ownership interests of any
type, in such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" means any Person, including a Subsidiary or
other Affiliate, that is a member of any group of organizations within
the meaning of Code Sections 414(b), (c), (m) or (o) of which Borrower is
a member.
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"Event of Default" has the meaning specified in Section 7.1 of
this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor Federal statute.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve Bank
of New York; provided that if no such rate is so published for any day
which is a Business Day, then the Federal Funds Rate for such day shall
be the average rate quoted to the Agent for such day on such transactions
received by the Agent from three (3) Federal funds brokers of recognized
standing selected by it; and, provided further, that if for any reason
the Agent shall have determined (which determination shall be conclusive
and binding absent manifest error) that it is unable to ascertain the
Federal Funds Rate for any reason, including the inability or failure of
the Agent to obtain sufficient quotations in accordance with the terms
hereof, then the ABR shall be determined without regard to clause (y) of
the definition of ABR until the circumstances giving rise to such
inability no longer exist.
"Fee Payment Date" means (i) in the case of the Unused Portion Fee
and the L/C Fee, the first Business Day following the end of any Fiscal
Quarter (or part thereof), and(ii) in the case of the Administrative Fee,
on the dates specified in the Administrative Fee Letter.
"Fiscal Quarter" means the quarter, during any Fiscal Year, ending
March 31, June 30, September 30 and December 31.
"Fiscal Year" has the meaning specified in Section 6.1(a) of this
Agreement.
"Fixed Charge Coverage Ratio" means the ratio of Consolidated Cash
Flow to Consolidated Fixed Charges as contemplated by Section 6.1(g)
hereof.
"Foreign Subsidiary" shall mean any Subsidiary that is not created
or organized under the laws of any State of the United States of America
or the District of Columbia.
"Form 8-K" means Form 8-K of the Exchange Act.
"Form 10-K" means Form 10-K of the Exchange Act.
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19
"Form 10-Q" means Form 10-Q of the Exchange Act.
"Funded Debt" means, as of any date of determination, the sum of
all Indebtedness.
"Funding Date" shall mean the date on which any loan shall be made
by a Lender to the Borrower hereunder.
"GAAP" has the meaning specified in Section 1.2 of this Agreement.
"Governmental Body" means (i) the United States of America or any
State thereof or any department, agency, commission, board, bureau or
instrumentality of the United States of America or any State thereof, and
(ii) any quasi-governmental body, agency or authority (including any
central bank) exercising regulatory authority over the Lender pursuant to
applicable law in respect of the transactions contemplated by this
Agreement.
"Guarantors" means those Subsidiaries of the Borrower who have
executed the Subsidiary Guarantee on or prior to the Effective Date, or
who may thereafter become a party to the Subsidiary Guarantee in
accordance with the provisions hereof.
"Hazardous Substances" shall have the meaning specified in Section
5.11 hereof.
"Indebtedness" of any Person means, as of any date of
determination and without duplication, the sum of (i) all indebtedness,
obligations and liabilities for money borrowed by such Person, whether or
not evidenced by a note, bond, indenture or other agreement (including in
the case of the Borrower, without limitation, the Revolving Notes and the
Swing Line Note), (ii) all obligations of such Person upon which interest
charges are customarily paid, (iii) the face amount of all letters of
credit issued for the account of such Person, (iv) all obligations of
such Person as lessee under any Capital Lease, (v) all amounts owing by
such Person under purchase money mortgages or other purchase money liens
or conditional sales or other title retention agreements, (vi) all
indebtedness or liabilities secured by purchase money mortgages, liens,
security interests, conditional sales or other title retention agreements
upon property owned by such Person (whether or not such Person has
assumed or become liable for the payment of such indebtedness or
liabilities), (vii) all obligations of such Person for the deferred
purchase price of property or services (other than current trade payables
or liabilities incurred in the ordinary and usual course of business),
including any deferred or contingent payments (including earnout
payments) in connection with any
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20
acquisition and any amounts payable under deferred compensation
agreements executed in connection with any acquisition, (viii) the net
obligations and liabilities of such Person in respect of any interest
rate swap, collar, floor or ceiling agreement or other hedging agreement,
and (ix) all Contingent Obligations of such Person in respect of the
Indebtedness of others.
"Indemnified Person" has the meaning specified in Section 9.10(b)
of this Agreement.
"Initial Fiscal Quarter" has the meaning specified in Section
6.1(e).
"Interest Payment Date" means (x) in the case of Revolving Loans
bearing interest at the Applicable ABR Rate, the last Business Day of
each Fiscal Quarter (or part thereof) in which interest accrues on such
Revolving Loans, (y) in the case of any LIBOR Loan, the expiration of the
LIBOR Period in respect of such LIBOR Loan, and (z) in the case of any
Swing Line Loan, on the last Business Day of each month during which such
Swing Line Loan shall be outstanding.
"Issuing Lender" shall mean the Agent.
"L/C Fee" has the meaning specified in Section 2.3(b) of this
Agreement.
"Lender" or "Lenders" have the meanings specified in the preamble
of this Agreement.
"Lender Availability" shall mean, as of any date of determination
and with respect to each Lender, the amount determined by deducting (x)
the amount of such Lender's Pro Rata Share of the Total Outstanding
Amount from (y) the amount of such Lender's Pro Rata Share of the Maximum
Available Amount.
"LIBOR" means, with respect to any LIBOR Period, (x) the per annum
interest rate (rounded upward to the nearest 1/100th of 1%) determined on
the basis of the offered rates for Dollar deposits for a term comparable
to such LIBOR Period and in an amount substantially equal to the
outstanding amount of the Revolving Loans in respect of which such
determination is made which appear on the Telerate Screen Page 3750 as of
11:00 a.m. (London time) on the day that is two LIBOR Business Days prior
to the first day of such LIBOR Period, divided by (y) a number equal to
1.00 minus the LIBOR Reserve Rate.
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21
"LIBOR Business Day" means any day on which commercial banks are
open for international business (including dealings in Dollar deposits)
in London or such other Euro-dollar interbank market as may be selected
by the Lender in its sole discretion.
"LIBOR Conversion" has the meaning specified in Section 3.8(a) of
this Agreement.
"LIBOR Conversion Notice" has the meaning specified in Section
3.8(a) of this Agreement.
"LIBOR Loans" means the Revolving Loans which bear interest at the
Applicable LIBOR Rate.
"LIBOR Period" means the one-month, two-month or three-month
interest period selected by the Borrower pursuant to any LIBOR Conversion
Notice or Borrowing Notice.
"LIBOR Reserve Rate" means, for any day with respect to a LIBOR
Loan, the maximum rate (expressed as a decimal) at which a Lender would
be required to maintain reserves under Regulation D of the Board of
Governors of the Federal Reserve System, as amended from time to time (or
any successor or similar regulations relating to such reserve
requirements), against "Eurocurrency liabilities" (as that term is used
in Regulation D), if such liabilities were outstanding. The LIBOR Reserve
Rate shall be adjusted automatically on and as of the effective date of
any change in the LIBOR Reserve Rate.
"Lien" of any Person shall mean any mortgage, deed of trust, lien,
pledge, adverse interest in property, charge, security interest or other
encumbrance in or on, or any interest or title of any vendor, lessor,
Lender or other secured party to or of such Person under any conditional
sale or other title retention agreement or Capital Lease with respect to,
any property or asset owned or held by such Person, or the signing or
filing of any security agreement with respect to any of the foregoing
authorizing any other party as the secured party thereunder to file any
financing statement.
"Mandatory Borrowing" shall have the meaning specified in Section
2.4(e) hereof.
"Material Domestic Subsidiary" shall mean, as of any date of
determination, any Domestic Subsidiary of any Person if (x) the book
value of all assets (both real and personal) of such Domestic Subsidiary
equals or
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22
exceeds $250,000 or (y) such Domestic Subsidiary has annual revenues
of $250,000 or more.
"Maturity Date" means July 28, 2002.
"Maximum Available Amount" shall mean, as of any date of
determination, the lesser of (x) the Revolving Loan Commitment and (y)
the Borrowing Base then in effect.
"Multiemployer Plan" means any "multiemployer plan" as defined in
ERISA Section 4001(a)(3) to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any
of the preceding three plan years made or accrued an obligation to make
contributions.
"Obligations" shall mean all now existing or hereafter arising
indebtedness, obligations, liabilities and covenants of the Borrower to
the Lenders or the Agent, their respective Affiliates or permitted
successors and assigns or any other Indemnified Person, in each case
arising under or in connection with or evidenced by this Agreement or any
other Credit Document, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due.
"Optional Prepayment" means the optional prepayment of Swing Line
Loans pursuant to Section 2.4(f) hereof or of Revolving Loans pursuant to
Section 3.6(b) hereof.
"Original Credit Agreement" shall have the meaning set forth in
the first Whereas clause hereof.
"Original Credit Documents" shall mean the Original Credit
Agreement and each other Credit Document (as defined in the Original
Credit Agreement).
"Permitted Investment" means each of (i) direct obligations of the
United States of America, and agencies thereof; (ii) obligations fully
guaranteed by the United States of America; (iii) certificates of deposit
issued by, or bankers' acceptance of, or time deposits with, any bank,
trust company or national banking association incorporated or doing
business under the laws of the United States of America or one of the
states thereof having combined capital and surplus and retained earnings
of at least $500,000,000; (iv) commercial paper of companies having a
rating assigned to such commercial paper by Standard & Poor's Corporation
or Moody's Investors
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23
Service, Inc. (or, if neither such organization shall rate such
commercial paper at any time, by any nationally recognized rating
organization in the United States of America) of A-1 or P-1,
respectively; (v) money-market funds or money-market mutual funds which
(a) seek to maintain a constant net asset value, (b) maintain fund assets
under management having an aggregate market value of at least
$500,000,000 and (c) invest primarily in Permitted Investments of the
type described in clauses (i), (ii), (iii) or (iv) hereof; or (vi) any
investment in any debt security or equity security so long as the amount
of all such debt or equity investments shall not exceed, in the aggregate
at any time, $500,000, provided that the aggregate amount of all voting
securities (or debt securities convertible into voting securities) of any
one Person held or purchased pursuant to this clause (vi) shall not
constitute more than 20% of the outstanding shares of voting securities
of such Person.
"Permitted Uses" shall have the meaning specified in Section
6.1(h) hereof.
"Person" means an individual, partnership, corporation (including
a business trust), joint stock company, trust, unincorporated
association, joint venture or other entity, or a government or any
political subdivision or agency thereof.
"Pledge Agreement" means a Pledge Agreement, substantially in the
form of Exhibit A executed and delivered pursuant to Section 6.1(w)
hereof, as the same may be amended, modified or supplemented from time to
time.
"Pledgor" shall mean each Person who shall have executed and
delivered a Pledge Agreement in favor of the Agent pursuant to Section
6.1(w) hereof.
"Potential Change in Control" means one or more of the following
events:
(a) the Borrower enters into an agreement, the consummation
of which would result in the occurrence of a Change In Control; or
(b) the Board of Directors of the Borrower adopts a
resolution, the effect of which would result in the occurrence of
a Change in Control.
"Potential Event of Default" means an event, condition or
circumstance which, with the giving of notice or the lapse of time, or
both, would constitute an Event of Default.
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24
"Prohibited Transaction" shall have the meaning ascribed to such
term in ERISA.
"Pro Rata Share" shall mean, as of any date of determination and
with respect to any Lender, a fraction (expressed as a percentage), the
numerator of which shall be the amount of such Lender's Commitment and
the denominator of which shall be the aggregate amount of Commitments of
all Lenders, as such Commitments may be reduced or otherwise adjusted
from time to time in accordance with the provisions of this Agreement;
provided, however, that if all of the Commitments are terminated or
reduced to zero hereunder, the Pro Rata Share shall mean, as of any date
of determination and with respect to any Lender, a fraction (expressed as
a percentage), the numerator of which shall be the sum of the aggregate
amount of such Lender's Revolving Loans then outstanding plus the
aggregate amount of such Lender's participation in any outstanding
Standby Letter of Credit and the denominator of which shall be the sum of
the aggregate amount of all Revolving Loans then outstanding plus all
Standby Letters of Credit then outstanding.
"Regulatory Change" means any applicable law, interpretation,
directive, request or guideline (whether or not having the force of law),
or any change therein or in the administration or enforcement thereof,
that becomes effective or is implemented or first required or expected to
be complied with after the date hereof, whether the same is (i) the
result of an enactment by a government or any agency or political
subdivision thereof, a determination of a court or regulatory authority,
or otherwise or (ii) enacted, adopted, issued or proposed before or after
the date hereof, including any such that imposes, increases or modifies
any tax, reserve requirement, insurance charge, special deposit
requirement, assessment or capital adequacy requirement, but excluding
any such that imposes, increases or modifies any income or franchise tax
imposed upon any Lender by any jurisdiction (or any political subdivision
thereof) in which any Lender or any office is located.
"Reportable Event" means any event or condition described in ERISA
Section 4043(b), other than an event or condition with respect to which
the 30-day notice requirement has been waived.
"Required Lenders" shall mean, except as otherwise provided in
Section 8.9(i) hereof, as of any date of determination, such Lenders
whose Pro Rata Shares of the Revolving Loan Commitment, in the aggregate,
are greater than fifty percent (50%); provided, however, that for so long
as only two financial institutions constitute Lenders hereunder (it being
understood that, solely for the purposes of determining the number of
financial
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institutions constituting Lenders under this proviso, each financial
institution, together with its Affiliates, shall constitute a single
Lender), Required Lenders shall mean, except as otherwise provided in
Section 8.9(i) hereof, as of any date of determination, such Lenders
whose Pro Rata Shares of the Revolving Loan Commitment, in the aggregate,
constitute one hundred percent (100%).
"Revolving Loan(s)" shall have the meaning specified in Section
2.1(a) hereof.
"Revolving Loan Commitment" shall mean the commitment of the
Lenders to make Revolving Loans and issue (or participate in the issuance
of) Standby Letters of Credit in an aggregate amount of up to
$18,000,000, as such amount may be reduced or otherwise adjusted from
time to time in accordance with the provisions of this Agreement,
including Section 2.5 hereof.
"Revolving Note" means any promissory note issued to a Lender by
the Borrower pursuant to this Agreement, substantially in the form
(appropriately completed) of Exhibit B to this Agreement, as the same may
be amended, modified or supplemented from time to time, and any other
promissory note issued in exchange or substitution thereof, and
"Revolving Notes" means, collectively, all such promissory notes so
issued.
"SEC" means the Securities and Exchange Commission or any similar
Federal agency.
"Securities Act" means the Securities Act of 1933, as amended, and
any successor Federal statute.
"Stamp Taxes" has the meaning specified in Section 9.5 of this
Agreement.
"Standby Letter of Credit" has the meaning specified in Section
2.3(a) of this Agreement.
"Subsidiary" shall mean any corporation, limited liability
company, partnership, trust or other entity a majority of the capital
stock (or equivalent ownership or controlling interest) of which at the
time outstanding, having ordinary voting power for the election of
directors (or equivalent controlling interest or person), is owned,
directly or indirectly, by any other corporation, limited liability
company, partnership, trust or other entity, and "Subsidiaries" means,
collectively, all such entities.
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"Subsidiary Guarantee" means the Amended and Restated Subsidiary
Guarantee, substantially in the form of Exhibit C hereto, executed and
delivered by the Guarantors in favor of the Agent pursuant to Section
4.1(i)(C) hereof (or by a Guarantor after the Effective Date as required
by Sections 6.2(e) and 6.2(g) hereof) as the same may be amended,
modified or supplemented from time to time.
"Subsidiary Security Agreement" shall mean each Security
Agreement, substantially in the form of Exhibit D hereto, executed and
delivered by a Subsidiary of the Borrower in favor of the Agent on or
prior to the Effective Date or by a Subsidiary after the Effective Date
as provided by Section 6.1(w) hereof, as the same may be amended,
modified or supplemented from time to time.
"Swing Line Lender" shall have the meaning specified in Section
2.4(a) hereof.
"Swing Line Loan" shall have the meaning specified in Section
2.4(a) hereof.
"Swing Line Note" means the promissory note issued by the Borrower
to Bank of America, N.A. pursuant to this Agreement in respect of the
Swing Line Loans, substantially in the form (appropriately completed) of
Exhibit E to this Agreement, as the same may be amended, modified or
supplemented from time to time, and any other promissory note issued in
exchange or substitution therefor.
"Swing Line Subfacility" shall have the meaning specified in
Section 2.4(a) hereof.
"Termination Event" means, with respect to any Benefit Plan, (i)
any Reportable Event with respect to such Benefit Plan, (ii) the
termination of such Benefit Plan, or the filing of a notice of intent to
terminate such Benefit Plan, or the treatment of any amendment to such
Benefit Plan as a termination under ERISA Section 4041(c), (iii) the
institution of proceedings to terminate such Benefit Plan under ERISA
Section 4042 or (iv) the appointment of a trustee to administer such
Benefit Plan under ERISA Section 4042.
"Total Outstanding Amount" has the meaning specified in Section
2.1(a) of this Agreement.
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"Triggering Event" means the occurrence of any of the following
events: (a) with respect to any Foreign Subsidiary of the Borrower and as
determined from time to time, if such Foreign Subsidiary has annual
revenues of $10,000,000 or more, (b) for any quarterly or annual period
of determination, if total revenues or profits from all Foreign
Subsidiaries of the Borrower comprise more than 20% of the total revenues
or profits of the Borrower and its Consolidated Subsidiaries, or (c) upon
an Event of Default. All determinations made with respect to the
definition of Triggering Event shall be calculated in Dollars based on
the applicable exchange rate quoted in The Wall Street Journal on any
date of determination.
"Uniform Commercial Code" shall mean the Uniform Commercial Code
in effect in the relevant jurisdiction.
"Unused Portion Fee" has the meaning specified in Section 3.7(a)
of this Agreement.
Section 1.2 Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistently applied in the United States
("GAAP").
Section 1.3 Time Period Computations. In the computation of a
period of time specified in this Agreement from a specified date to a subsequent
date, the word "from" means "from and including" and the words "to" and "until"
mean "to but excluding".
Section 1.4 Amendment and Restatement. The Borrower, the Agent and
the Lenders agree that the Original Credit Agreement is amended and restated in
its entirety upon the terms and conditions contained herein.
ARTICLE II
GENERAL PROVISIONS OF REVOLVING CREDIT FACILITY
Section 2.1 The Revolving Loans.
(a) Revolving Loan Borrowings. Subject to the terms and conditions
of this Agreement, each Lender severally and not jointly agrees to make
revolving loans (each, a "Revolving Loan" and, collectively, the "Revolving
Loans") to the Borrower, at any time and from time to time on and after the
Effective Date until one Business Day prior to the Maturity Date in an amount
which shall not exceed such Lender's Pro Rata Share of the Revolving Loan
Commitment; provided, however, that (i) the sum of the aggregate outstanding
amount of all Revolving
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Loans plus the aggregate outstanding amount of all Swing Line Loans plus the
aggregate amount then available to be drawn under all outstanding Standby
Letters of Credit (such sum, the "Total Outstanding Amount") shall at no time
exceed the Maximum Available Amount, and (ii) the aggregate outstanding amount
of all Revolving Loans made by each individual Lender pursuant to this Section
2.1 plus the aggregate amount then available to be drawn under all outstanding
Standby Letters of Credit made by or deemed made by such Lender pursuant to
Section 2.3 hereof shall at no time exceed such Lender's Pro Rata Share of the
Maximum Available Amount. Within the limits and subject to the terms and
conditions set forth in this Agreement, the Borrower may borrow pursuant to this
Section 2.1 and Section 2.2 hereof, may prepay pursuant to Section 3.6(b)
hereof, and reborrow under this Section 2.1 hereof.
(b) The Revolving Notes; Maturity. The Revolving Loans made by
each Lender pursuant hereto shall be evidenced by a separate Revolving Note.
Each Revolving Note shall be issued on or before the Effective Date and shall
bear interest, for the period from the initial Funding Date of such Revolving
Loan until such Revolving Note shall be paid in full, on the unpaid principal
amount thereof at the rate specified in Section 3.1 of this Agreement. Each
Lender is hereby authorized to record in the books and records of such Lender
(without making any notation in such Lender's Revolving Note or any schedule
thereto), among other things, the amount and Funding Date of each Revolving Loan
made by such Lender, the amount and date of each payment or prepayment of any
Revolving Loan and the amount and date of any LIBOR Conversion or of any LIBOR
Loan converted to an ABR Loan, as the case may be. No failure to so record nor
any error in so recording shall affect the obligations of the Borrower to repay
the actual outstanding principal amount of the Revolving Loans, with interest
thereon, as provided in this Agreement. The aggregate principal amount of the
Revolving Loans shall be payable on the Maturity Date, unless sooner accelerated
pursuant to the terms of this Agreement.
Section 2.2 Revolving Loan Borrowing Procedures.
(a) Notice of Revolving Borrowing. Whenever the Borrower desires
to borrow Revolving Loans under Section 2.1 hereof, the Borrower shall deliver
to the Agent irrevocable written notice (each such notice, a "Borrowing Notice")
(if then due or, if not then due, the most recently delivered Borrowing Base
Certificate), together with a Borrowing Base Certificate, no later than 12:00
noon (Eastern time) on the Funding Date of a Revolving Loan; provided, however,
that if any Revolving Loan requested pursuant to such Borrowing Notice is to
bear interest based on LIBOR, such Borrowing Notice shall be delivered no later
than 12:00 noon (Eastern time) on the date (which must be a Business Day) that
is three (3) LIBOR Business Days prior to the Funding Date of such Revolving
Loan. The Borrowing Notice
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shall specify (i) that the Borrower wishes to effect one or more Revolving
Loans, (ii) the aggregate principal amount of each Revolving Loan thereby
requested (which shall not be less than $1,000,000 and shall be in multiples of
$250,000 with respect to each such Revolving Loan), (iii) the requested Funding
Date of each such Revolving Loan, which date shall be a Business Day (whether or
not any Revolving Loans are to bear interest based on the ABR or LIBOR), (iv)
whether any Revolving Loan requested pursuant to such Borrowing Notice shall
bear interest based on LIBOR, in which case such Borrowing Notice shall specify
the applicable LIBOR Period being selected by the Borrower (it being understood
and agreed that no change in LIBOR with respect to any then outstanding LIBOR
Loan may be effected during the LIBOR Period relating thereto) and (v) the
Maximum Available Amount then in effect. Each Borrowing Notice shall be
accompanied by the officer's certificate contemplated by Section 4.2(vii)
hereof. In lieu of delivering the above-described Borrowing Notice, and only
with the consent of the Agent in its sole discretion at such time, the Borrower
may give the Agent telephonic notice of any such proposed borrowing by the time
period, as applicable, required under this Section 2.2(a); provided that, in the
event the Agent so consents, such notice shall be confirmed in writing by
delivery to the Agent promptly (but in no event later than 12:00 noon (Eastern
time) on the Funding Date of the requested Revolving Loans) of a Borrowing
Notice (it being understood that any such telephonic notice shall be irrevocable
and shall be conclusive and binding as against the Borrower). Notwithstanding
anything contained herein to the contrary, if on any Interest Payment Date or
Fee Payment Date the credit balance in the Borrower Account is insufficient to
permit the debit contemplated by the second sentence of Section 3.4(a) of this
Agreement, the Agent, without any notice or other authorization being required,
shall (and is hereby irrevocably instructed by the Borrower to) effect Revolving
Loans (which shall initially bear interest at the Applicable ABR Rate) in an
amount sufficient to permit such debit to be implemented or, if the amount of
such debit is greater than the aggregate of the Lender Availability of all
Lenders, in the amount of the unused portion of such Lender Availability.
(b) Making of Revolving Loans. Promptly after receipt of a
Borrowing Notice under clause (a) of this Section 2.2 (or telephonic notice if
the Agent so consents thereto), the Agent shall notify each Lender by telecopy
or telex or other customary form of teletransmission of the requested borrowing.
Each Lender shall make the amount of its Revolving Loan available to the Agent
in Dollars and in immediately available funds, not later than 3:00 P.M. (Eastern
time) on the Funding Date applicable to Revolving Loan(s) specified in the
Borrowing Notice. After the Agent's receipt of the proceeds of such Revolving
Loans from the Lenders, the Agent shall (unless it shall have learned that any
of the conditions precedent set forth in Section 4.2 hereof have not been
satisfied) make the proceeds of such Revolving Loans available to the Borrower
on such Funding Date relating thereto
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and shall disburse such funds in Dollars to the Borrower in immediately
available funds by crediting the Borrower Account.
(c) Failure to Fund by Lender. Unless the Agent shall have been
notified by any Lender prior to 2:00 P.M. (Eastern time) on any Funding Date in
respect of Revolving Loans requested under a Borrowing Notice that such Lender
does not intend to make available to the Agent such Lender's Revolving Loan on
such Funding Date, the Agent may assume that such Lender has made such amount
available to the Agent on such Funding Date and the Agent in its sole discretion
may, but shall not be obligated to, make available to the Borrower a
corresponding amount on such Funding Date. If such corresponding amount is not
in fact made available to the Agent by such Lender on or prior to 3:00 P.M.
(Eastern time) on a Funding Date, such Lender agrees to pay and the Borrower
agrees to repay to the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is paid or repaid to the
Agent, at (i) in the case of such Lender, the Federal Funds Rate, and (ii) in
the case of the Borrower, the Applicable ABR Rate, and no such payment by the
Borrower shall prejudice any rights which the Company or the Agent may have
against such Lender on account of such Lender's failure to so fund its Revolving
Loan. If such Lender shall pay to the Agent such corresponding amount, such
amount so paid shall constitute such Lender's Revolving Loan, and if both such
Lender and the Borrower shall have paid and repaid, respectively, such
corresponding amount, the Agent shall promptly pay over to the Borrower such
corresponding amount in same day funds, but the Borrower shall remain obligated
for all interest thereon. Nothing contained in this Section 2.2(c) shall be
deemed to relieve any Lender of its obligation hereunder to make its Revolving
Loan on any Funding Date.
(d) Maximum Number of LIBOR Loans Outstanding at Anytime. No more
than six (6) LIBOR Loans shall be permitted to be outstanding under this
Agreement at any time. In the event that the Borrower shall request (i) a
Revolving Loan on any Funding Date to bear interest based on LIBOR pursuant to
this Section 2.2, (ii) any LIBOR Conversion pursuant to a LIBOR Conversion
Notice under Section 3.8(a) hereof or (iii) to continue any LIBOR Loan pursuant
to a successive LIBOR Conversion Notice under Section 3.8(c) hereof, the Agent
and the Lenders shall have no obligation to make such Revolving Loan based on
LIBOR or effect such LIBOR Conversion or continue any LIBOR Loan if, after
giving effect to any such transaction, there shall be outstanding under this
Agreement more than six (6) LIBOR Loans, and the Agent and the Lenders shall be
irrevocably authorized without notice to the Borrower to make such Revolving
Loan as an ABR Loan or continue such ABR Loan as such or convert such expiring
LIBOR Loan to an ABR Loan.
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Section 2.3 Standby Letters of Credit.
(a) Generally. Subject to and in accordance with the terms and
conditions set forth herein, the Borrower may request the Issuing Lender, from
time to time during the terms of this Agreement but ending 10 Business Days
prior to the Maturity Date, to issue, and subject to the terms hereof the
Issuing Lender shall issue, for the account of the Borrower and on behalf of
itself or any Subsidiary thereof, one or more standby letters of credit (each, a
"Standby Letter of Credit") pursuant to the Issuing Lender's customary letter of
credit application. The aggregate outstanding amount at any time and from time
to time of all Standby Letters of Credit shall not exceed $5,000,000. The
Issuing Lender shall have no obligation to issue any Standby Letter of Credit
if, after giving effect to the issuance thereof, the Total Outstanding Amount
shall then exceed the Maximum Available Amount (it being understood that the
Issuing Lender shall, upon request of the Borrower, issue a Standby Letter of
Credit in an amount that would, after giving effect to the issuance thereof, not
cause the Maximum Available Amount to be exceeded).
(b) Standby Letter of Credit Fees; Maturity. The Borrower shall,
among other things, pay to the Issuing Lender for the benefit of the Lenders,
pro rata, a quarterly fee (the "L/C Fee"), payable in arrears on the Fee Payment
Date. The L/C Fee shall be computed by multiplying the Applicable L/C Margin
then in effect by the daily average of the aggregate available amount to be
drawn under all Standby Letters of Credit outstanding during the Fiscal Quarter
immediately preceding the Fee Payment Date (and shall be calculated on the basis
of a 360 day year and the actual number of days elapsed). All Standby Letters of
Credit issued by the Issuing Lender as contemplated by this Section 2.3 shall
expire no later than the Maturity Date. Notwithstanding that the Issuing Lender
shall have no obligation to issue any Standby Letter of Credit the expiration
date of which shall extend beyond the Maturity Date, if the expiration date of
any Standby Letter of Credit shall in fact extend beyond the Maturity Date, then
on the last Business Day immediately preceding the Maturity Date, there shall be
deemed to have been made Revolving Loans in the aggregate amount then available
to be drawn under all Standby Letters of Credit the expiration date of which
shall occur after the Maturity Date, the proceeds of which the Issuing Lender
shall deposit in a collateral account at the Issuing Lender or an Affiliate
thereof in order to collateralize such outstanding Standby Letters of Credit,
which collateral account shall bear interest for the account of the Borrower
based upon investment of the funds as agreed between the Issuing Lender and the
Borrower.
(c) Standby Letter of Credit Request Procedure. Whenever the
Borrower desires that a Standby Letter of Credit be issued on its behalf or on
behalf of any of its Subsidiaries, the Borrower shall give the Issuing Lender
(with copies to
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be sent by the Issuing Lender to the Agent and each other Lender) at least five
(5) Business Days' prior written notice therefor, which notice shall be
accompanied by a Borrowing Base Certificate (if then due or, if not then due,
the most recently delivered Borrowing Base Certificate). The execution and
delivery of each request for a Standby Letter of Credit shall be deemed to be a
representation and warranty by the Borrower that such Standby Letter of Credit
may be issued in accordance with, and will not violate the requirements of, this
Section 2.3. Unless the Issuing Lender has received notice from any Lender
before it issues the respective Standby Letter of Credit that one or more of the
conditions specified in Section 4.2 are not then satisfied, or that the issuance
of such Standby Letter of Credit would violate this Section 2.3, then the
Issuing Lender may issue the requested Standby Letter of Credit for the account
of the Borrower in accordance with the terms of this Agreement and, with respect
to any matters not specifically covered by this Agreement, in accordance with
the Issuing Lender's usual and customary practices as in effect from time to
time.
(d) Letter of Credit Participations.
(i) Immediately upon the issuance by the Issuing Lender of any
Standby Letter of Credit, the Issuing Lender shall be deemed to have sold
and transferred to each Lender (other than the Issuing Lender), and each
such Lender shall be deemed irrevocably and unconditionally to have
purchased and received from the Issuing Lender, without recourse or
warranty, an undivided interest and participation, in proportion to such
Lender's Pro Rata Share, in such Standby Letter of Credit, each drawing
made thereunder and the obligations of the Borrower under this Agreement
with respect thereto, and any collateral therefor. Upon any change in a
Lender's Pro Rata Share of the Revolving Loan Commitment, it is hereby
agreed that with respect to all outstanding Standby Letters of Credit,
there shall be an automatic adjustment to the participations pursuant to
this Section 2.3(d) to reflect the new Pro Rata Share of the Revolving
Loan Commitment of the assigning and assignee Lenders.
(ii) In determining whether to pay under any Standby Letter of
Credit, the Issuing Lender shall have no obligation relative to the
Lenders other than to confirm that any documents required to be delivered
under such Standby Letter of Credit appear to have been delivered and
that they appear to comply on their face with the requirements of such
Standby Letter of Credit. Any action taken or omitted to be taken by the
Issuing Lender under or in connection with any Standby Letter of Credit,
if taken or omitted in the absence of gross negligence or willful
misconduct, shall not create for the Issuing Lender any resulting
liability to any Lender.
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(iii) Upon the request of any Lender, the Issuing Lender shall
furnish to such Lender copies of any Standby Letter of Credit to which
the Issuing Lender is party and such other documentation relating to such
Standby Letter of Credit as may reasonably be requested by such Lender.
(iv) As between the Borrower on the one hand and the Issuing
Lender and the Lenders on the other hand, the Borrower assumes all risks
of the acts and omissions of, or misuse of, the Standby Letters of Credit
by the respective beneficiaries of such Standby Letters of Credit.
Without limiting the generality of the foregoing, neither the Issuing
Lender nor any other Lender shall be responsible (except in the case of
its gross negligence or willful misconduct) for the following:
(A) the form, validity, sufficiency, accuracy, genuineness
or legal effect of any documents submitted by any party in
connection with the application for and issuance of or any drawing
under such Standby Letters of Credit, even if it should in fact
prove to be in any respects invalid, insufficient, inaccurate,
fraudulent or forged;
(B) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any
such Standby Letter of Credit or the rights or benefits thereunder
or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason;
(C) failure of the beneficiary of any such Standby Letter
of Credit to comply fully with conditions required in order to
draw upon such Standby Letter of Credit, other than material
conditions or instructions that expressly appear in such Standby
Letter of Credit;
(D) errors, omissions, interruptions or delays in the
transmission or delivery of any messages by mail, cable,
telegraph, telecopier, telex or otherwise, whether or not they are
encoded;
(E) errors in interpretation of technical terms;
(F) any loss or delay in the transmission or otherwise of
any document required in order to make a drawing under any such
Standby Letter of Credit or the proceeds thereof;
(G) the misapplication by the beneficiary of any such
Standby Letter of Credit of the proceeds of any drawing of any
such Standby Letter of Credit; or
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(H) any consequences arising from causes beyond the control
of the Issuing Lender, including without limitation any acts of
governments.
(v) The obligations of the Lenders to make payments to the Agent
for the account of the Issuing Lender with respect to Standby Letters of
Credit shall be irrevocable and not subject to any qualification or
exception whatsoever and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances, including, without
limitation, any of the following circumstances:
(A) any lack of validity or enforceability of this
Agreement or any of the other Credit Documents;
(B) the existence of any claim, setoff, defense or other
right which the Borrower or any of its Subsidiaries may have at
any time against a beneficiary named in a Standby Letter of
Credit, any transferee of any Standby Letter of Credit (or any
Person for whom any such transferee may be acting), the Agent, the
Issuing Lender, any Lender, or any other Person, whether in
connection with this Agreement, any Standby Letter of Credit, the
transactions contemplated herein or any unrelated transactions;
(C) any draft, certificate or any other document presented
under the Standby Letter of Credit shall prove to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein shall prove to be untrue or inaccurate in any
respect;
(D) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents;
(E) the occurrence of any Event of Default or Potential
Event of Default; or
(F) the termination of this Agreement or any Commitment.
(e) Standby Letter of Credit Drawings Constitute Revolving Loans.
The Issuing Lender shall promptly notify the Agent, and the Agent shall promptly
notify each Lender, in each case by telecopy or telex or other customary form of
teletransmission, of any drawing under any Standby Letter of Credit (each
drawing, a "Drawing"). Each Drawing shall immediately be deemed to be and for
all purposes of this Agreement shall constitute a Revolving Loan hereunder in
the
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amount of such drawing (which Revolving Loan shall, for the avoidance of doubt,
bear interest initially at the Applicable ABR Rate). Each Lender shall promptly
and unconditionally pay to the Agent for the account of the Issuing Lender an
amount equal to such Lender's Pro Rata Share of such Drawing in same day funds.
Such payment shall be made to the Agent at the Agent Lending Office. If the
Agent delivers such notice to such Lender prior to 2:00 P.M. (Eastern time) on
any Business Day, such Lender shall make its required payment on the same
Business Day. If and to the extent such Lender shall not have made available to
the Agent for the account of the Issuing Lender such Lender's Pro Rata Share of
such Drawing, such Lender agrees to pay to the Agent for the account of the
Issuing Lender, promptly upon demand, such amount, together with interest
thereon, for each day from such date until the date such amount is paid to the
Agent for the account of the Issuing Lender at the Federal Funds Rate plus 100
basis points. The failure of any Lender to make available to the Agent for the
account of the Issuing Lender its Pro Rata Share of any Drawing shall not
relieve any other Lender of its obligation hereunder to make available to the
Agent for the account of the Issuing Lender its Pro Rata Share of any Drawing on
the date so required; provided, however, that no Lender shall be responsible for
the failure of any other Lender to make available to the Agent for the account
of the Issuing Lender such other Lender's Pro Rata Share of such Drawing.
Section 2.4 Swing Line Loan Subfacility.
(a) Swing Line Subfacility. Subject to the terms and conditions
hereof, Bank of America, N.A., in its individual capacity (as such, the "Swing
Line Lender"), shall, in its sole and absolute discretion from and after the
Effective Date until one Business Day prior to the Maturity Date, make swing
line loans (each, a "Swing Line Loan" and, collectively, the "Swing Line Loans")
to the Borrower; provided, however, that (i) the aggregate principal amount of
all Swing Line Loans shall at no time exceed $5,000,000.00 (such amount, the
"Swing Line Subfacility"), and (ii) the sum of the aggregate outstanding amount
of all Revolving Loans (whether bearing interest at the Applicable ABR Rate or
Applicable LIBOR Rate) plus the aggregate outstanding amount of all Swing Line
Loans plus the aggregate amount then available to be drawn under all outstanding
Standby Letters of Credit shall at no time exceed the Maximum Available Amount.
(b) The Swing Line Note; Maturity. The Swing Line Loans made by
the Swing Line Lender pursuant to this Section 2.4 shall be evidenced by a
separate Swing Line Note. The Swing Line Note shall be issued on or before the
Effective Date and shall bear interest for the period from the date of the
initial funding of any Swing Line Loan until paid in full on the unpaid
principal amount thereof. The Swing Line Lender is hereby authorized to record
in its books and records (without making any notation on the Swing Line Note or
any schedule thereto) the amount
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and date of funding of each Swing Line Loan made by it, and the amount and date
of each payment or prepayment of any Swing Line Loan. No failure to so record
nor any error in so recording shall affect the obligations of the Borrower to
repay the actual outstanding principal amount of the Swing Line Loans, with
interest thereon, as provided in this Agreement. The aggregate principal amount
of the Swing Line Loans shall be payable on the Maturity Date, unless sooner
accelerated pursuant to the terms of this Agreement.
(c) Swing Line Loan Borrowing Procedure. The Swing Line Lender
shall make Swing Line Loans to the Borrower upon the terms and subject to the
conditions contained in the autoborrow services agreement entered into by the
Borrower and the Swing Line Lender (as such agreement may be amended, modified
or supplemented from time to time, the "Autoborrow Services Agreement"), and
otherwise on the date (which shall be a Business Day), at the time and in the
amount as provided in the Autoborrow Services Agreement. The Autoborrow Services
Agreement shall specify, among other things, the minimum amount of each Swing
Line Loan and the minimum and maximum period during which any Swing Line Loan
may remain outstanding. The Swing Line Lender shall have no obligation to make
available to the Borrower any Swing Line Loan until such time as the Borrower
and the Swing Line Lender shall have executed and delivered the Autoborrow
Services Agreement.
(d) Interest on Swing Line Loans. Subject to the provisions of
clause (e) of this Section 2.4, in the event that the Swing Line Lender shall
make any Swing Line Loan pursuant to this Section 2.4 the aggregate principal
amount of Swing Line Loans outstanding from time to time shall bear interest at
a rate per annum equal to the Applicable Swing Line Rate (based on a 360 day
year and the actual number of days elapsed for the period during which such
Swing Line Loan shall remain outstanding). No Swing Line Loan may be converted
into a LIBOR Loan.
