EXECUTION
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Published Deal CUSIP: ___________
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of February 15, 2008
among
SOUTHWEST WATER COMPANY,
as Borrower,
BANK OF AMERICA, N.A.,
as Administrative Agent, Swing Line Lender
and
L/C Issuer,
and
The Other Lenders Party Hereto
BANC OF AMERICA SECURITIES LLC
as Sole Lead Arranger and Sole Book Manager
KEYBANK NATIONAL ASSOCIATION,
as Syndication Agent
and
COBANK, ACB, U.S. BANK NATIONAL ASSOCIATION and
JPMORGAN CHASE BANK, N.A.,
as Documentation Agents
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TABLE OF CONTENTS
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Page
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS 1
1.01. Defined Terms 1
1.02. Other Interpretive Provisions 22
1.03. Accounting Terms 23
1.04. Rounding 24
1.05. Times of Day 24
1.06. Letter of Credit Amounts 24
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS 24
2.01. Committed Loans 24
2.02. Borrowings, Conversions and Continuations of Committed Loans 25
2.03. Letters of Credit 26
2.04. Swing Line Loans 34
2.05. Prepayments 37
2.06. Voluntary Termination or Reduction of Commitments 38
2.07. Optional Increase in Commitments 39
2.08. Repayment of Loans 40
2.09. Interest 40
2.10. Fees 40
2.11. Computation of Interest and Fees 41
2.12. Evidence of Debt 42
2.13. Payments Generally; Administrative Agent's Clawback 42
2.14. Sharing of Payments 44
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY 45
3.01. Taxes 45
3.02. Illegality 47
3.03. Inability to Determine Rates 48
3.04. Increased Costs 48
3.05. Compensation for Losses 49
3.06. Mitigation Obligations 50
3.07. Survival 50
3.08. Replacement Lenders 50
ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS 51
4.01. Conditions of Initial Credit Extension 51
4.02. Conditions to all Credit Extensions 53
ARTICLE V. REPRESENTATIONS AND WARRANTIES 53
5.01. Existence, Qualification and Power; Compliance with Laws 53
5.02. Authorization; No Contravention 54
5.03. Governmental Authorization; Other Consents 54
5.04. Binding Effect 54
5.05. Financial Statements; No Material Adverse Effect 54
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5.06. Litigation 55
5.07. No Default 56
5.08. Ownership of Property; Liens 56
5.09. Environmental Compliance 56
5.10. Insurance 56
5.11. Taxes 56
5.12. ERISA Compliance 56
5.13. Subsidiaries 57
5.14. Margin Regulations; Investment Company Act; Public Utility Holding Company Act 57
5.15. Disclosure 58
5.16. Compliance with Laws 58
5.17. Intellectual Property; Licenses, Etc. 58
5.18. Debt Instruments; Restrictions on Restricted Payments and Loans 58
ARTICLE VI. AFFIRMATIVE COVENANTS 59
6.01. Financial Statements 59
6.02. Certificates; Other Information 60
6.03. Notices 61
6.04. Payment of Obligations 62
6.05. Preservation of Existence, Etc. 62
6.06. Maintenance of Properties. 62
6.07. Maintenance of Insurance 63
6.08. Compliance with Laws 63
6.09. Books and Records 63
6.10. Inspection Rights 63
6.11. Use of Proceeds 64
6.12. Financial Covenants 64
6.13. Additional Guarantors 64
ARTICLE VII. NEGATIVE COVENANTS 65
7.01. Liens 65
7.02. Investments 66
7.03. Indebtedness 67
7.04. Fundamental Changes 68
7.05. Dispositions 68
7.06. Restricted Payments 69
7.07. Change in Nature of Business 69
7.08. Transactions with Affiliates 69
7.09. Burdensome Agreements 69
7.10. Use of Proceeds 70
7.11. Subordinated Indebtedness 70
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES 71
8.01. Events of Default 71
8.02. Remedies Upon Event of Default 73
8.03. Application of Funds 73
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ARTICLE IX. ADMINISTRATIVE AGENT. 74
9.01. Appointment and Authorization of Administrative Agent 74
9.02. Rights as a Lender 74
9.03. Exculpatory Provisions 75
9.04. Reliance by Administrative Agent 76
9.05. Delegation of Duties 76
9.06. Resignation of Administrative Agent 76
9.07. Non-Reliance on Administrative Agent and Other Lenders 77
9.08. No Other Duties, Etc. 77
9.09. Administrative Agent May File Proofs of Claim 78
9.10. Guaranty Matters 78
ARTICLE X. MISCELLANEOUS 79
10.01. Amendments, Etc. 79
10.02. Notices; Effectiveness; Electronic Communications 80
10.03. No Waiver; Cumulative Remedies 82
10.04. Expenses; Indemnity; Damage Waiver 82
10.05. Payments Set Aside 84
10.06. Successors and Assigns 84
10.07. Treatment of Certain Information; Confidentiality 88
10.08. Right of Setoff 89
10.09. Interest Rate Limitation 89
10.10. Counterparts ; Integration; Effectiveness 89
10.11. Survival of Representations and Warranties 90
10.12. Severability 90
10.13. Governing Law; Jurisdiction; Etc. 90
10.14. Waiver of Right to Trial by Jury 91
10.15. California Judicial Reference 92
10.16. No Advisory or Fiduciary Responsibility. 92
10.17. USA PATRIOT Act Notice 92
10.18. Time of the Essence 93
SCHEDULES
1.01 Regulated and Unregulated Subsidiaries
2.01 Commitments and Applicable Percentages
5.03 Restrictions on Guarantees
5.06 Litigation
5.09 Environmental Matters
5.13 Subsidiaries and Other Equity Investments
7.01 Existing Liens
7.03 Existing Indebtedness
10.02 Administrative Agent's Office, Certain Addresses for Notices
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EXHIBITS
Form of
A Committed Loan Notice
B Swing Line Loan Notice
C Note
D Compliance Certificate
E Assignment and Assumption
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AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of February
15, 2008, among SOUTHWEST WATER COMPANY, a Delaware corporation ("Borrower"),
each lender from time to time party hereto (collectively, "Lenders" and
individually, a "Lender"), and BANK OF AMERICA, N.A., as Administrative Agent,
Swing Line Lender and L/C Issuer. In consideration of the mutual covenants and
agreements herein contained, the parties hereto covenant and agree as follows:
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS
1.01. Defined Terms. As used in this Agreement, the following terms shall
have the meanings set forth below:
"Acquisition" means any transaction, or any series of related
transactions, consummated after the Closing Date, by which Borrower or any
Subsidiary of Borrower directly or indirectly (a) acquires any ongoing business
or all or substantially all of the assets of any Person engaged in any ongoing
business, whether through purchase of assets, merger or otherwise, (b) acquires
control of securities of a Person engaged in an ongoing business representing
more than 50% of the ordinary voting power for the election of directors or
other governing position if the business affairs of such Person are managed by a
board of directors or other governing body or (c) acquires control of more than
50% of the ownership interest in any partnership, joint venture, limited
liability company, business trust or other Person engaged in an ongoing business
that is not managed by a board of directors or other governing body.