(e) Repayment of Swing Line Loans. Each Swing Line Loan made by
the Swing Line Lender hereunder shall be due and payable upon the expiration of
the period for which such Swing Line Loan shall be made in accordance with the
terms of the Autoborrow Services Agreement. The Swing Line Lender may, at any
time and in its sole and absolute discretion, by written notice to the Borrower
and the Agent (which shall promptly deliver a copy thereof to the other
Lenders), demand repayment of its Swing Line Loans then outstanding by way of
the making of a Revolving Loan borrowing (a "Mandatory Borrowing"), in which
case the Borrower shall be deemed to have requested a Revolving Loan borrowing
in the amount of the then outstanding Swing Line Loans which shall bear interest
initially at the Applicable ABR Rate and shall be applied to refund the then
outstanding Swing Line Loans; provided, however, that, in the following
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circumstances, any such demand shall also be deemed to have been given one
Business Day prior to each of (i) the occurrence of the Maturity Date, (ii) the
occurrence of any Event of Default described in clause (g) or (h) of Section 7.1
hereof, (iii) upon acceleration of the Obligations hereunder, whether on account
of an Event of Default described in clause (g) or (h) of Section 7.1 or any
other Event of Default, and (iv) the exercise of remedies in accordance with the
provisions of Section 7.1 hereof. Each Lender hereby irrevocably agrees to make
such Revolving Loans promptly upon any such request or deemed request on account
of a Mandatory Borrowing, in the amount (but in proportion to each Lender's Pro
Rata Share) and in the manner specified in the preceding sentence and on the
same such date notwithstanding that (A) the amount of the Mandatory Borrowing
may not comply with the minimum amount for borrowings of Revolving Loans
otherwise required hereunder, (B) whether any conditions specified in Section
4.2 are then satisfied, (C) whether an Event of Default or Potential Event of
Default then exists, (D) failure of any such request or deemed request for
Revolving Loans to be made by the time otherwise required in Section 2.2 hereof,
(E) the date of such Mandatory Borrowing, or (F) any reduction in the Revolving
Loan Commitment or termination of the Commitments relating thereto immediately
prior to such Mandatory Borrowing or contemporaneously therewith. In the event
that any Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the commencement
of a proceeding in bankruptcy with respect to the Borrower), then each Lender
hereby agrees that it shall forthwith purchase (as of the date the Mandatory
Borrowing would otherwise have occurred, but adjusted for any payments received
from the Borrower on or after such date and prior to such purchase) from the
Swing Line Lender such participations in the then outstanding Swing Line Loans
as shall be necessary to cause each such Lender to share in such Swing Line
Loans ratably based upon its respective Pro Rata Share of the Revolving Loan
Commitment (determined before giving effect to any termination of the Revolving
Loan Commitments pursuant to the last paragraph of Section 7.1); provided that
(1) all interest payable on the Swing Line Loans shall be for the account of the
Swing Line Lender until the date as of which the respective participation of
each other Lender is purchased, and (2) at the time any purchase of
participations pursuant to this sentence is actually made, the purchasing Lender
shall be required to pay to the Swing Line Lender interest on the principal
amount of such participation purchased for each day from and including the day
upon which the Mandatory Borrowing would otherwise have occurred to but
excluding the date of payment for such participation, at the rate equal to, if
paid within 2 Business Days of the date of the Mandatory Borrowing, the Federal
Funds Rate, and thereafter at a rate equal to the Applicable Swing Line Rate.
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(f) Optional Prepayment of Swing Line Loans. Subject to the
provisions of this clause (f), the Borrower may, at its sole option, prepay the
principal amount of the Swing Line Loans in whole or in part (and in an amount
not less than the amount provided in the Autoborrow Services Agreement) at any
time and from time to time, without premium or penalty. In respect of each
Optional Prepayment of a Swing Line Loan proposed to be made by the Borrower,
the right of the Borrower to make such Optional Prepayment is subject to the
Agent's receipt from the Borrower, no later than 12:00 P.M. on the Business Day
specified therein as the date on which such Optional Prepayment is to be made,
of a written notice (which shall be irrevocable and a copy thereof shall be
promptly delivered by the Agent to the Swing Line Lender) specifying (i) that
the Borrower desires to prepay such Swing Line Loan, (ii) the principal amount
of such Optional Prepayment, and (iii) the date (which shall be a Business Day)
on which such Optional Prepayment will be made. Any Optional Prepayment of a
Swing Line Loan, which has not been converted to a Revolving Loan, made by the
Borrower as permitted hereunder shall be paid to the Agent for the account of
the Swing Line Lender no later than 12:00 P.M. (Eastern Time) on the applicable
prepayment date.
Section 2.5 Mandatory Reduction of Revolving Loan Commitment;
Termination of Revolving Loan Commitment. Unless otherwise agreed by the
Required Lenders, the Revolving Loan Commitment shall be permanently and
automatically reduced from time to time by the amount of net cash proceeds to
(or for the account of) the Borrower or any Subsidiary thereof resulting from
(i) the issuance or sale by the Borrower or such Subsidiary of any of their
capital stock (or equivalent) to any Person, (ii) the issuance or sale by the
Borrower or such Subsidiary of any debt security or other instrument of
Indebtedness to any Person, (iii) the sale of any assets of the Borrower or such
Subsidiary other than assets sold in the ordinary course of business as
contemplated by clause (i) of Section 6.2(i) hereof, (iv) the disposition of
redundant, worn out or obsolete equipment to the extent the net cash proceeds
thereof are required to reduce the Obligations as provided by clause (i)(B) of
Section 6.2(i) hereof and (v) any proceeds of insurance or indemnity under
policies of insurance insuring or covering the properties, liabilities, risks or
losses (whether or not contingent) of the Borrower or such Subsidiary. Any such
reduction in the Revolving Loan Commitment shall reduce each Lender's
Commitment, pro rata. In addition, the Borrower shall have the right to
permanently terminate the Revolving Loan Commitment by giving written notice
thereof to the Agent, whereupon all Outstandings, including all Loans, together
with all interest accrued thereon and all other amounts owing hereunder, shall
be repaid in full and all outstanding Letters of Credit shall be fully cash
collateralized.
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ARTICLE III
INTEREST, FEES AND REPAYMENT
Section 3.1 Interest on the Revolving Loans
(a) ABR. Except as provided pursuant to clause (b) of this Section
3.1, the aggregate principal amount of the Revolving Loans outstanding from time
to time shall bear interest at a rate per annum equal to the Applicable ABR Rate
until the entire principal amount of the Revolving Loans shall have been repaid.
Any change in the rate of interest on the Revolving Loans resulting from a
change in the ABR shall be effective as of the opening of business on the day on
which such change is effective.
(b) LIBOR Rate. In the event the Borrower shall effect a LIBOR
Conversion in accordance with the provisions of Section 3.8 of this Agreement or
obtain a Revolving Loan that shall bear interest initially at the Applicable
LIBOR Rate as provided in Section 2.2(a) hereof, the aggregate principal amount
of each Revolving Loan that is the subject of such LIBOR Conversion or Borrowing
Notice, as the case may be, shall bear interest at a rate per annum equal to the
Applicable LIBOR Rate in respect of such Revolving Loan.
Section 3.2 Regulatory Changes. If, after the date of this
Agreement, any Regulatory Change
(i) shall subject any Lender to any tax, duty or other charge with
respect to its obligation to make or maintain any Revolving Loan or Swing
Line Loan or any Standby Letter of Credit or its Commitment, or shall
change the basis of taxation of payments to such Lender of the principal
of or interest on the Revolving Loans or Swing Line Loans or in respect
of any other amounts due under this Agreement in respect of its
obligation to make any Revolving Loan or Swing Line Loan or any Standby
Letter of Credit or maintain its Commitment or maintain any Standby
Letter of Credit (except for changes in the rate of tax on the overall
net income of such Lender); or
(ii) shall impose, modify or deem applicable any reserve,
assessment, special deposit, capital adequacy, capital maintenance or
similar requirement against assets of, deposits with or for the account
of, or credit extended by, such Lender or shall impose on such Lender any
other condition affecting (x) the obligation of the Lender to make or
maintain the Revolving Loans or Swing Line Loans or its Commitment or any
Standby Letter of Credit, or (y) the Revolving Notes or the Swing Line
Note;
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and the result of any of the foregoing is to increase the cost to such Lender of
making or maintaining any Revolving Loan or Swing Line Loan or any Standby
Letter of Credit or maintaining its Commitment or to reduce the amount of any
sum received or receivable by such Lender under, or the rate of return
attributable to, this Agreement or under the Revolving Notes or the Swing Line
Note or any Standby Letter of Credit, then such Lender shall give written notice
to the Borrower if such Regulatory Change shall impose costs in excess of those
costs, or reduce the amount of any such sum or rate of return below the amount
or rate, applicable on the date of this Agreement, and the Borrower shall pay to
such Lender for the account of such Lender, not later than 30 days following
receipt by the Borrower of such Lender's notice, such additional amount or
amounts as will compensate such Lender for such increase or reduction as
reflected in a certificate of such Lender attached to such notice setting forth
the basis for the amount of said increase or reduction, as the case may be. The
Lender's certificate attached to such notice shall be conclusive and binding on
the Borrower in the absence of manifest error.
Section 3.3 Interest after Due Date. In the event the Borrower
fails to make any payment of the principal amount of or interest on any of the
Revolving Loans or Swing Line Loans or of the Unused Portion Fee, the L/C Fee or
the Administrative Fee or any other amount owing hereunder, in each case when
due (whether by demand, acceleration or otherwise), the Borrower shall pay to
the Agent for the account of the Lenders interest on such unpaid amount, payable
from time to time on demand, from the date such amount shall have become due to
the date of payment thereof, accruing on a daily basis, at a per annum rate (the
"Default Rate") equal to the sum of (x) the Applicable ABR Rate plus (y) two
percent (2%).
Section 3.4 Payment and Computations.
(a) Payments. All payments required or permitted to be made to the
Agent, to the Agent for the account of the Lenders, or to any Lender under this
Agreement or under any Revolving Note or the Swing Line Note shall be made in
Dollars (i) if to the Agent, at the Lending Office of the Agent in immediately
available funds and (ii) if to any Lender, to it in immediately available funds
at an account specified by such Lender in writing to the Borrower. The Borrower
hereby irrevocably instructs and authorizes the Agent to effect each payment of
interest on the Revolving Loans and the Swing Line Loans due on each Interest
Payment Date, and of each payment of the Unused Portion Fee, the L/C Fee and the
Administrative Fee due on the Fee Payment Date, by debiting the Borrower Account
on such Interest Payment Date or Fee Payment Date, as the case may be, with the
aggregate amount thereof, in each case, after giving effect to the crediting to
the Borrower Account of the proceeds of the Revolving Loan, if any, made on such
Interest Payment Date or Fee Payment Date, as the case may be, in accordance
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with Section 2.2(a) of this Agreement. The Agent shall provide to the Borrower
an invoice showing the amount of such debit and the manner in which it was
calculated.
(b) Computations of Interest. Interest on the unpaid portion of
the Revolving Loans and the Swing Line Loans, and interest accruing at the
Default Rate on any amount owing hereunder, shall each be calculated for the
actual number of days (including the first day but excluding the last day)
elapsed and shall be computed on the basis of a year of 360 days.
(c) Interest on Loans. Interest on the Revolving Loans and the
Swing Line Loans shall be payable in arrears on each Interest Payment Date.
(d) Application of Payments; Apportionment.
(i) Apportionment of Payments and Prepayments. Unless a Lender
shall be in default of its obligations to advance any Revolving Loan or
reimburse the Agent as provided herein, all payments and prepayments of
principal and interest in respect of outstanding Revolving Loans and all
payments of fees (other than any fees payable pursuant to the
Administrative Fee Letter) and all other payments in respect of any other
Obligations (other than with respect to the Swing Line Loans) shall be
allocated among (and paid over as soon as reasonably practicable after
receipt thereof to) such of the Lenders as are entitled thereto in
proportion to their respective Pro Rata Share. All payments and
prepayments of principal and interest and other amounts in respect of the
Swing Line Loans that have not been converted to Revolving Loans shall be
allocated to the Swing Line Lender, and all fees payable pursuant to the
Administrative Fee Letter shall be allocated only to the Agent.
(ii) Application of Payments. Upon the occurrence and during the
continuance of an Event of Default, the Agent shall, unless otherwise
specified by the Required Lenders as provided in the last paragraph of
this clause (ii), apply all payments (including the proceeds of any
collateral obtained upon the exercise by the Agent of any remedy
specified in any Credit Document) in respect of any Obligations:
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(A) first, to pay Obligations to the Agent in respect of
reimbursement of any costs and expenses (including reasonable
attorney's fees and disbursements) in connection with the exercise
of any remedies by the Agent under any Credit Document;
(B) second, to pay interest on and then principal of any
portion of the Revolving Loans which the Agent may have
advanced on behalf of any Lender for which the Agent has not
then been reimbursed by such Lender or the Borrower;
(C) third, to pay Obligations in respect of any fees,
expense reimbursement or indemnities due to the Agent other
than as provided in subclause (A) above;
(D) fourth, to pay Obligations in respect of any fees,
expense reimbursement, indemnities, increased costs or breakage
then due to the Lenders, pro rata;
(E) fifth, to the ratable payment of overdue interest or
late charges, if any, then due the Lenders;
(F) sixth, to the ratable payment of interest due in
respect of the Revolving Loans and the Swing Line Loans;
(G) seventh, to the ratable payment or prepayment of
principal due in respect of the Revolving Loans and the Swing
Line Loans; and
(H) eighth, to the ratable payment of all other -
Obligations;
provided, however, that no Lender that shall be in default of its obligations to
fund Revolving Loans or reimburse the Agent as provided herein shall be entitled
to its ratable share of payments in respect of any Obligations prior to the
payment to all non-defaulting Lenders of all amounts due such Lenders as
provided herein.
The order of priority set forth in this Section 3.4(d)(ii) is set
forth solely to determine the rights and priorities of the Agent and the Lenders
as among themselves. The order of priority set forth in clauses (D) through (H)
of this Section 3.4(d)(ii) may at any time and from time to time be changed by
the Required Lenders without necessity of notice to or consent of or approval by
the Borrower, or any other Person. The order of priority set forth in clauses
(A) through (C) of this Section 3.4(d)(ii) may be changed only with the prior
written consent of the Agent.
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Section 3.5 Payment at Maturity Date. Any outstanding principal
amount of the Revolving Notes and the Swing Line Note theretofore not repaid,
together with any accrued and unpaid Unused Portion Fee, Administrative Fee or
L/C Fee, any accrued and unpaid interest thereon, together with any other
amounts due and payable in accordance with the provisions hereof (including
pursuant to Section 9.10 hereof), shall be due and payable in full on the
Maturity Date (unless sooner accelerated pursuant to the terms hereof), and this
Agreement shall not terminate until all Obligations shall have been paid in
full.
Section 3.6 Prepayments; Certain Early Repayments.
(a) Mandatory Prepayment of Revolving Loans, Swing Line Loans and
Standby Letters of Credit. If at any time the Total Outstanding Amount shall be
greater than the Maximum Available Amount, the Borrower shall, without notice
from the Lenders, prepay that portion of the Revolving Loans, Swing Line Loans
and/or the Standby Letters of Credit, as the case may be, in an amount equal to
such excess except that all prepayments made pursuant to this sentence shall be
applied first to reduce the Swing Line Loans, second to reduce the Revolving
Loans and last to cash collateralize the outstanding Standby Letters of Credit.
In addition, the Borrower shall, without notice from the Lenders, prepay (in the
same order of priority as specified in the immediately preceding sentence) any
outstanding Revolving Loan, Swing Loan and/or Letter of Credit in an amount
equal to the net cash proceeds to (or for the account of) the Borrower or any
Subsidiary thereof resulting from (i) the issuance or sale by the Borrower or
such Subsidiary of any of their capital stock (or equivalent) to any Person,
(ii) the issuance or sale by the Borrower or such Subsidiary of any debt
security or other instrument of Indebtedness to any Person, (iii) the sale of
any assets of the Borrower or such Subsidiary other than assets sold in the
ordinary course of business as contemplated by clause (i) of Section 6.2(i)
hereof, (iv) the disposition of redundant, worn out or obsolete equipment, if
required by clause (i)(B) of Section 6.2(i) hereof and (v) any proceeds of
insurance under policies of insurance or indemnity insuring or covering the
properties, liabilities, risks or losses (whether or not contingent) of the
Borrower or such Subsidiary.
(b) Optional Prepayments of Revolving Loans. Subject to the terms
and conditions of clause (c) below and Section 3.9 hereof, the Borrower may, at
its sole option prepay the principal amount of the Revolving Loans (whether
bearing interest at the Applicable ABR Rate or Applicable LIBOR Rate) in whole
or in part (in an amount of $1,000,000 or more and in multiples of $250,000) at
any time and from time to time, without premium or penalty.
(c) Optional Prepayment Procedure. In respect of each Optional
Prepayment of Revolving Loans (whether bearing interest at the Applicable ABR
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Rate or Applicable LIBOR Rate) proposed to be made by the Borrower, the right of
the Borrower to make such Optional Prepayment is subject to the Agent's receipt
from the Borrower, no later than 10:00 A.M. (Eastern Time) on the Business Day
specified therein as the date on which such Optional Prepayment is to be made
(unless such Optional Prepayment shall relate to the prepayment of any LIBOR
Loan, in which case such notice shall be given no later than 10:00 A.M. (Eastern
time) at least three (3) Business Days prior to the date of prepayment), of a
written notice (which shall be irrevocable) specifying (i) that the Borrower
desires to prepay the Revolving Loans, (ii) the principal amount of such
Optional Prepayment and the extent which any portion thereof relates the
prepayment of any LIBOR Loan, and (iii) the date (which shall be a Business Day
or, if such Optional Prepayment relates to a LIBOR Loan, a LIBOR Business Day)
on which such Optional Prepayment will be made. Any Optional Prepayment of
Revolving Loans made by the Borrower as permitted hereunder shall be paid to the
Agent for the account of the Lenders no later than 12:00 P.M. (Eastern Time) on
the applicable prepayment date (except that any prepayment of a LIBOR Loan shall
be paid no later than 10:00 A.M. (Eastern Time) on the applicable prepayment
date).
Section 3.7 Unused Portion Fee and Administrative Fee.
(a) Unused Portion Fee. For each Fiscal Quarter (or part thereof)
during the period from the Effective Date until the Maturity Date, the Borrower
shall pay to the Agent, for the account of the Lenders pro rata based upon each
Lender's Pro Rata Share of the Revolving Loan Commitment, an unused portion fee
(the "Unused Portion Fee") determined by subtracting the Total Outstanding
Amount (computed on the basis of the daily average for such Fiscal Quarter) from
the Revolving Loan Commitment Amount. The Unused Portion Fee shall be computed
at a rate per annum equal to, in the event the Funded Debt to EBITDA ratio
calculated pursuant to Section 6.1(e) hereof is (i) less than 1.00 to 1.00, then
0.25%, (ii) greater than or equal to 1.00 to 1.00 but less than 2.00 to 1.00,
then 0.30%, and (iii) greater than or equal to 3.00 to 1.00, then 0.375%. The
Unused Portion Fee shall be due and payable in arrears on the Fee Payment Date
to which such Unused Portion Fee relates and on the Maturity Date, and shall be
calculated on the basis of a 360 day year and the actual days elapsed. The
Unused Portion Fee for any Fiscal Quarter shall be determined based on the
financial statements delivered by the Borrower during the immediately preceding
Fiscal Quarter; provided, however, that if such financial statements are not
delivered when due, then the highest Funded Debt to EBITDA ratio shall apply.
(b) Administrative Fee. During the term of this Agreement, the
Borrower shall pay to the Agent, as compensation for the services of the Agent
hereunder, a fee (the "Administrative Fee") in an amount specified in, and
subject to the terms and conditions of, that certain letter agreement, dated
November 20,
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1998, between the Borrower and Bank of America, N.A. (as successor to
NationsBank, N.A.) (as the same may from time to time be amended, modified or
supplemented, the "Administrative Fee Letter"). The Administrative Fee shall be
due and payable on each Fee Payment Date, as provided in the Administrative Fee
Letter.
Section 3.8 LIBOR Conversion.
(a) Conversion. So long as no Event of Default or Potential Event
of Default shall have occurred and be continuing, the Borrower shall have the
right to convert all or part of the outstanding ABR Loans to loans bearing
interest at the then Applicable LIBOR Rate (such conversion, a "LIBOR
Conversion"); provided, however, that the LIBOR Period to which such LIBOR
Conversion shall relate will not extend beyond the Maturity Date. In order to
effect a LIBOR Conversion, the Borrower shall give the Agent irrevocable written
notice (such notice, a "LIBOR Conversion Notice") prior to 10:00 A.M. (Eastern
time) on the date (which must be a Business Day) that is at least three (3)
LIBOR Business Days prior to the first day of the LIBOR Period to which such
LIBOR Conversion shall apply, stating that (i) the Borrower wishes to effect a
LIBOR Conversion, (ii) the aggregate principal amount of outstanding ABR Loans
which the Borrower wishes to bear interest at the Applicable LIBOR Rate (it
being understood and agreed that no LIBOR Conversion shall be permitted in an
amount less than $1,000,000.00 and shall be in multiples of $250,000.00), (iii)
the applicable LIBOR Period being elected by the Borrower (it being understood
that no change in LIBOR with respect to any then outstanding LIBOR Loan may be
effected during the LIBOR Period relating thereto) and (iv) the Business Day on
which the LIBOR Period is to be effective.
(b) Notice of LIBOR to Borrower. In the event the Borrower has
requested a LIBOR Conversion, the Agent shall give written notice to the
Borrower and the Lenders of LIBOR as promptly as reasonably possible after such
rate is determined. The Agent's determination of LIBOR shall be conclusive in
the absence of manifest error.
(c) Successive Notice of LIBOR Conversion. Subject to the
provisions of clause (a) of this Section 3.8, the Borrower may, by executing a
LIBOR Conversion Notice at least three LIBOR Business Days prior to the first
day of the LIBOR Period to which such LIBOR Conversion Notice shall apply,
execute successive LIBOR Conversions with respect to any then outstanding ABR
Loan together with any then outstanding LIBOR Loans the LIBOR Period in respect
of which is scheduled to expire on or before the start of the LIBOR Period
specified in such LIBOR Conversion Notice. If, with respect to any LIBOR Loans,
the Agent shall not have received a LIBOR Conversion Notice for the next
immediately succeeding LIBOR Period which complies with the provisions of clause
(a) of this
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Section 3.8, such LIBOR Loans shall, immediately upon the expiration of the
then current LIBOR Period and without any notice to the Borrower, bear interest
at the Applicable ABR Rate in accordance with the provisions of Section 3.1(a)
of this Agreement.
Section 3.9 Breakage, etc. In the event of the prepayment of any
LIBOR Loan (whether by way of acceleration or otherwise or due to an Optional
Prepayment of any LIBOR Loan pursuant to Section 3.6(b) hereof or a mandatory
prepayment of any LIBOR Loan pursuant to Section 3.6(a) hereof), the Borrower
shall pay to each Lender whose LIBOR Loan has been so prepaid any loss or
expense which such Lender may incur or sustain directly as a result of such
prepayment, including, without limitation, an amount equal to (i) an amount of
interest which would have accrued on the amount so prepaid for the period
beginning on the date of such prepayment and ending on the last day of the
applicable LIBOR Period (such period, the "Breakage Period"), at the Applicable
LIBOR Rate minus (ii) the amount of interest (as reasonably determined by each
affected Lender) which would have accrued to such Lender on such amount by
placing such amount on deposit for the Breakage Period with leading banks in the
London interbank market. All amounts owing to a Lender pursuant to this Section
3.9 shall be paid by the Borrower promptly upon written request therefor.
Section 3.10 Inability to Determine Interest Rate for LIBOR Loans.
In the event that the Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower) that (a) by reason of circumstances
affecting the London interbank market generally, adequate and reasonable means
do not exist for ascertaining LIBOR for any LIBOR Period with respect to (i) any
proposed Revolving Loan that the Borrower has requested be made as a LIBOR Loan,
(ii) any LIBOR Loans that will result from the requested conversion of all or
part of any ABR Loans into LIBOR Loans, or (iii) the continuation of any LIBOR
Loan as such for an additional LIBOR Period, (b) LIBOR determined or to be
determined for any LIBOR Period will not adequately and fairly reflect the cost
to the Lenders of making or maintaining their affected LIBOR Loans during such
LIBOR Period by reason of circumstances affecting the London interbank market
generally or (c) dollar deposits in the relevant amount and for the relevant
period with respect to any such LIBOR Loan are not available to the Agent in the
London interbank market, then the Agent shall, prior to the requested Funding
Date or the conversion date or the last day of the then applicable LIBOR Period,
as the case may be, notify the Borrower (by telephone or otherwise, confirmed in
writing), with a copy to the Lenders, of such determination. If the Agent shall
have given such notice, then (x) any requested LIBOR Loans shall be made as ABR
Loans, (y) any ABR Loans that were to have been converted to LIBOR Loans shall
be continued as ABR Loans, and (z) any outstanding LIBOR Loans shall be
converted, on the last
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day of the then current LIBOR Period applicable thereto, into ABR Loans. Until
such notice has been withdrawn by the Agent, no further LIBOR Loans shall be
made and no ABR Loans shall be converted to LIBOR Loans.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.1 Conditions Precedent to Effective Date. This
Agreement, and the Revolving Loan Commitment of the Lenders hereunder, shall
become effective at a closing at the offices of ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, only on the Business Day (the
"Effective Date") on which all of the following conditions precedent shall have
been fulfilled to the satisfaction of the Lenders; provided, however, that in
the event the Effective Date shall have not occurred on or prior to July 31,
2000, the Lenders shall have no further obligations hereunder:
(i) Delivery of Certain Documents, Instruments, etc. The Agent, on
behalf of the Lenders, shall have received from the Borrower the
following instruments, agreements, certificates and payments, as the case
may be, on or prior to the Effective Date:
(A) Revolving Notes. A Revolving Note, dated on or prior to
the Effective Date, payable to the order of each Lender in the
amount of such Lender's Pro Rata Share of the Revolving Loan
Commitment and duly executed by the Borrower;
(B) Validity of Existing Security Agreements. The Borrower
Security Agreement and the separate Subsidiary Security Agreements
executed in favor of the Agent by, respectively, the Borrower,
▇▇▇▇▇▇ Bailly Services, Inc., HB Capital, Inc., Private Label
Energy Services, Inc., PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., GKMG, Inc. and
GKMG Consulting Services, Inc. shall be in full force and effect
and all uniform commercial code financing statements filed in
connection therewith naming the Borrower or such Subsidiary, as
the case may be, as Debtor and the Agent as secured party shall
remain valid and effective and shall not have lapsed, and each
such Subsidiary shall have delivered to the Agent a certificate,
dated the Effective Date, certifying that the collateral pledged
thereunder by the Borrower and such Subsidiary, as the case may
be, shall serve as collateral for the obligations of the Credit
Parties under the Credit Documents;
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(C) Amended and Restated Subsidiary Guarantee. The
Subsidiary Guarantee, dated on or prior to the Effective Date,
duly executed in favor of the Agent by each of ▇▇▇▇▇▇ Bailly
Services, Inc., HB Capital, Inc., Private Label Energy Services,
Inc., PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., GKMG, Inc., GKMG Consulting
Services, Inc. and ▇▇▇▇▇▇ Bailly Risk Advisors, Inc.;
(D) Swing Line Note. A Swing Line Note, dated on or prior
to the Effective Date, payable to the order of Bank of America,
N.A., in the amount of $5,000,000.00 and duly executed by the
Borrower;
(E) Subsidiary Security Agreement. A Subsidiary Security
Agreement, dated on or prior to the Effective Date, duly executed
in favor of the Agent by ▇▇▇▇▇▇ ▇▇▇▇▇▇ Risk Advisors, Inc.;
(F) Financing Statements. All uniform commercial code
financing statements shall have been filed, and all other actions
(including, without limitation, the filing of notices of
assignment with the United States government, as required by the
Lenders) shall have been taken, as shall be necessary or advisable
to effect the perfection of the Agent's security interest in the
collateral pledged or assigned under the Subsidiary Security
Agreement executed by ▇▇▇▇▇▇ Bailly Risk Advisors, Inc.;
(G) Legal Opinions. The Agent shall have received (i) an
opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇, L.L.P., special counsel to the Credit
Parties, dated the Effective Date and addressed to the Agent and
the Lenders, covering such matters incident to the transactions
contemplated by the Credit Documents as the Lenders shall
reasonably request and in form and substance satisfactory to the
Lenders and their counsel, and (ii) an opinion of ▇▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, Esq., General Counsel of the Borrower, dated the
Effective Date, addressed to the Agent and the Lenders, covering
such matters incident to the transactions contemplated by the
Credit Documents as the Lenders shall reasonably request and in
form and substance satisfactory to the Lenders and their counsel.
Each such opinion will permit the reliance thereon by any
financial institution that becomes a party to the Credit Documents
following the execution thereof by way of assignment;
(H) Resolutions. A certified copy of the resolutions of the
Board of Directors of each Credit Party authorizing the execution
and delivery of the Credit Documents to which it is a party;
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(I) Charter Documents. A copy of the charter documents and
by-laws of each Credit Party, together with all amendments
thereto, certified by the Secretary of such Credit Party as being
true, complete and correct and in effect as of the Effective Date,
or a certificate of the Secretary of such Credit Party to the
effect that copies of such charter documents and by-laws
previously delivered to the Lenders remain true, correct and
complete;
(J) Incumbency Certificate. An incumbency certificate of
the Secretary, an Assistant Secretary or an Assistant Treasurer of
each Credit Party certifying the names and true signatures of each
officer of such Credit Party authorized to execute the Credit
Documents to which such Credit Party is a party;
(K) Compliance Certificate. A certificate of an Authorized
Officer of the Borrower, dated the Effective Date, certifying that
the matters contained in clauses (iii), (iv) and (v) of Section
4.2 hereof are true and correct; and
(L) Insurance. A certificate of an Authorized Officer of
the Borrower, dated the Effective Date, certifying, in form and
substance reasonably satisfactory to the Lenders, the Borrower's
compliance with Section 6.1(m) hereof, having attached to such
certificate a summary in reasonable detail of the Borrower's and
its Subsidiaries' insurance coverage. The Borrower shall deliver
an insurance report, in form and substance reasonably acceptable
to the Lenders, of an independent insurance broker as to due
compliance as of the Effective Date with Section 6.1(m) hereof.
(ii) Financial Disclosure. The Borrower shall have disclosed to
the Lenders promptly from time to time any material developments or
changes in the Borrower and its Subsidiaries', taken as a whole,
business, assets, results of operations, condition (financial or
otherwise) or prospects, including without limitation amendments to their
charter documents or the Borrower's Form 10-K or 10-Q and the exhibits
thereto, and any material amendments, changes or terminations of any
material contracts or the award of or loss of any material bid or
proposal. Any such material developments, changes or amendments shall not
have affected adversely the assumptions contained in the credit analysis
of the Borrower performed by the Lenders prior to the execution of this
Agreement or resulted in a material adverse change since December 31,
1999 in the business, assets, results of operations, condition (financial
or otherwise) or prospects of the Borrower and its Subsidiaries, taken as
a whole;
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(iii) Financial Statements. The Borrower shall have delivered to
the Lenders (A) the Borrower's Form 10-K for the Fiscal Year ended
December 31, 1999 and Form 10-Q for the Fiscal Quarters ended March 31,
2000, and (B) such other unaudited consolidated financial statements of
the Borrower and its Subsidiaries as any Lender shall reasonably request,
together with, in each case, an officer's certificate, dated the
Effective Date, from each of the Borrower's Chief Financial Officer and
Treasurer, stating that, to their personal knowledge after having
performed such due diligence as would customarily be performed by a
corporate officer in their position but no additional due diligence, the
Borrower's Form 10-K and Form 10-Qs and unaudited consolidated financial
statements, if any, attached thereto as of the Effective Date do not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading;
(iv) Legal Matters. All legal matters incident to this Agreement
shall be satisfactory to counsel for the Lenders, and the Borrower shall
have reimbursed the Lenders for their fees and expenses and the fees and
expenses of the Lenders' counsel in connection with the preparation or
review, as the case may be, of the Credit Documents and all matters
incident thereto (it being understood that such statement may not reflect
the final statement of fees and expenses incurred by the Lenders' counsel
in connection with such preparation or review);
(v) Schedules. All schedules delivered hereunder by the Borrower -
shall be in form and substance satisfactory to the Lenders;
(vi) Due Diligence. The Lenders shall have completed their due
diligence review of the Borrower and its Subsidiaries, including their
business, assets, results of operations, condition (financial or
otherwise), prospects, liabilities (both actual and contingent, including
environmental liabilities), management and affairs, and the results
thereof shall have been satisfactory to the Lenders in their sole
discretion;
(vii) Fee. Bank of America, N.A. shall have received from the
Borrower, by wire transfer of immediately available funds to an account
designated by Bank of America, N.A., a fee payable by the Borrower in the
amount of $57,500.00;
(viii) Miscellaneous. The Lenders shall have received such other
documents, instruments, certificates, opinions, agreements and
information as the Lenders or their counsel shall reasonably request in
their discretion in connection with the consummation of the transactions
contemplated by this
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Agreement (including, without limitation, current consolidated and
consolidating financial statements of the Borrower and its Subsidiaries,
a report describing the aggregate amount and current age status of
accounts receivable and payable of the Borrower and its Subsidiaries, a
report describing the current status of goods or services on backlog with
the Borrower or any Subsidiary thereof and a report describing the status
of pending or threatened litigation).
Section 4.2 Further Conditions Precedent to Revolving Loans and
Standby Letters of Credit. The obligation of the Agent, on behalf of the
Lenders, to make any Revolving Loan, the obligation of the Swing Line Lender to
make any Swing Line Loan, and the obligation of the Issuing Lender to issue any
Standby Letter of Credit shall be subject to the fulfillment to the satisfaction
of the Lenders, in the case of Revolving Loans and Standby Letters of Credit,
and the Swing Line Lender, in the case of Swing Line Loans, of the further
conditions precedent that, on the Funding Date for such Revolving Loan or Swing
Line Loan or the issuance date for such Standby Letter of Credit, as the case
may be:
(i) Notice; Borrowing Base Certificate. In the case of any
Revolving Loan or Standby Letter of Credit, the Agent shall have received
a Borrowing Notice (except as otherwise provided in the last sentence of
Section 2.2(a) of this Agreement) in accordance with Section 2.2(a) or
the Issuing Lender shall have received a request for a Standby Letter of
Credit in accordance with Section 2.3(c), as the case may be, in each
case executed by an Authorized Officer of the Borrower (or other officer
of the Borrower designated by such Authorized Officer as having authority
to execute such notice) and having attached thereto the Borrowing Base
Certificate then in effect;
(ii) Payment of Obligations. The prospect of payment of all
obligations and liabilities outstanding or to become outstanding under
this Agreement is not impaired due to acts or events materially bearing
upon the financial condition of the Borrower, as determined by the
Required Lenders in their sole discretion;
(iii) No Material Adverse Change. Since the date of the most
recent financial statements or projections provided to the Lenders, there
shall have been no material adverse change in the Borrower's and the
Guarantors' (taken as a whole) financial condition or in the Borrower's
and the Guarantors' (taken as a whole) assets or prospects, in each case
as determined by the Required Lenders in their sole discretion;
(iv) Representations and Warranties. The representations and
warranties of each Credit Party in the Credit Documents are true and
correct
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as of such Funding Date (or, in the case of Standby Letters of Credit,
the date of issuance thereof) as though made on and as of such Funding
Date (or, in the case of Standby Letters of Credit, the date of issuance
thereof), except to the extent such representations and warranties relate
solely to an earlier date, in which case such representations and
warranties shall be true and correct as of such earlier date (and, if any
such representation and warranty shall not be true and correct, the
Borrower shall describe in writing to the Agent the nature of such
misrepresentation and warranty);
(v) No Event of Default. No event has occurred and is continuing,
or would result from such Revolving Loan or Swing Line Loan after giving
effect to the application of the proceeds therefrom or from the issuance
of such Standby Letter of Credit if the beneficiary thereof were to fully
draw upon such Standby Letter of Credit on the date of issuance, which
constitutes an Event of Default or would constitute a Potential Event of
Default;
(vi) Maximum Available Amount. After giving effect to the making
of such Revolving Loan or Swing Line Loan on the Funding Date thereof or
the issuance of such Standby Letter of Credit on the issuance date
thereof, the Total Outstanding Amount shall not exceed the Maximum
Available Amount; and
(vii) Officer's Certificate. In the case of any Revolving Loan or
Standby Letter of Credit, the Agent shall have received a certificate,
addressed to the Lenders, of an Authorized Officer of the Borrower, dated
the date of the Borrowing Notice, certifying that the matters contained
in clauses (iii), (iv), (v) and (vi) of this Section 4.2 are true and
correct.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Agent to enter into this
Agreement and make the Revolving Loans and Swing Line Loans contemplated by the
terms hereof, the Borrower represents and warrants with respect to itself and
its Subsidiaries, as the context shall require, as of the date hereof and as of
the Effective Date that:
Section 5.1 Existence, Power and Authority. The Borrower and each
Subsidiary thereof is a corporation or other entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with full corporate or company power and
authority to carry on its business as currently conducted and to own or hold
under lease its property; the
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Borrower and each Subsidiary thereof is duly qualified to do business as a
foreign corporation or other entity in good standing in each other jurisdiction
in which the conduct of its business or the maintenance of its property requires
it to be so qualified and where the failure to be so qualified would have a
material adverse effect on the financial condition, business or operation of the
Borrower or such Subsidiary; and, the Borrower and the other Credit Parties have
full power and authority (corporate or otherwise) to execute and deliver the
Credit Documents to which they are a party and to carry out the transactions
contemplated thereby.
Section 5.2 Authorization; Enforceable Obligations. Each Credit
Document to which the Borrower and the other Credit Parties are a party has been
duly authorized, executed and delivered (or will, on the Effective Date, be duly
authorized, executed and delivered) by the Borrower and such other Credit
Parties and constitutes the legal, valid and binding obligation of the Borrower
and such other Credit Parties, enforceable against the Borrower and such other
Credit Parties in accordance with its terms (except as such enforceability may
be limited by general principles of the law of equity or by any applicable
bankruptcy, reorganization, insolvency, moratorium or similar laws and laws
affecting creditors' rights generally).
Section 5.3 No Legal Bar. The execution, delivery and performance
by the Borrower and the other Credit Parties of the Credit Documents to which
they are a party (i) do not or will not violate the certificate of incorporation
(including any preferred stock designations or provisions incorporated therein
or attached thereto), by-laws or other charter or formation document of the
Borrower or such other Credit Parties, (ii) do not or will not violate or
conflict with any law, governmental rule or regulation or any judgment, writ,
order, injunction, award or decree of any court, arbitrator, administrative
agency or other governmental authority applicable to the Borrower or such other
Credit Parties, or any indenture, mortgage, contract, agreement or other
undertaking or instrument to which the Borrower or such other Credit Parties is
a party or by which their respective property may be bound and (iii) do not and
will not result in the creation or imposition of any lien, mortgage, security
interest or other encumbrance on any of its property pursuant to the provisions
of any such indenture, mortgage, contract, agreement or other undertaking or
instrument other than pursuant to the Credit Documents.
Section 5.4 Consents. The execution, delivery and performance by
the Borrower and the other Credit Parties of the Credit Documents to which they
are a party do not require any consent, which has not been obtained, of any
other Person (including, without limitation, stockholders of the Borrower or
such other Credit Parties) or any consent, license, permit, authorization or
other approval of, any giving of notice to, exemption by, any registration,
declaration or filing with, or any
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taking of any other action in respect of, any court, arbitrator, administrative
agency or other governmental authority.
Section 5.5 Litigation. Except as set forth on Schedule 5.5
hereto, there is no action, suit, investigation or proceeding by or before any
court, arbitrator, administrative agency or other governmental authority pending
or, to the knowledge of the Borrower or the Subsidiaries, threatened (i) which
involves any of the transactions contemplated by this Agreement or any other
Credit Document or (ii) against or affecting the Borrower or any Subsidiary
thereof which, if adversely determined against the Borrower or such Subsidiary,
would result in a judgment of $400,000 or more or, if such action, suit,
investigation or proceeding does not seek money damages, could in the reasonable
judgment of the Borrower materially adversely affect the financial condition,
business or operation of the Borrower or such Subsidiary.