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means administrative agent's address and,
as appropriate, account as set forth on Schedule 10.02, or such other address or
account as Administrative Agent may from time to time notify Borrower and
Lenders.
"Administrative Questionnaire" means an administrative questionnaire in a
form supplied by Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Aggregate Commitments" means the Commitments of all Lenders. As of the
Closing Date, the aggregate principal amount of the Aggregate Commitments is
$150,000,000.
"Agreement" means this Amended and Restated Credit Agreement.
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"Applicable Percentage" means, with respect to any Lender at any time, the
percentage (carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender's Commitment at such time. If the commitment of each
Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit
Extensions have been terminated pursuant to Section 8.02 or if the Aggregate
Commitments have expired, then the Applicable Percentage of each Lender shall be
determined based on the Applicable Percentage of such Lender most recently in
effect, giving effect to any subsequent assignments. The initial Applicable
Percentage of each Lender is set forth opposite the name of such Lender on
Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable.
"Applicable Rate" means, (i) as of each date of determination from the
Closing Date to the date on which the Administrative Agent receives a Compliance
Certificate pursuant to Section 6.02(a) for the Fiscal Quarter ending March 31,
2008, the percentages set forth below (expressed in basis points per annum) for
Pricing Level III and (ii) thereafter, as of each date of determination, the
following percentages (expressed in basis points per annum), based upon the
Total Capitalization Ratio as set forth in the most recent Compliance
Certificate received by Administrative Agent pursuant to Section 6.02(a):
Pricing Level Total Capitalization Base Rate Non-Use Fee Rate Eurodollar Rate
Ratio + Letters of
Credit
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I less than40.0% - 25.0 10.0 50.0
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II =>40.0% but less
than 47.5% - 25.0 12.5 62.5
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III =>47.5% but less
than55.0% - 25.0 15.0 75.0
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IV =>55.0% - 25.0 20.0 100.0
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Any increase or decrease in the Applicable Rate resulting from a change in
the Total Capitalization Ratio shall become effective on the first Business Day
of the first calendar month immediately following delivery of the related
Compliance Certificate pursuant to Section 6.02(a); provided, however, that if a
Compliance Certificate is not delivered when due in accordance with such
Section, then, upon the request of the Required Lenders, Pricing Level IV shall
apply from the first Business Day of the first calendar month following the date
such Compliance Certificate was required to have been delivered until the first
Business Day of the first calendar month following the date such Compliance
Certificate is delivered. Notwithstanding anything to the contrary contained in
this definition, the determination of the Applicable Rate for any period shall
be subject to the provisions of Section 2.11(b).
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Arranger" means Banc of America Securities LLC, in its capacity as sole
lead arranger and sole book manager.
"Assignee Group" means two or more Eligible Assignees that are Affiliates
of one another or two or more Approved Funds managed by the same investment
advisor.
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"Assignment and Assumption" means an assignment and assumption entered
into by a Lender and an Eligible Assignee (with the consent of any party whose
consent is required by Section 10.06(b), and accepted by Administrative Agent,
in substantially the form of Exhibit E or any other form approved by
Administrative Agent).
"Attributable Indebtedness" means, on any date, (a) in respect of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a capital lease.
"Audited Financial Statements" means the audited consolidated balance
sheet of Borrower and its Subsidiaries for the fiscal year ended December 31,
2006, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for such fiscal year of Borrower and its
Subsidiaries, including the notes thereto.
"Auto-Extension Letter of Credit" has the meaning provided in Section
2.03(b)(iv).
"Availability Period" means the period from and including the Closing Date
to the earliest of (a) the Maturity Date, (b) the date of termination of the
Aggregate Commitments pursuant to Section 2.06, and (c) the date of termination
of the commitment of each Lender to make Loans and of the obligation of the L/C
Issuer to make L/C Credit Extensions pursuant to Section 8.02.
"Bank of America" means Bank of America, N.A. and its successors.
"Base Rate" means, for any day, a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.
"Base Rate Committed Loan" means a Committed Loan that is a Base Rate
Loan.
"Base Rate Loan" means a Loan that bears interest based on the Base Rate.
"Bondable Capacity" means, as of any date of determination, 65% of the net
book value of utility plant, property and equipment of the Regulated
Subsidiaries, determined in accordance with GAAP.
"Borrower" has the meaning specified in the first paragraph of this
Agreement.
"Borrower Materials" has the meaning specified in Section 6.02.
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"Borrowing" means a Committed Borrowing or a Swing Line Borrowing, as the
context may require.
"Business Day" means any day other than a Saturday, Sunday or other day on
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, Los Angeles, California or the city where Administrative Agent's
Office is located and, if such day relates to any Eurodollar Rate Loan, means
any such day on which dealings in Dollar deposits are conducted by and between
banks in the London interbank eurodollar market.
"Capital Expenditure" means any expenditure by Borrower or by any
Subsidiary of Borrower for or related to fixed assets or purchased intangibles
that is treated as a capital expenditure under GAAP, including any amount which
is required to be treated as an asset subject to a Capital Lease Obligation. The
amount of Capital Expenditures in respect of fixed assets purchased or
constructed by Borrower or by any Subsidiary of Borrower in any fiscal period
shall be net of any casualty insurance proceeds received during such fiscal
period by Borrower or such Subsidiary for casualties to fixed assets and applied
to the repair or replacement thereof.
"Capital Lease Obligations" means all monetary obligations of a Person
under any leasing or similar arrangement which, in accordance with GAAP, is
classified as a capital lease.
"Cash" means, when used in connection with any Person, all monetary and
non-monetary items owned by that Person that are treated as cash in accordance
with GAAP, consistently applied.
"Cash Collateral" means cash or cash equivalents which Borrower has
deposited pursuant to an obligation to Cash Collateralize.
"Cash Collateralize" has the meaning specified in Section 2.03(g).
"Change in Law" means the occurrence, after the date of this Agreement, of
any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental Authority.
"Change of Control" means, with respect to any Person, an event or series
of events by which:
(a) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, but excluding any employee
benefit plan of such person or its subsidiaries, and any person or entity acting
in its capacity as trustee, administrative agent or other fiduciary or
administrator of any such plan) becomes the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have "beneficial ownership" of all securities
that such person or group has the right to acquire (such right, an "option
right"), whether such right is exercisable immediately or only after the passage
of time), directly or indirectly, of 30% or more of the equity securities of
such Person entitled to vote for members of the board of directors or equivalent
governing body of such Person on a fully-diluted basis (and taking into account
all such securities that such person or group has the right to acquire pursuant
to any option right);
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(b) during any period of twelve consecutive months, a majority of the
members of the board of directors or other equivalent governing body of such
Person cease to be composed of individuals (i) who were members of that board or
equivalent governing body on the first day of such period, (ii) whose election
or nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such
election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other equivalent
governing body was approved by individuals referred to in clauses (i) and (ii)
above constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the case of
both clause (ii) and clause (iii), any individual whose initial nomination for,
or assumption of office as, a member of that board or equivalent governing body
occurs as a result of an actual or threatened solicitation of proxies or
consents for the election or removal of one or more directors by any person or
group other than a solicitation for the election of one or more directors by or
on behalf of the board of directors); or
(c) any individual(s) or entity(s) acting in concert shall have acquired
by contract or otherwise, or shall have entered into a contract or arrangement
that, upon consummation thereof, will result in its or their acquisition of the
power to exercise, directly or indirectly, a controlling influence over the
management or policies of such Person, or control over the equity securities of
such Person entitled to vote for members of the board of directors or equivalent
governing body of such Person on a fully-diluted basis (and taking into account
all such securities that such individual(s) or entity(s) or group has the right
to acquire pursuant to any option right) representing 30% or more of the
combined voting power of such securities.
"Closing Date" means the first date all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 10.01.
"Code" means the Internal Revenue Code of 1986.
"Commitment" means, as to each Lender, its obligation to (a) make
Committed Loans to Borrower pursuant to Section 2.01, (b) purchase
participations in L/C Obligations, and (c) purchase participations in Swing Line
Loans, in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Committed Borrowing" means a borrowing consisting of simultaneous
Committed Loans of the same Type and, in the case of Eurodollar Rate Loans,
having the same Interest Period made by each of the Lenders pursuant to Section
2.01.
"Committed Loan" has the meaning specified in Section 2.01.
"Committed Loan Notice" means a notice of (a) a Committed Borrowing, (b) a
conversion of Committed Loans from one Type to the other, or (c) a continuation
of Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing,
shall be substantially in the form of Exhibit A.
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"Compliance Certificate" means a certificate substantially in the form of
Exhibit D.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Contributions in Aid of Construction" means, as of each date of
determination, the amount of the liability which should be reflected on
Borrower's consolidated balance sheet as the line item bearing that title and of
that date in accordance with GAAP, consistently applied.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Credit Extension" means each of the following: (a) a Borrowing and (b) an
L/C Credit Extension.
"Debtor Relief Laws" means the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"Default Rate" means (a) when used with respect to Obligations other than
L/C Fees an interest rate equal to (i) the Base Rate plus the Applicable Rate
plus (ii) 2% per annum; provided, however, that with respect to a Eurodollar
Rate Loan, the Default Rate shall be an interest rate equal to the interest rate
(including any Applicable Rate) otherwise applicable to such Loan plus 2% per
annum, and (b) when used with respect to L/C Fees, a rate equal to the
Applicable Rate plus 2% per annum.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Committed Loans, participations in L/C Obligations or
participations in Swing Line Loans required to be funded by it hereunder within
one Business Day of the date required to be funded by it hereunder, (b) has
otherwise failed to pay over to Administrative Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of the
date when due, unless the subject of a good faith dispute, or (c) has been
deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.
"Disposition" means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith, in an amount, for any transaction or series of related
transactions, in excess of $100,000, including without limitation any sale,
transfer, license, lease or other disposition which is compulsory by reason of
the exercise of a power of eminent domain, condemnation, or otherwise results
from a taking through the exercise of governmental power.
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"Disqualified Stock" means any capital stock, warrants, options or other
rights to acquire capital stock (but excluding any debt security which is
convertible, or exchangeable, for capital stock), which, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
latest maturity date of the Obligations.
"Dollar" and "$" mean lawful money of the United States.
"EBITDA" means, for any period, Net Income for that period, plus Interest
Expense, plus income tax expense, plus depreciation and amortization, plus any
non-recurring or extraordinary losses, plus any non-cash losses (and minus any
non-recurring or extraordinary gains or any non-cash gains), in each case for
the same period and to the extent deducted in determining Net Income.
"EBITDA Coverage Ratio" means, as of the last day of any Fiscal Quarter,
the ratio of :
(a) EBITDA for the twelve month period ended on that date minus
Maintenance Capital Expenditures made by Borrower and its Subsidiaries during
that period minus income taxes paid in Cash by Borrower and its Subsidiaries
with respect to that period; to
(b) the sum of (i) all Interest Expense paid or payable in cash during
that period, plus (ii) scheduled principal payments in respect of Total
Indebtedness during that period (other than any such payments due upon the final
maturity of any obligation which is Total Indebtedness), plus (iii) dividends
paid in Cash on Equity Interests of Borrower and its Subsidiaries to third
parties during that period, plus (iv) mandatory principal prepayments in respect
of Subordinated Indebtedness made pursuant to Section 7.11(b) during that
period.
provided that in the case of any Material Transaction, the calculation of the
foregoing ratio shall be adjusted on a pro forma basis to give effect to the
results of operations of each person or assets which are the subject of such
Material Transaction.
"Eligible Assignee" means any Person that meets the requirements to be an
assignee under Section 10.06(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 10.06(b)(iii)).
"Environmental Laws" means any and all federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.