Section 5.6 No Default. Except as set forth on Schedule 5.6
hereto, neither the Borrower nor any Subsidiary thereof is in default under any
order, writ, injunction, award or decree of any court, arbitrator,
administrative agency or other governmental authority binding upon it or its
property, or any indenture, mortgage, or other undertaking or instrument of
indebtedness or any material contract, agreement or other arrangement, to which
it is a party or by which its property may be bound, and nothing has occurred
which would materially adversely affect the ability of any of them to carry on
their respective business or perform their respective obligations under any such
order, writ, injunction, award or decree or any such indenture, mortgage, or
other undertaking or instrument of indebtedness or any material contract,
agreement or other arrangement.
Section 5.7 Financial Condition. The financial statements of the
Borrower (including the Borrower's Form 10-K and Form 10-Q) and its
Subsidiaries, copies of which have been furnished to the Lenders, were prepared
in accordance with GAAP and are complete and correct and fairly and accurately
present the financial condition of the Borrower and its Subsidiaries (taken as a
whole) as of their dates and the results of their operations for the periods
then ended. There has been no material adverse change in the financial condition
of the Borrower and its Subsidiaries (taken as a whole) or the results of their
operations since the date of such financial statements.
Section 5.8 Use of Proceeds. None of the proceeds of any Revolving
Loan have been or will be used to purchase or carry, or reduce or retire or
refinance any credit incurred to purchase or carry, any margin stock (within the
meaning of Regulations G, T, U and X of the Board of Governors of the Federal
Reserve system) or to extend credit to others for the purchasing or carrying of
any margin stock.
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Neither the Borrower nor any of its Subsidiaries is engaged in the business of
extending credit for the purpose of purchasing or carrying any margin stock.
Section 5.9 Borrower Not an Investment Company. Neither the
Borrower nor any of its Subsidiaries is an "investment company", or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.
Section 5.10 Taxes. The Borrower and its Subsidiaries have filed
or caused to be filed all tax returns which are required to be filed by them and
have paid or caused to be paid all taxes which have been shown to be due and
payable by such returns or (except to the extent being contested in good faith
and for the payment of which adequate reserves have been provided) tax
assessments received by the Borrower or any Subsidiary thereof to the extent
that such taxes have become due and payable.
Section 5.11 Environmental Matters. The Borrower and its
Subsidiaries conduct their respective operations in compliance with all
applicable laws and regulations concerning the discharge of substances into the
environment and other environmental control matters, except to the extent that
non-compliance would not have a material adverse effect on the business, results
of operations or condition (financial or otherwise) of the Borrower and the
Guarantors (taken as a whole). Neither the Borrower nor any Subsidiary thereof
has any liability, contingent or otherwise, under any law, ordinance or
regulation relating to the storage, transport, disposal or release of "oil",
"petroleum products", "hazardous substance", "hazardous waste", "hazardous
material", "hazardous chemical substance", "refuse" or any other term of similar
import (as such terms are defined in any such law, ordinance or regulation)
(collectively, "Hazardous Substances"), except to the extent that any such
liability would not have a material adverse effect on the business, results of
operations or condition (financial or otherwise) of the Borrower and the
Guarantors (taken as a whole).
Section 5.12 Subsidiaries. Set forth on Schedule 5.12 hereof is a
complete and correct list of all Subsidiaries of the Borrower as of the date
hereof together with, for each such Subsidiary, (i) the jurisdiction of
organization of such Subsidiary, (ii) each Person holding ownership interests in
such Subsidiary and (iii) the nature of the ownership interests held by each
Person and percentage of ownership of such Subsidiary represented by such
ownership interests. Except as disclosed on Schedule 5.12 hereof, (x) each of
the Borrower and its Subsidiaries owns, free and clear of Liens (other than (A)
any Liens created pursuant to the Credit Documents and (B) Liens for taxes and
assessments not yet due), and has the unencumbered right to vote, all
outstanding ownership interests in each Person shown to be held by it on
Schedule 5.12 hereof, (y) all of the issued and outstanding
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shares of capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable, and (z) there are no outstanding
Equity Rights with respect to such Person except for such Equity Rights as are
set forth on Schedule 5.12 hereof. As of the date hereof, (i) no Foreign
Subsidiary of the Borrower has annual revenues of $10,000,000.00 or more, and
(ii) the total revenues or profits of all Foreign Subsidiaries of the Borrower
for any quarterly or annual period ended prior to the date hereof have not
comprised more than 20% of the total revenues or profits of the Borrower and its
Consolidated Subsidiaries. As of the Effective Date, no Domestic Subsidiary of
the Borrower constitutes a Material Domestic Subsidiary other than those
Subsidiaries of the Borrower listed on Schedule 5.12 and specifically identified
as Material Domestic Subsidiaries.
Section 5.13 Computer Systems. All computer applications and
systems owned or operated by the Borrower or any of its Subsidiaries perform,
operate and function in a manner sufficient to enable the Borrower and its
Subsidiaries to operate their businesses (i) without material delay or
malfunction or (ii) in a manner that would not result in a material adverse upon
the effect financial condition or results of operations of the Borrower and its
Consolidated Subsidiaries, taken as a whole.
Section 5.14 Ownership of Property; Liens. Neither the Borrower
nor any of its Subsidiaries owns any real property, except as set forth on
Schedule 5.14 hereof. The Borrower and each of its Subsidiaries has valid
leasehold interests in all its respective material real property purported to be
leased by it, and has good title to all its respective material other property
purported to be owned by it, and none of such property is subject to any Lien,
except as permitted by Section 6.2(a) hereof, and all of such property taken as
a whole is sufficient in all material respects for the Borrower and its
Subsidiaries to conduct their respective business as it has been and is
presently being conducted by them.
Section 5.15 Public Utility Holding Company Act. Neither the
Borrower nor any Subsidiary thereof is a "holding company", or an affiliate of a
"holding company" or a "subsidiary company" of a "holding company", within the
meaning of the Public Utility Holding Company Act of 1935, as amended.
ARTICLE VI
COVENANTS
Section 6.1 Affirmative Covenants. The Borrower covenants and
agrees for itself and its Subsidiaries (in which case the Borrower shall cause
such Subsidiaries to take or refrain from taking the actions described below)
that, so long as this Agreement shall remain in effect or any Obligation shall
remain unpaid:
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(a) Audited Annual Financials. The Borrower shall deliver to the
Agent and each Lender, as soon as available but within 120 days of the end of
each fiscal year of the Borrower ending December 31 (each such year, a "Fiscal
Year"), a full and complete set of the annual audited consolidated financial
statements (including statements of financial condition, income, cash flows and
changes in shareholders' equity), together with all notes thereto, of the
Borrower and its Consolidated Subsidiaries prepared in accordance with GAAP and
certified by an independent accounting firm of national recognition reasonably
acceptable to the Required Lenders (which certificate shall be accompanied by an
unqualified opinion of such accounting firm of such statements). The audited
financial statement required to be delivered under this clause (a) shall be
accompanied by a certificate of any Authorized Officer of the Borrower to the
effect that the Borrower and the other Credit Parties are in compliance with all
covenants contained in this Agreement (including the financial ratios contained
in this Section 6.1) and the other Credit Documents and that no Event of Default
or Potential Event of Default has occurred and is continuing hereunder.
(b) Quarterly and Monthly Financial Statements and Reports.
(i) Quarterly Financial Statements. The Borrower shall
deliver to the Agent and each Lender, as soon as available but within 45
days following the end of each of the Borrower's Fiscal Quarters,
internally prepared consolidated and consolidating financial statements
of the Borrower and its Consolidated Subsidiaries (including a balance
sheet, income statement and statement of cash flows), together with a
statement computing
(A) the ratio of Funded Debt to EBITDA pursuant to
Section 6.1(e) hereof,
(B) demonstrating that the Borrower and its
Consolidated Subsidiaries shall have maintained the required
amount of EBITDA pursuant to Section 6.1(f) hereof and
(C) computing the Fixed Charge Coverage Ratio
pursuant to Section 6.1(g) hereof, in each case as of the end of
such Fiscal Quarter.
The financial statements and reports required to be
delivered under this clause (b) (i) shall be accompanied by a
certificate of an Authorized Officer of the Borrower to the effect
that the information contained therein is true and accurate as of
the date of such certificate, that the Borrower and the other
Credit Parties are in compliance with all covenants contained in
this Agreement (including
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the financial ratios contained in this Section 6.1) and the other
Credit Documents and that no Event of Default or Potential Event
of Default has occurred and is continuing hereunder.
(ii) Monthly Borrowing Base Certificate; Receivables
and Payables Report, etc. The Borrower shall deliver to the Agent and
each Lender, as soon as available but within 20 days following the end of
each of month, a borrowing base certificate, substantially in the form of
Exhibit F hereto (the "Borrowing Base Certificate"), together with (A) a
report detailing the aggregate amount and current age status of accounts
receivable and payable, together with a report detailing all unbilled
receivables (which shall specify, among other things, the contract to
which the unbilled receivable relates and the date on which such unbilled
receivable is expected to be billed), of the Borrower and any of its
Consolidated Subsidiaries, in each case in a form reasonably acceptable
to the Agent, and (B) the Federal Contract (as defined in the Borrower
Security Agreement and each Subsidiary Agreement) list as provided
pursuant to Section 4.21 of the Borrower Security Agreement and each
Subsidiary Security Agreement (notwithstanding any requirement thereunder
to deliver list less frequently than monthly), together with such other
backlog information, in form reasonably acceptable to the Agent, relating
to the Borrower and its Consolidated Subsidiaries as the Agent shall
reasonably request. The financial statements and reports required to be
delivered under this clause (b)(ii) shall be accompanied by a certificate
of an Authorized Officer of the Borrower to the effect that the
information contained therein is true and accurate as of the date of such
certificate.
(c) Exchange Act and Securities Act Filings. The Borrower shall
deliver to each Lender and the Agent, within 5 days following the filing with
the SEC, copies of all filings by it or any of its Subsidiaries under the
Exchange Act (including reports on Forms 10-Q, 10-K and 8-K) and registration
statements filed with the SEC under either the Securities Act or the Exchange
Act. The Borrower shall deliver to each Lender and the Agent copies of all of
the Borrower's annual reports and proxy statements and, at the request of such
Lender, any other shareholder communication.
(d) Tax Forms. From time to time, the Borrower shall cause each of
its Foreign Subsidiaries to cooperate with each Lender and shall execute and
deliver to such Lender in a timely manner such forms (including Internal Revenue
Service Forms) and certificates as such Lender shall reasonably request, in each
case for the purpose of confirming that such Lender is capable, under the
provisions of any applicable tax treaty concluded with the United States of
America or any other applicable law, of receiving payments of interest hereunder
without deduction
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or withholding of any tax. In the event that any such tax shall be required to
be withheld or deducted, the Borrower shall pay to such Lender an amount that
would fully indemnify such Lender for such withheld or deducted amount.
(e) Funded Debt to EBITDA Ratio. The Borrower and its Consolidated
Subsidiaries, taken as a whole, shall maintain, for (and at all times during)
each Fiscal Quarter beginning with the Fiscal Quarter ended March 31, 2000 (the
"Initial Fiscal Quarter"), a ratio of Funded Debt to EBITDA of not greater than
3.00 to 1.00. The ratio contemplated by this clause (e) shall be computed on the
basis of a rolling four quarter period and shall include the results of
operations for the Fiscal Quarter for which such ratio shall be determined plus
the immediately preceding three Fiscal Quarters; provided, however, that to the
extent that any Acquisition Party acquired in accordance with Section 6.2(e)
hereof shall not constitute a Subsidiary for a period falling within such
rolling four quarters at the time of the determination of this ratio, then
EBITDA for the purposes of this ratio shall include, for such rolling four
quarter period as it relates to such Acquisition Party, (i) the pro forma EBITDA
of such Acquisition Party for that portion of the rolling four quarter period
during which such Acquisition Party was not a Subsidiary of the Borrower, and
(ii) the actual EBITDA of such Acquisition Party for that portion of the rolling
four quarter period during which such Acquisition Party constitutes a Subsidiary
of the Borrower. For the purposes of illustration of the proviso to the
preceding sentence, if an Acquisition Party is acquired on March 31, 2001 and
the ratio contemplated by this clause (e) shall be determined for the period
ending June 30, 2001, then such Acquisition Party's pro forma EBITDA as it
existed prior to the acquisition for the quarters ending September 30, 2000,
December 31, 2000 and March 31, 2001, together with such Acquisition Party's
actual EBITDA as a Subsidiary of the Borrower for the quarter ending June 30,
2001, shall be taken into account for the purposes of calculating this ratio.
Notwithstanding anything contained in this Section 6.1(e) to the contrary, the
Funded Debt to EBITDA ratio for the Fiscal Quarters ending June 30 and September
30, 2000 shall be determined by (i) in the case of the Funded Debt to EBITDA
ratio for the Fiscal Quarter ending June 30, 2000, annualizing the Borrower's
and its Consolidated Subsidiaries' results of operations from the period
beginning on January 1, 2000 and ending on June 30, 2000, and (ii) in the case
of the Funded Debt to EBITDA ratio for the Fiscal Quarter ending September 30,
2000, annualizing the Borrower's and its Consolidated Subsidiaries' results of
operations from the period beginning on January 1, 2000 and ending on September
30, 2000.
(f) Minimum EBITDA. The Borrower and its Consolidated
Subsidiaries, taken as a whole, shall for each Fiscal Quarter have EBITDA during
such Fiscal Quarter of not less than $2,500,000.00.
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(g) Fixed Charge Coverage Ratio. The Borrower and its Consolidated
Subsidiaries, taken as a whole, shall at all times maintain, for (and at all
times during) each Fiscal Quarter (i) beginning with the Initial Fiscal Quarter
and through and including the Fiscal Quarter ending September 30, 2000, a ratio
of Consolidated Cash Flow to Consolidated Fixed Charges of not less than 1.25 to
1.00 and (ii) for each Fiscal Quarter ending after September 30, 2000, a ratio
of Consolidated Cash Flow to Consolidated Fixed Charges of not less than 1.50 to
1.00. The ratio contemplated by this clause (g) shall be computed on the basis
of a rolling four quarter period and shall include the results of operations for
the Fiscal Quarter for which such ratio shall be determined plus the immediately
preceding three Fiscal Quarters; provided, however, that to the extent that any
Acquisition Party acquired in accordance with Section 6.2(e) hereof shall not
constitute a Subsidiary for a period falling within such rolling four quarters
at the time of the determination of this ratio, then Consolidated Cash Flow for
the purposes of this ratio shall include, for such rolling four quarter period
as it relates to such Acquisition Party, (i) the pro forma Cash Flow of such
Acquisition Party for that portion of the rolling four quarter period during
which such Acquisition Party was not a Subsidiary of the Borrower, and (ii) the
actual Cash Flow of such Acquisition Party for that portion of the rolling four
quarter period during which such Acquisition Party constitutes a Subsidiary of
the Borrower. For the purposes of illustration of the proviso to the preceding
sentence, if an Acquisition Party is acquired on March 31, 2001 and the ratio
contemplated by this clause (g) shall be determined for the period ending June
30, 2001, then such Acquisition Party's pro forma Cash Flow as it existed prior
to the acquisition for the quarters ending September 30, 2000, December 31, 2000
and March 31, 2001, together with such Acquisition Party's actual Cash Flow as a
Subsidiary of the Borrower for the quarter ending June 30, 2001, shall be taken
into account for the purposes of calculating this ratio. Notwithstanding
anything contained in this Section 6.1(g) to the contrary, the Fixed Charge
Coverage Ratio for the Fiscal Quarters ending June 30 and September 30, 2000
shall be determined by (i) in the case of the Fixed Charge Coverage Ratio for
the Fiscal Quarter ending June 30, 2000, annualizing the Borrower's and its
Consolidated Subsidiaries' results of operations from the period beginning on
January 1, 2000 and ending on June 30, 2000, and (ii) in the case of the Fixed
Charge Coverage Ratio for the Fiscal Quarter ending September 30, 2000,
annualizing the Borrower's and its Consolidated Subsidiaries' results of
operations from the period beginning on January 1, 2000 and ending on September
30, 2000.
(h) Proceeds. The Borrower shall use the proceeds of the Revolving
Loans, the Swing Line Loans and the Standby Letters of Credit for general
corporate purposes, including financing the general working capital requirements
of the Borrower (the "Permitted Uses") and for no other purpose.
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(i) Payment of Debts and Taxes. The Borrower and its Subsidiaries
shall pay all debts, liabilities, taxes, assessments and other governmental
charges when due in the ordinary course; provided, however, that no such debt,
liability, tax, assessment or other governmental charge need be paid if such is
being contested in good faith by appropriate legal proceedings promptly
initiated and diligently conducted and if such reserves or other appropriate
provision, if any, as shall be required by GAAP shall have been made therefor.
(j) Conduct of Business. The Borrower and its Subsidiaries shall
continue to engage in business of the same general type as now conducted by the
Borrower or such Subsidiary. The Borrower and its Subsidiaries will conduct and
manage their respective business and affairs in the ordinary course, and shall
take all steps necessary and reasonable for the purpose of preserving the value
of their respective business and assets.
(k) Preservation of Corporate Existence. Except as otherwise
permitted pursuant to Section 6.2(e) hereof, the Borrower and its Subsidiaries
shall at all times preserve and keep in full force and effect their respective
corporate existence and their respective rights, privileges, licenses and
franchises which are necessary in the normal conduct of their business.
(l) Books and Records. The Borrower and its Subsidiaries shall at
all times keep and maintain complete and accurate books, accounts and records of
its operations and affairs in accordance with customary and sound business
practices, and shall permit each Lender and the Agent and their respective
officers, employees, agents and representatives to, from time to time upon
reasonable notice and during normal business hours, have access to its place of
business, examine such books, accounts and records and make copies thereof (at
such Lender's and the Agent's expense unless an Event of Default has occurred
and is continuing) and discuss the affairs and finances of the Borrower or its
Subsidiaries with any of their respective officers or directors. Without
limiting the generality of the foregoing, the Agent and its representatives and
advisors shall have the right to perform, at the cost and expense of the
Borrower, an annual examination and audit of the books, records, processes and
systems of, and all collateral security pledged under any Credit Document by,
the Borrower and its Subsidiaries; provided, however, that in the event any
"Event of Default" shall have occurred and be continuing, the Lenders and the
Agent and their respective representatives and advisors shall be permitted to
conduct more than one such examination and audit during any annual period, as
requested by the Lenders, and the costs and expenses of such additional
examinations and audits shall be for the account of the Borrower.
(m) Insurance. The Borrower and its Subsidiaries shall carry or
cause to be carried in full force and effect, with financially sound and
reputable insurance
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companies and in amounts reasonably satisfactory to the Bank, policies of
insurance on all their property and general liability insurance in such amounts
and covering such risks as is consistent with sound business practice for
companies similarly situated and in the same or similar businesses. Any
insurance may be subject to deductibility or similar clauses which, in effect,
result in self-insurance of certain losses, provided that such self-insurance
under the insurance referred to above is in accord with the general practices of
companies similarly situated and adequate insurance reserves are maintained in
connection with such self-insurance. Any policies of insurance carried in
accordance with this Section 6.1(m) and any policies taken out in substitution
or replacement for any such policies shall (i) in the case of insurance against
loss or damage to property of the Borrower or its Subsidiaries, name the Agent
as loss payee (the "Loss Payee"), (ii) in the case of public liability
insurance, name the Agent as additional insured (the "Additional Insured"),
(iii) provide that in the case of any policies that contain any condition,
warranty or declaration (other than the failure to pay premiums) which, if
breached or violated prior to a loss, would void the insurance or allow the
underwriters to avoid liability under the policy, the insurance under such
policies shall not be invalidated, in respect to the respective interests of the
Loss Payee and the Additional Insured in such insurance, by any action or
inaction of the Borrower or its Subsidiaries, and shall insure the Loss Payee's
and the Additional Insured's interests, regardless of any breach or violation of
any warranty, declaration or condition contained in such policies by the
Borrower or any of its Subsidiaries, (iv) provide that, if such insurance is
cancelled for any reason whatsoever, or any substantial change is made in the
policy which affects the coverage certified to the Agent, or if such insurance
is allowed to lapse for nonpayment of premium, such cancellation, change or
lapse shall not be effective as to the Loss Payee and the Additional Insured for
30 days after receipt by the Agent of written notice from such insurer of such
cancellation, change or lapse, (v) provide that neither the Loss Payee nor the
Additional Insured shall have any obligation or liability for premiums,
commissions, assessments or calls in connection with such insurance, (vi)
provide that the insurers waive (A) any rights to set-off, counterclaims or any
other deduction, whether by attachment or otherwise, which they may have against
the Loss Payee or the Additional Insured, and (B) any rights of subrogation
against the Loss Payee or any Additional Insured, (vii) be primary without right
of contribution from any other insurance which may be carried by the Loss Payee
or any Additional Insured, and (viii) in the case of public liability policies,
provide that all provisions of such insurance, except the limits of liability
(which shall be borne solely by the Borrower) shall operate in the same manner
as if there were a separate policy covering each named insured. The Borrower
will furnish to the Agent upon request full information as to all insurance
carried by the Borrower or any Subsidiary.
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(n) Compliance with Laws. The Borrower and its Subsidiaries shall
comply with all applicable laws, rules, regulations and orders of any
governmental or regulatory body or authority, a breach of which could have a
material adverse effect on the financial condition or business of the Borrower
and its Subsidiaries taken as a whole.
(o) Lending Relationship with the Agent. The Borrower shall
maintain its principal banking relationship with the Agent and shall maintain
with the Agent the Borrower Account.
(p) Borrower Ownership of Subsidiaries. The Borrower will, at all
times, either directly or indirectly own all of the outstanding shares of each
class of capital stock (or other equity interests) of each Subsidiary thereof;
provided, however, that (i) as of the date hereof in the case of ▇▇▇▇▇▇ ▇▇▇▇▇▇
Services (India) Ltd., the Borrower may own, directly or indirectly, not less
than 74% of such capital stock (or other equity interests) thereof and (ii) in
the case of any Foreign Subsidiary of the Borrower, not more than 5% of the
capital stock (or other equity interests) of such Foreign Subsidiary may be
owned by directors of such Foreign Subsidiary. So long as any Obligation remains
outstanding, the Borrower shall continue to consolidate the accounts of each its
Foreign and Domestic Subsidiaries on the consolidated financial statements of
the Borrower.
(q) Notice of Default. The Borrower shall, promptly after becoming
aware thereof, deliver to each Lender and the Agent notice of any Event of
Default and Potential Event of Default, and such notice shall contain an express
reference to this Agreement and that such notice is a "notice of an Event of
Default" or "notice of Potential Event of Default," as the case may be.
(r) Notice of Environmental Claims. The Borrower shall deliver to
each Lender and the Agent a copy of any notice or other communication (i)
alleging any violation by the Borrower or its Subsidiaries of any laws or
regulations concerning the discharge of substances into the environment and
other environmental control matters or (ii) under which the Borrower or its
Subsidiaries shall admit to any such violation. Each copy of any such notice
shall be delivered to the Lenders and the Agent promptly following the receipt
or issuance thereof by the Borrower or such Subsidiary.
(s) Seniority. Under applicable laws in force from time to time,
the claims and rights of the Lenders and the Agent against each Credit Party
under the Credit Documents will not be subordinate to, and will rank senior in
right of payment to, the claims and rights of each other creditor of each Credit
Party.
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(t) Lien Search. At the request of the Agent following the
Effective Date, the Borrower shall deliver to the Agent the results of a recent
search, upon the records maintained with the appropriate Secretary of State and
county or city recorder offices of all jurisdictions deemed advisable by the
Agent, regarding personal property, judgment and tax liens, if any, on file with
such offices and naming ▇▇▇▇▇▇ Bailly Risk Advisors, Inc. as a debtor.
(u) Maximum Available Amount. The Total Outstanding Amount shall
not at any time exceed the Maximum Available Amount.
(v) Pledge of Stock of Foreign Subsidiaries. (i) Upon the
occurrence of any Triggering Event pursuant to clause (a) thereof or (ii) at the
written request of the Agent to the Borrower upon the occurrence of any
Triggering Event pursuant to clause (b) or (c) thereof, the Borrower shall
pledge or cause its Subsidiary to pledge, as the case may be, within five (5)
Business Days of the occurrence of such Triggering Event or the Agent's request,
as the case may be, sixty-five percent (65%) of the outstanding shares of
capital stock (or other equity interests) of each Foreign Subsidiary as to which
such Triggering Event relates pursuant to one or more Pledge Agreements in favor
of the Agent and for the ratable benefit of the Lenders, which Pledge Agreements
shall be accompanied by such resolutions, incumbency certificates, stock powers
and legal opinions as are reasonably requested by the Agent and its counsel;
provided, however, (A) that if a Triggering Event pursuant to clause (b) thereof
shall have occurred, the Borrower shall, at the written request of the Agent,
pledge or cause to be pledged to the Agent sixty-five percent (65%) of the
outstanding shares of capital stock (or other equity interests) of such Foreign
Subsidiaries which, after giving effect to the pledge thereof, will result in
Agent having a pledge of such shares in respect of Foreign Subsidiaries of the
Borrower selected by the Agent whose revenues or profits comprise at least
eighty percent (80%) of the revenues or profits of all Foreign Subsidiaries of
the Borrower, and (B) that if a Triggering Event pursuant to clause (c) thereof
shall have occurred, the Borrower shall, at the written request of the Agent,
pledge or cause to be pledged to the Agent sixty-five percent (65%) of the
outstanding shares of capital stock (or other equity interests) of all Foreign
Subsidiaries of the Borrower.
(w) Execution of Subsidiary Security Agreements After the
Effective Date. With respect to each Domestic Subsidiary of the Borrower not a
party to a Subsidiary Security Agreement, at the written request of the Agent at
any time following the occurrence and continuance of an Event of Default or such
Domestic Subsidiary constituting a Material Domestic Subsidiary, the Borrower
shall from time to time cause each Domestic Subsidiary identified in the Agent's
request to execute and deliver in favor of the Agent, for the ratable benefit of
the Lenders, a Subsidiary Security Agreement not later than five (5) Business
Days following such request, which Subsidiary Security Agreement shall be
accompanied by such
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resolutions, incumbency certificates, financing statements (and other documents
or instruments as shall be reasonably required to perfect the security interest
created thereby) and legal opinions as are reasonably requested by the Agent and
its counsel.
(x) Merger with PA Holdings Limited. The Borrower acknowledges
that, as of the date hereof, the Lenders have not completed their due diligence
review of PA Holdings Limited and its assets, properties, financial condition,
prospects, business plans and otherwise in connection with the Borrower's
planned merger or consolidation (or other similar transaction) with and into PA
Holdings Limited or a Subsidiary thereof. The Borrower shall cooperate with all
reasonable requests of the Lenders to enable the Lenders to complete as soon as
practicable such due diligence review. In the event that the results of such due
diligence review shall not be satisfactory to the Required Lenders in their sole
discretion, the Required Lenders shall have the right, by the giving of not less
than thirty (30) days' written notice to the Borrower not later than thirty (30)
days' following the effective date of such merger or consolidation (or similar
transaction), to terminate this Agreement and the Revolving Loan Commitment,
whereupon all Outstandings, including all Loans, together with all interest
accrued thereon, and all other amounts owing hereunder, shall become due and
payable and any outstanding Letter of Credit shall be cash collateralized.
(y) Examination of the Borrower's Records. If (i) all
Outstandings, including all Loans, together with all interest accrued thereon,
and all other amounts owing hereunder (including all outstanding Letters of
Credit) shall not have been repaid or cash collateralized on or before September
30, 2000 and (ii) the Revolving Loan Commitment shall not have been terminated
by the Borrower pursuant to Section 2.5 hereof on or before such date, the
Borrower shall cooperate with all reasonable requests of such Lenders and the
Agent and their respective officers, employees and agents and representatives
for the purpose of facilitating an examination of the books, records, business
plans, operations, prospects and condition (financial and otherwise) of the
Borrower and its Subsidiaries. Such examination shall be conducted at the
expense of the Borrower during normal business hours upon the giving of not less
than fifteen (15) days' written notice to the Borrower by such Lender. In the
event that the results of such examination are not satisfactory to the Required
Lenders as determined in their sole discretion, then the Lenders shall have the
right, notwithstanding anything to the contrary contained herein and by giving
notice to the Borrower, to reduce the percentages for which Eligible Billed
Receivables and Eligible Unbilled Receivables are included in the Borrowing
Base.
Section 6.2 Negative Covenants. The Borrower covenants and agrees
for itself and its Subsidiaries (in which case the Borrower shall cause such
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Subsidiaries to take or refrain from taking the actions described below), that,
so long as this Agreement shall remain in effect or any Obligation shall remain
unpaid:
(a) Liens. The Borrower and its Subsidiaries shall not, directly
or indirectly, create, incur, assume, grant, pledge or permit to exist any Lien
on the property or assets of the Borrower and its Subsidiaries, taken as a
whole, whether now owned or hereafter acquired, or any income or profits
therefrom, other than:
(i) any Lien (other than a Lien arising out of a purchase money
security interest) which, together with all such other similar Liens, are
no greater than $250,000;
(ii) any Lien (A) which shall constitute a purchase money security
interest or (B) granted to or possessed by any financial institution or
insurance company (other than the Lenders) in connection with any surety
bond issued by such financial institution or insurance company in
connection with the performance of any contract to which the Borrower or
any Subsidiary is a party; provided that the amount of all such Liens
permitted by this clause (ii) shall not exceed (in the aggregate and as
to the Borrower and its Subsidiaries, taken as a whole) $1,000,000;
(iii) the security interests created under the Promissory Note and
Security Agreement, dated October 28, 1995, executed by GKMG, Inc.
(formerly named Galland, Kharasch, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, P.C.) in favor of
First Union National Bank of Washington, D.C. ("First Union") in
connection with that certain Loan Agreement, dated as of October 28, 1995
(the "First Union Loan Agreement"), between First Union and GKMG, Inc.
(formerly named Galland, Kharasch, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, P.C.); and
(iv) the Liens granted by or created under the Credit Documents.
(b) Indebtedness. Neither the Borrower nor its Subsidiaries shall,
directly or indirectly, create, incur or assume, or otherwise become or remain
directly or indirectly liable with respect to, any indebtedness (including any
Indebtedness), other than:
(i) the Indebtedness incurred by the Borrower hereunder and
evidenced by the Revolving Notes and the Swing Line Note and the
Indebtedness of the Guarantors under the Subsidiary Guarantee;
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(ii) trade debt, operating leases, accounts payable and other
similar indebtedness incurred in the ordinary course of the Borrower's or
its Subsidiaries' business;
(iii) the Indebtedness evidenced by the Standby Letters of Credit,
if any, issued by the Issuing Lender in accordance with Section 2.3
hereof;
(iv) (A) indebtedness constituting purchase money security
indebtedness or (B) indebtedness for, or reimbursement obligations
(whether contingent or accrued) in respect of, any surety bond issued by
a financial institution or insurance company (other than the Lenders) in
connection with the performance of any contract to which the Borrower or
any Subsidiary thereof is party; provided that the amount of all such
indebtedness permitted by this clause (iv) shall not exceed (in the
aggregate and as to the Borrower and its Subsidiaries, taken as a whole)
$1,000,000;
(v) any guarantee, suretyship agreement or other similar
arrangement entered into by the Borrower or any Guarantor effecting the
assumption or guarantee of a debt or obligation of or the endorsement of
any promissory note or other instrument or obligation of, any Guarantor
or the Borrower, in each case provided the underlying obligation so
guaranteed is entered into in the ordinary course of the Borrower's or
such Guarantor's business and is necessary and beneficial in connection
with the operation thereof;
(vi) the indebtedness described on Schedule 6.2(b) hereof;
(vii) term loan indebtedness under the First Union Loan Agreement
referred to in Section 6.2(a)(iii); provided that such indebtedness does
not exceed as of the Effective Date $50,000.00; and
(viii) indebtedness of the type described in clause (i) of Section
6.2(a) which does not exceed (in the aggregate and as to the Borrower and
its Subsidiaries, taken as a whole) the amount set forth in clause (i) of
Section 6.2(a).
(c) Capital Stock. Without the prior written consent of the
Required Lenders, neither the Borrower nor any Subsidiary thereof shall,
directly or indirectly, repurchase, redeem or retire any of their capital stock,
create new classes of capital stock, issue any capital stock or Equity Rights in
respect thereof, declare or pay any dividends (whether in cash or property) on
their capital stock, except that the Borrower may:
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(i) so long as the Funded Debt to EBITDA ratio computed for the
most recent Fiscal Quarter pursuant to Section 6.1(e) hereof shall not be
less than 2.00 to 1.00, repurchase from time to time the capital stock of
the Borrower provided such repurchases do not, throughout the term of
this Agreement, exceed in the aggregate $2,000,000 and, provided further,
that after giving effect to any such repurchase, the Borrower shall be in
compliance with all provisions of this Agreement (including, without
limitation, all financial ratios contained in Section 6.1 hereof based on
the financial statements most recently provided by the Borrower to the
Lenders);
(ii) any Subsidiary of the Borrower may declare and pay dividends
or make other distributions on its capital stock provided the proceeds
thereof are received by the Borrower or any Guarantor;
(iii) issue securities authorized under stock incentive plans
described in the Borrower's Form 10-K or Proxy Statement; and
(iv) issue shares of common stock of the Borrower at fair market
value (or an average fair market value as determined by reference to not
more than a 30-day period prior to the date of issuance of such common
stock) pursuant to any registration statement filed under the Securities
Act or an exemption therefrom, except as otherwise contemplated by clause
(iii) above.
(d) Loan. Neither the Borrower nor any Subsidiary thereof shall,
directly or indirectly, make any loans or advances to any corporate officers or
directors, or any employees, or any insiders or affiliates (as defined in the
Exchange Act) or to any Subsidiary of the Borrower not a party to the Subsidiary
Guarantee or to any other Person, other than:
(i) travel, relocation and other salary advances made in the
ordinary course of the Borrower's or its Subsidiaries' business;
(ii) loans of the proceeds of the Revolving Loans and the Swing
Line Loans to any Domestic Subsidiary of the Borrower that is not a party
to the Subsidiary Guarantee for the purpose of financing the acquisition
of any Acquisition Party as contemplated by, and in accordance with the
limitations contained in, Section 6.2(e) hereof (provided such Subsidiary
shall have become a party to the Subsidiary Guarantee in accordance with
Section 6.2(g) hereof);
(iii) loans to any officer of the Borrower; provided that the
aggregate amount of all loans made pursuant to this clause and
outstanding from time to time shall not exceed $1,000,000.00;
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(iv) loans to any Foreign Subsidiary of the Borrower if such
loans, together with all such other Foreign Subsidiary loans by the
Borrower and all other advances made by the Borrower to any Foreign
Subsidiary pursuant to Section 6.2(g) hereof and all receivables owing to
the Borrower from any Foreign Subsidiary, do not at any time exceed
$8,000,000.00; and
(v) loans or advances to any domestic joint venture company in
which the Borrower or any Subsidiary thereof owns at least one-third of
the equity interests therein provided the aggregate amount of all such
loans does not exceed $500,000.00.
(e) No Merger or Acquisition. Without the prior written consent of
the Required Lenders, neither the Borrower nor any Subsidiary thereof shall
acquire, whether by stock or asset purchase, merger, consolidation or other
business combination, any corporation, partnership, joint venture or other
business organization (any such entity, an "Acquisition Party"); provided,
however, that the Borrower or any direct or indirect Consolidated Subsidiary
thereof may acquire, either by way of stock or asset acquisition, merger,
consolidation or otherwise, one or more Acquisition Parties involved in a line
of business similar to the line of business of the Borrower if:
(i) the Acquisition Consideration (which shall consist only of
common stock of the Borrower and the assumption of debt, as provided
therein) paid for all Acquisition Parties shall not exceed, in the
aggregate, $10,000,000.00 less the aggregate amount of stock repurchases
effected as permitted by Section 6.2(c)(i) hereof;
(ii) the corporate headquarters of such Acquisition Party shall be
located in the continental United States of America unless such
Acquisition Party is a foreign Person and the acquisition thereof is
permitted by the terms of this Agreement;
(iii) such Acquisition Party's EBITDA shall, for the 12-month
period immediately preceding the acquisition of such Acquisition Party,
be greater than $0.00;
(iv) the Borrower and its Subsidiaries shall, after giving effect
to the acquisition of any such Acquisition Party as provided herein, be
in compliance with all of the terms of this Agreement including the
financial covenants described in Sections 6.1(e), 6.1(f) and 6.1(g)
hereof, as determined on a pro-forma basis;
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(v) such acquisition, merger, consolidation (or otherwise) is not
hostile or pursued by way of tender offer, proxy contest or other
contested manner (unless the Required Lenders shall have waived in
writing compliance with this clause (v));
(vi) during the term of this Agreement, Acquisition Parties that
are not organized under the laws of a state of the United States of
America or the District of Columbia may not be so acquired except to the
extent that the Acquisition Consideration permitted to be paid by
Borrower as provided in clause (i) hereof for all such Acquisition
Parties does not exceed $4,000,000.00 (it being understood and agreed
that such $4,000,000.00 shall at any time of determination be reduced by
the sum of (x) the amount of any loan or advance made by the Borrower to
any Foreign Subsidiary as permitted by the provisions of Sections
6.2(d)(iv) and 6.2(g) hereof, respectively, and (y) the amount of all
receivables owing to the Borrower from any Foreign Subsidiary);
(vii) such Acquisition Party shall have become a party to the
Subsidiary Guarantee pursuant to an instrument in writing satisfactory to
the Agent (unless such Acquisition Party shall, after giving effect to
the acquisition thereof, (A) constitute a Foreign Subsidiary, in which
case the entity acquiring the capital stock or other equity interests of
such Acquisition Party shall pledge to the Agent for the benefit of the
Lenders, pursuant to a pledge agreement satisfactory to the Agent, not
more than 65% of the issued and outstanding shares of capital stock or
other equity interests of such Acquisition Party to the extent required
by Section 6.1(v) hereof or (B) not constitute a Material Domestic
Subsidiary); and
(viii) five (5) Business Days prior to consummation thereof, the
Borrower shall have delivered to the Agent (which shall promptly deliver
a copy to the Lenders) a certificate, executed by an Authorized Officer
of the Borrower, demonstrating in sufficient detail compliance with the
financial covenants contained in this Section 6.2(e) and, further,
certifying that, after giving effect to the consummation of such
acquisition, merger, consolidation (or otherwise), the representations
and warranties of the Borrower contained herein will be true and correct
and that the Borrower, as of the date of such consummation, will be in
compliance with all other terms and conditions contained herein.
Notwithstanding anything to the contrary contained in this Section 6.2(e), any
Subsidiary of the Borrower may merge with and into or consolidate with the
Borrower or any other Subsidiary of the Borrower, or the Borrower may cause the
dissolution or liquidation of any of its Subsidiaries; provided, that, after
giving
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effect to such merger, consolidation, dissolution or liquidation, (w) in the
case of any merger or consolidation with the Borrower, the Borrower shall be the
surviving entity, (x) in the case of any merger or consolidation of any
Subsidiary of the Borrower with any other such Subsidiary, the surviving entity
resulting therefrom shall have succeeded, by operation of law, contract or
otherwise, to all of the rights, properties, both real and personal, privileges
and franchises of the disappearing Subsidiary, (y) in the event such merged or
consolidated Subsidiary shall be a party to any Credit Document, the surviving
Subsidiary resulting from such merger or consolidation shall, by operation or
law, contract or otherwise and, at the request of any Lender, pursuant to an
agreement in writing, be bound by the agreements, covenants and other provisions
contained in each such Credit Document. to which the disappearing Subsidiary was
a party, and (z) in the event of the dissolution or liquidation of a Subsidiary,
the rights, properties, both real and personal, privileges and franchises
thereof shall be distributed or otherwise conveyed and transferred to the
Borrower or another Domestic Subsidiary thereof (unless the dissolved or
liquidating Subsidiary is a Foreign Subsidiary, in which case such rights,
properties, both real and personal, privileges and franchises may be distributed
or otherwise conveyed and transferred to another Foreign Subsidiary of the
Borrower).