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"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of Borrower, any other Loan Party or any of their
respective Subsidiaries directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"Equity Interests" means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are outstanding on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with Borrower within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes
of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by Borrower or any ERISA Affiliate from a Pension Plan subject
to Section 4063 of ERISA during a plan year in which it was a substantial
employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under Section 4062(e) of ERISA;
(c) a complete or partial withdrawal by Borrower or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment
of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or
the commencement of proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (e) an event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any
liability under Title IV of ERISA, other than for PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon Borrower or any ERISA Affiliate.
"Eurodollar Base Rate" has the meaning specified in the definition of
Eurodollar Rate.
"Eurodollar Rate" means for any Interest Period with respect to a
Eurodollar Rate Loan, a rate per annum determined by Administrative Agent
pursuant to the following formula:
Eurodollar Base Rate
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Eurodollar Rate = 1.00 - Eurodollar Reserve
Percentage
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Where,
"Eurodollar Base Rate" means, for such Interest Period (rounded upwards,
as necessary, to the nearest 1/100 of 1%) the rate per annum equal to the
British Bankers Association LIBOR Rate ("BBA LIBOR"), as published by
Reuters (or other commercially available source providing quotations of
BBA LIBOR as designated by Administrative Agent from time to time) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, for Dollar deposits (for delivery on
the first day of such Interest Period) with a term equivalent to such
Interest Period. If such rate is not available at such time for any
reason, then the "Eurodollar Base Rate" for such Interest Period (rounded
upwards, as necessary, to the nearest 1/100 of 1%) shall be the rate per
annum determined by Administrative Agent to be the rate at which deposits
in Dollars for delivery on the first day of such Interest Period in same
day funds in the approximate amount of the Eurodollar Rate Loan being
made, continued or converted by Bank of America and with a term equivalent
to such Interest Period would be offered by Bank of America's London
Branch to major banks in the London interbank eurodollar market at their
request at approximately 11:00 a.m. (London time) two Business Days prior
to the commencement of such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, carried out to
five decimal places) in effect on such day, if applicable to any Lender,
under regulations issued from time to time by the Board of Governors of
the Federal Reserve System of the United States for determining the
maximum reserve requirement (including any emergency, supplemental or
other marginal reserve requirement) with respect to Eurocurrency funding
(currently referred to as "Eurocurrency liabilities"). The Eurodollar Rate
for each outstanding Eurodollar Rate Loan shall be adjusted automatically
as of the effective date of any change in the Eurodollar Reserve
Percentage.
"Eurodollar Rate Loan" means a Committed Loan that bears interest at a
rate based on the Eurodollar Rate.
"Event of Default" has the meaning specified in Section 8.01.
"Excluded Taxes" means, with respect to Administrative Agent, any Lender,
the L/C Issuer or any other recipient of any payment to be made by or on account
of any obligation of Borrower hereunder, (a) taxes imposed on or measured by its
overall net income (however denominated), and franchise taxes imposed on it (in
lieu of net income taxes), by the United States (or any political subdivision
thereof) or by the jurisdiction (or any political subdivision thereof) under the
laws of which such recipient is organized or in which its principal office is
located or, in the case of any Lender, in which its applicable Lending Office is
located, and (b) any branch profits taxes imposed by the United States or any
similar tax imposed by any other jurisdiction in which Borrower is located.
-9-
"Existing Credit Agreement" means the Credit Agreement, dated as of April
1, 2005, as amended, by and among Borrower, the lenders referred to therein, and
Bank of America, as Administrative Agent.
"Existing Indentures" means, collectively, the NMUI Indenture and the
Suburban Indenture.
"Existing Letters of Credit" means letters of credit issued under the
Existing Credit Agreement which are outstanding on the Closing Date.
"Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by Administrative Agent.
"Fee Letter" means the letter agreement dated as of the date of this
Agreement among Borrower, Administrative Agent and the Arranger.
"Fiscal Quarter" means the fiscal quarter of Borrower ending on each March
31, June 30, September 30, and December 31.
"Fiscal Year" means the fiscal year of Borrower ending on each December
31.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"Fund" means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its activities.
"GAAP" means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
"Governmental Authority" means the government of the United States or any
other nation, or of any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government (including
any supra-national bodies such as the European Union or the European Central
Bank).
-10-
"Guarantee" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term "Guarantee" as a verb has a
corresponding meaning.
"Guarantors" means, collectively, (a) the Persons which are party to the
Guaranty as of the Closing Date, and (b) each Person which hereafter becomes a
Significant Subsidiary other than any Significant Subsidiary that is not
permitted to be a party to the Guaranty based upon any Law applicable to such
Subsidiary by reason of its status as a regulated utility (provided that no such
Subsidiary shall be obligated to apply for any discretionary regulatory
approvals which would be required to permit its execution of the Guaranty) or
any Contractual Obligation of such Subsidiary existing on the Closing Date and
disclosed to the Administrative Agent on Schedule 5.03.
"Guaranty" means the Amended and Restated Guaranty made by the Guarantors
in favor of Administrative Agent and for the benefit of the Lenders, in form and
substance reasonably satisfactory to Administrative Agent.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Honor Date" has the meaning specified in Section 2.03(c)(i).
-11-
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes,
loan agreements or other similar instruments, including without
limitation advances for construction (whether or not bearing
interest);
(b) all direct or contingent obligations of such Person arising under
letters of credit (including standby and commercial letters of
credit), bankers' acceptances, bank guaranties, surety bonds and
similar instruments;
(c) all obligations of such Person to pay the deferred purchase price of
property or services (other than trade accounts incurred and paid in
the ordinary course of business);
(d) indebtedness (excluding prepaid interest thereon) secured by a Lien
on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have
been assumed by such Person or is limited in recourse;
(e) capital leases and Synthetic Lease Obligations;
(f) all obligations of such Person to purchase, redeem, retire, defease
or otherwise make any payment in respect of any Equity Interest in
such Person or any other Person (except to the extent such
obligations are honored by the issuance of other Equity Interests),
valued, in the case of a redeemable preferred interest, at the
greater of its voluntary or involuntary liquidation preference plus
accrued and unpaid dividends; and
(g) all Guarantees of such Person in respect of any of the foregoing.