(f) Fiscal Year. The Borrower and its Subsidiaries shall not,
without the prior written consent of the Required Lenders, make any material
change in accounting policies or reporting practices, including a change in
their Fiscal Year.
(g) Advances to Subsidiaries and Affiliates. The Borrower shall
not, without the prior written consent of the Required Lenders, make any
advances (either directly or indirectly), whether such advances are made from
the proceeds of the Revolving Loans or Swing Line Loans or Standby Letters of
Credit or otherwise, to any of its Subsidiaries or Affiliates not a party to the
Subsidiary Guarantee unless such Subsidiary or Affiliate shall have entered into
an agreement or instrument (in form and substance acceptable to the Required
Lenders) pursuant to which such Subsidiary or Affiliate shall have agreed to be
bound by all of the terms, conditions, covenants and agreements contained in the
Subsidiary Guarantee and such Subsidiary or Affiliate shall have delivered such
documents, certificates and opinions as any Lender may reasonably request to
implement such agreement or instrument; provided, however, that the Borrower may
make advances to any Foreign Subsidiary without such Foreign Subsidiary being a
party to the Subsidiary Guarantee so long as the aggregate amount of all such
advances to such Foreign Subsidiaries, together with all loans made to, and all
receivables owing from, such Foreign Subsidiaries, do not exceed at any time
$8,000,000.00; and, provided, further, that the Borrower may make loans or
advances to any joint venture in which the Borrower or any Subsidiary thereof
owns at least one-third of the equity interests to the extent permitted by
Section 6.2(d)(v) hereof.
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(h) Creation of Subsidiaries. Neither the Borrower nor any
Subsidiary thereof shall create or cause to be formed any Subsidiary without the
consent of the Required Lenders unless such Subsidiary is a Consolidated
Subsidiary of the Borrower and agrees to be bound by the terms and conditions of
the Subsidiary Guarantee pursuant to an agreement of the type and to the extent
described in clause (g) of this Section 6.2 or such Subsidiary does not
constitute a Material Domestic Subsidiary; provided, however, that no Foreign
Subsidiary so created or formed shall be required to be a party to the
Subsidiary Guarantee except to the extent required by Sections 6.2(e)(viii) and
6.2(g) hereof.
(i) Disposition of Assets. Neither the Borrower nor any Subsidiary
thereof shall, without the prior written consent of the Required Lenders, sell,
transfer or otherwise dispose of (including by way of a sale and leaseback
transaction) any of its assets (whether real or personal) other than (i) in the
ordinary and usual course of its business for fair value in arm's-length
transactions and, so long as no Event of Default or Potential Event of Default
has occurred and is continuing, dispositions in a commercially reasonable manner
of equipment which has become redundant, worn out or obsolete or which should be
replaced so as to improve productivity, so long as the proceeds of any such
disposition are (A) used to acquire replacement equipment which has comparable
or better utility and equivalent or better value or (B) applied to repay the
Obligations, and (ii) as otherwise permitted by any other Credit Document.
(j) Permitted Investments. Neither the Borrower nor any Subsidiary
thereof shall, without the prior written consent of the Required Lenders, make
any investment in any security (whether consisting of debt or equity or a
partnership, limited liability company or other interest) or like instrument
except for Permitted Investments (it being understood and agreed that this
clause (j) shall not prohibit the acquisition of the securities of any
Acquisition Party to the extent permitted by the provisions of Section 6.2(e)
hereof) and except as provided in Schedule 6.2(j) hereof.
ARTICLE VII
EVENTS OF DEFAULT
Section 7.1 Events of Default. If one or more of the following
events or conditions (each, an "Event of Default") shall occur and be
continuing, that is to say:
(a) the Borrower defaults in the payment of principal of any
Revolving Note when due, or any Guarantor defaults in the observance or
performance of any agreement contained in Section 2 of the Subsidiary Guarantee;
or
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(b) the Borrower defaults in the payment of interest on any
Revolving Loan or Swing Line Loan, or of the Unused Portion Fee, the L/C Fee,
the Administrative Fee or of any other fee, expense or other amount payable
hereunder after the same becomes due and payable for more than two (2) Business
Days after notice thereof has been given by the Agent to the Borrower (which
notice may be telephonic); or
(c) the Borrower or any Subsidiary thereof defaults in any payment
of principal of or interest on, or fees and expenses relating to any other
obligation for borrowed money beyond any period of grace provided with respect
thereto or in the performance of any other agreement, term or condition
contained in any instrument or agreement evidencing, securing, guaranteeing or
otherwise relating to any such obligation and shall not have cured such default
within any period of grace provided by such agreement and such obligation,
either individually or in the aggregate, is for an amount in excess of
$100,000.00; or
(d) any written representation or warranty made by any Credit
Party in or pursuant to this Agreement or any other Credit Document or in any
other documents, certificates, financial statements or reports furnished by any
Credit Party in connection with the transactions contemplated hereby shall prove
to have been false or misleading in any material respect as of the time made or
furnished; or
(e) (i) the Borrower shall default in the performance or
observance of any covenant, condition or agreement contained in clause (c), (d),
(i), (j), (k), (l), (m), (r), (s) or (t) of Section 6.1 and such default shall
remain unremedied for more than ten (10) Business Days, or (ii) the Borrower
shall default in the performance or observance of any other covenant, condition
or agreement contained in Section 6.1 or any covenant, condition or agreement
contained in Section 6.2; or
(f) the Borrower shall default in the performance or observance of
any other covenant, condition or provision hereof or in any other Credit
Document or any other Credit Party shall default in the performance or
observance of any covenant, condition or provision in any other Credit Document
(other than the Subsidiary Guarantee) or any Guarantor shall default in the
performance or observance of any covenant, condition or provision in the
Subsidiary Guarantee (other than Section 2 thereof, as to which clause (a) of
this Section 7.1 relates), as the case may be, and such default shall not be
remedied within thirty (30) days after written notice thereof is received by the
Borrower or any other Credit Party, as the case may be, from any Lender or the
Agent; or
(g) a proceeding (other than a proceeding commenced by the
Borrower or any Subsidiary thereof, as the case may be) shall have been
instituted in a court
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having jurisdiction in the premises seeking a decree or order for relief in
respect of the Borrower or such Subsidiary in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or for the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Borrower or such Subsidiary
or for any substantial part of its total assets, or for the winding-up or
liquidation of its affairs and such proceedings shall remain undismissed or
unstayed and in effect for a period of thirty (30) consecutive days or such
court shall enter a decree or order granting the relief sought in such
proceeding; or
(h) the Borrower or any Subsidiary thereof, as the case may be,
shall commence a voluntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, shall consent to the entry of an
order for relief in an involuntary case under any such law, or shall consent to
the appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) of the Borrower or
such Subsidiary or for any substantial part of its total assets, or shall make a
general assignment for the benefit of creditors, or shall fail generally to pay
its debts as they become due, or shall take any corporate action in furtherance
of any of the foregoing; or
(i) a judgment or order shall be entered against the Borrower or
any Subsidiary thereof, by any court, and (i) in the case of a judgment or order
for the payment of money that has not been vacated, stayed or appealed (and
bonded, if required) within the time required by the terms of such judgment or
order, either (A) such judgment or order shall continue undischarged for a
period of fifteen (15) days in which the aggregate amount of all such judgments
and orders exceeds $100,000 or (B) enforcement proceedings shall have been
commenced upon such judgment or order, and (ii) in the case of any judgment or
order for other than the payment of money, such judgment or order could, in the
reasonable judgment of any Lender, together with all other such judgments or
orders, have a materially adverse effect on the Borrower and its Subsidiaries
taken as a whole; or
(j) the occurrence of a material adverse change in the financial
condition, properties, assets or results of operations of the Borrower and its
Consolidated Subsidiaries, taken as a whole; or
(k) (i) any Termination Event shall occur with respect to any
Benefit Plan, (ii) any Accumulated Funding Deficiency, whether or not waived,
shall exist with respect to any Benefit Plan, (iii) any Person shall engage in
any Prohibited Transaction involving any Benefit Plan, (iv) the Borrower or any
ERISA Affiliate shall be in "default" (as defined in ERISA Section 4219(c)(5))
with respect to payments owing to a Multiemployer Plan as a result of the
Borrower's or any ERISA Affiliate's complete or partial withdrawal (as described
in ERISA Section
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4203 or 4205) from such Multiemployer Plan, (v) the Borrower or any ERISA
Affiliate shall fail to pay when due an amount that is payable by it to the
Pension Benefit Guaranty Corporation or to a Benefit Plan under Title IV of
ERISA, or (vi) a proceeding shall be instituted by a fiduciary of any Benefit
Plan against the Borrower or any ERISA Affiliate to enforce ERISA Section 515
and such proceeding shall not have been dismissed within 30 days thereafter,
except that no event or condition referred to in clauses (i) through (vi) shall
constitute an Event of Default if it, together with all other such events or
conditions at the time existing, has not had, and in the reasonable
determination of the Required Lenders will not have, a materially adverse effect
on the Borrower and its Subsidiaries, taken as whole; or
(l) if (i) the Borrower or any Subsidiary thereof shall be
suspended or debarred from contracting with the United States Government and
such suspension or debarment shall not have been lifted within fifteen (15)
Business Days after the imposition thereof, or (ii) the United States Government
shall have terminated any contract to which the Borrower or any Subsidiary
thereof is a party and such termination would have a material adverse effect
upon the financial condition or prospects of the Borrower and its Consolidated
Subsidiaries, taken as a whole;
(m) the occurrence of a Change in Control or a Potential Change in
Control;
(n) the Borrower Security Agreement, any Subsidiary Security
Agreement or any Pledge Agreement shall cease for any reason to be in full force
and effect, shall cease to be effective to grant a perfected security interest
in the collateral pledged thereunder with the priority stated to be created
thereby or shall be declared null and void by any Governmental Body, or the
validity or enforceability thereof shall be contested by any party thereto
(other than the Agent or any Lender) or any Credit Party shall deny that it has
any further liability or obligation thereunder; or
(o) the Subsidiary Guaranty shall cease for any reason to be in
full force and effect or shall be declared null and void by any Governmental
Body, or the validity or enforceability thereof shall be contested by any
Guarantor, or any Guarantor shall deny that it has any further liability or
obligation under the Subsidiary Guaranty; or
(p) any creditor of any Credit Party shall obtain possession of
any of the collateral pledged by any Credit Party in favor of the Agent by any
means, including, without limitation, levy, distraint, replevin or self-help, or
any such creditor shall establish or obtain any right in such which is equal to
or senior to the security interests of the Agent in such collateral; or
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(q) the Agent or any Lender shall allege in writing that one or
more Events of Default have occurred and the Borrower shall have failed, after
15 Business Days notice thereof from the Agent or such Lender, to provide
reasonably satisfactory evidence to the Agent and the Lenders that such Events
of Default have not in fact occurred;
then, and upon any such event, the Agent, with the consent of the Required
Lenders, may (1) upon notice to the Borrower, declare the entire outstanding
principal amount, if any, of the Revolving Notes, the Swing Line Note, any and
all accrued and unpaid interest thereon, the aggregate amount outstanding under
all Standby Letters of Credit, any and all accrued and unpaid Unused Portion Fee
and L/C Fee, and any and all other amounts payable by the Borrower to the
Lenders or the Agent under this Agreement or the Revolving Notes or the Swing
Line Note to be forthwith due and payable, whereupon the entire outstanding
principal amount, if any, of the Revolving Notes or the Swing Line Note,
together with any and all accrued and unpaid interest thereon, the aggregate
amount outstanding under all Standby Letters of Credit, any and all accrued and
unpaid Unused Portion Fee and L/C Fee, and any and all other such amounts, shall
become and be forthwith due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived by the
Borrower; provided, however, that in the event of the entry of an order for
relief with respect to the Borrower or any of its Subsidiaries under the
Bankruptcy Code, any principal amount of the Revolving Notes and the Swing Line
Note then outstanding, together with any and all accrued and unpaid interest
thereon, the aggregate amount outstanding under all Standby Letters of Credit,
any and all accrued and unpaid Unused Portion Fee and L/C Fee, and any and all
such other amounts shall thereupon automatically become and be due and payable
without presentment, demand, protest or notice of any kind, all of which are
hereby expressly waived by the Borrower; (2) terminate or reduce the Revolving
Loan Commitment and the Swing Line Subfacility; and (3) exercise any rights and
remedies available to it under any Credit Document or under applicable laws,
including without limitation any rights and remedies of a secured party under
the Uniform Commercial Code in effect in the Commonwealth of Virginia and under
any other applicable laws.
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ARTICLE VIII
THE AGENT
Section 8.1 Appointment of Agent.
(a) Appointment Generally. Each of the Lenders hereby designates
and appoints Bank of America, N.A. as the Agent of such Lender under this
Agreement and the other Credit Documents, and each of the Lenders hereby
irrevocably authorizes the Agent to take such action on its behalf under the
provisions of this Agreement and the other Credit Documents and to exercise such
powers as are set forth herein and therein, together with such other powers as
are incidental thereto. The Agent agrees to act as such on the express
conditions contained in this Article VIII.
(b) Agent Acts for Lenders. The provisions of this Article VIII
are solely for the benefit of the Agent and the Lenders, and the Borrower shall
have no right (including as third party beneficiary) to rely on or enforce any
of the provisions hereof. In performing its functions and other duties under
this Agreement and the other Credit Documents, the Agent shall act solely as
agent for the Lenders and does not assume and shall not be deemed to have
assumed any obligation toward or relationship of agency or trust with or for the
Borrower or any of its Affiliates.
Section 8.2 Nature of Duties; Non-Reliance on Agent and other
Lenders.
(a) The Agent shall not have any duties or responsibilities except
those expressly set forth in this Agreement or in the other Credit Documents.
The duties of the Agent shall be mechanical and administrative in nature. The
Agent shall not have, by reason of this Agreement or any other Credit Document,
a fiduciary relationship in respect of any Lender and is not a trustee for the
Lenders. Nothing in this Agreement or any of the other Credit Documents,
expressed or implied, is intended to or shall be construed to impose upon the
Agent any obligations in respect of this Agreement or any of the other Credit
Documents except as expressly set forth herein and therein. If the Agent seeks
the consent or approval of the Lenders to the taking or refraining from taking
of any action hereunder, the Agent shall send notice thereof to each Lender. The
Agent shall promptly notify each Lender at any time the Required Lenders or all
of the Lenders, as the case may be, have instructed the Agent to act or refrain
from acting pursuant hereto. The Agent may execute any of its duties hereunder
or under any other Credit Document by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Agent shall
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not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
(b) Each Lender expressly acknowledges that neither the Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by
the Agent or any Affiliate thereof hereinafter taken, including any review of
the affairs of the Borrower or any Subsidiary thereof, shall be deemed to
constitute any representation or warranty by the Agent to any Lender. Each
Lender represents to the Agent that it has, independently and without reliance
upon the Agent or any other Lender, and based on such documents and information
as it has deemed appropriate, made its own appraisal of and investigation into
the business, assets, operations, property, financial and other conditions,
prospects and creditworthiness of the Borrower and its Subsidiaries and made its
own decision to make its Revolving Loans and issue or participate in the
issuance of Standby Letters of Credit hereunder and enter into this Agreement
and the other Credit Documents to which it is a party. Each Lender covenants
that it will, independently and without reliance upon the Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement or any other Credit Document
to which it is a party, and to make such investigations as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower and its
Subsidiaries. Except for notices, reports and other documents expressly required
to be furnished to the Lenders by the Agent hereunder, the Agent shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, assets, property, financial and
other conditions, prospects or creditworthiness of the Borrower and its
Subsidiaries which may come into the possession of the Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates.
Section 8.3 Rights, Exculpation, Etc. Neither the Agent nor any of
its Affiliates nor any of their respective officers, directors, employees,
agents, attorneys or consultants shall be liable to any Lender for any action
taken or omitted by it or such Person hereunder or under any of the other Credit
Documents, or in connection herewith or therewith, except that (i) the Agent
shall be obligated on the terms set forth herein for performance of its express
obligations hereunder, and (ii) neither the Agent nor any such other Person
shall have any liability hereunder or under any other Credit Document except to
the extent arising out of its own gross negligence or willful misconduct (as
determined by the final judgment of a court of competent jurisdiction). The
Agent shall not be liable for any apportionment or distribution of payments made
by it in good faith pursuant to the terms of this
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Agreement and if any such apportionment or distribution is subsequently
determined to have been made in error the sole recourse of any Lender to whom
payment was due, but not made, shall be to recover from other Lenders any
payment in excess of the amount to which they are determined to have been
entitled. The Agent shall not be responsible to any Lender for any recitals,
statements, representations or warranties made by the Borrower or any Subsidiary
thereof in this Agreement or in any other Credit Document or in any other
document, certificate, report or financial statement delivered by the Borrower
or any Subsidiary thereof in connection herewith or therewith or for the
execution, effectiveness, genuineness, validity, enforceability, collectibility,
or sufficiency of this Agreement or any of the other Credit Documents, or any of
the transactions contemplated thereby, or for the financial condition of the
Borrower or any of its Subsidiaries. The Agent shall not be required to make any
inquiry concerning conditions of this Agreement or any of the Credit Documents
or the financial condition of the Borrower or its Subsidiaries or the existence
or possible existence of any Potential Event of Default or Event of Default. The
Agent may at any time request instructions from the Lenders with respect to any
actions or approvals which by the terms of this Agreement or of any of the other
Credit Documents the Agent is permitted or required to take or to grant, and if
such instructions are promptly requested, the Agent shall be absolutely entitled
to refrain from taking any action or to withhold any approval and shall not
incur any liability whatsoever to any Person for refraining from any action or
withholding any approval under any of the Credit Documents until it shall have
received such instructions from the Required Lenders or, to the extent
specifically provided herein, all the Lenders or unless it shall first be
indemnified by the Lenders against any and all liability and expense which may
be incurred by it by reason of refraining to take any action or withholding any
approval. Without limiting the foregoing, no Lender shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting under this Agreement or any of the other Credit Documents
in accordance with the instructions of the Required Lenders or, to the extent
specifically provided herein, all the Lenders, and such instructions shall be
binding upon all Lenders (including their successors and assigns).
Section 8.4 Reliance; Notice of Default.
(a) The Agent shall be entitled to rely upon any written notice,
statement, certificate, order, letter, cablegram, telegram, telecopy, telex or
teletype message, statement or other document or any telephone message believed
by it in good faith to be genuine and correct and to have been signed or made by
the proper Person, and with respect to all matters pertaining to this Agreement
or any of the other Credit Documents and its duties hereunder or thereunder,
upon advice of legal counsel (including counsel for any Credit Party),
independent public
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accountants and other experts selected by it with reasonable care. The Agent may
deem and treat each Lender as the owner of its interests hereunder for all
purposes unless and until the Agent shall have received a duly executed
instrument of assignment as contemplated by Section 9.8(c) hereof and the other
conditions to assignment, to the extent applicable, shall have been satisfied.
(b) The Agent shall not be deemed to have knowledge or notice of
the occurrence of any Event of Default or Potential Event of Default unless the
Agent has received notice from a Lender or the Borrower referring to this
Agreement, describing such Event of Default or Potential Event of Default and
stating that such notice is a "notice of Event of Default" of "notice of
Potential Event of Default", as the case may be. The Agent shall take such
action with respect to such Event of Default or Potential Event of Default as
shall be reasonably directed by the Required Lenders.
Section 8.5 Indemnification. To the extent that the Agent is not
reimbursed and indemnified by the Borrower or the Borrower fails upon demand by
the Agent to perform its obligations to reimburse or indemnify the Agent, the
Lenders will severally reimburse and indemnify the Agent for and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against the Agent in any way
relating to or arising out of this Agreement or any of the other Credit
Documents or any action taken or omitted by the Agent under this Agreement or
any of the other Credit Documents, in proportion to each Lender's Pro Rata
Share; provided, that no Lender shall be liable for (i) any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Agent's gross negligence or
willful misconduct (as determined by the final judgment of a court of competent
jurisdiction) or (ii) the legal fees and expenses incurred by the Agent in
connection with the execution and delivery of this Agreement and the other
Credit Documents (to the extent not reimbursed by the Borrower). The obligations
of the Lenders under this Section 8.5 shall survive the payment in full of the
Revolving Loans and the termination of this Agreement.
Section 8.6 The Agent Individually. With respect to its Pro Rata
Share hereunder and the Revolving Loans, Standby Letters of Credit and any Swing
Line Loan made by it, the Agent shall have and may exercise the same rights and
powers hereunder and is subject to the same obligations and liabilities as and
to the extent set forth herein for any other Lender. The term "Lenders" or
"Required Lenders" or any similar terms shall, unless the context clearly
otherwise indicates, include the Agent in its individual capacity as a Lender.
The Agent and its Affiliates may accept deposits from, lend money to, and
generally engage in any
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kind of banking, trust or other business with the Borrower and its Subsidiaries
as if it were not acting as Agent pursuant hereto.
Section 8.7 Successor Agent; Resignation of Agent.
(a) The Agent may resign from the performance of its functions and
duties hereunder at any time by giving at least thirty (30) days' prior written
notice to the Lenders and the Borrower. In the event that the Agent gives notice
of its desire to resign from the performance of its functions and duties as
Agent, any such resignation shall take effect only upon the acceptance by a
successor Agent of appointment pursuant to clause (b) or (c) below.
(b) The Required Lenders shall jointly appoint a successor Agent,
which shall be a Lender hereunder.
(c) If a successor Agent shall not have been so appointed within
said twenty (20) day period, the retiring Agent shall then appoint a successor
Agent who shall serve as Agent until such time, if any, as the Lenders appoint a
successor Agent as provided above, it being understood and agreed that any
successor Agent so appointed by the retiring Agent pursuant to this clause (c)
need not be, notwithstanding the provisions of clause (b) above, a Lender
hereunder so long as such successor Agent is a commercial bank organized under
the laws of the United States of America or of any State thereof or of the
District of Columbia and has a combined capital and surplus of at least
$400,000,000.00.
(d) Upon the appointment of a successor Agent, the term "Agent"
shall, for all purposes of this Agreement and the other Credit Documents,
thereafter include such successor Agent, the retiring Agent shall be discharged
from its duties and obligations as Agent, as appropriate, under this Agreement
and the other Credit Documents and the successor Agent shall thereupon succeed
to and become vested with all the rights, powers, privileges and duties of the
retiring Agent, except that the retiring Agent shall reserve all rights as to
obligations accrued or due to it, in its capacity as such, at the time of such
succession and all rights (whenever arising) under Section 9.10 hereof.
Section 8.8 Certain Matters Requiring the Consent of all Lenders.
Subject to the provisions of Section 8.9(ii) hereof, the consent of all the
Lenders shall be required for taking any of the following required or permitted
actions hereunder:
(i) any decrease or increase in any interest rate or margin
applicable to any Revolving Loan or Swing Line Loan or in any fee payable
hereunder,
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or change in the method of computing the interest rate or margin
applicable to any Revolving Loan or Swing Line Loan or in any fee payable
hereunder;
(ii) any change in the Maturity Date;
(iii) any increase in the Revolving Loan Commitment;
(iv) any change in the definition of Required Lenders;
(v) any assignment or delegation of the Borrower's Obligations and
rights hereunder;
(vi) any postponement of the date of payment of any principal,
interest or fees (other than any fee, if any, payable solely to the
Agent, which may be postponed or waived at the sole discretion of the
Agent) due hereunder;
(vii) the release of any collateral pledged by any Credit Party
under the Borrower Security Agreement, any Subsidiary Security Agreement
or any Pledge Agreement;
(viii) the release of any Guarantor from its obligations under the
Subsidiary Guarantee; and
(ix) any amendment, modification or waiver of this Section 8.8.
For the avoidance of doubt, all other actions, consents, waivers and amendments
permitted or required hereunder by the Lenders shall be by the Required Lenders
(unless such action, consent, waiver or amendment shall relate only to an
individual Lender, in which case such action may be taken by such Lender
individually).
Section 8.9 Defaulting Lenders Vote Not Counted. Whenever the
"Required Lenders" or "all the Lenders" shall be required or permitted to take
any action pursuant to the provisions of any Credit Document, for so long as a
Lender shall be in default of its obligation to advance its Pro Rata Share of
any Revolving Loan or, if applicable, any Swing Line Loan or advance any other
funds to the Agent or any other Lender as required hereunder:
(i) until the earlier of the cure of such default and the
termination of the Revolving Loan Commitment, the term Required Lenders
for purposes of this Agreement shall mean Lenders (excluding all Lenders
whose default shall have not been cured) whose Pro Rata Shares represent
more than fifty percent (50%) of the aggregate Pro Rata Shares of such
Lenders; and
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(ii) until the earlier of the cure of such default and the
termination of the Revolving Loan Commitment, the term "all the Lenders"
for purposes of this Agreement shall mean Lenders (excluding all Lenders
whose default shall have not been cured) whose Pro Rata Shares represent
one hundred percent (100%) of the aggregate Pro Rata Shares of such
Lenders.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendments and Waivers; Cumulative Remedies. No delay
or failure of any Lender or the Agent or the holder of any the Revolving Notes
or the Swing Line Note in exercising any right, power or privilege hereunder or
under any other Credit Document shall affect such right, power or privilege; nor
shall any single or partial exercise thereof or any abandonment or
discontinuance of steps to enforce such a right, power or privilege preclude any
further exercise thereof or of any other right, power or privilege. The rights
and remedies of any Lender or the Agent or any other holder of the Revolving
Notes or the Swing Line Note are cumulative and not exclusive of any rights or
remedies which any of them would otherwise have. Neither this Agreement or any
other Credit Document, nor any term, condition, representation, warranty,
covenant or agreement hereof or thereof, may be changed, waived, discharged or
terminated orally but only by an instrument in writing executed by the party
against whom such change, waiver, discharge or termination is sought. Any
waiver, permit, consent or approval of any kind or character (whether involving
a breach, default, provision, condition or term hereof or otherwise) on the part
of any Lender or the Agent or any other holder of any Revolving Note, the Swing
Line Note, or of the Borrower under this Agreement, or under any other Credit
Document shall be effective only in the specific instance and for the purpose
for which given and only to the extent set forth specifically in writing. No
notice or demand given hereunder shall entitle the recipient thereof to any
other or further notice or demand in similar or other circumstances.
Section 9.2 Survival of Representations and Warranties. All
representations, warranties, covenants and agreements of the Borrower and the
other Credit Parties contained herein or made in writing in connection herewith
shall survive the execution and delivery of this Agreement and the other Credit
Documents, the making of Revolving Loans or Swing Line Loans hereunder and the
issuance of the Revolving Notes and the Swing Line Note.
Section 9.3 Supervening Illegality. If, after the date hereof, as
the result of (i) the adoption of any law, rule or regulation by any
Governmental Body, (ii) any change in the existing laws, rules and regulations
of any Governmental Body, (iii) the issuance of any order or decree by any
Governmental Body, (iv) any
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change in the interpretation or administration of any applicable law, rule,
regulation, order or decree by any Governmental Body (including any central bank
or similar agency) charged with the interpretations or administration thereof,
or (v) compliance by any Lender with any request or directive (whether or not
having the force of law) of any Governmental Body, it shall be unlawful or
impossible for such Lender to maintain or make any LIBOR Loan, then the
obligation of such Lender to maintain or make any LIBOR Loan or convert any ABR
Loan to a LIBOR Loan shall forthwith be cancelled and such Lender shall
automatically convert any outstanding LIBOR Loan to an ABR Loan. The Borrower
shall pay to such Lender, promptly upon demand, any additional amounts necessary
to compensate such Lender for any costs incurred by such Lender in making any
conversion in accordance with this Section 9.3 including, but not limited to,
any interest or fees payable by such Lender to lenders of funds obtained by it
in order to make or maintain the LIBOR Loans hereunder, and such Lender's notice
to the Borrower of such costs shall be conclusive and binding absent manifest
error.
Section 9.4 No Reduction in Payments. All payments due to the
Lenders hereunder, and all other terms, conditions, covenants and agreements to
be observed and performed by the Borrower hereunder, shall be made, observed or
performed by the Borrower without any reduction or deduction whatsoever,
including any reduction or deduction for any set-off, recoupment, counterclaim
(whether sounding in tort, contract or otherwise) or tax.
Section 9.5 Stamp Taxes. The Borrower, on behalf of itself and the
other Credit Parties, agrees to pay, and to save each Lender harmless from all
liability for, any State or Federal stamp, transfer, documentary or similar
taxes, assessments or charges (herein "Stamp Taxes"), and any penalties or
interest with respect thereto, which may be assessed, levied, collected or
imposed by or upon such Lender, or otherwise become payable by such Lender, in
connection with the execution and delivery of this Agreement or the other Credit
Documents.
Section 9.6 Notices. Any notice, statement, request or demand
required or permitted hereunder to be in writing may be given by telecopy,
telex, cable or other customary means of electronic communication or by
registered or certified mail (return receipt requested) or express courier,
postage prepaid. All notices, statements, requests and demands given to or made
upon any party hereto in accordance with the provisions of this Agreement shall
be deemed to have been given or made(i) in the case of telephonic notice (to the
extent expressly permitted hereunder), when made, (ii) in the case of notice
delivered by overnight express courier, one Business Day after the Business Day
such notice was delivered to such courier, (iii) in the case of notice delivered
by first class mail, three Business Days after being deposited in the mail,
postage prepaid, return receipt requested, (iv) in the case of notice by hand,
when delivered, or (v) in the case of notice by any
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customary means of telecommunication, when sent provided confirmation of receipt
or answer back has been received, in each case if addressed:
to the Borrower, to it at:
▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
to the Agent, to it at:
Bank of America, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Mail Stop MD 2-600-03-02
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and if to any Lender, to it at its
address specified opposite its name
on the signature pages hereto.
or such other address for notice as any party hereto may designate for itself in
a notice to the other party, except in cases where it is expressly provided
herein that such notice, statement, request or demand shall not be effective
until received by the party to whom it is addressed.
Section 9.7 Governing Law. THIS AGREEMENT AND THE OTHER CREDIT
DOCUMENTS SHALL BE DEEMED TO BE CONTRACTS UNDER THE LAWS OF THE COMMONWEALTH OF
VIRGINIA AND, FOR ALL PURPOSES, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT REGARD TO THE CONFLICTS OF
LAWS PRINCIPLES.
Section 9.8 Successors and Assigns; Participations; Assignments.
(a) Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective permitted
successors
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and assigns of the parties hereto, provided that the Borrower may not assign or
transfer any of its interest hereunder without the prior written consent of all
the Lenders and the Agent.
(b) Participations. Any Lender may sell participation in all or
any part of the Revolving Loans made by it or its Commitment or any other
interest herein or in its Revolving Note or in any other document delivered or
instrument delivered in connection herewith to another bank or other entity. In
the case of such participation by a Lender, (i) the participant shall not have
any rights under this Agreement or the applicable Revolving Note or any other
document or instrument delivered in connection herewith (the participant's
rights against such Lender in respect of such participation to be those set
forth in the agreement executed by such Lender in favor of the participant
relating thereto), (ii) all amounts payable by the Borrower shall be determined
as if such Lender had not sold such participation and (iii) the Borrower shall
continue to deal directly with such Lender with respect to the transactions
contemplated hereby.
(c) Assignments. Each Lender may assign any of its rights or
interests under the Credit Documents to one or more financial institutions,
provided that:
(i) each such assignment shall be in an amount not less than
$5,000,000.00 (or such lesser amount if, after giving effect to such
assignment and all other assignments by such Lender occurring
substantially simultaneously therewith, such assigning Lender shall hold
no Commitment or any Revolving Loan or Swing Line Loan);
(ii) each such assignment by a Lender of its Commitment or
Revolving Loans or Swing Line Loans shall be made in such manner so that
the same portion of such Lender's Commitment, Revolving Loans, Revolving
Note, Swing Line Loans and Swing Line Note and obligations in respect of
any Standby Letter of Credit is assigned to the respective assignee
Lender;
(iii) the assigning Lender shall pay to the Agent a one-time fee
in the amount of $3,500.00; and
(iv) the Agent and, so long as no Event of Default shall have
occurred and be continuing, the Borrower shall have consented to such
assignment, which consent shall not be unreasonably withheld or delayed.
Upon execution and delivery by the assignee to the Borrower and the Agent of an
instrument in writing pursuant to which such assignee agrees to be a "Lender"
hereunder (if not already a Lender) having the Commitment and Revolving Loans
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and Swing Line Loans specified in such assignment, and upon the consent of the
Agent and, if applicable, the Borrower as provided above, the assignee shall
have, to the extent of such assignment, the rights, benefits and obligations of
a Lender hereunder holding the Commitment, Revolving Loans and Swing Line Loans
(or portions thereof) and Standby Letters of Credit or deemed participations
therein, as applicable, assigned to it pursuant to such assignment (in addition
to the Commitment, Revolving Loans and Swing Line Loans (or portions thereof)
and Standby Letters of Credit or deemed participations therein, as applicable,
theretofore held by such assignee), and the assigning Lender shall, to the
extent of such assignment, be relieved from its Commitment (or portion thereof)
and other obligations hereunder so assigned.
Section 9.9 Affirmative Rate of Interest Permitted by Law. Nothing
in this Agreement or in any Revolving Note or Swing Line Note shall require the
Borrower to pay interest to the Agent for the account of the Lenders at a rate
exceeding the maximum rate permitted by applicable law to be charged or received
by the Lenders, it being understood that this Section 9.9 is not intended to
make the criminal laws of any jurisdiction applicable in circumstances in which
they would not otherwise apply. If the rate of interest specified herein or in
any Revolving Note would otherwise exceed the maximum rate so permitted to be
charged or received with respect to any amounts outstanding hereunder or under
such Revolving Note, or Swing Line Note, the rate of interest required to be
paid to the Agent for the account of the Lenders shall be automatically reduced
to such maximum rate.
Section 9.10 Costs and Expenses; Indemnification.
(a) Without regard to whether the Effective Date shall have come
into existence or whether any Revolving Loan or Swing Line Loan or Standby
Letter of Credit shall have been made or issued hereunder, the Borrower shall
pay to each Lender and the Agent, as the case may be, and reimburse each Lender
and the Agent for, as the case may be, and defend and save each Lender and the
Agent, as the case may be, harmless from, and indemnify each Lender and the
Agent, as the case may be, against, losses from:
(i) in the case of the Agent, (x) all out-of-pocket cost and
expenses of the Agent in connection with the preparation, execution,
delivery, waiver, modification, amendment, filing and recording of this
Agreement and any other Credit Document (to the extent applicable) and
any other document or instrument delivered in connection with the
transactions contemplated hereby, including, without limitation, the
reasonable fees and expenses of counsel for the Agent with respect
thereto, and (y) all out-of-pocket costs and expenses, if any (including
without limitation, reasonable counsel and advisor fees and expenses), of
such Agent in such capacity in connection with the
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enforcement (whether through negotiations, legal proceedings or
otherwise) of or exercise of remedies under this Agreement and any other
Credit Document and any other document or instrument delivered in
connection with the transactions contemplated hereby, including, for the
avoidance of doubt and without limitation, reasonable counsel fees and
expenses in connection with the enforcement of rights under this clause
(i); and
(ii) in the case of any Lender, all out-of-pocket costs and
expenses, if any (including without limitation, reasonable counsel fees
and expenses), of such Lender in connection with the enforcement (whether
through negotiations, legal proceedings or otherwise) of or exercise of
remedies under this Agreement and any other Credit Document and any other
document or instrument delivered in connection with the transactions
contemplated hereby, including, for the avoidance of doubt and without
limitation, reasonable counsel fees and expenses in connection with the
enforcement of rights under this clause (ii).
(b) The Borrower shall indemnify, defend and hold harmless each
Lender, the Agent and their respective affiliates, officers, directors,
employees, agents and advisors (each, an "Indemnified Person") from and against,
and pay and reimburse each Indemnified Person for, any and all claims, damages,
fines, penalties, losses, liabilities, costs and expenses (including, without
limitation, reasonable fees and disbursements of counsel) which may be incurred
by or asserted or awarded against any Indemnified Person (i) arising out of or
in connection with or by reason of any investigation, litigation or proceeding
(of whatever nature), or the preparation of a defense of any investigation,
litigation or proceeding, relating to this Agreement, any other Credit Document,
any other document or instrument delivered in connection with the transactions
contemplated hereby, the proceeds of the Revolving Loans or Swing Line Loans or
any other transaction contemplated hereby or thereby, and (ii) with respect to
any environmental matters, any environmental compliance expenses and remediation
expenses, to the extent required under any environmental law (whether statutory
or common law) in connection with the presence or suspected presence of any
Hazardous Substance in or into the air, soil, groundwater, surface water or
improvements at, on, about, under, or within any of the Borrower's or its
current or former Subsidiaries' present, past or future properties, or any
portion thereof, or elsewhere in connection with the transportation of Hazardous
Substances to or from such properties, and in the case of clause (i) or (ii)
whether or not an Indemnified Person is a party hereto or thereto and whether or
not the Effective Date shall have come into existence or any Revolving Loan or
any Standby Letter of Credit has been made or issued under this Agreement;
provided, however, that the Borrower shall have no obligation to indemnify or
hold harmless any Indemnified Person under this Section 9.10(b) to
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the extent arising out of such Indemnified Person's gross negligence or willful
misconduct.
(c) All amounts payable by the Borrower under this Section 9.10
shall be immediately due upon written request by a Lender or the Agent, as the
case may be, for the payment thereof. The obligations of the Borrower under this
Section 9.10 shall survive the repayment of the Revolving Notes and the Swing
Line Note and reimbursement for any Drawing under any Standby Letter of Credit.
Section 9.11 Set-Off; Suspension of Payment and Performance. Each
Lender and the Agent is hereby authorized by the Borrower, at any time and from
time to time, without notice (a) to set off against, and to appropriate and
apply to the payment of, the liabilities of the Borrower then due under this
Agreement and any other Credit Document any and all liabilities owing by any
Lender or the Agent or any of their Affiliates to the Borrower (whether payable
in Dollars or any other currency, whether matured or unmatured and, in the case
of liabilities that are deposits (including, without limitation, any funds from
time to time on deposit in the Borrower Account or other account maintained with
any Lender or the Agent, whether general or special, time or demand and however
evidenced and whether maintained at a branch or office located within or without
the United States), and (b) during any Event of Default, to suspend the payment
and performance of such liabilities owing by such Person or its Affiliates and,
in the case of liabilities that are deposits, to return as unpaid for
insufficient funds any and all checks and other items drawn against such
deposits.
Section 9.12 Judicial Proceedings; Waiver of Jury Trial. Any
judicial proceeding brought against the Borrower with respect to any Credit
Agreement Related Claim may be brought in any court of competent jurisdiction in
the Commonwealth of Virginia, and, by execution and delivery of this Agreement,
the Borrower (a) accepts, generally and unconditionally, the nonexclusive
jurisdiction of such courts and any related appellate court and irrevocably
agrees to be bound by any judgment rendered thereby in connection with any
Credit Agreement Related Claim and (b) irrevocably waives any objection it may
now or hereafter have as to the venue of any such proceeding brought in such a
court or that such a court is an inconvenient forum. The Borrower hereby waives
personal service of process and consents that service of process upon it may be
made by certified or registered mail, return receipt requested, at its address
specified or determined in accordance with the provisions of Section 9.6 of this
Agreement, and service so made shall be deemed completed on the earlier of (x)
the receipt thereof and (y) if sent by registered or certified mail (return
receipt requested), the fifth (5th) Business Day after such service is deposited
in the mail. Nothing herein shall affect the right of any Lender, the Agent or
any other Indemnified Person to serve process in any other manner permitted by
law or shall limit the right of any Lender, the Agent or any other
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Indemnified Person to bring proceedings against the Borrower in the courts of
any other jurisdiction. Any judicial proceeding by the Borrower against any
Lender or the Agent involving any Credit Agreement Related Claim shall be
brought only in a court located in the Commonwealth of Virginia. THE BORROWER
AND THE LENDERS AND THE AGENT HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING TO WHICH THEY ARE PARTIES INVOLVING ANY CREDIT AGREEMENT RELATED
CLAIM.
Section 9.13 Integration. This Agreement, the other Credit
Documents and the Autoborrow Services Agreement constitute the entire agreement
of the Agent, the Lenders, the Borrower and the other Credit Parties with
respect to the subject matter hereof and thereof, and there are no promises,
undertakings, representations or warranties by the Agent or any Lender relative
to the subject matter hereof or thereof not expressly set forth or referred to
herein or in the other Credit Documents.
Section 9.14 Further Acts and Assurances. The Borrower shall, and
shall cause the Credit Parties to promptly and duly execute and deliver to a
Lender or the Agent, as the case may be, and to such other persons as such
Lender or the Agent shall reasonably designate, such further instruments and
shall take such further action as may be required by law or as such Lender or
the Agent may from time to time request in order more effectively to carry out
and accomplish the intent and purpose of this Agreement and the other Credit
Documents and to establish and protect the rights and remedies created or
intended to be created in favor of the Agent or any Lender hereunder or under
any other Credit Document.
Section 9.15 No Fiduciary Relationship. . The Borrower
acknowledges that no provision of this Agreement or in any of the other Credit
Documents, and no course of dealing between any Lender or the Agent and the
Borrower, or any other Credit Party, shall be deemed to create any fiduciary
duty by the Agent or any Lender to the Borrower or any other Credit Party.
Section 9.16 Severability. . The provisions of this Agreement are
severable, and if any clause or provision of this Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction, then such
clause or provision shall, as to such jurisdiction, be ineffective to the extent
of such invalidity or unenforceability without in any manner affecting the
validity or enforceability of such clause or provision in any other jurisdiction
or the remaining provisions hereof in any jurisdiction.
Section 9.17 Counterparts. . This Agreement may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each complete set of which, when so executed and delivered by all parties, shall
be
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an original, but all such counterparts shall together constitute but one and the
same instrument.
Section 9.18 Headings, Bold Type and Table of Contents. . The
section headings, subsection headings, and bold type used herein and the Table
of Contents hereto have been inserted for convenience of reference only and do
not constitute matters to be considered in interpreting this Agreement.
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IN WITNESS WHEREOF, the parties hereto, by their officers
thereunto duly authorized, have executed this Agreement as of the day and year
first above written.
BORROWER
▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President, Chief Executive Officer,
Chief Financial Officer and
Treasurer
AGENT
Address: BANK OF AMERICA, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Mail Stop MD 2-600-03-02 ---------------------------------------
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Title: Senior Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
LENDERS
Address: BANK OF AMERICA, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Mail Stop MD 2-600-03-02 ---------------------------------------
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Title: Senior Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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Schedule I to Amended and Restated
Revolving Credit Agreement
Name of Lender Commitment (in Dollars)
-------------- -----------------------
Bank of America, N.A. $18,000,000.00
94
Schedule 5.5 to Amended and Restated
Revolving Credit Agreement
Litigation
There are no exceptions to report; however, litigation, claims and
investigations involving or which could lead to liability on the part of the
Borrower or any of its Subsidiaries are as follows:
Apogee Research, Inc. ("Apogee"), a wholly owned subsidiary of the Borrower,
received a subpoena in July 1998 from the Office of the Inspector General of
the Environmental Protection Agency (the "EPA") requesting records from April
1993 through October 1995 pertaining to a contract between Apogee and the
EPA. Apogee has provided records in response to the subpoena. The work under
this contract has been completed. The subpoena was served in connection with
an EPA investigation relating to the submission of potential false statements
and false claims under the contract. The investigation appears to have been
inactive in 1999 and 2000. The Borrower has not received any further
communications concerning the investigation for over a year.
HB Capital, Inc. v. Engineering Power Systems Group, Inc. HB Capital, Inc.
("HB Capital"), a wholly owned subsidiary of the Borrower, filed a claim in
the Supreme Court of Newfoundland, Canada seeking a judgment with respect to
a retainer and certain outstanding expenses and a declaratory judgment as to
a potential success fee owed it by a former client. A counterclaim was filed
by the client alleging that HB Capital's breach of its contract jeopardized
the successful completion of a financing project and resulted in additional
costs to it. The case has been settled in principle, with HB Capital to
receive an aggregate of $50,000 and each party to release the other from all
claims.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. A former employee of the Borrower has filed a
claim with the Arlington County, Virginia Human Rights Commission (dual-filed
with the Equal Employment Opportunity Commission) alleging employment
discrimination based on race, sex and age. The Borrower has been informed
that the case has been dismissed but has not yet received formal notice.
The Borrower and ▇.▇. ▇▇▇▇▇▇▇ World Solutions Company ("▇.▇. ▇▇▇▇▇▇▇") are
engaged in a dispute over the purchase of software and maintenance services
pursuant to a contract entered into in July 1998. ▇.▇. ▇▇▇▇▇▇▇ has threatened
to pursue arbitration pursuant to the contract but has not done so.
95
Claim of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq. regarding the "net worth" calculation used
upon his withdrawal from the GKMG, Inc.'s predecessor law firm (the "Law
Firm"). ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, formerly a shareholder in a predecessor of GKMG, has
asserted a claim for the value of his share of the Law Firm's net worth at
the time of his departure. ▇▇▇▇▇▇▇▇ has filed suit against the Law Firm in
the U.S. District Court for the District of Columbia claiming approximately
$326,000. GKMG is responsible for 50.87% of what, if anything, is paid to
▇▇▇▇▇▇▇▇.
▇▇▇▇▇▇▇, Kharasch & ▇▇▇▇▇▇▇▇▇, P.C. v. Philippine Airlines, Inc., Civil
Action No. 2529-38 in the Superior Court of the District of Columbia
(including counterclaim by Philippine Airlines). Suit was filed in 1998 in
the District of Columbia Superior Court to recover payment for consulting
services provided to Philippine Airlines ("PA"). PA filed a counterclaim in
the amount of the payment claimed alleging that a predecessor of GKMG
violated a retainer agreement with PA. This case is still pending, but there
are no current activities in the case.
Washington Consulting Group, Inc. v. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Civil Action No. 99CA-003513 in the Superior Court of the District of
Columbia. Washington Consulting Group, Inc. ("WCG") filed suit in Superior
Court, District of Columbia against ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, a shareholder in
▇▇▇▇▇▇▇, Kharasch and formerly a shareholder in GKMG and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
alleging breach of fiduciary duty and fraudulent misrepresentation in
connection with their retention in connection with an appeal of a contract
award. No specific dollar amount is claimed. This case is still pending with
discovery proceeding. GKMG is not itself a party to this litigation.
Motorup Corporation, et al. ▇. ▇▇▇▇▇▇▇, Kharasch & ▇▇▇▇▇▇▇▇▇, P.C. and
▇▇▇▇▇▇▇ Kharasch, Greenberg, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.C. and ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇.
A legal malpractice action was filed in the County Court of Philadelphia,
Pennsylvania and removed to the United States District Court for the Eastern
District of Pennsylvania against the Law Firm and one of its partners. The
amount of damages claimed is indeterminate.
▇▇▇▇▇ ▇▇▇▇▇▇▇, a former Senior Vice President of PHB ▇▇▇▇▇▇ Bailly, Inc.,
alleged that his termination in late 1999 by PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. was
based on age discrimination. To the Borrower's knowledge and belief, ▇▇.
▇▇▇▇▇▇▇ has not taken any legal action to pursue his claim.
▇▇▇▇▇▇▇▇▇ v. PHB ▇▇▇▇▇▇ Bailly, Inc. -- Former PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc.
employee alleges in claim filed in state court in Saratoga County, New York
that PHB ▇▇▇▇▇▇ Bailly, Inc. owes him $103,752.80 plus interest from February
1, 2000 on claims of breach of employment contract, unjust enrichment and
quantum meruit. Employee resigned prior to payment of bonuses for 1998; he
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now claims PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. owes him 80% of his 1998 base salary as
bonus. Settlement negotiations are ongoing.
Karat Interactive Network, Inc. ▇. ▇▇▇▇▇▇ Bailly Services, Inc. and Alpine
Specialty Imports, Inc. -- Plaintiff alleges in claim filed in district court
in Boulder County, Colorado trespass against ▇▇▇▇▇▇ ▇▇▇▇▇▇ Services, Inc.
arising out of an incident in which a coffee maker was improperly installed
in ▇▇▇▇▇▇ Bailly Services, Inc.'s offices. Leak from a water line over a
weekend caused extensive damage to plaintiff's offices. Plaintiff is also
claiming business interruption damages. Co-defendant Alpine performed the
installation of the coffee machine water line. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Services, Inc.
filed an answer to the complaint, and cross-claimed against Alpine. ▇▇▇▇▇▇
Bailly Services, Inc. also instituted a third-party action against Coffee
Consultants, Inc. d/b/a/ Peaberry Coffee, Ltd. with which it had contracted
to install the coffee machine. Peaberry subsequently subcontracted the work
to Alpine. Peaberry's answer has not yet been filed. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Services,
Inc.'s insurer, The Chubb Group, is paying defense costs.
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97
Schedule 5.6 to Amended and Restated
Revolving Credit Agreement
Defaults
None.
98
Schedule 5.12 to Amended and Restated
Revolving Credit Agreement
Subsidiaries
All Subsidiaries of the Borrower are listed below, with jurisdiction of
organization indicated in parenthesis.
1. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. owns 100% of the stock of the following subsidiaries:
(a) ▇▇▇▇▇▇ Bailly Services, Inc. (Delaware)
(b) ▇▇▇▇▇▇ ▇▇▇▇▇▇ Risk Advisors, Inc. (Delaware)
(c) PHB ▇▇▇▇▇▇ Bailly, Inc. (Delaware)
(d) PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇ Ltd. (UK)
(e) HB Capital, Inc. (Delaware)
(f) Apogee Research, Inc. (Maryland)
(g) GKMG, Inc. (District of Columbia)
2. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. owns 50% of the following subsidiary:
(a) Cap Gemini ▇▇▇▇▇▇ Bailly LLC
3. PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. owns 100% of the stock of the following
subsidiaries:
(a) PHB ▇▇▇▇▇▇ Bailly Asia Pacific Ltd. (New Zealand)
(b) PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇ Asia Pacific Pty Ltd. (Australia)
4. PHB ▇▇▇▇▇▇ Bailly Asia Pacific Ltd owns 100% of the stock of the
following subsidiary:
(a) CORE Management Systems Ltd. (New Zealand)
5. HB Capital, Inc. owns 100% of the stock of the following subsidiary:
(a) Private Label Energy Services, Inc. (Delaware)
6. Apogee Research, Inc. owns 100% of the stock of the following subsidiary:
(a) ▇▇▇▇▇▇ ▇▇▇▇▇▇, Canada Ltd. (Ontario, Canada)
7. Apogee Research, Inc. owns 40% of the stock of the following subsidiary:
(a) Apogee Capital LLC (Maryland)
99
8. GKMG, Inc. owns 100 % of the stock of the following subsidiaries:
(a) GKMG Aviation Services, Inc. (District of Columbia)
(b) GKMG Consulting Services, Inc. (District of Columbia)
9. GKMG Consulting Services, Inc. owns 100% of the stock of the following
subsidiaries:
(a) AirTrans, Inc. (Virginia)
(b) Georgetown Global Investments Corp. (Delaware)
10. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Services, Inc. owns 100% of the stock of the following
subsidiaries:
(a) ▇▇▇▇▇▇ Bailly Texas, Inc. (Texas)
(b) ▇▇▇▇▇▇ ▇▇▇▇▇▇ Consulting, Ltd. (Ireland)
(c) Estudio Q S.A. (Argentina)
(d) Estudio Q Ingenieros Associados S. R. L. (Argentina)
(e) ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇. (Argentina)
(f) ▇▇▇▇▇▇ Bailly Indonesia, Inc. (Delaware)
(g) ▇▇▇▇▇▇ ▇▇▇▇▇▇ Services India (Private) Ltd. (India)
(h) ▇▇▇▇▇▇ Bailly Armenia (Republic of Armenia)
(i) ZAO ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Russia)
(j) ▇▇▇▇▇▇ Bailly Consulting France S.A. (France)
(k) ▇▇▇▇▇▇ ▇▇▇▇▇▇ International S.A. (Brussels, Belgium)
11. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇. owns 100% of the following subsidiary:
(a) ▇▇▇▇▇▇ Bailly do Brasil LTDA (Brazil)
12. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Indonesia, Inc. and ▇▇▇▇▇▇ Bailly Services, Inc. own 99.7%
and 0.3%, respectively, of the following subsidiary:
(a) PT ▇▇▇▇▇▇ ▇▇▇▇▇▇ Indonesia (Indonesia)
13. ▇▇▇▇▇▇ Bailly Services, Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc. own 25% and 5%,
respectively, of the following subsidiary:
(a) ▇▇▇▇▇▇ Bailly Pakistan (Private) Ltd. (Pakistan)
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100
Schedule 5.14 to Amended and Restated
Revolving Credit Agreement
Real Property
None.
101
Schedule 6.2(b) to Amended and Restated
Revolving Credit Agreement
Certain Indebtedness
None.
102
Schedule 6.2(j) to Amended and Restated
Revolving Credit Agreement
Certain Other Permitted Investments
1. Permitted Investments for ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc.
(a) Up to 1,000,000 shares of Series A Preferred Stock of ThinkChain
Holdings, LLC for an aggregate purchase price of $500,000; and
(b) Up to an aggregate of $3,050,000 ($2,000,000 in cash and
$1,050,000 in services) of common stock of Selectrica, Inc.
("Selectrica"), plus warrants to purchase 966,667 shares of
Selectrica common stock at a purchase price of $3.00 per share.
2. Permitted Investments for ▇▇▇▇▇▇ Bailly Services, Inc.
(a) Warrants to purchase 25,000 shares of common stock of
▇▇▇▇▇▇▇▇.▇▇▇, Inc. at an exercise price of $0.10 per share.
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Exhibit A to Amended and Restated
Revolving Credit Agreement
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Form of
PLEDGE AGREEMENT
dated as of ______________, ____
between
[Name of Pledgor]
in favor of
Bank of America, N.A.
as Agent
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PLEDGE AGREEMENT
This PLEDGE AGREEMENT, dated as of ___________, ___ (as amended, modified
or otherwise supplemented from time to time, the "Pledge Agreement") is made by
__________________, a [corporation] organized under the laws of ______________
(the "Pledgor"), in favor of BANK OF AMERICA, N.A. (the "Agent"), in its
capacity as Agent for the lenders (the "Lenders") from time to time a party to
the Amended and Restated Revolving Credit Agreement, dated as of July 28, 2000
(as amended, modified or otherwise supplemented from time to time, the
"Revolving Credit Agreement"), by and among ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc., a Delaware
corporation (the "Borrower"), the Agent, in its capacity as "Agent" thereunder,
and the Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Revolving Credit Agreement, and subject to the
terms and conditions contained therein, the Lenders have severally agreed to
make available to the Borrower a revolving line of credit for Revolving Loans,
Swing Line Loans and Standby Letters of Credit in an aggregate principal amount
at any time not to exceed the Maximum Available Amount;
WHEREAS, the Pledgor is the legal and beneficial owner of the shares of
Pledged Stock (as hereinafter defined) issued by the Issuer; and
WHEREAS, the Borrower is required to cause the Pledgor to execute this
Agreement pursuant to the provisions of the Revolving Credit Agreement; and
WHEREAS, subject to the terms and conditions contained in the Revolving
Credit Agreement, the Standby Letters of Credit may be issued for the benefit of
the Pledgor, and the proceeds of the Revolving Loans and Swing Line Loans may be
used to enable the Borrower to make valuable transfers to the Pledgor;
NOW, THEREFORE, in consideration of the premises and to induce the
Lenders to continue to make or to maintain their respective Revolving Loans and
Swing Line Loans, and to induce the Issuing Lender to issue or maintain the
Standby Letters of Credit, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Pledgor hereby
agrees with the Agent, for the ratable benefit of the Lenders, as follows:
SECTION 1. Definitions. Capitalized terms used herein without definition
shall have the respective meanings specified in the Revolving Credit Agreement,
and the following terms shall have the following meanings (such meanings to be,
when appropriate, equally applicable to both the singular and plural forms of
the terms defined):
"Agent" shall have the meaning specified in the preamble hereof.
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"Borrower" shall have the meaning specified in the preamble hereof.
"Chattel Paper" shall have the meaning specified in the UCC on the date
hereof.
"Collateral" shall mean all Pledged Stock and all Proceeds thereof.
"Instruments" shall have the meaning specified in the UCC on the date
hereof.
"Issuer" shall mean the issuer of the Pledged Stock and identified as
such on Schedule I hereto.
"Lenders" shall have the meaning specified in the preamble hereof.
"Obligations" shall mean any and all now existing or hereafter arising
indebtedness, obligations, liabilities and covenants of the Borrower to any
Lender, the Agent, their respective Affiliates, successors and assigns and any
other Indemnified Person under or arising out of the Revolving Credit Agreement
and each other Credit Document to which the Borrower is a party, including
without limitation (i) all Revolving Loans and Swing Line Loans, together with
all interest thereon, and all Standby Letters of Credit, (ii) all fees,
expenses, indemnity payments and other amounts due or to become due under the
Revolving Credit Agreement, the Revolving Notes, the Swing Line Note or any
other Credit Document to which the Borrower is a party, (iii) all liabilities
and obligations under this Pledge Agreement, and (iv) any agreement or
instrument refinancing or restructuring all or any portion of the obligations
and liabilities under the Revolving Credit Agreement any other Credit Document
to which the Borrower is a party or under any successor agreement or note, in
each case whether direct or indirect, absolute or contingent or due or to become
due.
"Pledged Stock" shall mean all of the issued and outstanding shares of
capital stock of the Issuer now owned or at any time hereafter acquired by the
Pledgor but only to the extent that such shares do not at any time exceed
sixty-five percent (65%) of the issued and outstanding shares of capital stock
of the Issuer, together with (i) all voting or other rights appertenant thereto,
(ii) all stock certificates in respect thereof and stock certificates issued in
respect thereof on account of any stock split or otherwise, (iii) all dividends,
distributions and options in respect thereof and (iv) all other rights and
benefits of any nature whatsoever that has been or may at any time hereafter be
granted to the Pledgor by the Issuer with respect thereto while this Pledge
Agreement remains in effect.
"Pledgor" shall have the meaning specified in the preamble hereof.
"Proceeds" means all proceeds as such term is defined in Section 9-306(1)
of the UCC on the date hereof and, in any event, shall include, without
limitation, all dividends or other income from Pledged Stock, and any and all
collections on the foregoing or distributions with respect to the foregoing.
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"Revolving Credit Agreement" shall have the meaning specified in the
preamble hereof.
"UCC" shall mean the Uniform Commercial Code from time to time in effect
in the Commonwealth of Virginia.
SECTION 2. Pledge and Grant of Security Interest. To secure the prompt
repayment when due (whether at maturity or by acceleration or otherwise) of the
Obligations, the Pledgor hereby grants, pledges, transfers, conveys and delivers
to the Agent, for the ratable benefit of the Lenders, a first priority,
continuing security interest in all of the Pledgor's right, title and interest
in and to the Pledged Stock, together with all Proceeds thereof, free and clear
of any lien, charge, encumbrance or other adverse claim whatsoever of any Person
(other than the lien and security interest created hereby).
SECTION 3. Rights of the Agent. If requested by the Agent in writing to
the Pledgor at any time following the occurrence and continuance of an Event of
Default, all Proceeds, when collected by the Pledgor, shall be forthwith
deposited by the Pledgor in the exact form received, duly indorsed by the
Pledgor to the Agent if required, in a special bank account maintained by the
Agent, subject to withdrawal by the Agent only, and, until so turned over, shall
be held by the Pledgor in trust for the Agent, segregated from other funds of
the Pledgor. Any funds held in such special bank account which have not been
withdrawn and applied by the Agent to the Obligations shall be returned to the
Pledgor by the Agent in the event that such Event of Default is cured or waived
in accordance with the terms of the Credit Documents.
SECTION 4. Stock Powers; Endorsements. Concurrently with the delivery by
the Pledgor to the Agent of each certificate representing one or more shares of
Pledged Stock, the Pledgor shall deliver an undated stock power covering such
certificate, duly executed in blank by the Pledgor. The Agent shall have the
right to require any Pledgor to cause any such stock certificate to be re-issued
in the name of the Agent to the extent the Agent shall deem it necessary or
appropriate for the purpose of perfecting its security interest in the Pledged
Stock.
SECTION 5. Representations and Warranties. The Pledgor hereby represents
and warrants that:
(a) set forth on Schedule I hereto is a listing as of the date
hereof of the total number of all shares of capital stock issued and
outstanding with respect to the Issuer, together with the total number of
shares of capital stock of the Issuer owned by the Pledgor; the Pledgor
is the record owner of the shares of Pledged Stock;
(b) the Pledged Stock is legally and equitably owned by the
Pledgor, free and clear of any and all liens, security interests, claims,
charges, Equity Rights of others and other encumbrances whatsoever,
except for the security interest granted to the Agent hereby;
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(c) all shares of Pledged Stock have been duly authorized and
validly issued and are fully paid and nonassessable;
(d) the Pledgor has the right to vote, pledge and grant a security
interest in the Collateral, as provided by this Pledge Agreement;
(e) upon delivery to the Agent of the stock certificates
evidencing the Pledged Stock and the execution and delivery of the stock
powers referred to in Section 4 hereof, the Lien granted pursuant to this
Pledge Agreement will constitute a valid, perfected first priority Lien
on the Collateral (except, with respect to Proceeds, only to the extent
permitted by Section 9-306 of the Code), enforceable as such against all
creditors of the Pledgor and any Persons purporting to purchase any
Collateral from the Pledgor except, in each case, as enforceability may
be affected by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law);
(f) no security agreement, financing statement or other public
notice with respect to all or any part of the Collateral is on file or of
record in any public office, except such as may have been filed in favor
of the Agent pursuant to this Pledge Agreement; and
(g) the Pledgor's chief executive office and chief place of
business, and the place where the Pledgor keeps its records concerning
the Collateral, is, as of the date hereof, located at the address listed
on Schedule II hereto, or such other location as such Pledgor shall
inform the Agent in accordance with subsection 6(e) hereof.
Each Pledgor agrees that the foregoing representations and warranties shall be
deemed to have been made by it on each Funding Date and or each date of a LIBOR
Conversion or the issuance of a Standby Letter of Credit under the Revolving
Credit Agreement on and as of such date as though made hereunder on and as of
such date.
SECTION 6. Covenants. The Pledgor covenants and agrees with the Agent and
the Lenders, that, from and after the date of this Pledge Agreement until the
Obligations are paid in full, no Standby Letters of Credit are outstanding or
not fully cash collateralized and the Commitments are terminated:
(a) If the Pledgor shall, as a result of its ownership of the
Collateral, become entitled to receive or shall receive any stock
certificate (including, without limitation, any certificate representing
a stock dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any certificate
issued in connection with any reorganization), promissory note or other
instrument, option or rights, whether in addition to, in substitution of,
as a conversion of, or in exchange for any of the Collateral, or
otherwise in respect
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thereof, the Pledgor shall accept the same as the agent of the Agent and
the Lenders, hold the same in trust for the Agent and the Lenders and
deliver the same forthwith to the Agent in the exact form received, duly
indorsed by the Pledgor to the Agent, if required, together with an
undated stock power or endorsement, as appropriate, covering such
certificate, note or instrument duly executed in blank by the Pledgor, to
be held by the Agent, subject to the terms hereof, as additional
collateral security for the Obligations. Any sums paid upon or in respect
of the Collateral upon the liquidation or dissolution of any Issuer shall
be paid over to the Agent to be held by it hereunder as additional
collateral security for the Obligations, and, in case any distribution of
capital shall be made on or in respect of the Collateral or any property
shall be distributed upon or with respect to the Collateral pursuant to
the recapitalization or reclassification of the capital of the Issuer or
pursuant to the reorganization thereof, the property so distributed shall
be delivered to the Agent to be held by it hereunder as additional
collateral security for the Obligations. If any sums of money or property
so paid or distributed in respect of the Collateral shall be received by
the Pledgor, the Pledgor shall, until such money or property is paid or
delivered to the Agent, hold such money or property in trust for the
Lenders, segregated from other funds of the Pledgor, as additional
collateral security for the Obligations.
(b) Without the prior written consent of the Agent except as
otherwise permitted by the Revolving Credit Agreement, the Pledgor shall
not (i) vote to enable, or take any other action to permit, the Issuer to
issue any stock or other equity securities of any nature or to issue any
other securities convertible into or granting the right to purchase or
exchange for any stock or other equity securities of any nature of the
Issuer, (ii) sell, assign, transfer, exchange, or otherwise dispose of,
or grant any option with respect to, the Collateral, or (iii) create,
incur or permit to exist any Lien or option in favor of, or any claim of
any Person with respect to, any of the Collateral, or any interest
therein, except for the Lien created by this Pledge Agreement. The
Pledgor will defend the right, title and interest of the Agent and the
Lenders in and to the Collateral pledged by it hereunder against the
claims and demands of all Persons whomsoever.
(c) At any time and from time to time, upon the written request of
the Agent, and at the sole expense of the Pledgor, the Pledgor will
promptly and duly execute and deliver such further instruments and
documents and take such further actions as the Agent may reasonably
request for the purposes of obtaining or preserving the full benefits of
this Pledge Agreement and of the rights and powers herein granted. If any
amount payable under or in connection with any of the Collateral shall be
or become evidenced by any promissory note, other Instrument or Chattel
Paper, such note, Instrument or Chattel Paper shall be immediately
delivered to the Agent, duly endorsed in a manner satisfactory to the
Agent, to be held as Collateral pursuant to this Pledge Agreement.
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(d) The Pledgor agrees to pay, and to hold the Agent and the
Lenders harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all stamp, excise, sales
or other similar taxes which may be payable or determined to be
payable with respect to any of the Collateral or in connection with
any of the transactions contemplated by this Pledge Agreement.
(e) The Pledgor shall not, unless it shall give 45 days' (or such
other notice as is acceptable to the Agent) prior written notice to
such effect to the Agent, (i) change the location of its chief
executive office or chief place of business from that specified in
Section 5(g) hereof, or remove its books and records from such
location or (ii) change its name, identity or structure to such an
extent that any financing statements filed by the Agent in connection
with this Agreement would become misleading.
SECTION 7. Cash Dividends, Voting Rights, and Interest Payments.
(a) Pledgor's Limited Right to Receive Dividends. Unless an Event
of Default shall have occurred and be continuing and the Agent shall
(unless such Event of Default is an Event of Default arising under
Section 7.1(g) or 7.1(h) of the Revolving Credit Agreement, in which case
no such notice need be given) have given notice to the Pledgor of the
Agent's intent to exercise its rights pursuant to Section 8 hereof with
respect to the Collateral, the Pledgor shall be (i) permitted to receive
all cash dividends or distributions in respect of the Pledged Stock to
the extent expressly permitted by the Revolving Credit Agreement and (ii)
permitted to exercise all voting, corporate and other rights of ownership
with respect to the Pledged Stock, provided, however, that no vote shall
be cast or corporate right exercised or other action taken which would
impair the Collateral or which would be inconsistent with or result in
any violation of any provision of the Revolving Credit Agreement or any
other Credit Document.
(b) Dividends Paid to Agent Upon Event of Default. If an Event of
Default shall have occurred and be continuing and the Agent shall (unless
such Event of Default is an Event of Default arising under Section 7.1(g)
or 7.1(h) of the Revolving Credit Agreement, in which case no such notice
need be given) have given notice to the Pledgor of its intent to exercise
its rights pursuant to Section 8 hereof with respect to the Collateral,
(i) all dividends and other distributions (including cash) paid on or in
respect of the Pledged Stock shall be paid to and retained by the Agent
as Collateral hereunder (or if received by the Pledgor, shall be held in
trust by the Pledgor for the benefit of the Agent and the Lenders and
shall be forthwith delivered by it) and (ii) all voting, corporate and
other rights pertaining to the Pledged Stock, if any, shall be exercised
by the Agent.
SECTION 8. Rights of the Lenders and the Agent.
(a) Right to Receive Dividends and Exercise Voting Rights. If an
Event of Default shall have occurred and be continuing and the Agent
shall (unless such Event of Default is an Event of Default arising under
Section 7.1(g) or 7.1(h) of the Revolving
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Credit Agreement, in which case no such notice need be given) give notice of its
intent to exercise its rights hereunder to the Pledgor, (i) the Agent shall have
the right to receive any and all cash dividends, distributions and payments or
other income paid in respect of the Collateral and make application thereof to
the Obligations in such order as the Agent may determine, and (ii) all shares of
the Pledged Stock shall be registered in the name of the Agent or its nominee,
and the Agent or its nominee may thereafter exercise (A) all voting, corporate
and other rights, powers and privileges pertaining to such Collateral at any
meeting of shareholders of the applicable Issuer or otherwise, and (B) any and
all rights of conversion, exchange, subscription and any other rights,
privileges or options pertaining to the Collateral as if it were the absolute
owner thereof (including, without limitation, the right to exchange at its
discretion any and all of the Collateral upon the merger, consolidation,
reorganization, recapitalization or other fundamental change in the structure of
the Issuer, or upon the exercise by the Pledgor or the Agent of any right,
privilege or option pertaining to the Collateral, and in connection therewith,
the right to deposit and deliver any and all of the Collateral with any
committee, depositary, transfer agent, registrar or other designated agency upon
such terms and conditions as it may determine), all without liability except to
account for property actually received by it and except as otherwise provided in
Section 11 hereof, but the Agent shall have no duty to the Pledgor to exercise
any such right, privilege or option and shall not be responsible for any failure
to do so or delay in so doing.
(b) Rights of Agent under Pledge Agreement Not Affected by Other
Rights of Agent. The rights of the Agent and the Lenders hereunder shall not be
conditioned or contingent upon the pursuit by the Agent or any Lender of any
right or remedy against the Issuer or the Pledgor or against any other Person
which may be or become liable in respect of all or any part of the Obligations
or against any collateral security therefor, guarantee therefor or right of
set-off with respect thereto. Neither the Agent nor any Lender shall be liable
for any failure to demand, collect or realize upon all or any part of the
Collateral or for any delay in doing so, nor shall the Agent be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
the Pledgor or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof. Without limiting the generality of
the foregoing, all rights of the Agent and Lenders, and the security interests,
hereunder and all obligations of the Pledgor hereunder shall be absolute and
unconditional irrespective of, and unaffected by, (i) any lack of validity or
enforceability of the Revolving Credit Agreement or any other Credit Document;
(ii) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Obligations, or any other amendment or waiver of or any
consent to any departure from the Revolving Credit Agreement or any other Credit
Document; (iii) any exchange, surrender, release or non-perfection of any
Pledged Collateral for all or any of the Obligations; or (iv) any other
circumstance or condition which might otherwise constitute a defense available
to, or a discharge of, the Pledgor in respect of the Obligations or this Pledge
Agreement.
(c) Agent's Right to Maintain Proceedings. The Agent (i) shall
have the right and power to institute and maintain such suits and proceedings as
it may deem
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appropriate to protect and enforce the rights vested in it by this Pledge
Agreement and (ii) may proceed by suit or suits at law or in equity to enforce
such rights and to foreclose upon the Collateral and to sell all or, from time
to time, any of the Collateral under the judgment or decree of a court of
competent jurisdiction.
(d) Appointment of Receiver. The Agent shall, to the extent
permitted by applicable law, without notice to the Pledgor or to any party
claiming through the Pledgor, without regard to the solvency or insolvency at
such time of any Person then liable for the payment of any of the Obligations,
without regard to the then value of the Collateral and without requiring any
bond from any complainant in such proceedings, be entitled as a matter of right
to the appointment of a receiver or receivers (who may be the Agent) of the
Collateral or any part thereof, pending such proceedings, with such powers as
the court making such appointment shall confer, and to the entry of an order
directing that the profits, revenues and other income of the property
constituting the whole or any part of the Collateral be segregated, sequestered
and impounded for the benefit of the Agent, and the Pledgor irrevocably consents
to the appointment of such receiver or receivers and to the entry of such order.
SECTION 9. Remedies. In the event that any portion of the Obligations has
been declared or becomes due and payable in accordance with the terms of the
Revolving Credit Agreement or other Credit Document and such Obligations have
not been paid in full, the Agent, on behalf of the Lenders, may exercise, in
addition to all other rights and remedies granted in this Pledge Agreement and
in any other instrument or agreement guarantying, securing, evidencing or
relating to the Obligations, all rights and remedies of a secured party under
the UCC. Without limiting the generality of the foregoing, the Agent, without
demand of performance or other demand, presentment, protest, advertisement or
notice of any kind (except any notice required by law referred to below) to or
upon the Pledgor, the Issuer or any other Person (all and each of which demands,
defenses, advertisements and notices are hereby waived), may in such
circumstances forthwith collect, receive, appropriate and realize upon the
Collateral, or any part thereof, and may forthwith sell, assign, give option or
options to purchase or otherwise dispose of and deliver the Collateral or any
part thereof (or contract to do any of the foregoing), in one or more parcels at
public or private sale or sales, in the over-the-counter market, at any exchange
or broker's board or office of the Agent or any Lender or elsewhere upon such
terms and conditions as it may deem advisable and at such prices as it may deem
best, for cash or on credit or for future delivery without assumption of any
credit risk. The Agent or any Lender shall have the right upon any such public
sale or sales, and, to the extent permitted by law, upon any such private sale
or sales, to purchase the whole or any part of the Collateral so sold, free of
any right or equity of redemption in the Pledgor, which right or equity is
hereby waived or released, including, to the extent permitted by applicable law,
all rights under Section 9-506 of the UCC. The Agent shall apply any Proceeds
from time to time held by it and the net proceeds of any such collection,
recovery, receipt, appropriation, realization or sale, after deducting all
reasonable costs and expenses of every kind incurred in respect thereof or
incidental to the care or safekeeping of any of the Collateral or in any way
relating to the Collateral or the rights
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of the Agent and the Lenders hereunder, including, without limitation,
reasonable attorneys' fees and disbursements of counsel to the Agent, to the
payment in whole or in part of the Obligations, in such order as the Agent may
elect, and only after such application and after the payment by the Agent of any
other amount required by any provision of law, including, without limitation,
Section 9-504(1)(c) of the UCC, shall the Agent be required to account for the
surplus, if any, to the Pledgor. To the extent permitted by applicable law, the
Pledgor waives all claims, damages and demands it may acquire against the Agent
or any Lender arising out of the lawful exercise by them of any rights
hereunder. If any notice of a proposed sale or other disposition of Collateral
shall be required by law, such notice shall be deemed reasonable and proper if
given at least 10 days before such sale or other disposition.
SECTION 10. Registration Rights; Private Sales.
(a) Registration of Securities. If the Agent shall determine to
exercise its right to sell any or all of the Collateral pursuant to Section 9
hereof, and if in the opinion of the Agent it is necessary or advisable to have
the Collateral, or that portion thereof to be sold, registered under the
provisions of the Securities Act, the Pledgor will cause the Issuer to (i)
execute and deliver, and cause the directors and officers of the Issuer or the
Pledgor, as the case may be, to execute and deliver, all such instruments and
documents, and do or cause to be done all such other acts as may be, in the
opinion of the Agent, necessary or advisable to register the Pledged Stock, or
that portion thereof to be sold, under the provisions of the Securities Act,
(ii) use its best efforts to cause the registration statement relating thereto
to become effective and to remain effective for such period of time as is
required by law, and (iii) make all amendments thereto or to the related
prospectus that, in the opinion of the Agent are necessary or advisable, all in
conformity with the requirements of the Securities Act and the rules and
regulations of the SEC applicable thereto. The Pledgor agrees to cause the
Issuer to comply with the provisions of the securities or "Blue Sky" laws of any
and all jurisdictions that the Agent shall designate and to make available to
its security holders, as soon as practicable, an earnings statement (which need
not be audited) that will satisfy the provisions of Section 11(a) of the
Securities Act.
(b) Private Sales. The Pledgor recognizes that the Agent may be
unable to effect a public sale of any or all the Pledged Stock by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws or otherwise, and may be compelled to resort to one or more
private sales thereof to a restricted group of purchasers that will be obliged
to agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof. The
Pledgor acknowledges and agrees that any such private sale may result in prices
and other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Agent shall be
under no obligation to delay a sale of any of the Pledged Stock for the period
of time necessary to
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permit the Issuer to register such securities for public sale under the
Securities Act, or under applicable state securities laws, even if the Issuer
would agree to do so.
(c) Assistance. The Pledgor further agrees to use its best efforts
to do or cause to be done all such other acts as may be necessary to make such
sale or sales pursuant to this Section 10 of all or any portion of the Pledged
Stock valid and binding and in compliance with any and all other applicable
laws. The Pledgor further agrees that a breach of any of the covenants contained
in this Section 10 will cause irreparable injury to the Agent and the Lenders,
that the Agent and the Lenders have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section 10 shall be specifically enforceable against the Pledgor, and the
Pledgor hereby waives and agrees not to assert any defenses against an action
for specific performance of such covenants.
SECTION 11. Limitation on Duties Regarding Collateral. The Agent's sole
duty with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the UCC or otherwise, shall
be to deal with it in the same manner as the Agent deals with similar securities
and property for its own account. Neither the Agent nor any Lender nor their
respective directors, officers, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Collateral or for any delay in
doing so (except to the extent the same constitutes gross negligence or willful
misconduct) or shall be under any obligation to sell or otherwise dispose of any
Collateral upon the request of any Pledgor or otherwise. The Agent shall not be
liable to any Pledgor or any other Person for any loss caused by the Agent's
failure to meet any obligation imposed upon it by Section 9-207 of the UCC or
any successor provision except to the extent the Agent shall have breached its
duty as provided in the first sentence of this Section 11. The Agent shall not
have any duty or responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relative to any Collateral, whether or not the Agent has or is deemed to have
knowledge of such matters, or (ii) taking any necessary steps to preserve rights
against any parties with respect to the Collateral.
SECTION 12. Power of Attorney; Powers Coupled with an Interest.
(a) Power of Attorney. Without limiting any other right granted
hereunder, the Pledgor hereby irrevocably constitutes and appoints the Agent,
with full power of substitution, as its true and lawful attorney-in-fact with
full irrevocable power and authority in the place and stead of the Pledgor and
in the name of the Pledgor or in its own name, from time to time in the Agent's
reasonable discretion for the purpose of carrying out the terms of this Pledge
Agreement, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purpose of this Pledge Agreement. Without limiting the generality of the
foregoing, the Pledgor hereby gives the Agent the power and right, on behalf of
the Pledgor, without notice to or assent by the Pledgor, to do the following:
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(i) to pay or discharge taxes, liens, security interests or
other encumbrances levied or placed on or threatened against the
Collateral; and
(ii) upon the occurrence and continuance of any Event of
Default and otherwise to the extent provided in this Pledge Agreement,
(A) to direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due and to come due
thereunder directly to the Agent or as the Agent shall direct, (B) to
receive payment of and receipt for, and to demand and ▇▇▇ for, any and
all moneys, claims and other amounts due and to become due at any time in
respect of or arising out of the Collateral, (C) to sign and indorse and
receive, take, assign and deliver, any checks, notes, drafts, negotiable
and non-negotiable instruments, any invoices, drafts against debtors,
assignments, verifications and notices in connection with accounts and
other documents relating to the Collateral, (D) to commence, settle,
compromise, compound, prosecute, defend or adjust any claim, suit, action
or proceeding with respect to, or in connection with, the Collateral, (E)
to sell, transfer, assign or otherwise deal in or with the Collateral or
any part thereof, as fully and effectively as if the Agent were the
absolute owner thereof and (F) to do, at its option, but at the expense
of the Pledgor, at any time or from time to time, all acts and things
which the Agent deems necessary to protect, preserve or realize upon the
Collateral and the Agent's security interest therein, in order to effect
the intent of this Pledge Agreement, all as fully and effectively as the
Pledgor might do.
(b) Powers Coupled With an Interest. All authorizations and
agencies granted or provided herein with respect to the Collateral, including
the powers granted under clause (a) of this Section 12, are irrevocable and
powers coupled with an interest.
SECTION 13. Estoppel.