Notwithstanding the foregoing provisions of this definition,
"Indebtedness" shall not include (i) Contributions in Aid of Construction,
or (ii) public indebtedness for borrowed money to the extent that such
indebtedness (y) has been defeased pursuant to the terms of the indenture
or other instrument under which the same has been issued or (z) has been
called redemption and for which funds sufficient to redeem such
indebtedness have been irrevocably delivered to a trustee or other
representative for such indebtedness to assure the full repayment thereof.
The amount of any capital lease or Synthetic Lease Obligation as of any
date shall be deemed to be the amount of Attributable Indebtedness in
respect thereof as of such date.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Indemnitees" has the meaning specified in Section 10.04(b).
"Information" has the meaning specified in Section 10.07.
-12-
"Interest Expense" means, for any period, the sum of all interest expense
(net of interest income) determined for Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP, consistently applied.
"Interest Payment Date" means, (a) as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; provided, however, that if any Interest Period for a Eurodollar
Rate Loan exceeds three months, the respective dates that fall every three
months after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan (including a Swing Line Loan),
each Quarterly Payment Date.
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by Borrower in its Committed Loan Notice;
provided that:
(i) any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business
Day;
(ii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at
the end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity Date.
"Internal Control Event" means any determination by Borrower or by its
auditors that Borrower has a material weakness in, or fraud that involves
management or other employees who have a significant role in, Borrower's
internal controls over financial reporting, in each case as described in the
Securities Laws.
"Investment" means, as to any Person, any direct or indirect acquisition
or investment by such Person, whether by means of (a) the purchase or other
acquisition of capital stock or other securities of another Person, (b) a loan,
advance or capital contribution to, Guarantee or assumption of debt of, or
purchase or other acquisition of any other debt or equity participation or
interest in, another Person, including any partnership or joint venture interest
in such other Person and any arrangement pursuant to which the investor
Guarantees Indebtedness of such other Person, or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of assets of
another Person that constitute a business unit. For purposes of covenant
compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such
Investment.
"IRB" means any industrial revenue bond or similar arrangement.
"IRS" means the United States Internal Revenue Service.
-13-
"ISP" means, with respect to any Letter of Credit, the "International
Standby Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time of
issuance).
"Issuer Documents" means, with respect to any Letter of Credit, the L/C
Application, and any other document, agreement and instrument entered into by
the L/C Issuer and Borrower (or any Subsidiary) or in favor of the L/C Issuer
and relating to any such Letter of Credit.
"Laws" means, collectively, all international, foreign, federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"L/C Advance" means, with respect to each Lender, such Lender's funding of
its participation in any L/C Borrowing in accordance with its Applicable
Percentage.
"L/C Application" means an application and agreement for the issuance or
amendment of a Letter of Credit in the form from time to time in use by the L/C
Issuer.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Committed Borrowing.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the increase of the
amount thereof.
"L/C Expiration Date" means the fifth Business Day prior to the Maturity
Date then in effect (or, if such day is not a Business Day, the next preceding
Business Day).
"L/C Fee" has the meaning specified in Section 2.03(i).
"L/C Issuer" means Bank of America in its capacity as issuer of Letters of
Credit hereunder, or any successor issuer of Letters of Credit hereunder.
"L/C Obligations" means, as of any date of determination, the aggregate
amount available to be drawn under all outstanding Letters of Credit plus the
aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For
purposes of computing the amount available to be drawn under any Letter of
Credit, the amount of such Letter of Credit shall be determined in accordance
with Section 1.06. For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP,
such Letter of Credit shall be deemed to be "outstanding" in the amount so
remaining available to be drawn.
"L/C Sublimit" means an amount equal to $50,000,000. The L/C Sublimit is
part of, and not in addition to, the Aggregate Commitments.
-14-
"Lender" has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes Swing Line Lender.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify Borrower and
Administrative Agent.
"Letter of Credit" means each standby letter of credit issued hereunder
and shall include the Existing Letters of Credit.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature of
a security interest of any kind or nature whatsoever (including any conditional
sale or other title retention agreement, any easement, right of way or other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).
"Loan" means an extension of credit by a Lender to Borrower under Article
II in the form of a Committed Loan or a Swing Line Loan.
"Loan Documents" means this Agreement, each Note, each Issuer Document,
the Fee Letter and the Guaranty.
"Loan Parties" means, collectively, Borrower and each Person (other than
Administrative Agent, the L/C Issuer, Swing Line Lender, or any Lender)
executing a Loan Document including, without limitation, each Guarantor.
"Maintenance Capital Expenditures" means a Capital Expenditure for the
maintenance, repair, restoration or refurbishment of fixed assets which are
owned by Borrower or any of its Subsidiaries on the Closing Date, but excluding
any Capital Expenditures which add to or significantly improve any such
property.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, assets,
liabilities (actual or contingent) or condition (financial or otherwise) of
Borrower and its Subsidiaries taken as a whole; (b) a material impairment of the
ability of any Loan Party to perform its obligations under any Loan Document to
which it is a party; or (c) a material adverse effect upon the legality,
validity, binding effect or enforceability against any Loan Party of any Loan
Document to which it is a party.
"Material Transaction" means each Acquisition or Disposition involving an
aggregate consideration (including any assumption of Indebtedness) in an amount
which is in excess of $5,000,000.
"Maturity Date" means February 15, 2013.
"Maximum Increase Amount" has the meaning specified in Section 2.07(a).
-15-
"Monarch" means Monarch Utility Inc. (formerly known as Tecon Water
Companies Incorporated).
"Monarch Loan Agreement" means the Amended and Restated Master Loan
Agreement dated as of September 12, 2005 between Monarch and CoBank ACB, as
heretofore amended by a first amendment thereto dated November 6, 2006, and as
the same may hereafter be amended in a manner conforming to the requirements of
this Agreement.
"Multiemployer Plan" means any employee benefit plan of the type described
in Section 4001(a)(3) of ERISA, to which Borrower or any ERISA Affiliate makes
or is obligated to make contributions, or during the preceding five plan years,
has made or been obligated to make contributions.
"Negative Pledge" means any covenant binding upon any Person that
prohibits the granting of liens on the property of that Person or any of its
Affiliates.
"Net Income" means, for any period, the consolidated net income of
Borrower and its Subsidiaries for that period, determined in accordance with
GAAP, consistently applied.