(a) No Actions To Impede Sale of Collateral. The Pledgor agrees,
to the extent it may lawfully do so, that it will not at any time in any manner
whatsoever claim or take the benefit or advantage of any appraisal, valuation,
stay, extension, moratorium, turnover or redemption law, or any law permitting
it to direct the order in which the Collateral shall be sold, now or at any time
hereafter in force which may delay, prevent or otherwise affect the performance
or enforcement of this Pledge Agreement, and hereby waives all benefit or
advantage of all such laws. The Pledgor covenants that it will not hinder, delay
or impede the execution of any power granted to the Agent in this Pledge
Agreement, the Revolving Credit Agreement or any other Credit Document.
(b) Collateral Sold as an Entirety. The Pledgor, to the extent it
may lawfully do so, on behalf of itself and all who claim through or under it,
including without limitation any and all subsequent creditors, vendees,
assignees and lienors, waives and releases all rights to demand or to have any
marshalling of the Collateral upon any sale, whether made under any power of
sale granted herein or pursuant to judicial proceedings
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or under any foreclosure or any enforcement of this Pledge Agreement, and
consents and agrees that all of the Collateral may at any such sale be offered
and sold as an entirety.
SECTION 14. Severability. The provisions of this Pledge Agreement are
severable, and if any clause or provision of this Pledge Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction, then such
clause or provision shall, as to such jurisdiction, be ineffective to the extent
of such invalidity or unenforceability without in any manner affecting the
validity or enforceability of such clause or provision in any other jurisdiction
or the remaining provisions hereof in any jurisdiction.
SECTION 15. Integration. This Pledge Agreement and the other Credit
Documents constitute the entire agreement of the Agent, the Lenders, the
Borrower and the other Credit Parties with respect to the subject matter hereof
and thereof, and there are no promises, undertakings, representations or
warranties by the Agent or any Lender relative to the subject matter hereof or
thereof not expressly set forth or referred to herein or in the other Credit
Documents.
SECTION 16. No Waiver; Cumulative Remedies. Neither the Agent nor any
Lender shall by any act (except by a written instrument pursuant to Section 17
hereof) be deemed to have waived any right or remedy hereunder. No failure to
exercise, nor any delay in exercising, on the part of the Agent or any Lender
any right, power or privilege hereunder shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. A waiver by the Agent or any Lender of any right or
remedy hereunder on any one occasion shall not be construed as a bar to any
right or remedy which the Agent or such Lender would otherwise have on any
future occasion. The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
SECTION 17. Waivers and Amendments; Successors and Assigns, Governing
Law. None of the terms or provisions of this Pledge Agreement may be amended,
supplemented or otherwise modified except by a written instrument executed by
the Pledgor and the Agent; provided that any provision of this Pledge Agreement
may be waived by the Agent in a letter or agreement executed by the Agent or by
telex or facsimile transmission from the Agent. This Pledge Agreement shall be
binding upon the successors and assigns of the Pledgor and shall inure to the
benefit of the Agent and the Lenders and their respective successors and
assigns. THIS PLEDGE AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF VIRGINIA,
without giving effect to principles of conflicts of laws other than those
contained in the UCC.
SECTION 18. Notices. All notices, requests and other communications to a
party hereunder shall be in writing and shall be given to such party at, in the
case of the Agent
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or any Lender, to its address or facsimile number specified in the Revolving
Credit Agreement, to the Pledgor, to its address or facsimile number specified
on Schedule II hereto, and to the Issuer, to its address or facsimile number
specified on Schedule III hereto or, in each case, such other address as such
party may hereafter specify for that purpose by notice to the other. Each such
notice, request or other communication shall be effective (i) in the case of
telephonic notice (to the extent expressly permitted hereunder), when made, (ii)
in the case of notice delivered by overnight express courier, one Business Day
after the Business Day such notice was delivered to such courier, (iii) in the
case of notice delivered by first class mail, three Business Days after being
deposited in the mail, postage prepaid, return receipt requested, (iv) in the
case of notice by hand, when delivered, or (v) in the case of notice by any
customary means of telecommunication, when sent provided confirmation of receipt
or answer back has been received, in each case if addressed to any party hereto
as provided herein. Rejection or refusal to accept, or the inability to deliver
because of a changed address of which no notice was given, shall not affect the
validity of notice given in accordance with this section.
SECTION 19. Irrevocable Authorization and Instruction to Issuer. The
Pledgor hereby authorizes and instructs the Issuer to comply with any
instruction received by it from the Agent in writing that (a) states that an
Event of Default has occurred and is continuing and (b) is otherwise in
accordance with the terms of this Pledge Agreement, without any other or further
instructions from the Pledgor, and the Pledgor agrees that the Issuer shall be
fully protected in so complying.
SECTION 20. Authority of Agent. The Pledgor acknowledges that the rights
and responsibilities of the Agent under this Pledge Agreement with respect to
any action taken by the Agent or the exercise or non-exercise by the Agent of
any option, voting right, request, judgment or other right or remedy provided
for herein or resulting or arising out of this Pledge Agreement shall, as
between the Agent and the Lenders, be governed by the Revolving Credit Agreement
and by such other agreements with respect thereto as may exist from time to time
among them, but, as between the Agent and the Pledgor, the Agent shall be
conclusively presumed to be acting as agent for the Lenders with full and valid
authority so to act or refrain from acting, and neither the Pledgor nor the
Issuer shall be under any obligation, or entitlement, to make any inquiry
respecting such authority.
SECTION 21. Judicial Proceedings; Waiver of Jury Trial. Any judicial
proceeding brought against the Pledgor with respect to any Credit Agreement
Related Claim may be brought in any court of competent jurisdiction in the
Commonwealth of Virginia, and, by execution and delivery of this Pledge
Agreement, the Pledgor (a) accepts, generally and unconditionally, the
nonexclusive jurisdiction of such courts and any related appellate court and
irrevocably agrees to be bound by any judgment rendered thereby in connection
with any Credit Agreement Related Claim and (b) irrevocably waives any objection
it may now or hereafter have as to the venue of any such proceeding brought in
such a court or that such a court is an inconvenient forum. The Pledgor hereby
waives personal service of process and consents that service of
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process upon it may be made by certified or registered mail, return receipt
requested, at its address specified or determined in accordance with the
provisions of Section 18 of this Pledge Agreement, and service so made shall be
deemed completed on the earlier of (x) the receipt thereof and (y) if delivered
in the manner described in clause (iii) of Section 18 hereof, the fifth (5th)
Business Day after such service is deposited in the mail. Nothing herein shall
affect the right of any Lender or the Agent to serve process in any other manner
permitted by law or shall limit the right of any Lender or the Agent to bring
proceedings against the Pledgor in the courts of any other jurisdiction. Any
judicial proceeding by the Pledgor against any Lender or the Agent involving any
Credit Agreement Related Claim shall be brought only in a court located in the
Commonwealth of Virginia. THE PLEDGOR AND THE LENDERS AND THE AGENT HEREBY WAIVE
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING TO WHICH THEY ARE PARTIES INVOLVING ANY
CREDIT AGREEMENT RELATED CLAIM.
SECTION 22. Expenses of the Agent. The Pledgor shall pay to the Agent
from time to time upon demand (i) all of the costs and expenses (including
reasonable fees and disbursements of counsel) incurred by the Agent in
connection with the preparation, modification, amendment, waiver or termination
of this Pledge Agreement or any document or agreement contemplated hereby or any
consent or waiver hereunder or thereunder and (ii) as a result of or in
connection with any Event of Default, all of the costs and expenses incurred by
the Agent or any Lender (including, without limitation, the reasonable fees and
disbursements of counsel and any amounts payable by the Agent or any Lender to
any of their respective agents) arising from or incurred in connection with the
administration (excluding internal overhead costs) of this Pledge Agreement, or
any document or agreement contemplated hereby, or in connection with the
administration (excluding internal overhead costs), sale or other disposition of
Collateral hereunder or under any document or agreement contemplated hereby or
the preservation, protection or defense of the rights of the Agent or any Lender
in and to the Collateral.
SECTION 23. Indemnification. The Pledgor shall at all times hereafter
indemnify, hold harmless and, on demand, reimburse the Agent and the Lenders and
their respective subsidiaries, affiliates, successors, assigns, officers,
directors, employees and agents, and their respective heirs, executors,
administrators, successors and assigns (all of the foregoing parties, including,
but not limited to, the Agent, being hereinafter collectively referred to as the
"Indemnities" and individually as an "Indemnitee") from, against and for any and
all liabilities, obligations, claims, damages, actions, penalties, causes of
action, losses, judgments, suits, costs, expenses and disbursements, including,
without limitation, attorney's fees (any and all of the foregoing being
hereinafter collectively referred to as the "Liabilities" and individually as a
"Liability") which the Indemnitees, or any of them, might be or become
subjected, by reason of, or arising out of the preparation, execution, delivery,
modification, administration or enforcement of, or performance of the Agent's or
any Lender's rights under, this Pledge Agreement or any other document,
instrument or agreement contemplated hereby or executed in connection herewith;
provided, however, that the Pledgor shall not be liable to any Indemnitee for
any Liability caused solely by the gross negligence or willful misconduct of
such
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Indemnitee; and, provided, further, that no Lender shall be entitled to be
indemnified for its costs and expenses incurred in connection with the
preparation, execution, delivery, modification, administration or enforcement of
this Pledge Agreement except to the extent provided in Section 22 hereof. In no
event shall any Indemnitee, as a condition to enforcing its rights under this
Section 23 or otherwise, be obligated to make a claim against any other Person
(including, without limitation, the Agent) to enforce its rights under this
Section 23.
SECTION 24. Further Acts and Assurances Generally. The Pledgor shall
promptly and duly execute and deliver to a Lender or the Agent, as the case may
be, and to such other persons as such Lender or the Agent shall reasonably
designate, such further instruments and shall take such further action as may be
required by law or as such Lender or the Agent may from time to time reasonably
request in order more effectively to carry out and accomplish the intent and
purpose of this Pledge Agreement and to establish and protect the rights and
remedies created or intended to be created in favor of the Agent or any Lender
hereunder.
SECTION 25. Counterparts. This Pledge Agreement may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each complete set of which, when so executed and delivered by all parties, shall
be an original, but all such counterparts shall together constitute but one and
the same instrument.
SECTION 26. Headings; Bold Type. The section headings, subsection
headings, and bold type used herein have been inserted for convenience of
reference only and do not constitute matters to be considered in interpreting
this Pledge Agreement.
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IN WITNESS WHEREOF, the undersigned have caused this Pledge Agreement to be duly
executed and delivered as of the date first above written.
PLEDGORS
[Name of Pledgor]
By:
----------------------
Name:
Title:
AGENT
BANK OF AMERICA, N.A., as Agent
By:
------------------------------------
Name:
Title:
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ACKNOWLEDGEMENT AND CONSENT
The undersigned Issuer referred to in the foregoing Pledge
Agreement hereby acknowledges receipt of a copy thereof and agrees to be bound
thereby and to comply with the terms thereof insofar as such terms are
applicable to it. The undersigned Issuer agrees to notify the Agent promptly in
writing of the occurrence of any of the events described in Section 6(a) of the
Pledge Agreement. The undersigned Issuer further agrees that the terms of
Section 10(c) of the Pledge Agreement shall apply to it, mutatis mutandis, with
respect to all actions that may be required of it under or pursuant to or
arising out of Section 10 of the Pledge Agreement.
ISSUER
[Name of Issuer]
By:
-----------------------------------
Name:
Title:
121
Schedule I to Pledge Agreement
Description of Pledged Stock
OWNER OF PERCENTAGE
STOCK TOTAL NO. OF OUTSTANDING OF SHARES
CLASS OF CERTIF. OUTSTANDING SHARES AND NO. OWNED
NAME OF ISSUER STOCK NUMBER SHARES OF SHARES OWNED BY OWNERS
------------------------------- --------------------- ------------- ------------------- ----------------------------- --------------
[Foreign Subsidiary] [Common]; [1] ____ [Name of Pledgor]; __ [100%]
___ shares
authorized;
par value $___
per share
------------------------------- --------------------- ------------- ------------------- ----------------------------- --------------
122
Schedule II to Pledge Agreement
Chief Executive
Office of The Pledgor
Name of Pledgor Chief Executive Office
--------------- ----------------------
[Name] [Address]
123
Schedule III to Pledge Agreement
Address of Issuers
Name of Issuers Address
--------------- -------
[Name] [Address]
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Exhibit B to Amended and Restated
Revolving Credit Agreement
FORM OF
REVOLVING NOTE
REVOLVING NOTE
U.S.$18,000,000.00 Dated: ___________, 2000
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇ ▇▇▇▇▇▇, INC., a Delaware
corporation (the "Borrower"), hereby unconditionally promises to pay on the
Maturity Date to the order of BANK OF AMERICA, N.A. (the "Lender"), and its
successors and assigns, the principal amount of the lesser of (x) EIGHTEEN
MILLION UNITED STATES DOLLARS ($18,000,000.00) and (y) the aggregate amount of
Revolving Loans made by the Lender to the Borrower pursuant to the Agreement (as
hereinafter defined) and remaining outstanding on such date. Capitalized terms
used (but not defined) in this Revolving Note shall have the meanings given to
them in the Agreement (as hereinafter defined).
The Borrower promises to pay interest from the initial Funding Date
of such Revolving Loans until the Maturity Date on the principal amount of this
Revolving Note from time to time outstanding at the rate, and in the manner,
prescribed in the Agreement. Any principal amount of, or any interest accrued
on, this Revolving Note which is not paid on the date due shall bear interest
from such due date until paid in full at the Default Rate. In no event shall the
rate of interest borne by this Revolving Note at any time exceed the maximum
rate of interest permitted at that time under applicable law.
Payments of the principal amount of and interest on this Revolving
Note shall be made in lawful money of the United States of America to the
Lending Office of the Agent on behalf of the Lender as provided in the
Agreement.
This Revolving Note is one of the Revolving Notes referred to in the
Amended and Restated Revolving Credit Agreement, dated as of July 28, 2000 (as
the same may from time to time be amended, modified or supplemented, the
"Agreement"), between the Lender, the lenders from time to time a party thereto,
if
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any, the Borrower and Bank of America, N.A., as Agent. The Lender is entitled to
the rights and benefits of the Agreement and the other Credit Documents, and the
Agent, for the benefit of the Lender, is entitled to the benefits provided under
the Borrower Security Agreement, the Subsidiary Security Agreements, any Pledge
Agreement and the Subsidiary Guarantee. The Agreement, among other things,
contains provisions for optional and mandatory prepayments on account of the
principal of this Revolving Note by the Borrower and for acceleration of the
maturity of this Revolving Note upon the terms and conditions therein specified.
This Revolving Note is being issued in replacement of that certain
Revolving Note, dated May 20, 1998, issued by the Borrower to the Lender (as
successor to NationsBank, N.A.) under the Original Credit Agreement.
THIS REVOLVING NOTE IS BEING ISSUED IN THE COMMONWEALTH OF VIRGINIA
AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT REGARD TO THE CONFLICTS OF LAWS
PRINCIPLES.
▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By:__________________________
Name:
Title:
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Exhibit C to the Amended and Restated
Revolving Credit Agreement
FORM OF
AMENDED AND RESTATED
SUBSIDIARY GUARANTEE
AMENDED AND RESTATED SUBSIDIARY GUARANTEE, dated as of ___________, 2000
(this "Guarantee"), is made by each of the entities that are signatories hereto
(the "Guarantors") in favor of BANK OF AMERICA, N.A., as Agent (in such
capacity, the "Agent") for the lenders and other financial institutions (the
"Lenders") that are from time to time parties to the Revolving Credit Agreement
described below.
W I T N E S S E T H:
WHEREAS, ▇▇▇▇▇▇ Bailly, Inc., a Delaware corporation (the "Company"), is
party to the Amended and Restated Revolving Credit Agreement, dated as of July
28, 2000, among the Company, the Lenders and the Agent (as amended, supplemented
or otherwise modified from time to time, the "Revolving Credit Agreement"),
amending and restating in its entirety the Revolving Credit Agreement, dated as
of November 20, 1998 (as amended, the "Original Credit Agreement") between the
Agent, the Lenders and the Company;
WHEREAS, in connection with the transactions contemplated by the Original
Credit Agreement, the Guarantors entered into in favor of the Agent, for the
ratable benefit of the Lenders, a Subsidiary Guaranty, dated as of November 20,
1998 (as amended, the "Original Guaranty");
WHEREAS, pursuant to the terms of the Revolving Credit Agreement and the
other Credit Documents, the Lenders have severally agreed to make extensions of
credit in the form of Revolving Loans, Swing Line Loans and Standby Letters of
Credit to or for the benefit of the Company;
WHEREAS, except as set forth in the Revolving Credit Agreement or the
schedules attached thereto, the Company owns, directly or indirectly, all of the
issued and outstanding shares of capital of stock of, or other equity interests
in, each of the Guarantors;
WHEREAS, the proceeds of such Revolving Loans, Swing Line Loans and
Standby Letters of Credit may be used to enable the Company to make valuable
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transfers to any or all of the Guarantors in connection with the operation of
their respective businesses and for the Permitted Uses;
WHEREAS, each Guarantor will derive substantial direct and indirect
benefit from such Revolving Loans, Swing Line Loans and Standby Letters of
Credit;
WHEREAS, the obligation of the Lenders to make the Revolving Loans and
Swing Line Loans and issue the Standby Letters of Credit is conditioned upon,
among other things, the execution and delivery by each of the Guarantors of a
guarantee to the Agent for the benefit of the Agent and for the ratable benefit
of the Lenders; and
WHEREAS, the Guarantors and the Agent desire to amend and restate the
Original Guaranty in its entirety upon the terms and conditions set forth
herein;
NOW, THEREFORE, in consideration of the premises, the commercial benefits
accruing to each Guarantor and to induce the Lenders to enter into the Revolving
Credit Agreement and to make the Revolving Loans and the Swing Line Loans and to
issue the Standby Letters of Credit, each Guarantor hereby agrees with and for
the benefit of the Agent and the Lenders as follows:
SECTION 1. Defined Terms. As used in this Guarantee, terms defined in the
Revolving Credit Agreement (unless otherwise defined herein) are used herein as
therein defined, and the following terms shall have the following meanings (such
meanings to be, when appropriate, equally applicable to both the singular and
plural forms of the terms defined):
"Agent" shall have the meaning specified in the preamble hereof.
"Guarantee" shall have the meaning specified in the preamble hereof.
"Guarantors" shall have the meaning specified in the preamble
hereof.
"Lenders" shall have the meaning specified in the preamble hereof.
"Maximum Guaranteed Amount" for any Guarantor shall mean the amount
which can be guaranteed by such Guarantor under applicable federal and state
laws relating to the insolvency of debtors.
"Revolving Credit Agreement" shall have the meaning specified in the
first whereas clause hereof.
SECTION 2. Guarantee.
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(a) Each of the Guarantors hereby, jointly and severally,
absolutely, unconditionally and irrevocably guarantees to the Agent and the
Lenders and their respective successors, indorsees, transferees and assigns the
prompt and complete payment by the Company when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations, and each Guarantor
further agrees to pay any and all expenses (including, without limitation, all
reasonable fees and disbursements of counsel) which may be paid or incurred by
the Agent or any Lender in enforcing, or obtaining advice of counsel in respect
of, any rights with respect to, or collecting, any or all of the Obligations
and/or enforcing any rights with respect to, or collecting against, such
Guarantor under this Guarantee; provided, however, that, notwithstanding
anything to the contrary contained herein or in any other Credit Document, the
maximum liability of each Guarantor hereunder and under the other Credit
Documents shall in no event exceed such Guarantor's Maximum Guaranteed Amount.
This Guarantee constitutes a present and continuing guarantee of payment and
performance when due and not of collection, and each of the Guarantors, as a
primary obligor and not as a surety, specifically agrees that no Guarantor shall
be entitled to require that the Agent or any Lender exercise any right, assert
any claim or demand, foreclose against or enforce any remedy whatsoever against
the Company (or any other Person) before or as a condition to the obligations of
such Guarantor hereunder. Each Guarantor hereby acknowledges that it is fully
aware of the terms and conditions and has received a copy of each Credit
Document to which it or any other Credit Party is a party and is fully aware of
the transactions contemplated thereby.
(b) Each Guarantor agrees that the Obligations may at any time and
from time to time exceed the Maximum Guaranteed Amount of such Guarantor or of
all of the Guarantors without impairing this Guarantee or affecting the rights
and remedies of the Agent and the Lenders hereunder.
(c) No payment or payments made by the Company, any of the
Guarantors, any other guarantor or any other Person or received or collected by
the Agent or any Lender from the Company, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of the Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of any Guarantor hereunder which
shall, notwithstanding any such payment or payments other than payments made by
such Guarantor in respect of the Obligations or payments received or collected
from such Guarantor in respect of the Obligations, remain liable for the
Obligations up to its Maximum Guaranteed Amount until such time as the
Obligations are paid in full, no Standby Letters of Credit are outstanding or
not fully cash collateralized and the Commitments are terminated.
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(d) Each Guarantor agrees that whenever, at any time or from time to
time, it shall make any payment to the Agent or any Lender on account of its
liability hereunder, it will notify the Agent in writing that such payment is
made under this Guarantee for such purpose.
SECTION 3. Right of Contribution. Each Guarantor hereby agrees that to the
extent that a Guarantor shall have paid more than its proportionate share of any
payment made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder who has not paid its
proportionate share of such payment. Each Guarantor's right of contribution
shall be subject to the terms and conditions of Section 5 hereof. The provisions
of this Section 3 shall in no respect limit the obligations and liabilities of
any Guarantor to the Agent and the Lenders, and each Guarantor shall remain
liable to the Agent and the Lenders for the full amount guaranteed by such
Guarantor hereunder.
SECTION 4. Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default specified in the Revolving Credit Agreement,
each Guarantor hereby irrevocably authorizes each Lender at any time and from
time to time without notice to such Guarantor or any other Guarantor, any such
notice being expressly waived by each Guarantor, to set-off and appropriate and
apply any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender to or for the
credit or the account of such Guarantor, or any part thereof, in such amounts as
such Lender may elect, against and on account of the obligations and liabilities
of such Guarantor to such Lender hereunder and claims of every nature and
description of such Lender against such Guarantor, in any currency, whether
arising hereunder, under the Revolving Credit Agreement, the Revolving Notes,
the Swing Line Note, the Standby Letters of Credit or otherwise under any other
Credit Document, as such Lender may elect, whether or not the Agent or any
Lender has made any demand for payment and although such obligations,
liabilities and claims may be contingent or unmatured. Each Lender agrees to
notify such Guarantor promptly of any such set-off and the application made by
such Lender, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Lender under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which such Lender may have.
SECTION 5. Subrogation, etc. Notwithstanding any payment or payments made
by any of the Guarantors hereunder or any set-off or application of funds of any
of the Guarantors by any Lender, no Guarantor shall exercise any of the rights
of the Agent or any Lender which the Guarantor may acquire by way of
subrogation, by any payment made hereunder, by reason of such set-off or
application of funds or otherwise, against the Company or any other Guarantor or
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any collateral security or guarantee or right of set-off held by any Lender for
the payment of the Obligations, nor shall any Guarantor seek or be entitled to
seek any contribution or reimbursement from the Company or any other Guarantor
in respect of payments made by such Guarantor hereunder, until all amounts owing
to the Agent and the Lenders by the Company on account of the Obligations are
paid in full, no Standby Letters of Credit are outstanding or not fully cash
collateralized and the Commitments are terminated. If any amount shall be paid
to any Guarantor on account of such subrogation or reimbursement rights at any
time when all of the Obligations shall not have been paid in full, any Standby
Letter of Credit shall be outstanding or not fully cash collateralized or the
Commitments shall not have been terminated, such amount shall be held by such
Guarantor in trust for the Agent and the Lenders, segregated from other funds of
such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned
over to the Agent in the exact form received by such Guarantor (duly indorsed by
such Guarantor to the Agent, if required), to be applied against the
Obligations, whether matured or unmatured, in such order as required by the
applicable Credit Documents.
SECTION 6. Amendments, etc. with respect to the Obligations; Waiver of
Rights. Each Guarantor shall remain obligated hereunder notwithstanding that,
without any reservation of rights against any Guarantor and without notice to or
further assent by any Guarantor, (i) any demand for payment of any of the
Obligations made by the Agent or any Lender may be rescinded by such party and
any of the Obligations continued, (ii) the Obligations, or the liability of any
other party upon or for any part thereof, may, from time to time, in whole or in
part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Agent or any Lender, (iii) the Revolving Credit
Agreement, the Revolving Notes, the Swing Line Note, the other Credit Documents,
any Standby Letter of Credit and any other collateral security document or other
guarantee or document in connection therewith may be amended, modified,
supplemented or terminated, in whole or in part, as the Agent and/or any Lender
may deem advisable from time to time, and (iv) any collateral security,
guarantee or right of set-off at any time held by the Agent or any Lender for
the payment of the Obligations may be sold, exchanged, waived, surrendered or
released. Neither the Agent nor any Lender shall have any obligation to protect,
secure, perfect or insure any Lien at any time held by it as security for the
Obligations or for this Guarantee or any property subject thereto. When making
any demand hereunder against any of the Guarantors, the Agent or any Lender may,
but shall be under no obligation to, make a similar demand on the Company or any
other Guarantor or guarantor, and any failure by the Agent or any Lender to make
any such demand or to collect any payments from the Company or any such other
Guarantor or guarantor or any release of the Company or such other Guarantor or
guarantor shall not relieve any of the Guarantors in respect of which a demand
or collection is not made or any of
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the Guarantors not so released of their several obligations or liabilities
hereunder, and shall not impair or affect the rights and remedies, express or
implied, or as a matter of law, of the Agent or any Lender against any of the
Guarantors. For the purposes hereof "demand" shall include the commencement and
continuance of any legal proceedings. EACH GUARANTOR EXPRESSLY AND IRREVOCABLY
WAIVES THE BENEFITS AFFORDED TO IT UNDER SECTIONS 49-25 AND 49-26 OF THE CODE OF
VIRGINIA (1950), AS AMENDED, OR ANY SIMILAR STATUTE OR COMMON LAW.
SECTION 7. Guarantee Absolute and Unconditional. Each Guarantor waives any
and all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by the Agent or any Lender upon
this Guarantee or acceptance of this Guarantee. The Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, annexed or waived, in reliance upon this Guarantee, and
all dealings between the Company or any of the Guarantors and the Agent or any
Lender shall likewise be conclusively presumed to have been had or consummated
in reliance upon this Guarantee. Each Guarantor waives diligence, presentment,
protest, demand for payment and notice of default or nonpayment to or upon the
Company or any of the Guarantors with respect to the Obligations or this
Guarantee. Each Guarantor understands and agrees that this Guarantee shall be
construed as a continuing, absolute and unconditional guarantee of payment, and
not of collection, without regard to (whether or not the Guarantor or the
Company shall have any knowledge or notice of any of the following) (a) the
validity, regularity or enforceability of the Revolving Credit Agreement, the
Revolving Notes, the Swing Line Note, the Standby Letters of Credit, any of the
other Credit Documents, any of the Obligations or any other collateral security
therefore or guarantee or right of set-off with respect thereto at any time or
from time to time held by the Agent or any Lender, (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at any
time be available to or be asserted by the Company against the Agent or any
Lender, (c) any termination, amendment or modification of, or deletion from, or
addition or supplement to, or other change in any of the Credit Documents or any
other instrument or agreement applicable to any of the parties to such
agreements, or any furnishing or acceptance of additional security, or any
release of, exchange or action with respect to any security, for the obligations
of the Company under the Credit Documents, or the failure of any security or the
failure of any Person to perfect any interest in any collateral security; (d)
any exercise, nonexercise or waiver of any right, remedy, power or privilege
under or in respect of any Credit Document or any obligation or liability
contained therein or any failure to mitigate damages under any Credit Document
or any waiver of any such right, remedy, power or privilege or any failure to
give any notice (including notice of an Event of Default) to any Credit Party;
(e) any extension of time for payment of any Obligation, or of the time for
performance of
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any other obligations, covenants or agreements under or arising out of any
Credit Document, or the extension or the renewal of any thereof; and (f) any
other law, rule, regulation, event, condition or circumstance whatsoever (with
or without notice to or knowledge of the Company or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of the Company for the Obligations, or of such Guarantor under this
Guarantee (or of a guarantor or surety in general), in bankruptcy or in any
other instance. When pursuing its rights and remedies hereunder against any
Guarantor, the Agent and any Lender may, but shall be under no obligation to,
pursue such rights and remedies as it may have against the Company or any other
Person or against any collateral security or guarantee for the Obligations or
any right of set-off with respect thereto, and any failure by the Agent or any
Lender to pursue such other rights or remedies or to collect any payments from
the Company or any such other Person or to realize upon any such collateral
security or guarantee or to exercise any such right of set-off, or any release
of the Company or any such other Person or any such collateral security,
guarantee or right of set-off, shall not relieve such Guarantor of any liability
hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of the Agent or any Lender
against such Guarantor. This Guarantee shall remain in full force and effect and
be binding in accordance with and to the extent of its terms upon each Guarantor
and the successors and assigns thereof, and shall inure to the benefit of the
Agent and the Lenders, and their respective successors, indorsees, transferees
and assigns, until all the Obligations and the obligations of each Guarantor
under this Guarantee shall have been satisfied by payment in full, no Standby
Letter of Credit shall remain outstanding or not fully cash collateralized and
the Commitments shall be terminated, notwithstanding that from time to time
during the term of the Revolving Credit Agreement the Company may be free from
any Obligations.
SECTION 8. Reinstatement. This Guarantee shall continue to be effective,
or be reinstated automatically, as the case maybe, if at any time payment, or
any part thereof, of any of the Obligations is rescinded or must otherwise be
restored or returned by the Agent or any Lender upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of the Company or any Guarantor, or
upon or as a result of the appointment of a receiver, intervenor or conservator
of, or trustee or similar officer for, the Company or any Guarantor or any
substantial part of its property, or otherwise, all as though such payments had
not been made. If an event permitting the declaration of default under a Credit
Document shall at any time have occurred and be continuing, and such declaration
of default shall at such time be prevented by reason of the pendency against the
Company or any other Person of a case or proceeding under a bankruptcy or
insolvency law, each Guarantor agrees that, for purposes of this Guarantee and
its obligations hereunder, such Credit Document shall be deemed to have been
declared in default with the same effect as if such Credit Document had been
enforceable in accordance with the terms thereof,
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and each Guarantor shall forthwith pay the amounts specified by the Agent or any
Lenders to be paid thereunder, any interest thereon and any other amounts
guaranteed hereunder without further notice or demand.
SECTION 9. Payments; Execution and Delivery Taxes. Each Guarantor hereby
guarantees that payments hereunder will be paid to the Agent without set-off or
counterclaim in U.S. Dollars at the office of the Agent located at BANK OF
AMERICA, N.A., care of ▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇, VA-200-05-02, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or such other office of the Agent in the United
States of America as the Agent may from time to time designate to the Guarantors
by written notice.
SECTION 10. Representations and Warranties. Each Guarantor hereby
represents and warrants that:
(a) such Guarantor is a corporation, limited liability company or
partnership, as the case may be, duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is organized and has the
corporate, limited liability company or partnership power and authority and the
legal right to own and operate its property, to lease the property it operates
and to conduct the business in which it is currently engaged;
(b) such Guarantor has the corporate, limited liability company or
partnership power and authority and the legal right to execute and deliver, and
to perform its obligations under this Guarantee, and has taken all necessary
corporate, limited liability company or partnership action to authorize its
execution, delivery and performance of this Guarantee;
(c) this Guarantee constitutes the legal, valid and binding
obligations of such Guarantor enforceable against such Guarantor in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law);
(d) the execution, delivery and performance by such Guarantor of
this Guarantee will not violate any certificate of incorporation, by-laws or
other charter or formation documents, or any applicable law, rule or regulation
or any contract, agreement or instrument (including agreements or instruments of
indebtedness) applicable to or binding upon such Guarantor;
(e) no consent or authorization of, filing with, or other act by or
in respect of, any arbitrator or Governmental Body and no consent of any other
Person (including, without limitation, any stockholder or creditor of such
Guarantor) is
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required in connection with the execution, delivery, performance, validity or
enforceability by or against such Guarantor of this Guarantee; and
(f) there is no action, suit, investigation or proceeding by or
before any court, administrative agency or other governmental authority pending
or, to the knowledge of such Guarantor, threatened which involves any of the
transactions contemplated by this Guarantee or would affect materially the
ability (financial or otherwise) of such Guarantor to perform its obligations
hereunder.
Each Guarantor agrees that the foregoing representations and warranties
shall be deemed to have been made by such Guarantor on each Funding Date by the
Company under the Revolving Credit Agreement on and as of such Funding Date as
though made hereunder on and as of such Funding Date.
SECTION 11. Severability. Any provision of this Guarantee which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 12. Section Headings. The Section headings used in this
Guarantee are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation
hereof.
SECTION 13. No Waiver; Cumulative Remedies. Neither the Agent nor any
Lender shall, by any act (except by a written instrument pursuant to Section 14
hereof), delay, indulgence, omission or otherwise be deemed to have waived any
right or remedy hereunder or to have acquiesced in any default or Event of
Default or in any breach of any of the terms and conditions hereof. No failure
to exercise, nor any delay in exercising, on the part of the Agent or any
Lender, any right, power or privilege hereunder shall operate as a waiver
thereof. No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Agent or any Lender of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Agent or such Lender would otherwise have
on any future occasion. The rights and remedies herein provided are cumulative,
may be exercised singly or concurrently and are not exclusive of any rights or
remedies provided by law.
SECTION 14. Integration; Waivers and Amendments; Successors and Assigns;
Governing Law. This Guarantee represents the agreement of each Guarantor with
respect to the subject matter hereof and there are no promises or
representations by the Agent or any Lender relative to the subject matter hereof
not
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reflected herein. None of the terms or provisions of this Guarantee may be
waived, amended or supplemented or otherwise modified except by a written
instrument executed by each Guarantor and the Agent, provided that any provision
of this Guarantee may be waived by the Agent in a letter or agreement executed
by the Agent or by telex or facsimile transmission from the Agent. This
Guarantee shall be binding upon the successors and permitted assigns of each
Guarantor and shall inure to the benefit of the Agent and the Lenders and their
respective successors and assigns. THIS GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
VIRGINIA, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS.
SECTION 15. Notices. All notices, requests and demands to or upon the
Guarantors or the Agent or any Lender to be effective shall be in writing or by
telecopy and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made (i) in the case of telephonic notice (to the extent
expressly permitted hereunder), when made, (ii) in the case of notice delivered
by overnight express courier, one Business Day after the Business Day such
notice was delivered to such courier, (iii) in the case of notice delivered by
first class mail, three Business Days after being deposited in the mail, postage
prepaid, return receipt requested, (iv) in the case of notice by hand, when
delivered, or (v) in the case of notice by any customary means of
telecommunication, when sent provided confirmation of receipt or answer back has
been received, in each case if addressed, in the case of the Agent and the
Lenders, to such party at the address provided for such party in section 9.6 of
the Revolving Credit Agreement or, in the case of the Guarantors, addressed to
such party as specified in Schedule I hereto.
SECTION 16. Counterparts. This Guarantee may be executed by one or
more of the parties hereto on any number of separate counterparts and all of
said counterparts taken together shall be deemed to constitute one and the
same instrument.
SECTION 17. Acknowledgement. Each Guarantor hereby confirms its
agreement with sections 9.15 and 9.13 of the Revolving Credit Agreement.
SECTION 18. Submission To Jurisdiction; Waivers. Any judicial proceeding
brought against any Guarantor with respect to this Guarantee or the transactions
contemplated hereby may be brought in any court of competent jurisdiction in the
Commonwealth of Virginia, and, by execution and delivery of this Guarantee, each
Guarantor (a) accepts, generally and unconditionally, the nonexclusive
jurisdiction of such courts and any related appellate court and irrevocably
agrees to be bound by any judgment rendered thereby in connection with this
Guarantee or the transactions contemplated hereby and (b) irrevocably waives any
objection it may
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now or hereafter have as to the venue of any such proceeding brought in such a
court or that such a court is an inconvenient forum. Each Guarantor hereby
waives personal service of process and consents that service of process upon it
may be made by certified or registered mail, return receipt requested, at its
address specified or determined in accordance with the provisions of Section 15
hereof, and service so made shall be deemed completed on the earlier of (x) the
receipt thereof and (y) if sent by registered or certified mail (return receipt
requested), the fifth (5th) Business Day after such service is deposited in the
mail. Nothing herein shall affect the right of any Lender or the Agent to serve
process in any other manner permitted by law or shall limit the right of any
Lender or the Agent to bring proceedings against any Guarantor in the courts of
any other jurisdiction. Any judicial proceeding by any Guarantor against any
Lender or the Agent involving this Guarantee or the transactions contemplated
hereby shall be brought only in a court located in the Commonwealth of Virginia.
THE GUARANTORS AND THE LENDERS AND THE AGENT HEREBY WAIVE TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING TO WHICH THEY ARE PARTIES INVOLVING THIS GUARANTEE OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 19. Authority of Agent. Each Guarantor acknowledges that the
rights and responsibilities of the Agent under this Guarantee with respect to
any action taken by the Agent or the exercise or non-exercise by the Agent of
any option, right, request, judgment or other right or remedy provided for
herein or resulting or arising out of this Guarantee shall, as between the Agent
and the Lenders, be governed by the Revolving Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and such Guarantor, the Agent shall be conclusively
presumed to be acting as Agent for the Lenders with full and valid authority so
to act or refrain from acting, and neither such Guarantor, the Company nor any
other Guarantor shall be under any obligation, or entitlement, to make any
inquiry respecting such authority.
IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee to
be duly executed and delivered by its duly authorized officer as of the day and
year first above written.
▇▇▇▇▇▇ ▇▇▇▇▇▇ Services, Inc.
By:
------------------------------
Name:
Title:
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HB Capital, Inc.
By:
------------------------------
Name:
Title:
Private Label Energy Services, Inc.
By:
------------------------------
Name:
Title:
PHB ▇▇▇▇▇▇ ▇▇▇▇▇▇, Inc.
By:
------------------------------
Name:
Title:
GKMG, Inc.
By:
------------------------------
Name:
Title:
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GKMG Consulting Services, Inc.
By:
------------------------------
Name:
Title:
▇▇▇▇▇▇ Bailly Risk Advisors, Inc.