"Net Sales Proceeds" means, in respect of any sale, transfer or other
disposition of assets by Borrower or any of its Subsidiaries, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a
promissory note, a receivable or otherwise, but only as received) received by
Borrower or such Subsidiary from such transaction, net of (a) the reasonable
costs of such transaction (including fees and commissions, payments of assumed
liabilities relating to the assets conveyed in such transaction and required
payments of any Indebtedness (other than any Indebtedness owed to Borrower or
such Subsidiary) which is secured by the respective assets which were conveyed
in such transaction), (b) the taxes paid or payable as a result of such
transaction, and (c) in the case of the sale of any Subsidiary of the Borrower
or all or substantially all of the assets of such Subsidiary, the amount of any
Indebtedness of that Subsidiary which, according to the terms thereof, must be
prepaid or repaid using such Net Sales Proceeds.
"NMUI" means New Mexico Utilities, Inc., a New Mexico corporation.
"NMUI Indenture" means the Indenture of Mortgage, dated February 14, 1992,
executed by NMUI in favor of Sunwest Bank of Albuquerque, National Association,
as amended and as in effect on the date hereof and, subject to Section 7.09, as
the same may from time to time be further amended.
"NMUI Litigation" means (a) the litigation pending between Albuquerque
Bernalillo County Water Utility Authority, a political subdivision of the State
of New Mexico (the "NM Authority") and NMUI with respect to certain fees charged
by the NM Authority and the ownership of certain water rights credits, and (b)
the condemnation action instituted by the Water Authority and the City of Rio
Rancho, a home-rule municipal corporation, against NMUI.
"Non-Extension Notice Date" has the meaning specified in Section
2.03(b)(iv).
-16-
"Note" means a promissory note made by Borrower in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of Exhibit C.
"Obligations" means all advances to, and debts, liabilities, obligations,
covenants and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan or Letter of Credit, whether direct or
indirect (including those arising under any Swap Contract or acquired by
assumption), absolute or contingent, due or to become due, now existing or
hereafter arising and including interest and fees that accrue after the
commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding.
"Organization Documents" means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-United States
jurisdiction); (b) with respect to any limited liability company, the
certificate or articles of formation or organization and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership, joint venture or other applicable agreement of
formation or organization and any agreement, instrument, filing or notice with
respect thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Other Taxes" means all present or future stamp, intangible or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or under any other Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Loan Document.
"Outstanding Amount" means (i) with respect to Committed Loans and Swing
Line Loans on any date, the aggregate outstanding principal amount thereof after
giving effect to any borrowings and prepayments or repayments of Committed Loans
and Swing Line Loans, as the case may be, occurring on such date; and (ii) with
respect to any L/C Obligations on any date, the amount of such L/C Obligations
on such date after giving effect to any L/C Credit Extension occurring on such
date and any other changes in the aggregate amount of the L/C Obligations as of
such date, including as a result of any reimbursements by Borrower of
Unreimbursed Amounts.
"Participant" has the meaning specified in Section 10.06(d).
"Participating Lenders" has the meaning specified in Section 2.07(c).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer or other plan
described in Section 4064(a) of ERISA, has made contributions at any time during
the immediately preceding five plan years.
-17-
"Permitted Acquisition" means each Acquisition by Borrower or any
Subsidiary of Borrower of another Person engaged in the United States in the
same or a similar line of business as Borrower and its Subsidiaries, or of
assets comprising a business segment of such a Person, and which has not been
objected to by the Board of Directors or other management body of the Person
being acquired, provided that:
(i) after giving pro forma effect to such Acquisition, Borrower will
have the immediate ability to borrow additional Loans of at least
$10,000,000;
(ii) prior to the consummation of such Acquisition, Borrower shall
provide the Administrative Agent with a certification stating that, giving
pro forma effect to the consummation thereof, (A) no Default or Event of
Default shall have occurred and remain continuing, and (B) where the
aggregate consideration paid by Borrower and its Subsidiaries is in excess
of $25,000,000 (including cash paid, Indebtedness of the acquired entity
assumed by Borrower and its Subsidiaries, and equity securities of the
Borrower issued to the seller), attaching pro-forma balance sheets and
projections in form and substance reasonably acceptable to the
Administrative Agent demonstrating on a pro forma basis that Borrower
shall continue to be in compliance with the financial covenants set forth
in Section 6.12 and with all other provisions of the Loan Documents and
shall have the ability to borrow additional Loans of at least $10,000,000
as of the immediately succeeding Fiscal Quarter;
(iii) Borrower shall comply with Section 6.13 as to each Person
which is the subject of a Permitted Acquisition; and
(iv) Any Permitted Acquisition made in respect of an Unregulated
Subsidiary which involves an aggregate consideration which is in excess of
$20,000,000 shall be subject to the prior written consent of the Required
Lenders.
"Person" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by Borrower or, with respect to any such plan
that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"Platform" has the meaning specified in Section 6.02.
"Pro Forma Covenant Default" means, for purposes of Section 7.05(h) that,
after giving pro forma effect to the making of the proposed Disposition as of
the last day of the most recent fiscal quarter for which Borrower is then
required to have delivered financial statements pursuant to Sections 6.01(a) or
(b), Borrower is in pro forma compliance with each of the covenants set forth in
Section 6.12, provided that in making such calculations, Total Indebtedness
shall be equal to the amount of the Total Indebtedness of Borrower on the date
of Disposition, after giving effect to any related prepayment of the
Obligations.
-18-
"Public Lender" has the meaning specified in Section 6.02.
"Quarterly Payment Date" means the fifteenth calendar day of each March,
June, September and December and the Maturity Date.
"Register" has the meaning specified in Section 10.06(c).
"Registered Public Accounting Firm" has the meaning specified in the
Securities Laws and shall be independent of Borrower as prescribed by the
Securities Laws.
"Regulated Subsidiaries" means (a) as of the Closing Date, the regulated
Subsidiaries identified on Schedule 1.01 and (b) thereafter, any Subsidiary of
Borrower which is subject to regulation of water or waste water by a
Governmental Authority.
"Related Parties" means, with respect to any Person, such Person's
Affiliates and the partners, directors, officers, employees, Administrative
Agents and advisors of such Person and of such Person's Affiliates.
"Reportable Event" means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Committed Loans, a Committed Loan Notice, (b) with
respect to an L/C Credit Extension, an L/C Application, and (c) with respect to
a Swing Line Loan, a Swing Line Loan Notice.
"Required Lenders" means, as of any date of determination, Lenders having
more than 50% of the Aggregate Commitments or, if the commitment of each Lender
to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions
have been terminated pursuant to Section 8.02, Lenders holding in the aggregate
more than 50% of the Total Outstandings (with the aggregate amount of each
Lender's risk participation and funded participation in L/C Obligations and
Swing Line Loans being deemed "held" by such Lender for purposes of this
definition); provided that the Commitment of, and the portion of the Total
Outstandings held or deemed held by, any Defaulting Lender shall be excluded for
purposes of making a determination of Required Lenders.
"Responsible Officer" means, in respect of any Person, the chief executive
officer, president, vice president, chief financial officer, chief operating
officer, treasurer or assistant treasurer of that Person. Any document delivered
hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.
"Restricted Payment" means any dividend or other distribution (whether in
cash, securities or other property) with respect to any capital stock or other
Equity Interest of Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any such capital stock or other Equity Interest or on account of
any return of capital to Borrower's stockholders, partners or members (or the
equivalent Person thereof).
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"▇▇▇▇▇▇▇▇-▇▇▇▇▇" means the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Securities Laws" means the Securities Act of 1933, the Securities
Exchange Act of 1934, ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and the applicable accounting and auditing
principles, rules, standards and practices promulgated, approved or incorporated
by the SEC or the Public Company Accounting Oversight Board, as each of the
foregoing may be amended and in effect on any applicable date hereunder.
"Significant Subsidiary" means, as of each date of determination, each
Subsidiary of Borrower that either (a) had revenues for the Fiscal Year then
most recently ended which is greater than or equal to 4% of consolidated
revenues, or (b) had assets greater than or equal to 4% of the consolidated
total assets of Borrower and its Subsidiaries as of the last day of that Fiscal
Year, in case each determined in accordance with GAAP, consistently applied.
"Stockholders' Equity" means, as of any date of determination and with
respect to any Person, the consolidated stockholders' equity of the Person as of
that date determined in accordance with GAAP; provided that there shall be
excluded from Stockholders' Equity any amount attributable to Disqualified
Stock.
"Subordinated Indebtedness" means Borrower's 6.85% convertible
subordinated debentures due 2021 and any other Indebtedness of Borrower
requiring no payments of principal prior to the date which is one year following
the Maturity Date and which is subordinated to the Obligations in a manner
approved by the Administrative Agent in writing in the exercise of its
reasonable discretion within five Business Days after the distribution of draft
documentation to the Lenders relating to such Indebtedness.
"Subsidiary" of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
Borrower.
"Suburban" means Suburban Water Systems, a California corporation.
"Suburban Indenture" means the Indenture of Mortgage and Deed of Trust,
dated October 1, 1986, executed by Suburban in favor of Security Pacific
National Bank, as Trustee, as amended and as in effect on the date hereof and,
subject to Section 7.09, as the same may from time to time be further amended.
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"Swap Contract" means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swing Line" means the revolving credit facility made available by Swing
Line Lender pursuant to Section 2.04.
"Swing Line Borrowing" means a borrowing of a Swing Line Loan pursuant to
Section 2.04.
"Swing Line Lender" means Bank of America in its capacity as provider of
Swing Line Loans, or any successor swing line lender hereunder.
"Swing Line Loan" has the meaning specified in Section 2.04(a).
"Swing Line Loan Notice" means a notice of a Swing Line Borrowing pursuant
to Section 2.04(b), which, if in writing, shall be substantially in the form of
Exhibit B.
"Swing Line Sublimit" means an amount equal to the lesser of (a)
$15,000,000 and (b) the Aggregate Commitments. The Swing Line Sublimit is part
of (although uncommitted), and not in addition to, the Aggregate Commitments.
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the Indebtedness of such
Person (without regard to accounting treatment).
"Taxes" means all present or future taxes, levies, imposts, duties,
deductions, withholdings, assessments, fees or other charges imposed by any
Governmental Authority, including any interest, additions to tax or penalties
applicable thereto.
"Total Capitalization" means, as of any date of determination the sum of
(a) Total Indebtedness and (b) Stockholders Equity, in each case as of that
date.
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"Total Capitalization Ratio" means, as of each date of determination, the
ratio of (a) Total Indebtedness as of that date, to (b) Total Capitalization as
of that date.
"Total Indebtedness" means, as of any date of determination, the
consolidated Indebtedness of Borrower and its Subsidiaries outstanding on such
date (including without limitation the Subordinated Indebtedness), other than
(a) any obligations in respect of letters of credit which are not issued in
support of Indebtedness for borrowed money or any Guarantee of Indebtedness for
borrowed money of a third party, (b) any obligations in respect to performance
bonds, completion bonds, completion guarantees or similar arrangements to the
extent that the same are not required by GAAP to be reflected on the
consolidated balance sheet of Borrower as of that date, and (c) any obligations
in respect of any IRB, to the extent of any cash held in a project fund or other
similar restricted account pending disbursement for the construction of the
applicable project in accordance with the documentation governing the issuance
of such IRB. For the avoidance of doubt, no item of Indebtedness of the Borrower
and its Subsidiaries which is supported by a letter of credit or other credit
assurance issued for the account of Borrower or any its Subsidiaries shall be
included in "Total Indebtedness" on a duplicative basis with the underlying
Indebtedness.
"Total Outstandings" means the aggregate Outstanding Amount of all Loans
and all L/C Obligations.
"Type" means, with respect to a Committed Loan, its character as a Base
Rate Loan or a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
"United States" means the United States of America.
"Unmatured Surviving Obligations" means, as of the date of the termination
of the Aggregate Commitments and the repayment of all other Obligations any
Obligations that by their terms survive the termination of this Agreement or the
other Loan Documents but are not, as of the date of determination, due and
payable and for which no outstanding claim has been made.
"Unregulated Subsidiaries" means, as of each date of determination, each
Subsidiary of the Borrower which is not a Regulated Subsidiary as of that date.
As of the Closing Date, the Unregulated Subsidiaries are identified on Schedule
1.01.
"Unreimbursed Amount" has the meaning specified in Section 2.03(c)(i).