By:
------------------------------
Name:
Title:
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SCHEDULE I TO
AMENDED AND RESTATED
SUBSIDIARY GUARANTEE
Addresses of Guarantors
Notices may be provided to each Guarantor by Addressing the Guarantor by
its name, care of:
▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: 703-351-____
Telecopier: 703-528-____
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Exhibit D to Amended and Restated
Revolving Credit Agreement
--------------------------------------------------------------------------
Form of
SECURITY AGREEMENT
dated as of ______________, ____
between
[NAME OF COMPANY]
as Debtor
and
BANK OF AMERICA, N.A.
as Agent
-------------------------------------------------------------------------
141
TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................2
Section 1.1 Definitions Generally..............................2
Section 1.2 UCC Definitions....................................5
ARTICLE II SECURITY INTERESTS................................................5
Section 2.1 Grant of Security Interests........................5
Section 2.2 Continuing Liability of the Debtor.................7
Section 2.3 Sales and Collections..............................7
Section 2.4 Segregation of Proceeds............................8
Section 2.5 Verification of Receivables........................9
Section 2.6 Release of Collateral..............................9
ARTICLE III REPRESENTATIONS AND WARRANTIES..................................10
Section 3.1 Title to Collateral...............................10
Section 3.2 Validity, Perfection and Priority of
Security Interests................................10
Section 3.3 Enforceability of Receivables and Other
Intangibles.......................................11
Section 3.4 Place of Business.................................11
Section 3.5 Location of Collateral............................11
Section 3.6 Trade Names.......................................12
Section 3.7 Patents and Trademarks............................12
ARTICLE IV COVENANTS........................................................12
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Section 4.1 Perfection of Security Interests..................12
Section 4.2 Further Actions...................................12
Section 4.3 Change of Name, Identity or Structure.............14
Section 4.4 Place of Business and Collateral..................14
Section 4.5 Fixtures..........................................14
Section 4.6 Maintenance of Records............................14
Section 4.7 Compliance with Laws..............................15
Section 4.8 Payment of Taxes..................................15
Section 4.9 Compliance with Terms of Accounts and
Contracts.........................................15
Section 4.10 Limitation on Liens on Collateral.................15
Section 4.11 Limitations on Modifications of
Receivables and Other Intangibles; No
Waivers or Extensions.............................16
Section 4.12 Maintenance of Insurance..........................16
Section 4.13 Limitations on Dispositions of
Collateral........................................16
Section 4.14 Further Identification of Collateral..............16
Section 4.15 Notices...........................................17
Section 4.16 Change of Law.....................................17
Section 4.17 Right of Inspection...............................17
Section 4.18 Maintenance of Equipment..........................18
Section 4.19 Covenants Regarding Patent and
Trademark Collateral..............................18
Section 4.20 Termination of Federal Contracts..................19
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Section 4.21 Federal Contracts.................................20
Section 4.22 Reimbursement Obligation..........................20
ARTICLE V REMEDIES; RIGHTS UPON DEFAULT.....................................20
Section 5.1 UCC Rights........................................20
Section 5.2 Payments on Collateral............................21
Section 5.3 Possession of Collateral..........................21
Section 5.4 Sale of Collateral; Notice........................21
Section 5.5 Rights of Purchasers..............................23
Section 5.6 Additional Rights of the Agent....................23
Section 5.7 Remedies Not Exclusive, etc.......................24
Section 5.8 Waiver and Estoppel...............................25
Section 5.9 Power of Attorney; Powers Coupled With
An Interest.......................................26
Section 5.10 Certain Provisions Relating to
Securities........................................27
Section 5.11 Application of Monies.............................27
ARTICLE VI MISCELLANEOUS....................................................28
Section 6.1 Notices...........................................28
Section 6.2 No Waiver; Cumulative Remedies....................28
Section 6.3 Amendments and Waivers............................29
Section 6.4 Successors and Assigns............................29
Section 6.5 Governing Law.....................................29
Section 6.6 Limitation by Law; Severability...................29
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Section 6.7 Counterparts......................................30
Section 6.8 Expenses of the Agent.............................30
Section 6.9 Indemnification...................................30
Section 6.10 Termination; Survival.............................31
Section 6.11 Judicial Proceedings; Waiver of Jury
Trial.............................................31
Section 6.12 Integration.......................................31
Section 6.13 Authority of Agent................................32
Section 6.14 Headings, Bold Type and Table of
Contents..........................................32
Schedule 3.4 - Place of Business
Schedule 3.5 - Location of Collateral
Schedule 3.6 - Trade Names, Division Names, etc.
Schedule 3.7 - Patents and Trademarks
Schedule 4.1 - UCC Filings
Exhibit A - Assignment of Federal Contract
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SECURITY AGREEMENT
This SECURITY AGREEMENT, dated as of ____________, ____ (as amended,
supplemented or modified from time to time, the "Security Agreement"), is made
by [Name of Company], a [Name of State] corporation (the "Debtor"), and BANK OF
AMERICA, N.A., a national banking association (the "Agent") in its capacity as
Agent for the lenders (the "Lenders") from time to time a party to the Amended
and Restated Revolving Credit Agreement, dated as of ____________, ____ (as
amended, supplemented or otherwise modified from time to time, the "Revolving
Credit Agreement"), by and among [Name of Company], a [Name of State]
corporation (the "Company"), the Agent, in its capacity as such thereunder, and
the Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Revolving Credit Agreement, the Lenders have
severally agreed to make available to the Company a revolving line of credit for
Revolving Loans, Swing Line Loans and Standby Letters of Credit in an aggregate
principal amount at any time not to exceed the Maximum Available Amount, subject
to the terms and conditions contained therein;
WHEREAS, the Company owns, directly or indirectly, all of the issued
and outstanding shares of capital stock of the Debtor;
WHEREAS, the Debtor constitutes a Material Domestic Subsidiary under
the Revolving Credit Agreement;
WHEREAS, pursuant to the provisions of the Revolving Credit Agreement, the
Company is required to cause each of its Material Domestic Subsidiaries to
execute and deliver to the Agent, for the ratable benefit of the Lenders, a
Subsidiary Security Agreement, as more fully provided therein;
WHEREAS, the proceeds of such Revolving Loans, Swing Line Loans and
Standby Letters of Credit may be used to enable the Company to make valuable
transfers to the Debtor in connection with the operation of its business and for
the Permitted Uses;
WHEREAS, the Debtor will derive substantial direct and indirect benefit
from such Revolving Loans, Swing Line Loans and Standby Letters of Credit; and
146
WHEREAS, the Debtor desires to enter into this Security Agreement for
the ratable benefit of the Lenders;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, and to induce the Lenders to enter into the Revolving Credit
Agreement and make their respective Revolving Loans and Swing Line Loans, and
the Issuing Lender to issue the Standby Letters of Credit, under the Revolving
Credit Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Debtor hereby agrees with the
Agent, for the ratable benefit of the Lenders, as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions Generally. Capitalized terms used herein without
definition shall have the respective meanings specified in the Revolving Credit
Agreement, and the following terms shall have the following meanings (such
meanings to be, when appropriate, equally applicable to both the singular and
plural forms of the terms defined):
"Account Debtor" shall mean, with respect to any Receivable or Other
Intangible, any Person obligated to make payment thereunder, including without
limitation any account debtor thereon.
"Assignment of Claims Act" shall mean the Assignment of Claims Act of
1940, 31 U.S.C. Section 3727, 41 U.S.C. Section 15 (1986), as the same may be
amended and any successor statute of similar import.
"Assignment of Federal Contract" shall have the meaning specified in
Section 4.21 hereof.
"Cash Collateral Account" shall have the meaning specified in Section 2.4
hereof.
"Collateral" shall have the meaning set forth in Section 2.1.
"Company" shall have the meaning specified in the preamble hereof.
"Debtor" shall have the meaning specified in the preamble hereof.
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147
"Equipment" shall mean all equipment now owned or hereafter acquired by
the Debtor, including all items of machinery, equipment, furnishings and
fixtures of every kind, whether affixed to real property or not, as well as all
automobiles, trucks and vehicles of every description, trailers, handling and
delivery equipment, fittings, special tools, all additions to, substitutions
for, replacements of or accessions to any of the foregoing, all attachments,
components, parts (including spare parts) and accessories whether installed
thereon or affixed thereto and all fuel for any thereof.
"Federal Contract" means any contract or agreement with, involving or for
the benefit of the United States of America or any department, agency or
instrumentality thereof (collectively, the "U.S. Government"), whether now
existing or hereafter arising, in each case as the same may be amended, modified
or otherwise supplemented from time to time.
"Inventory" shall mean all inventory now owned or hereafter acquired by
the Debtor, including (i) all goods and other personal property which are held
for sale or lease or are furnished or are to be furnished under a contract of
service or which constitute raw materials, work in process or materials used or
consumed or to be used or consumed in the Debtor's business, (ii) all inventory,
wherever located, evidenced by negotiable and non-negotiable documents of title,
warehouse receipts and bills of lading, (iii) all of the Debtor's rights in, to
and under all purchase orders now owned or hereafter received or acquired by it
for goods or services and (iv) all rights of the Debtor as an unpaid seller,
including rescission, replevin, reclamation and stopping in transit.
"Lenders" shall have the meaning specified in the preamble hereof.
"Obligations" shall mean any and all now existing or hereafter arising
indebtedness, obligations, liabilities and covenants of each Credit Party to any
Lender, the Agent, their respective Affiliates, successors and assigns and any
other Indemnified Person under or arising out of any Credit Document, including
without limitation (i) all Revolving Loans and all Swing Line Loans together
with interest thereon and all Standby Letters of Credit, (ii) all fees,
expenses, indemnity payments and other amounts due or to become due under the
Revolving Credit Agreement, the Revolving Notes, the Swing Line Note or any
other Credit Document, (iii) all liabilities and obligations under the
Subsidiary Guarantee and any other agreement executed by any Credit Party
guarantying the obligations of the Borrower under the Revolving Credit Agreement
or any other Credit Document,
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(iv) all liabilities and obligations under any agreement providing collateral
for any of the foregoing (including any Pledge Agreement and the Subsidiary
Security Agreements), and (v) and any agreement or instrument refinancing or
restructuring all or any portion of the obligations and liabilities under any of
foregoing or under any successor agreement or note, in each case whether direct
or indirect, absolute or contingent or due or to become due.
"Other Intangibles" shall mean all accounts, accounts receivable, contract
rights, documents, instruments, notes, chattel paper, money, indemnities,
warranties and general intangibles now owned or hereafter acquired by the Debtor
including, without limitation, all goodwill, customer lists, permits, federal
and state tax refunds, reversionary interests in pension plan assets, Patents,
Trademarks, licenses, copyrights and other rights in intellectual property,
other than Receivables.
"Patents" shall mean all letters patent of the United States or any other
country, and all applications for letters patent of the United States or any
other country, in which the Debtor may now or hereafter have any right, title or
interest and all reissues, continuations, continuations-in-part or extensions
thereof.
"Proceeds" shall mean all proceeds, including (i) whatever is received
upon any collection, exchange, sale or other disposition of any of the
Collateral and any property into which any of the Collateral is converted,
whether cash or non-cash, (ii) any and all payments or other property (in any
form whatsoever) made or due and payable on account of any insurance, indemnity,
warranty or guaranty payable to the Debtor with respect to any of the
Collateral, (iii) any and all payments (in any form whatsoever) made or due and
payable in connection with any requisition, confiscation, condemnation, seizure
or forfeiture of all or any part of the Collateral by any governmental body,
authority, bureau or agency (or any person, corporation, agency, authority or
other entity acting under color of any governmental authority) and (iv) any and
all other amounts from time to time paid or payable under or in connection with
any of the Collateral.
"Receivables" shall mean all accounts now or hereafter owing to the
Debtor, and all accounts receivable, contract rights, documents, instruments or
chattel paper representing amounts payable or monies due or to become due to the
Debtor, arising from the sale of Inventory or the rendition of services in the
ordinary course of business or otherwise (whether or not earned by performance),
together with all Inventory returned by or reclaimed from customers wherever
such Inventory is
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located, and all guaranties, securities and liens held for the payment of any
such account, account receivable, contract right, document, instrument or
chattel paper.
"Security Agreement" shall have the meaning specified in the preamble
hereof.
"Trademarks" shall mean all right, title or interest which the Debtor may
now or hereafter have in any or all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles, service
marks, logos, other source of business identifiers, prints and labels on which
any of the foregoing have appeared or appear, designs and general intangibles of
like nature, now existing or hereafter adopted or acquired, all registrations
and recordings thereof and all applications in connection therewith, including
without limitation, registrations, recordings and applications in the United
States Patent and Trademark Office or in any similar office or agency of the
United States, any state thereof or any other country or political subdivision
thereof and all reissues, extensions or renewals thereof.
"UCC" shall mean the Uniform Commercial Code in effect on the date hereof
in the Commonwealth of Virginia.
"U.S. Government" has the meaning specified in the definition of
Federal Contract contained herein.
Section 1.2 UCC Definitions. The uncapitalized terms "account", "account
debtor", "chattel paper", "contract right", "document", "warehouse receipt",
"▇▇▇▇ of lading", "document of title", "instrument", "inventory", "general
intangible", "money", "security", "certificated security", "uncertificated
security", "financial asset" and "proceeds" as used in Section 1.1 or elsewhere
in this Security Agreement shall have the respective meanings set forth in the
UCC.
ARTICLE II
SECURITY INTERESTS
Section 2.1 Grant of Security Interests. To secure the due and punctual
payment of all Obligations, howsoever created, arising or evidenced, whether
direct or indirect, absolute or contingent, now or hereafter existing or due or
to become due, whether at maturity or upon acceleration or otherwise, in
accordance with the terms thereof and to secure the due and punctual performance
of all of the
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Obligations and in order to induce the Lenders to continue to make or maintain
the extensions of credit under and pursuant to the Revolving Credit Agreement,
the Debtor hereby pledges, assigns, delivers, conveys and transfers to the
Agent, for the ratable benefit of the Lenders, and grants to the Agent, for the
ratable benefit of the Lenders, a first priority and continuing security
interest in and lien on, all of the Debtor's right, title and interest in, to
and under the following, whether now existing or hereafter acquired (the
"Collateral"):
(i) all Receivables;
(ii) all Other Intangibles;
(iii) all Equipment;
(iv) all Inventory;
(v) to the extent not included in the foregoing, all
securities (whether certificated or uncertificated) and all
financial assets, whether now existing or hereafter arising,
including, without limitation, all capital stock issued by any
Person and held by Debtor, and all partnership interests, whether in
the nature of a joint venture, limited liability company member's
interest, master limited partnership, teaming arrangement or
otherwise;
(vi) to the extent not included in the foregoing, all other
personal property, whether tangible or intangible, and wherever
located whether within or outside of the United States, including,
but not limited to, the balance of every deposit account now or
hereafter existing of the Debtor with any bank or other financial
institution and all monies of the Debtor and all rights to payment
of money of the Debtor;
(vii) to the extent not included in the foregoing, all
books, ledgers and records and all computer programs, tapes, discs,
punch cards, data processing software, transaction files, master
files and related property and rights (including computer and
peripheral equipment) necessary or helpful in enforcing,
identifying or establishing any item of Collateral; and
(viii) to the extent not otherwise included, all Proceeds and
products of any or all of the foregoing, whether existing on the
date hereof or arising hereafter; provided, however, notwithstanding
anything to the contrary contained herein, the Debtor is not
assigning, pledging or otherwise
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encumbering under this Security Agreement its interests in
any Federal Contract to which it is a party, or in accounts or
receivables due to Debtor under such Federal Contract, to the
extent, but only to the extent, such assignment, pledge or other
encumbrance would breach or violate or would cause Debtor to breach
or violate such Federal Contract or statutes or regulations
applicable thereto, it being understood that this proviso does not
apply to, or in any way limit, Debtor's assignment, pledge or
encumbrance of Proceeds of all Federal Contracts to which it is a
party.
Section 2.2 Continuing Liability of the Debtor. Anything herein to the
contrary notwithstanding, the Debtor shall remain liable to observe and perform
all the terms and conditions to be observed and performed by it under any
contract, agreement, warranty or other obligation with respect to the
Collateral; and shall do nothing to impair the security interests herein
granted. The Agent shall not have any obligation or liability under any such
contract, agreement, warranty or obligation by reason of or arising out of this
Security Agreement or the receipt by the Agent of any payment relating to any
Collateral, nor shall the Agent be required to perform or fulfill any of the
obligations of the Debtor with respect to the Collateral, to make any inquiry as
to the nature or sufficiency of any payment received by it or the sufficiency of
the performance of any party's obligations with respect to any Collateral.
Furthermore, the Agent shall not be required to file any claim or demand to
collect any amount due or to enforce the performance of any party's obligations
with respect to, the Collateral.
Section 2.3 Sales and Collections.
(a) Sales of Inventory in the Ordinary Course of Business. The
Debtor is authorized (i) to sell in the ordinary course of its business for fair
value and on an arm's-length basis any of its Inventory normally held by it for
such purpose and (ii) to use and consume, in the ordinary course of its
business, any raw materials, supplies and materials normally held by it for such
purpose. The Agent may, upon the occurrence of any Event of Default, without
cause or notice, curtail or terminate such authority at any time.
(b) Collection of Receivables. The Debtor is authorized to collect
amounts owing to it with respect to the Collateral, except as otherwise provided
in connection with the Assignment of Federal Contract, if any as provided
herein. However, the Agent may, upon and during the continuance of an Event of
Default or a Potential Event of Default, notify Account Debtors obligated to
make payments
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under any or all Receivables or Other Intangibles that the Agent has a security
interest in such Collateral and that payments shall be made directly to the
Agent. Upon the request of the Agent upon and during the continuance of an Event
of Default or a Potential Event of Default, as the case may be, the Debtor will
so notify such Account Debtors and will execute such contract assignments,
notices of assignment or other documents as may be required by such Account
Debtors. The Debtor will use all reasonable efforts to cause each Account Debtor
to comply with the foregoing instruction. In furtherance of the foregoing, the
Debtor authorizes the Agent upon and during the continuance of an Event of
Default or a Potential Event of Default (i) to ask for, demand, collect, receive
and give acquittances and receipts for any and all amounts due and to become due
under any Collateral and in the name of the Debtor or its own name or otherwise,
(ii) to take possession of, endorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of monies due under any
Collateral and (iii) to file any claim or take any other action in any court of
law or equity or otherwise which it may deem appropriate for the purpose of
collecting any amounts due under any Collateral. The Agent shall have no
obligation to obtain or record any information relating to the source of such
funds or the obligations in respect of which payments have been made.
Section 2.4 Segregation of Proceeds.
(a) Cash Collateral Account Maintained by Agent. Upon an Event of
Default or a Potential Event of Default, the Agent shall have the right at any
time during the continuance thereof to cause to be opened and maintained at the
office of the Agent in McLean, Virginia a non-interest bearing bank account (the
"Cash Collateral Account") which will contain only Proceeds. Any "cash proceeds"
(as such term is defined in Section 9-306(1) of the UCC) received by the Agent
directly from Account Debtors obligated to make payments under Receivables or
Other Intangibles pursuant to Section 2.3 hereof or from the Debtor pursuant to
clause (b) of this Section 2.4, whether consisting of checks, notes, drafts,
bills of exchange, money orders, commercial paper or other Proceeds received on
account of any Collateral, shall be promptly deposited in the Cash Collateral
Account, and until so deposited shall be held in trust for the Agent as property
of the Agent and shall not be commingled with any funds of the Debtor not
constituting Proceeds of Collateral. The name in which the Cash Collateral
Account is carried shall clearly indicate that the funds deposited therein are
the property of the Debtor, subject to the security interest of the Agent
hereunder. Such Proceeds, when deposited, shall continue to be security for the
Obligations and shall not constitute payment thereof
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until applied as hereinafter provided. The Agent shall have sole dominion and
control over the funds deposited in the Cash Collateral Account, and such funds
may be withdrawn therefrom only by the Agent.
(b) Deposit of Proceeds by the Debtor. Upon notice by the Agent to
the Debtor that the Cash Collateral Account has been opened, the Debtor shall
cause all cash Proceeds collected by it to be delivered to the Agent forthwith
upon receipt, in the original form in which received (with such endorsements or
assignments as may be necessary to permit collection thereof by the Agent), and
for such purpose the Debtor hereby irrevocably authorizes and empowers the
Agent, its officers, employees and authorized agents to endorse and sign the
name of the Debtor on all checks, drafts, money orders or other media of payment
so delivered, and such endorsements or assignments shall, for all purposes, be
deemed to have been made by the Debtor prior to any endorsement or assignment
thereof by the Agent. The Agent may use any convenient or customary means for
the purpose of collecting such checks, drafts, money orders or other media of
payment.
Section 2.5 Verification of Receivables. The Agent shall have the right to
make test verifications of Receivables in any reasonable manner and through any
medium that it considers advisable, and the Debtor agrees to furnish all such
assistance and information as the Agent may reasonably require in connection
therewith. The Debtor at its expense will cause its chief financial officer to
furnish to the Agent at any reasonable time and from time to time, promptly upon
the Agent's reasonable request, the following reports: (i) a reconciliation of
all Receivables, (ii) an aging of all Receivables, (iii) trial balances and (iv)
a test verification of such Receivables as the Agent may request.
Section 2.6 Release of Collateral.
(a) Security Interest of Agent Ceases Upon Permitted Dispositions.
The Debtor may sell or realize upon or transfer or otherwise dispose of
Collateral only to the extent permitted by Section 4.13, and the security
interests of the Agent in such Collateral so sold, realized upon or disposed of
(but not in the Proceeds arising from such sale, realization or disposition)
shall cease immediately upon such sale, realization or disposition, without any
further action on the part of the Agent. The Agent, if requested in writing by
the Debtor but at the expense of the Debtor, is hereby authorized and instructed
to deliver to the Account Debtor or the purchaser or other transferee of any
such Collateral a certificate stating that the Agent no longer has a security
interest therein, and such Account Debtor or such purchaser
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or other transferee shall be entitled to rely conclusively on such certificate
for any and all purposes.
(b) Filing of Termination Statements. Upon the payment in full of
all of the Obligations and if there is no commitment by any Lender to make
further advances, incur obligations or otherwise give value, the Agent will (as
soon as reasonably practicable after receipt of notice from the Debtor
requesting the same but at the expense of the Debtor) deliver to the Debtor (i)
for each jurisdiction in which a UCC financing statement is on file to perfect
the security interests granted to the Agent hereunder, a termination statement
(appropriately completed) to the effect that the Agent no longer claims a
security interest under such financing statement, and (ii) such other documents
as the Debtor shall reasonably request evidencing satisfaction of the
Obligations and the release of the security interests granted to the Agent
hereunder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Debtor represents and warrants that:
Section 3.1 Title to Collateral. Except for the security interests granted
to the Agent pursuant to this Security Agreement and as otherwise permitted by
Section 6.2(a) of the Revolving Credit Agreement, the Debtor is the sole owner
of each item of the Collateral, having good and marketable title thereto, free
and clear of any and all Liens.
Section 3.2 Validity, Perfection and Priority of Security Interests.
(a) By complying with Section 4.1 hereof, the Debtor will have
created a valid security interest in favor of the Agent in all existing
Collateral and in all identifiable Proceeds of such Collateral, which security
interest (except in respect of Collateral not located at a facility identified
on Schedule 3.5 hereto and motor vehicles for which the exclusive manner of
perfecting a security interest therein is by noting such security interest in
the certificate of title in accordance with local law) would be prior to the
claims of a trustee in bankruptcy under Section 544(a) of the Bankruptcy Code.
Continuing compliance by the Debtor with the provisions of Section 4.2 hereof
will also (i) create valid security interests in all Collateral acquired after
the date hereof and in all identifiable Proceeds of such Collateral and (ii)
cause such security interests in all Collateral and in all Proceeds
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which are (A) identifiable cash Proceeds of Collateral covered by financing
statements required to be filed hereunder, (B) identifiable Proceeds in which a
security interest may be perfected by such filing under the UCC and (C) any
Proceeds in the Cash Collateral Account to be duly perfected under the UCC, in
each case prior to the claims of a trustee in bankruptcy under the Bankruptcy
Code (except in respect of Collateral not located at a facility identified on
Schedule 3.5 hereto).
(b) The security interests of the Agent in the Collateral located at
the facilities identified on Schedule 3.5 hereto rank first in priority. Other
than financing statements or other similar documents perfecting the security
interests in favor of the Agent, no financing statements, deeds of trust,
mortgages or similar documents covering all or any part of the Collateral are on
file or of record in any government office in any jurisdiction in which such
filing or recording would be effective to perfect a security interest in such
Collateral, nor is any of the Collateral in the possession of any Person (other
than the Debtor) asserting any claim thereto or security interest therein.
Section 3.3 Enforceability of Receivables and Other Intangibles. To the
best knowledge of the Debtor, each Receivable and Other Intangible is a valid
and binding obligation of the related Account Debtor in respect thereof,
enforceable in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
general provisions of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and complies with any
applicable legal requirements.
Section 3.4 Place of Business. Schedule 3.4 correctly sets forth the chief
executive office and principal place of business of the Debtor and the offices
of the Debtor where records concerning Receivables and Other Intangibles are
kept.
Section 3.5 Location of Collateral. Schedule 3.5 correctly sets forth the
location of all Equipment and Inventory, other than rolling stock, aircraft and
goods in transit. Except as otherwise specified in Schedule 3.5, all Inventory
and Equipment has been located at the address specified on Schedule 3.5 at all
times during the four-month period prior to the date hereof while owned by the
Debtor. All Inventory has been and will be produced in compliance with the Fair
Labor Standards Act, 29 U.S.C. Sections 201-219, except for such non-compliance
which could not reasonably be expected to have a material adverse effect on the
Debtor. No
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Inventory is evidenced by a negotiable document of title, warehouse receipt or
▇▇▇▇ of lading. No non-negotiable document of title, warehouse receipt or ▇▇▇▇
of lading has been issued to any person other than the Debtor, and the Debtor
has retained possession of all of such non-negotiable documents, warehouse
receipts and bills of lading. No amount payable under or in connection with any
of the Collateral is evidenced by promissory notes or other instruments.
Section 3.6 Trade Names. Schedule 3.6 correctly sets forth any and all
trade names, division names, assumed names or other names under which the Debtor
currently transacts business or has transacted business within the four-month
period prior to the date hereof.
Section 3.7 Patents and Trademarks. Schedule 3.7 correctly sets forth all
Patents, Patent licenses, Trademarks and Trademark licenses now owned by the
Debtor.
ARTICLE IV
COVENANTS
The Debtor covenants and agrees that until all obligations and liabilities
in respect of the Obligations shall have performed and paid in full and until no
Standby Letters of Credit are outstanding or fully cash collateralized and the
Commitments are terminated:
Section 4.1 Perfection of Security Interests. The Debtor will, at its
expense, cause all filings and recordings and other actions specified on
Schedule 4.1 to have been completed on or prior to the Effective Date.
Section 4.2 Further Actions.
(a) At all times after the date hereof, the Debtor will, at its
expense, comply with the following:
(i) as to all Receivables, Other Intangibles, Equipment and
Inventory, it will cause UCC financing statements and continuation
statements to be filed and to be on file in all applicable
jurisdictions as required to perfect the security interests granted
to the Agent hereunder, to the extent that applicable law permits
perfection of a security interest by filing under the UCC;
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(ii) as to all Proceeds, it will cause all UCC financing
statements and continuation statements filed in accordance with
clause (i) above to include a statement or a checked box indicating
that Proceeds of all items of Collateral described herein are
covered;
(iii) as to any amount payable under or in connection with
any of the Collateral which shall be or shall become evidenced by
any promissory note or other instrument, the Debtor will promptly
(but in no event later than ten (10) Business Days after receipt of
such note or instrument), pledge and deliver such note or other
instrument to the Agent as part of the Collateral, duly endorsed in
a manner reasonably satisfactory to the Agent;
(iv) at the request of the Agent, the Debtor shall deliver
all other Collateral consisting of certificated securities, endorsed
for transfer in a manner reasonably satisfactory to the Agent (or
execute a securities intermediary account control agreement to the
extent possession by the Agent of such securities is not feasible);
and
(v) as to all Patents, Patent licenses, Trademarks or
Trademark licenses, the Debtor will effect the recordation or
renewal of the recordation of the security interests of the Agent
therein so as to maintain valid and perfected security interests
therein under all applicable state and federal laws.
(b) Further Assurances. The Debtor will, from time to time and at
its expense, execute, deliver, file or record such UCC financing statements,
applications for certificates of title and such other statements, assignments,
instruments, documents, agreements or other papers and take any other action
that may be necessary or desirable, or that the Agent may reasonably request, in
order to create, preserve, perfect, confirm or validate the security interest of
the Agent in the Collateral, to enable the Agent to obtain the full benefits of
this Security Agreement or to enable it to exercise and enforce any of its
rights, powers and remedies hereunder, including, without limitation, its right
to take possession of the Collateral.
(c) Signature. To the fullest extent permitted by law, the Debtor
authorizes the Agent to sign and file financing and continuation statements and
amendments thereto with respect to the Collateral without its signature thereon.
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Section 4.3 Change of Name, Identity or Structure. The Debtor will not
change its name, identity or corporate structure in any manner and, except as
set forth on Schedule 3.6, will not conduct its business under any trade,
assumed or fictitious name unless it shall have given the Agent at least
forty-five (45) days' prior written notice thereof and shall have taken all
action (or made arrangements to take such action substantially simultaneously
with such change if it is impossible to take such action in advance) necessary
or reasonably requested by the Agent to amend any financing statement or
continuation statement relating to the security interests granted hereby in
order to preserve such security interests and to effectuate or maintain the
priority thereof against all Persons.
Section 4.4 Place of Business and Collateral. The Debtor will not change
the location of (i) its places of business, (ii) its chief executive office or
(iii) the office or other locations where it keeps or holds any Collateral or
any records relating thereto from the applicable location listed on Schedule 3.4
or 3.5 unless, prior to such change, it notifies the Agent forty-five (45) days
in advance of such change, makes all UCC filings required by Section 4.2 and
takes all other action necessary or that the Agent may reasonably request to
preserve, perfect, confirm and protect the security interests granted hereby.
The Debtor will in no event change the location of any Collateral if such change
would cause the security interest granted hereby in such Collateral to lapse or
cease to be perfected. The Debtor will at all times maintain its chief executive
office within one of the forty-eight contiguous states in which Article 9 of the
uniform commercial code is in effect.
Section 4.5 Fixtures. The Debtor will not permit any Equipment to become a
fixture unless it shall have given the Agent at least ten (10) days' prior
written notice thereof and shall have taken all such action and delivered or
caused to be delivered to the Agent all instruments and documents, including,
without limitation, waivers and subordination agreements by any landlords and
mortgagees, and filed all financing statements necessary or reasonably requested
by the Agent, to preserve and protect the security interest granted herein and
to effectuate or maintain the priority thereof against all Persons; provided,
however, that, so long as no Event of Default or Potential Event of Default
shall have occurred and be continuing, the Debtor shall not be obligated to
comply with the provisions of this Section 4.5 with respect to the first $50,000
of Equipment (determined based on the then fair market value thereof).
Section 4.6 Maintenance of Records. The Debtor will keep and maintain at
its own cost and expense complete books and records relating to the Collateral
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which are satisfactory to the Agent including, without limitation, a record of
all payments received and all credits granted with respect to the Collateral and
all of its other dealings with the Collateral. The Debtor will ▇▇▇▇ its books
and records pertaining to the Collateral to evidence this Security Agreement and
the security interests granted hereby. For the Agent' further security, the
Debtor agrees that the Agent shall have a special property interest in all of
the Debtor's books and records pertaining to the Collateral and the Debtor shall
deliver and turn over any such books and records to the Agent or to its
representatives at any time on demand of the Agent.
Section 4.7 Compliance with Laws The Debtor will comply in all material
respects with all acts, rules, regulations, orders, decrees and directions of
any government or any state or local government applicable to the Collateral or
any part thereof or to the operation of the Debtor's business except to the
extent that the failure to comply would not have a material adverse effect on
the financial or other condition of the Debtor; provided, however, that the
Debtor may contest any act, rule, regulation, order, decree or direction in any
reasonable manner which shall not, in the sole opinion of the Agent, adversely
affect the Agent's rights or, in the case of Collateral located at a facility
identified on Schedule 3.4 hereto, the first priority of its security interest
in the Collateral.
Section 4.8 Payment of Taxes. The Debtor will pay promptly when due all
taxes, assessments and governmental charges or levies imposed upon the
Collateral or in respect of its income or profits therefrom, as well as all
claims of any kind (including claims for labor, materials and supplies), except
that no such charge need be paid if (i) the validity thereof is being contested
in good faith by appropriate proceedings and (ii) such charge is adequately
reserved against in accordance with generally accepted accounting principles, as
consistently applied.
Section 4.9 Compliance with Terms of Accounts and Contracts. The Debtor
will perform and comply in all material respects with all of its obligations
under all agreements relating to the Collateral to which it is a party or by
which it is bound.
Section 4.10 Limitation on Liens on Collateral. The Debtor will not
create, permit or suffer to exist, and will defend the Collateral and the
Debtor's rights with respect thereto against and take such other action as is
necessary to remove any Lien, security interest, encumbrance, or claim in or to
the Collateral other than the security interests created hereunder and such
Liens to the extent permitted pursuant to Section 6.2(a) of the Revolving Credit
Agreement.
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Section 4.11 Limitations on Modifications of Receivables and Other
Intangibles; No Waivers or Extensions. The Debtor will not (i) amend, modify,
terminate or waive any provisions of any material Receivable or Other Intangible
in any manner which might, when taken together with all such other Receivables
or Other Intangibles, respectively, materially reduce the value of all
Receivables or Other Intangibles, respectively, in the Collateral, (ii) fail to
exercise promptly and diligently each and every material right which it may have
under each Receivable and Other Intangible or (iii) fail to deliver to the Agent
a copy of each material demand, notice or document received by it relating in
any way to any Receivable or Other Intangible.
Section 4.12 Maintenance of Insurance. The Debtor will maintain with
financially sound insurance companies licensed to do business in the
jurisdictions in which the Collateral is located insurance policies on the
Inventory and Equipment in accordance with the provisions of Section 6.1(m) of
the Revolving Credit Agreement.
Section 4.13 Limitations on Dispositions of Collateral. The Debtor will
not directly or indirectly (through the sale of stock, merger or otherwise),
without the prior written consent of the Agent, sell, transfer, lease or
otherwise dispose of any of the Collateral, or attempt, offer or contract to do
so except for (i) sales of Inventory in the ordinary course of its business for
fair value in arm's-length transactions and (ii) so long as no Event of Default
(or Potential Event of Default) has occurred and is continuing, dispositions in
a commercially reasonable manner of Equipment which has become redundant, worn
out or obsolete or which should be replaced so as to improve productivity, so
long as the proceeds of any such disposition are (x) used to acquire replacement
equipment which has comparable or better utility and equivalent or better value
and which is subject to a first priority security interest in favor of the Agent
therein, except as permitted by Section 6.2(a) of the Revolving Credit
Agreement, or (y) applied to repay the Obligations. The inclusion of Proceeds of
the Collateral under the security interests granted hereby shall not be deemed a
consent by the Agent to any sale or disposition of any Collateral other than as
permitted by this Section 4.13.
Section 4.14 Further Identification of Collateral. The Debtor will furnish
to the Agent from time to time statements and schedules further identifying and
describing the Collateral and such other reports in connection with the
Collateral as the Agent may reasonably request. The Debtor shall promptly notify
the Agent if
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the value of the Collateral located at the facilities identified on Schedule 3.5
hereto is less than 80% of the value of all of the Collateral.
Section 4.15 Notices. The Debtor will advise the Agent promptly and in
reasonable detail (i) of any Lien, security interest, encumbrance or claim made
or asserted against any of the Collateral, other than, unless reasonably
requested by the Agent, Liens permitted by Section 6.2(a) of the Revolving
Credit Agreement, (ii) of any material change in the composition of the
Collateral, and (iii) of the occurrence of any other event which would have a
material adverse effect on the aggregate value of the Collateral or on the
security interests granted to the Agent in this Security Agreement.
Section 4.16 Change of Law. The Debtor shall promptly notify the Agent of
any change in law known to it which (i) adversely affects or will adversely
affect the validity, perfection or priority of the security interests granted
hereby, (ii) requires or will require a change in the proceedings to be followed
in order to maintain and protect such validity, perfection and priority or (iii)
could result in the Agent not having a perfected security interest in any of the
Collateral.
Section 4.17 Right of Inspection.
(a) Access to Books and Records. The Debtor shall, following any
request by the Agent and upon reasonable notice, permit the Agent or its
representatives to have full and free access during normal business hours to all
the books, correspondence and records of the Debtor, and the Agent or its
representatives may examine the same, take extracts therefrom, make photocopies
thereof and have such discussions with officers, employees and public
accountants of the Debtor as the Agent may deem reasonably necessary, and the
Debtor agrees to render to the Agent, at the Debtor's cost and expense, such
clerical and other assistance as may be reasonably requested with regard
thereto. The Agent and its representatives shall upon reasonable notice and
during normal business hours also have the right to enter into and upon any
premises where any of the Inventory or the Equipment is located for the purpose
of inspecting the same, observing its use or protecting the interests of the
Agent therein.
(b) Audits. The Debtor shall permit the Lenders, the Agent and their
representatives and advisors to review the operations of the Debtor and perform
the audits and examinations as provided in Section 6.1(l) of the Revolving
Credit Agreement.
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Section 4.18 Maintenance of Equipment. The Debtor will, at its expense,
maintain the Equipment in good operating condition, ordinary wear and tear
excepted.
Section 4.19 Covenants Regarding Patent and Trademark Collateral.
(a) Generally. At such time as the Debtor shall acquire any Patents
or Trademarks, it will comply with the terms, covenants and warranties of this
Section 4.19.
(b) Continued Use of Trademark. The Debtor (either itself or through
licensees) will, unless the Debtor shall reasonably determine, after
consultation with the Agent, that a Trademark is of negligible economic value to
the Debtor, (i) continue to use each Trademark on each and every Trademark class
of goods applicable to its current products and services as reflected in its
current catalogs, brochures and price lists in order to maintain each Trademark
in full force and free from any claim of abandonment for non-use, (ii) maintain
as in the past the quality of products and services offered under each
Trademark, (iii) employ each Trademark with the appropriate notice of
registration, (iv) not adopt or use any ▇▇▇▇ which is confusingly similar to a
colorable imitation of any Trademark and (v) not (and not permit any licensee or
sublicensee thereof to) do any act or knowingly omit to do any act whereby any
Trademark may become invalidated.
(c) No Abandonment. The Debtor will not, unless the Debtor shall
reasonably determine, after consultation with the Agent, that a Patent is of
negligible economic value to the Debtor, do any act, or knowingly omit to do any
act, whereby any Patent may be abandoned or dedicated.
(d) Notice of Abandonment or Adverse Determinations. The Debtor
shall notify the Agent immediately if it knows, or has reason to know, that any
application or registration relating to any Patent or Trademark may become
abandoned or dedicated, or of any adverse determination or development
(including, without limitation, the institution of, or any such determination or
development in any proceeding in the United States Patent and Trademark Office
or any court of tribunal in any country) regarding the Debtor's ownership of any
Patent or Trademark, its right to register the same or keep and maintain the
same.
(e) Filings After Notice to Agent. In no event shall the Debtor,
either itself or through any agent, employee, licensee or designee, file an
application for registration of any Patent or Trademark with the United States
Patent and
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Trademark Office or any similar office or agency in any other country or any
political subdivision thereof, unless it promptly informs the Agent and, upon
request of the Agent, executes and delivers any and all agreements, instruments,
documents and papers as the Agent may request to evidence the Agent's security
interest in such Patent or Trademark and the goodwill and general intangibles of
the Debtor relating thereto or represented thereby, and the Debtor hereby
constitutes the Agent its attorney-in-fact to execute and file all such writings
for the foregoing purposes, all such acts of such attorney being hereby ratified
and confirmed.
(f) Pursuit of Applications and Maintenance of Registrations. The
Debtor will take all necessary steps, including, without limitation, in any
proceeding before the United States Patent and Trademark Office or any similar
office or agency in any other country or any political subdivision thereof, to
maintain and pursue each application (and to obtain the relevant registration)
and to maintain each registration of the Patents and Trademarks, including
without limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability; provided, however, that no such Patent or
Trademark shall be required to be maintained or pursued to the extent such
Patent or Trademark is determined by the Debtor, after consultation with the
Agent, to be of negligible economic value to the Debtor.
(g) Notice of Infringement. If any of the Patent and Trademark
Collateral is infringed, misappropriated or diluted by a third party, the Debtor
shall promptly notify the Agent after it learns thereof and shall, unless the
Debtor shall reasonably determine, after consultation with the Agent, that such
Patent and Trademark Collateral is of negligible economic value to the Debtor,
promptly ▇▇▇ for infringement, misappropriation of dilution, seek injunctive
relief where appropriate and recover any and all damages for such infringement,
misappropriation or dilution, or take such other action as the Debtor shall
reasonably deem appropriate under the circumstances to protect such Patent and
Trademark Collateral.
Section 4.20 Termination of Federal Contracts. With respect to each
Federal Contract in respect of which the Debtor is required to execute an
Assignment of Federal Contract in accordance with Section 4.21 hereof, the
Debtor shall give prompt written notice to the Agent if the U.S. Government
shall terminate or threaten to terminate (whether for convenience or default)
any such Federal Contract with the Debtor having a value (including unexercised
options) of $100,000 or more. In addition, the Debtor shall give prompt written
notice to the Agent if the
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U.S. Government shall terminate or threaten to terminate any contract between
the U.S. Government and any other prime contractor under which the Debtor is a
subcontractor if the value of such subcontract (including unexercised options)
is $100,000 or more.
Section 4.21 Federal Contracts. The Debtor shall provide to the Agent, as
soon as reasonably practicable but not later than forty-five (45) days following
the end of each Fiscal Quarter, a report identifying each Federal Contract to
which it is a party, having attached thereto a copy of the first two pages of
such Federal Contract and any amendment thereto, to the extent not previously
provided to the Agent. At the request of the Agent (unless an Event of Default
shall have occurred and be continuing, in which case no such request shall be
required), the Debtor shall execute and deliver to the Agent an Assignment of
Federal Contract, in substantially the form of Exhibit A hereto (the "Assignment
of Federal Contract"), and execute any other instruments or take any other steps
required by the Agent in order that all moneys due or to become due under such
Federal Contracts shall be assigned to the Agent and notice thereof given under
the Assignment of Claims Act, including without limitation delivery of Notices
of Assignments with respect to each Federal Contract as contemplated by Appendix
A to Exhibit A hereto.
Section 4.22 Reimbursement Obligation. Should the Debtor fail to comply
with the provisions of this Security Agreement, the Revolving Credit Agreement
or any other agreement relating to the Collateral such that the value of any
Collateral or the validity, perfection, rank or value of any security interest
granted to the Agent hereunder or thereunder is thereby diminished or
potentially diminished or put at risk (as reasonably determined by the Agent),
the Agent on behalf of the Debtor may, but shall not be required to, effect such
compliance on behalf of the Debtor, and the Debtor shall reimburse the Agent for
the cost thereof on demand, and interest shall accrue on such reimbursement
obligation from the date the relevant costs are incurred until reimbursement
thereof in full at the Default Rate.
ARTICLE V
REMEDIES; RIGHTS UPON DEFAULT
Section 5.1 UCC Rights. In the event that any portion of the Obligations
has been declared or becomes due and payable in accordance with the Revolving
Credit Agreement or other Credit Documents and such Obligations have not been
paid in full, the Agent may in addition to all other rights and remedies granted
to it
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in this Security Agreement and in any other instrument or agreement securing,
guarantying, evidencing or relating to the Obligations, exercise (i) all rights
and remedies of a secured party under the UCC (whether or not in effect in the
jurisdiction where such rights are exercised) and (ii) all other rights
available to the Agent at law or in equity.
Section 5.2 Payments on Collateral. Without limiting the rights of
the Agent under any other provision of this Security Agreement, if an Event of
Default shall occur and be continuing:
(i) all payments received by the Debtor under or in
connection with any of the Collateral shall be held by the Debtor in
trust for the Agent, shall be segregated from other funds of the
Debtor and shall forthwith upon receipt by the Debtor be turned over
to the Agent, in the same form as received by the Debtor (duly
indorsed by the Debtor to the Agent, if required to permit
collection thereof by the Agent); and
(ii) all such payments received by the Agent (whether from
the Debtor or otherwise) may, in the sole discretion of the Agent,
be held by the Agent as collateral security for, and/or then or at
any time thereafter applied in whole or in part by the Agent to the
payment of, the expenses and the Obligations as set forth in Section
5.11 hereof.
Section 5.3 Possession of Collateral. In furtherance of the foregoing, the
Debtor expressly agrees that, if an Event of Default shall occur and be
continuing, the Agent may (i) by judicial powers, or without judicial process if
it can be done without breach of the peace, enter any premises where any of such
Collateral is or may be located and, without charge or liability to the Agent,
seize and remove such Collateral from such premises and (ii) have access to and
use of the Debtor's books and records relating to such Collateral.
Section 5.4 Sale of Collateral; Notice.
(a) Sale of Collateral. The Debtor expressly agrees that if an Event
of Default shall occur and be continuing, the Agent, without demand of
performance or other demand or notice of any kind (except the notice specified
below of the time and place of any public or private sale) to or upon the Debtor
or any other Person (all of which demands and/or notices are hereby waived by
the Debtor), may forthwith (i) apply the cash, if any, then held by it as
collateral as specified in Section 5.11 hereof and (ii) if there shall be no
cash or such cash shall be insufficient
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to pay the Obligations in full, collect, receive, appropriate and realize upon
the Collateral, and/or sell, assign, give an option or options to purchase or
otherwise dispose of and deliver the Collateral (or contract to do so) or any
part thereof in one or more parcels (which need not be in round lots) at public
or private sale, at any office of the Agent or elsewhere in such manner as is
commercially reasonable and, as the Agent may deem best, for cash or on credit
or for future delivery without assumption of any credit risk. The Agent shall
have the right upon any such public sale, and, if the Collateral is of a type
customarily sold in a recognized market or is of a type which is the subject of
widely distributed standard price quotations, upon any such private sale or
sales, to purchase the whole or any part of the Collateral so sold, and
thereafter to hold the same, absolutely and free from any right or claim of any
kind. To the extent permitted by applicable law, the Debtor waives all claims,
damages and demands against the Agent arising out of the foreclosure,
repossession, retention or sale of the Collateral.
(b) Notice of Sale. Unless the Collateral threatens to decline
speedily in value or is of a type customarily sold on a recognized market, the
Agent shall give the Debtor ten (10) days' written notice of its intention to
make any such public or private sale or sale at a broker's board or on a
securities exchange. Such notice shall (i) in the case of a public sale, state
the time and place fixed for such sale, (ii) in the case of sale at a broker's
board or on a securities exchange, state the board or exchange at which such
sale is to be made and the day on which the Collateral, or the portion thereof
being sold, will first be offered for sale and (iii) in the case of a private
sale, state the day after which such sale may be consummated. The Agent shall
not obligated to make any such sale pursuant to any such notice. The Agent may
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for the sale, and such sale
may be made at any time or place to which the same may be so adjourned. In the
case of any sale of all or any part of the Collateral on credit or for future
delivery, the Collateral so sold may be retained by the Agent until the selling
price is paid by the purchaser thereof, but the Agent shall not incur any
liability in case of the failure of such purchase to take up and pay for the
Collateral so sold and, in the case of such failure, such Collateral may again
be sold upon like notice.
(c) Special Provisions Relating to Sales of Securities. The Debtor
recognizes that the Agent may be unable to effect a public sale of any or all
the Collateral constituting a "security" (as such term is defined in the
Securities Act) by reason of certain prohibitions contained in the Securities
Act and applicable state securities laws or otherwise, and may be compelled to
resort to one or more private
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sales thereof to a restricted group of purchasers that will be obliged to agree,
among other things, to acquire such securities for their own account for
investment and not with a view to the distribution or resale thereof. The Debtor
acknowledges and agrees that any such private sale may result in prices and
other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The Agent shall be
under no obligation to delay a sale of any of Collateral constituting a security
for the period of time necessary to permit the issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such issuer would agree to do so.
Section 5.5 Rights of Purchasers. Upon any sale of the Collateral
(whether public or private), the Agent shall have the right to deliver, assign
and transfer to the purchaser thereof the Collateral so sold. Each purchaser
(including the Agent) at any such sale shall hold the Collateral so sold
absolutely, free from any claim or right of whatever kind, including any equity
or right of redemption of the Debtor who, to the extent permitted by law, hereby
specifically waives all rights of redemption, including, without limitation, any
right to redeem the Collateral under Section 9-506 of the UCC, and any right to
a judicial or other stay or approval which it has or may have under any law now
existing or hereafter adopted.
Section 5.6 Additional Rights of the Agent.
(a) Right to Maintain Proceedings. The Agent (i) shall have the
right and power to institute and maintain such suits and proceedings as it may
deem appropriate to protect and enforce the rights vested in it by this Security
Agreement and (ii) may proceed by suit or suits at law or in equity to enforce
such rights and to foreclose upon the Collateral and to sell all or, from time
to time, any of the Collateral under the judgment or decree of a court of
competent jurisdiction.
(b) Appointment of Receiver. The Agent shall, to the extent
permitted by applicable law, without notice to the Debtor to any party claiming
through the Debtor, without regard to the solvency or insolvency at such time of
any Person then liable for the payment of any of the Obligations, without regard
to the then value of the Collateral and without requiring any bond from any
complainant in such proceedings, be entitled as a matter of right to the
appointment of a receiver or receivers (who may be the Agent) of the Collateral
or any part thereof, pending such proceedings, with such powers as the court
making such appointment shall
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confer, and to the entry of an order directing that the profits, revenues and
other income of the property constituting the whole or any part of the
Collateral be segregated, sequestered and impounded for the benefit of the
Agent, and the Debtor irrevocably consents to the appointment of such receiver
or receivers and to the entry of such order.
(c) No Duty to Exercise Rights. In no event shall the Agent have
any duty to exercise any rights or take any steps to preserve the rights of the
Agent in the Collateral, nor shall the Agent be liable to the Debtor or any
other Person for any loss caused by the Agent's failure to meet any obligation
imposed by Section 9-207 of the UCC or any successor provision. Without limiting
the foregoing, the Agent shall be deemed to have exercised reasonable care in
the custody and preservation of the Collateral in its possession if the
Collateral is accorded treatment substantially equal to that which the Agent
accords its own property, it being understood that the Agent shall not have any
duty or responsibility for (i) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relative to
any Collateral, whether or not the Agent has or is deemed to have knowledge of
such matters, or (ii) taking any necessary steps to preserve rights against any
parties with respect to any Collateral.
Section 5.7 Remedies Not Exclusive, etc.
(a) Remedies Not Exclusive. No remedy conferred upon or
reserved to the Agent in this Security Agreement is intended to be exclusive of
any other remedy or remedies, but every such remedy shall be cumulative and
shall be in addition to every other remedy conferred herein or now or hereafter
existing at law, in equity or by statute.
(b) Restoration of Rights. If the Agent shall have proceeded to
enforce any right, remedy or power under this Security Agreement and the
proceeding for the enforcement thereof shall have been discontinued or abandoned
for any reason or shall have been determined adversely to the Agent, the Debtor
and the Agent shall, subject to any determination in such proceeding, severally
and respectively be restored to their former positions and rights under this
Security Agreement, and thereafter all rights, remedies and powers of the Agent
shall continue as though no such proceedings had been taken.
(c) Enforcement. All rights of action under this Security
Agreement may be enforced by the Agent without the possession of any instrument
evidencing
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any Obligation or the production thereof at any trial or other proceeding
relative thereto, and any suit or proceeding instituted by the Agent shall be
brought in its name and any judgment shall be held as part of the Collateral.
Section 5.8 Waiver and Estoppel.
(a) No Actions to Impede Sale of Collateral. The Debtor agrees,
to the extent it may lawfully do so, that it will not at any time in any manner
whatsoever claim or take the benefit or advantage of any appraisal, valuation,
stay, extension, moratorium, turnover or redemption law, or any law permitting
it to direct the order in which the Collateral shall be sold, now or at any time
hereafter in force which may delay, prevent or otherwise affect the performance
or enforcement of this Security Agreement, and hereby waives all benefit or
advantage of all such laws. The Debtor covenants that it will not hinder, delay
or impede the execution of any power granted to the Agent in this Security
Agreement, any Assignment of Federal Contract or any other Credit Document.
(b) Collateral Sold As An Entirety. The Debtor, to the extent
it may lawfully do so, on behalf of itself and all who claim through or under
it, including without limitation any and all subsequent creditors, vendees,
assignees and lienors, waives and releases all rights to demand or to have any
marshalling of the Collateral upon any sale, whether made under any power of
sale granted herein or pursuant to judicial proceedings or under any foreclosure
or any enforcement of this Security Agreement, and consents and agrees that all
of the Collateral may at any such sale be offered and sold as an entirety.
(c) Waiver of Notices. The Debtor waives, to the extent
permitted by law, presentment, demand, protest and any notice of any kind
(except the notices expressly required hereunder) in connection with this
Security Agreement and any action taken by the Agent with respect to the
Collateral.
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Section 5.9 Power of Attorney; Powers Coupled With An Interest.
(a) Power of Attorney. Without limiting any other right granted
hereunder, the Debtor hereby irrevocably constitutes and appoints the Agent,
with full power of substitution, as its true and lawful attorney-in-fact with
full irrevocable power and authority in the place and stead of the Debtor and in
the name of the Debtor or in its own name, from time to time in the Agent's
reasonable discretion, for the purpose of carrying out the terms of this
Security Agreement, to take any and all appropriate action and to execute any
and all documents and instruments which may be necessary or desirable to
accomplish the purpose of this Security Agreement and, without limiting the
generality of the foregoing, hereby gives the Agent the power and right, on
behalf of the Debtor, without notice to or assent by the Debtor, to do the
following:
(i) to pay or discharge taxes, liens, security interests
or other encumbrances levied or placed on or threatened against the
Collateral;
(ii) to effect any repairs or any insurance called for by
the terms of this Security Agreement or any other Credit Document, and to
pay all or any part of the premiums therefor and the costs thereof;
(iii) upon the occurrence and continuance of any Event of
Default and otherwise to the extent provided in this Security Agreement,
(a) to direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due and to come due
thereunder directly to the agent or as the Agent shall direct, (B) to
receive payment of and receipt for, and to demand and ▇▇▇ for, any and
all moneys, claims and other amounts due and to become due at any time in
respect of or arising out of the collateral, (C) to sign and indorse and
receive, take, assign and deliver, any checks, notes, drafts, negotiable
and non-negotiable instruments, any invoices, freight or express bills,
bills of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications and notices in connection with accounts and
other documents relating to the Collateral, (D) to commence, settle,
compromise, compound, prosecute, defend or adjust any claim, suit, action
or proceeding with respect to, or in connection with, the Collateral, (e)
to sell, transfer, assign or otherwise deal in or with the Collateral or
any part thereof, as fully and effectively as if the Agent were the
absolute owner thereof and (F) to do, at its option, but at the expense
of the Debtor, at any time or from time to time, all acts and things
which the Agent deems necessary to protect,
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preserve or realize upon the collateral and the agent's security interest
therein, in order to effect the intent of this security agreement, all as
fully and effectively as the debtor might do.
(b) Powers Coupled With an Interest. All authorizations and
agencies granted or provided herein with respect to the Collateral, including
the powers granted under clause (a) of this Section 5.9, are irrevocable and
powers coupled with an interest.
Section 5.10 Certain Provisions Relating to Securities. Solely with
respect to any Collateral constituting a "security" (as defined in the
Securities Act), if an Event of Default shall have occurred and be continuing,
all such securities (as defined in the Securities Act) constituting a part of
the Collateral shall, at the request of the Agent, be registered in the name of
the Agent or its nominee, and the Agent or its nominee may thereafter exercise
(i) all voting, corporate and other rights, powers and privileges pertaining to
such Collateral at any meeting of shareholders of the issuer thereof or
otherwise, and (ii) any and all rights of conversion, exchange, subscription and
any other rights, privileges or options pertaining to such Collateral as if it
were the absolute owner thereof (including, without limitation, the right to
exchange at its discretion any and all such Collateral upon the merger,
consolidation, reorganization, recapitalization or other fundamental change in
the structure of any such issuer, or upon the exercise by the Debtor or the
Agent of any right, privilege or option pertaining to such Collateral, and in
connection therewith, the right to deposit and deliver any and all such
Collateral with any committee, depositary, transfer agent, registrar or other
designated agency upon such terms and conditions as it may determine), all
without liability except to account for property actually received by it and
except as provided in Section 5.6(c) hereof, but the Agent shall have no duty to
the Debtor to exercise any such right, privilege or option and shall not be
responsible for any failure to do so or delay in so doing.
Section 5.11 Application of Monies. The proceeds of any sale of, or other
realization upon, all or any part of the Collateral shall be applied by the
Agent in the following order of priority:
first, to payment of the expenses of such sale or other realization,
including reasonable compensation to the Agent and its agents and counsel, and
all expenses, liabilities and advances incurred or made by the Agent, its agents
and counsel in
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connection therewith or in connection with the care, safekeeping or otherwise of
any or all of the Collateral;
second, to payment of the Obligations, in such order as the Agent may
elect; and
third, any surplus then remaining shall be paid to the Debtor, or its
successors or assigns, or to whomsoever may be lawfully entitled to receive the
same (including pursuant to Section 9-504(1)(C) of the UCC) or as a court of
competent jurisdiction may direct.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Notices. All notices, requests and other communications to a
party hereunder shall be in writing and shall be given to such party at its
address set forth on the signature page hereof or such other address as such
party may hereafter specify for that purpose by notice to the other. Each such
notice, request or other communication shall be effective (i) in the case of
telephonic notice (to the extent expressly permitted hereunder), when made, (ii)
in the case of notice delivered by overnight express courier, one Business Day
after the Business Day such notice was delivered to such courier, (iii) in the
case of notice delivered by first class mail, three Business Days after being
deposited in the mail, postage prepaid, return receipt requested, (iv) in the
case of notice by hand, when delivered, or (v) in the case of notice by any
customary means of telecommunication, when sent provided confirmation of receipt
or answer back has been received, in each case if addressed to any party hereto
as provided herein. Rejection or refusal to accept, or the inability to deliver
because of a changed address of which no notice was given, shall not affect the
validity of notice given in accordance with this section.
Section 6.2 No Waiver; Cumulative Remedies. The Agent shall not by any
act (except by a written instrument pursuant to Section 6.3 hereof) be deemed to
have waived any right or remedy hereunder. No failure to exercise, nor any delay
in exercising, on the part of the Agent any right, power or privilege hereunder
shall operate as a waiver thereof. No single or partial exercise of any right,
power or privilege hereunder shall preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. A waiver by the
Agent of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Agent would otherwise have
on any future occasion. The
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rights and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any other rights or remedies provided by
law.
Section 6.3 Amendments and Waivers. None of the terms or provisions of
this Security Agreement may be amended, supplemented or otherwise modified
except by a written instrument executed by the Debtor and the Agent; provided
that any provision of this Security Agreement may be waived by the Agent in a
letter or agreement executed by the Agent or by telex or facsimile transmission
from the Agent.
Section 6.4 Successors and Assigns. The provisions of this Security
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns; provided, however, that the Debtor
may not assign or transfer any of its rights or obligations hereunder without
the prior written consent of the Agent.
Section 6.5 Governing Law. THIS SECURITY AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA, OTHER
THAN ITS LAWS RESPECTING CHOICE OF LAW OTHER THAN THOSE CONTAINED IN THE UCC.
Section 6.6 Limitation by Law; Severability.
(a) All rights, remedies and powers provided in this Security
Agreement may be exercised only to the extent that the exercise thereof does not
violate any applicable provision of law, and all the provisions of this Security
Agreement are intended to be subject to all applicable mandatory provisions of
law which may be controlling and to be limited to the extent necessary so that
they will not render this Security Agreement invalid, unenforceable in whole or
in part, or not entitled to be recorded, registered or filed upon the provisions
of any applicable law.
(b) If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, a. the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the Agent in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
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Section 6.7 Counterparts. This Security Agreement may be executed in any
number of counterparts and by different parties hereto on separate counterparts,
each complete set of which, when so executed and delivered by all parties, shall
be an original, but all such counterparts shall together constitute but one and
the same instrument.
Section 6.8 Expenses of the Agent. The Debtor shall pay to the Agent from
time to time upon demand, all of the costs and expenses incurred by the Agent or
any Lender (including, without limitation, the reasonable fees and disbursements
of counsel and any amounts payable by the Agent or any Lender to any of their
respective agents) (i) arising in connection with the administration,
modification, amendment, - waiver or termination of this Security Agreement or
any document or agreement contemplated hereby or any consent or waiver hereunder
or thereunder or (ii) incurred in connection with the administration -- of this
Security Agreement, or any document or agreement contemplated hereby, or in
connection with the administration, sale or other disposition of Collateral
hereunder or under any document or agreement contemplated hereby or the
preservation, protection or defense of the rights of the Agent or any Lender in
and to the Collateral.
Section 6.9 Indemnification. The Debtor shall at all times hereafter
indemnify, hold harmless and, on demand, reimburse the Agent and the Lenders and
their respective subsidiaries, affiliates, successors, assigns, officers,
directors, employees and agents, and their respective heirs, executors,
administrators, successors and assigns (all of the foregoing parties, including,
but not limited to, the Agent, being hereinafter collectively referred to as the
"Indemnities" and individually as an "Indemnitee") from, against and for any and
all liabilities, obligations, claims, damages, actions, penalties, causes of
action, losses, judgments, suits, costs, expenses and disbursements, including,
without limitation, attorney's fees (any and all of the foregoing being
hereinafter collectively referred to as the "Liabilities" and individually as a
"Liability") which the Indemnitees, or any of them, might be or become
subjected, by reason of, or arising out of the preparation, execution, delivery,
modification, administration or enforcement of, or performance of the Agent's
rights under, this Security Agreement or any other document, instrument or
agreement contemplated hereby or executed in connection herewith; provided,
however, that the Debtor shall not be liable to any Indemnitee for any Liability
caused solely by the gross negligence or willful misconduct of such Indemnitee.
In no event shall any Indemnitee, as a condition to enforcing its rights under
this Section 6.9 or otherwise, be obligated to make a claim against any other
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Person (including, without limitation, the Agent) to enforce its rights under
this Section 6.9.
Section 6.10 Termination; Survival. This Security Agreement shall
terminate when the security interests granted hereunder have terminated and the
Collateral has been released as provided in Section 2.6; provided, however, that
the obligations of the Debtor under Section 4.22 and the provisions of this
Article 6 shall survive any such termination.
Section 6.11 Judicial Proceedings; Waiver of Jury Trial. Any judicial
proceeding brought against the Debtor with respect to any Credit Agreement
Related Claim hereby may be brought in any court of competent jurisdiction in
the Commonwealth of Virginia, County of Fairfax, or any Federal court in the
Eastern District of Virginia, and, by execution and delivery of this Security
Agreement, the Debtor (a) accepts, generally and unconditionally, the
nonexclusive jurisdiction of such courts and any related appellate court and
irrevocably agrees to be bound by any judgment rendered thereby in connection
with any Credit Agreement Related Claim and (b) irrevocably waives any objection
it may now or hereafter have as to the venue of any such proceeding brought in
such a court or that such a court is an inconvenient forum. The Debtor hereby
waives personal service of process and consents that service of process upon it
may be made by certified or registered mail, return receipt requested, at its
address specified or determined in accordance with the provisions of Section 6.1
hereof, and service so made shall be deemed completed on the earlier of (x) the
receipt thereof and (y) if sent by registered or certified mail (return receipt
requested), the fifth (5th) Business Day after such service is deposited in the
mail. Nothing herein shall affect the right of the Agent to serve process in any
other manner permitted by law or shall limit the right of the Agent to bring
proceedings against the Debtor in the courts of any other jurisdiction. Any
judicial proceeding by the Debtor against the Agent relating to or involving any
Credit Agreement Related Claim hereby shall be brought only in a court located
in the Commonwealth of Virginia, County of Fairfax, or the Federal court in the
Eastern District of Virginia. THE DEBTOR AND THE AGENT HEREBY UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING TO WHICH THEY ARE PARTIES
INVOLVING ANY CREDIT AGREEMENT RELATED CLAIM.
Section 6.12 Integration. This Security Agreement and the other Credit
Documents constitute the entire agreement of the Agent, the Lenders, the
Borrower and the other Credit Parties with respect to the subject matter hereof
and thereof,
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176
and there are no promises, undertakings, representations or warranties by the
Agent or any Lender relative to the subject matter hereof or thereof not
expressly set forth or referred to herein or in the other Credit Documents.
Section 6.13 Authority of Agent. The Debtor acknowledges that the rights
and responsibilities of the Agent under this Security Agreement with respect to
any action taken by the Agent or the exercise or non-exercise by the Agent of
any option, voting right, request, judgment or other right or remedy provided
for herein or resulting or arising out of this Security Agreement shall, as
between the Agent and the Lenders, be governed by the Revolving Credit Agreement
and by such other agreements with respect thereto as may exist from time to time
among them, but, as between the Agent and the Debtor, the Agent shall be
conclusively presumed to be acting as agent for the Lenders with full and valid
authority so to act or refrain from acting, and the Debtor shall not be under
any obligation, or entitlement, to make any inquiry respecting such authority.
Section 6.14 Headings, Bold Type and Table of Contents. The section
headings, subsection headings, and bold type used herein and the Table of
Contents hereto have been inserted for convenience of reference only and do not
constitute matters to be considered in interpreting this Security Agreement.
32
177
IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed by their respective authorized officers as of the
day and year first written above.
[NAME OF COMPANY]
Address:
-------
-------
-------
By:________________________________
Attention: Name:
Phone: (___) ___-____ Title:
Fax: (___) ___-____
BANK OF AMERICA, N.A.
Address:
-------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ By:_______________________________
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇ Title: Senior Vice President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
33
178
Schedule 3.4
Place of Business
-----------------
-----------------
-----------------
179
Schedule 3.5
Location of Collateral
-----------------
-----------------
-----------------
180
Schedule 3.6
Trade Names, Division Names, etc.
------
181
Schedule 3.7
Patents and Trademarks
------
182
Schedule 4.1
UCC Filings
183
Exhibit A to
Security Agreement
FORM OF
ASSIGNMENT OF FEDERAL CONTRACT
This ASSIGNMENT OF FEDERAL CONTRACT, dated as of _____, __ (the
"Agreement"), is made by [Name of Company], a [Name of State] corporation (the
"Assignor"), in favor of BANK OF AMERICA, N.A.., a national banking association
(the "Agent"), in its capacity as Agent for the lenders from time to time a
party to the Revolving Credit Agreement (as defined in the Security Agreement
referred to below).
W I T N E S S E T H:
WHEREAS, the Assignor has secured certain obligations undertaken by [Name
of Company] pursuant to the provisions of a Security Agreement, dated as of
___________________, ____ (as the same may be amended, supplemented or otherwise
modified from time to time, the "Security Agreement"), by and between the
Assignor and the Agent; and
WHEREAS, the Assignor is a party to, and from time to time will become
entitled to receive moneys under and by virtue of, a certain contract with,
involving or for the benefit of the United States of America or any department,
agency or instrumentality thereof (herein referred to as the "Government"),
designated as Contract Number _______ entered into by the Assignor and the
Government on ________ __, 2000 (which contract, together with all additions,
change orders, supplements, amendments, renewals, extensions, and modifications
thereto now or hereafter in effect, are hereinafter collectively called the
"Contract"); and
WHEREAS, pursuant to the Security Agreement, the Assignor has undertaken
to effectuate the assignment(s) and other actions contemplated by this
Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Assignor covenants and agrees as follows:
184
1. Incorporation By Reference. The provisions of the Security
Agreement are incorporated herein by reference, and the terms defined in the
Security Agreement are used herein with the same meanings.
2. Representations. The Assignor represents and warrants to the
Agent that (a) the Contract is legal, valid and binding on the Assignor and, to
its knowledge, the other parties thereto, is in full force and effect, and is
not evidenced by any chattel paper or instrument, (b) upon due filing of this
Agreement, together with a Notice of Assignment substantially in the form of
Appendix A hereto with the authorized representative, the execution and delivery
of this Agreement does not violate and is not in conflict with the provisions of
the Contract, (c) there has been no default on the part of the Assignor or any
other party to the Contract, (d) the Assignor has made no previous assignment of
the Contract to any person and knows of no fact or defense that will render the
moneys due or to be due thereunder uncollectible, (e) no financing statement
covering the Contract is on file in any public office except financing
statements in favor of the Agent, (f) no set-off or counterclaim to any moneys
due or to become due under the Contract exists on the date hereof, and no
agreement has been made with any person under which any deduction or discount
may be claimed, and (g) the address of the office where the Assignor keeps its
records concerning the Contract is ____________________.
3. Collateral. As security and collateral for the payment of all
of the Obligations (defined in the Security Agreement) and for performance of,
and compliance with, by the Assignor, all of the terms, covenants, conditions,
stipulations, and agreements contained in this Agreement and in the Security
Agreement, the Assignor hereby assigns to the Agent, and grants to the Agent a
lien on and security interest in, all moneys and claims for moneys now and
hereafter due and to become due to the Assignor under or by reason of the
Contract, together with all cash and non-cash proceeds thereof; provided,
however, that nothing contained herein shall impose upon the Agent any of the
obligations or liabilities of the Assignor under the Contract.
4. Covenants. Until payment and performance in full of the
Obligations, the Assignor covenants as follows:
(a) The Assignor shall place on any and all vouchers, invoices, or
other instruments demanding payment under the Contract the direction that such
payment is to be made to the Agent in accordance with Section 5 of this
Agreement.
(b) The Assignor shall promptly upon request execute, acknowledge,
and deliver any notice, financing statement, renewal, affidavit, deed,
assignment,
2
185
continuation statement, security agreement, certificate, or other document as
the Agent may require in order to perfect, preserve, maintain, protect,
continue, and/or extend the assignment, lien, and security interest of the Agent
under this Agreement and its priority. The Assignor shall pay to the Agent on
demand all taxes, costs, and expenses incurred by the Agent in connection with
the preparation, execution, recording, and filing of any such document or
instrument mentioned aforesaid, and such taxes, costs, and expenses shall
constitute and become a part of the Obligations. A carbon, photographic, or
other reproduction of a security agreement or a financing statement is
sufficient as a financing statement.
(c) The Assignor shall fully, promptly, and faithfully comply with
and perform its obligations and duties under the Contract in accordance with the
terms thereof and will make no changes or amendments to the Contract or
terminate or cancel the Contract without the prior written consent of the Agent
except as permitted by the Security Agreement. In the event that any change,
amendment, termination or cancellation of the Contract is made or effected by
the Government, the Assignor will promptly notify the Agent thereof and promptly
furnish to the Agent a copy of any document or agreement evidencing any such
change, amendment, termination, or cancellation.
(d) The Assignor will promptly
(i) furnish to the Agent all information received by the
Assignor affecting the moneys due and to become due under the Contract,
(ii) inform the agent of any delay in performance of, or
claims made in regard to, the Contract, and
(iii) notify the agent in writing of the failure of any
party to the Contract to perform any of its obligations thereunder and
any rejection of any performance rendered by the assignor under or in
connection with the Contract.
(e) The Assignor will at all times keep accurate and complete
records of performance by the Assignor under the Contract, and the Agent and its
agents shall have the right, during normal business hours and upon reasonable
advance notice, to call at the place or places of business of the Assignor at
intervals to be determined by the Agent, and without hindrance or delay, to
inspect, audit, check, and make extracts from the books, records, journals,
orders, receipts, correspondence, and other data relating to the Contract or to
any other transactions between the parties hereto related to the Contract.
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186
5. Payments. The Assignor hereby authorizes, empowers, and
directs the Government to draw all checks, drafts, or other instruments
representing the payments of money due the Assignor under the Contract (herein
called the "Items of Payment") to the order of BANK OF AMERICA, N.A., assignee
of Assignor, and to send the same (i) if by mail, to , (ii) if by electronic
transfer, to BANK OF AMERICA, N.A., for the account of ________________, Bank
Account #__________, Agent ABA#_________, or (iii) if by wire transfer, to BANK
OF AMERICA, N.A., for the account of _________________________, Bank Account
#_______, ABA#___________. If, despite this direction, any instruments or checks
representing payments should be delivered to the Assignor, the Assignor will
immediately endorse and deliver such instruments or checks to the order of the
Agent. The Assignor does hereby irrevocably (subject to revocation with the
consent of the Agent) designate and appoint (which appointment is coupled with
an interest) the Agent, and the Agent's successors in interest by operation of
law, the Assignor's true and lawful attorney with power irrevocable for the
Assignor and in the Assignor's name, place, and stead, but at the sole cost and
expense of the Assignor, to receive, endorse, and collect all Items of Payment,
and to ask, demand, receive, receipt, and give acquittances for any and all
amounts which may be payable or which become due and payable by the Government
under the Contract, and in the Agent's discretion to file any claim or to take
any other action or proceeding, either in the Agent's own name or in the name of
the Assignor or otherwise, which to the Agent or any successor in interest
thereof may seem necessary or desirable in order to collect or endorse the
payment of any and all amounts now due or owing or which may hereafter be or
become due or owing on account of the Contract. All Items of Payment received by
the Agent pursuant hereto which are finally paid in cash or solvent credits
shall be applied against the Obligations as provided in the Security Agreement.
Any portion of the Items of Payment which the Agent elects not to so apply shall
be paid over to the Assignor or to whomsoever shall be entitled thereto under
applicable law, including pursuant to Section 9-504(1)(C) of the Uniform
Commercial Code of the Commonwealth of Virginia.
6. No Waiver. Neither this Agreement nor any term, condition,
representation, warranty, covenant, or agreement hereof may be changed, waived,
discharged, or terminated orally, but only by an instrument in writing by the
party against whom such change, waiver, discharge, or termination is sought.
7. Governing law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
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187
8. Gender. Whenever used herein, the singular number shall
include the plural, the plural the singular, and the use of the masculine,
feminine, or neuter gender shall include all genders.
9. Counterparts. This Agreement may be executed in any number of
duplicate originals, each of which shall be an original but all of which
together shall constitute one and the same instrument.
10. Paragraph Headings. The paragraph headings of this Agreement
are for convenience only and shall not limit or define the provisions of this
Agreement.
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188
IN WITNESS WHEREOF, Assignor and the Agent have caused this Agreement to
be duly executed and delivered by their respective representatives thereunto
duly authorized as of the date first above written.
[NAME OF COMPANY]
ATTEST:
--------------------------
, Secretary
By:
-------------------------------
[Corporate Seal] Name:
Title:
WITNESS:
--------------------------
BANK OF AMERICA, N.A.
ATTEST:
--------------------------
, Secretary
By:
-----------------------------------
[Corporate Seal] Name:
Title:
WITNESS:
--------------------------
6
189
Appendix A To
Assignment of Federal Contract
Notice of Assignment
Date: ____________
To: Contracting Officer
[Address]
Re: CONTRACT NUMBER ___________ (the "Contract") MADE BY THE
UNITED STATES OF AMERICA
By: Department of the [Applicable U.S. Government
Agency] [Address]
with [Name of Subsidiary] (the "Contractor")
[Address]
for manufacture and support of a [Brief description of
Subject of Contract]
dated _______________
PLEASE TAKE NOTICE that moneys due or to become due under the Contract
have been assigned to BANK OF AMERICA, N.A., pursuant to the provisions of the
Assignment of Claims Act of 1940, as amended (31 USC Section 3727 and 41 USC
Section 15). A true copy of the Assignment executed by the Contractor on the
date hereof (the "Assignment") is attached to the original of this Notice of
Assignment. Please file this original Notice of Assignment along with the copy
of the Assignment in the contract file for the Contract and forward one of the
enclosed copies of this Notice of Assignment to the current disbursing office
for the Contract.
190
Payments due or to become due under the Contract should be made (i) if by
mail, to BANK OF AMERICA, N.A., ____________________, (ii) if by electronic
transfer, to BANK OF AMERICA, for the account of ______________________, Bank
Account #__________, Agent ABA#_____________, and (iii) if by wire transfer, to
BANK OF AMERICA, N.A., for the account of __________________________, Bank
Account #_________, ABA#_________.
Please return enclosed copies of this Notice of Assignment with
appropriate notations showing the date and hour of receipt, and duly signed by
the person acknowledging receipt on behalf of the addressee, to Bank of America,
N.A., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
__________________.
Very truly yours,
[NAME OF COMPANY]
By:
------------------------------
Name:
Title:
Receipt is hereby acknowledged of the above notice and a copy of the
above mentioned instrument of assignment. These were received at _________[A.M.]
[P.M.] on ______________________, 2000.
-------------------------------
Name:
Title:
on behalf of Contracting Officer
[Address]
2
191
Exhibit E to Amended and Restated
Revolving Credit Agreement
FORM OF
SWING LINE NOTE
SWING LINE NOTE
U.S.$5,000,000.00 Dated: , 2000
-------------
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇ ▇▇▇▇▇▇, INC., a
Delaware corporation (the "Borrower"), hereby unconditionally promises to pay on
the Maturity Date to the order of BANK OF AMERICA, N.A. (the "Lender"), and its
successors and assigns, the principal amount of the lesser of (x) FIVE MILLION
UNITED STATES DOLLARS ($5,000,000.00) and (y) the aggregate amount of Swing Line
Loans made by the Lender to the Borrower pursuant to the Agreement (as
hereinafter defined) and remaining outstanding on such date. Capitalized terms
used (but not defined) in this Swing Line Note shall have the meanings given to
them in the Agreement (as hereinafter defined).
The Borrower promises to pay interest from the initial Funding
Date of such Swing Line Loans until the Maturity Date on the principal amount of
this Swing Line Note from time to time outstanding at the rate, and in the
manner, prescribed in the Agreement. Any principal amount of, or any interest
accrued on, this Swing Line Note which is not paid on the date due shall bear
interest from such due date until paid in full at the Default Rate. In no event
shall the rate of interest borne by this Swing Line Note at any time exceed the
maximum rate of interest permitted at that time under applicable law.
Payments of the principal amount of and interest on this Swing
Line Note shall be made in lawful money of the United States of America to the
Lending Office of the Agent on behalf of the Lender as provided in the
Agreement.
This Swing Line Note is the Swing Line Note referred to in the
Amended and Restated Revolving Credit Agreement, dated as of July 28, 2000 (as
the same may from time to time be amended, modified or supplemented, the
"Agreement"), between the Lender, the other lenders from time to time a party
thereto, if any, the Borrower and Bank of America, N.A., as Agent. The Lender is
entitled to the rights and benefits of the Agreement and the other Credit
Documents, and the Agent, for the benefit of the Lender, is entitled to the
benefits
192
provided under the Borrower Security Agreement, the Subsidiary Security
Agreements, any Pledge Agreement and the Subsidiary Guarantee. The Agreement,
among other things, contains provisions for optional and mandatory prepayments
on account of the principal of this Swing Line Note by the Borrower and for
acceleration of the maturity of this Swing Line Note upon the terms and
conditions therein specified.
This Swing Line Note is being issued in replacement of that
certain Swing Line Note, dated May 20, 1998, issued by the Borrower to the
Lender (as successor to NationsBank, N.A.) under the Original Credit Agreement.
THIS SWING LINE NOTE IS BEING ISSUED IN THE COMMONWEALTH OF
VIRGINIA AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT REGARD TO THE CONFLICTS OF
LAWS PRINCIPLES.
▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By:
----------------------------------
Name:
-----------------------------
Title:
-----------------------------
-----------------------------
-----------------------------
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193
Exhibit F to Amended and
Restated Revolving Credit Agreement
Form of
Borrowing Base Certificate
To: Bank of America, N.A. (the "Agent")
From: ▇▇▇▇▇▇ Bailly, Inc.,
a Delaware corporation (the "Borrower")
This Borrowing Base Certificate is made an integral part of the
officer's certificate to which this Borrowing Base Certificate is attached and,
in connection with and as required by the Amended and Restated Revolving Credit
Agreement, dated as of July 28, 2000 (the "Revolving Credit Agreement";
capitalized terms used herein without definition shall have the respective
meanings specified in the Revolving Credit Agreement), between the Borrower, the
Agent and the several lenders from time to time a party thereto, the Borrowing
Base of the Borrower as of the month ending __________, __ is equal to:
1. Eligible Billed Receivables(1) $
-------------
2. 75% of Eligible Billed
Receivables $
-------------
3. Eligible Unbilled Receivables(2) $
-------------
4. 25% of Eligible Unbilled
Receivables $
-------------
5. Lesser of (x) 25% of Eligible
Unbilled Receivables and
(y) $5,000,000 $
--------------
6. The Borrowing base (which is the sum of lines 2 and 5) $
------------
---------------------
(1) Attach listing of gross billed receivables and ineligible billed
receivables, by category of eligibility.
(2) Attach listing of gross unbilled receivables by category.
194
7. Revolving Loan Commitment $18,000,000.00(3)
8. Lesser of line 6 and line 7 $
-----------
9. Total Outstanding Amount (the sum
of aggregate principal amount of
Revolving Loans and Swing Line
Loans and aggregate amount
available to be drawn under all
outstanding Standby Letters of
Credit) $
-----------
10. Amount available for further
advances (line 8 minus line 9) $
-----------
Certified as true, correct and complete in all respects this ____ day of
___________, 200_.
▇▇▇▇▇▇ ▇▇▇▇▇▇, INC.
By:
------------------------------
Name:
Title:
Date:
---------------------
(3) Subject to reduction, as provided in the Revolving Credit Agreement,
including Section 2.5 thereof.