1.02. Other Interpretive Provisions. With reference to this Agreement and
each other Loan Document, unless otherwise specified herein or in such other
Loan Document:
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(a) The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include," "includes" and "including" shall be deemed to
be followed by the phrase "without limitation." The word "will" shall be
construed to have the same meaning and effect as the word "shall." Unless the
context requires otherwise, (i) any definition of or reference to any agreement,
instrument or other document (including any Organization Document) shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein
or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person's successors and assigns, (iii) the words
"herein," "hereof" and "hereunder," and words of similar import when used in any
Loan Document, shall be construed to refer to such Loan Document in its entirety
and not to any particular provision thereof, (iv) all references in a Loan
Document to Articles, Sections, Exhibits and Schedules shall be construed to
refer to Articles and Sections of, and Exhibits and Schedules to, the Loan
Document in which such references appear, (v) any reference to any law shall
include all statutory and regulatory provisions consolidating, amending,
replacing or interpreting such law and any reference to any law or regulation
shall, unless otherwise specified, refer to such law or regulation as amended,
modified or supplemented from time to time, and (vi) the words "asset" and
"property" shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.
(b) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words "to"
and "until" each mean "to but excluding;" and the word "through" means "to and
including."
(c) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03. Accounting Terms. b) Generally. All accounting terms not
specifically or completely defined herein shall be construed in conformity with,
and all financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement shall be
prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing
the Audited Financial Statements, except as otherwise specifically prescribed
herein.
(b) Changes in GAAP. If at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either Borrower or the Required Lenders shall so request,
Administrative Agent, Lenders and Borrower shall negotiate in good faith to
amend such ratio or requirement to preserve the original intent thereof in light
of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and (ii)
Borrower shall provide to Administrative Agent and Lenders financial statements
and other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.
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(c) Consolidation of Variable Interest Entities. All references
herein to consolidated financial statements of Borrower and its Subsidiaries or
to the determination of any amount for Borrower and its Subsidiaries on a
consolidated basis or any similar reference shall, in each case, be deemed to
include each variable interest entity that the Borrower is required to
consolidate pursuant to FASB Interpretation No. 46 - Consolidation of Variable
Interest Entities: an interpretation of ARB No. 51 (January 2003) as if such
variable interest entity were a Subsidiary as defined herein.
1.04. Rounding. Any financial ratios required to be maintained by Borrower
pursuant to this Agreement shall be calculated by dividing the appropriate
component by the other component, carrying the result to one place more than the
number of places by which such ratio is expressed herein and rounding the result
up or down to the nearest number (with a rounding-up if there is no nearest
number).
1.05. Times of Day. Unless otherwise specified, all references herein to
times of day shall be references to Pacific time (daylight or standard, as
applicable).
1.06. Letter of Credit Amounts. Unless otherwise specified herein the
amount of a Letter of Credit at any time shall be deemed to be the stated amount
of such Letter of Credit in effect at such time; provided, however, that with
respect to any Letter of Credit that, by its terms or the terms of any Issuer
Document related thereto, provides for one or more automatic increases in the
stated amount thereof, the amount of such Letter of Credit shall be deemed to be
the maximum stated amount of such Letter of Credit after giving effect to all
such increases, whether or not such maximum stated amount is in effect at such
time.
ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS
2.01. Committed Loans. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make loans (each such loan, a "Committed
Loan") to Borrower from time to time, on any Business Day during the
Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Lender's Commitment; provided, however, that
after giving effect to any Committed Borrowing, (i) the Total Outstandings shall
not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount
of the Committed Loans of any Lender, plus such Lender's Applicable Percentage
of the Outstanding Amount of all L/C Obligations, plus such Lender's Applicable
Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed
such Lender's Commitment. Within the limits of each Lender's Commitment, and
subject to the other terms and conditions hereof, Borrower may borrow under this
Section 2.01, prepay under Section 2.05, and reborrow under this Section 2.01.
Committed Loans may be Base Rate Loans or Eurodollar Rate Loans, as further
provided herein.
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2.02. Borrowings, Conversions and Continuations of Committed Loans. c)
Each Committed Borrowing, each conversion of Committed Loans from one Type to
the other, and each continuation of Eurodollar Rate Loans shall be made upon
Borrower's irrevocable notice to Administrative Agent, which may be given by
telephone. Each such notice must be received by Administrative Agent not later
than 11:00 a.m. (i) three Business Days prior to the requested date of any
Committed Borrowing of, conversion to or continuation of Eurodollar Rate Loans
or of any conversion of Eurodollar Rate Loans to Base Rate Committed Loans, and
(ii) on the requested date of any Committed Borrowing of Base Rate Committed
Loans. Each telephonic notice by Borrower pursuant to this Section 2.02(a) must
be confirmed promptly by delivery to Administrative Agent of a written Committed
Loan Notice, appropriately completed and signed by a Responsible Officer of
Borrower. Each Committed Borrowing of, conversion to or continuation of
Eurodollar Rate Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $500,000 in excess thereof. Except as provided in Sections 2.03(c)
and 2.04(c), each Committed Borrowing of or conversion to Base Rate Committed
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof. Each Committed Loan Notice (whether telephonic or written)
shall specify (i) whether Borrower is requesting a Committed Borrowing, a
conversion of Committed Loans from one Type to the other, or a continuation of
Eurodollar Rate Loans, (ii) the requested date of the Committed Borrowing,
conversion or continuation, as the case may be (which shall be a Business Day),
(iii) the principal amount of Committed Loans to be borrowed, converted or
continued, (iv) the Type of Committed Loans to be borrowed or to which existing
Committed Loans are to be converted, and (v) if applicable, the duration of the
Interest Period with respect thereto. If Borrower fails to specify a Type of
Committed Loan in a Committed Loan Notice or if Borrower fails to give a timely
notice requesting a conversion or continuation, then the applicable Committed
Loans shall be made as, or converted to, Eurodollar Rate Loans with an Interest
Period of one month. Any such automatic conversion to Eurodollar Rate Loans with
an Interest Period of one month shall be effective as of the last day of the
Interest Period then in effect with respect to the applicable Eurodollar Rate
Loans. If Borrower requests a Committed Borrowing of, conversion to, or
continuation of Eurodollar Rate Loans in any such Committed Loan Notice, but
fails to specify an Interest Period, it will be deemed to have specified an
Interest Period of one month. Notwithstanding anything to the contrary herein, a
Swing Line Loan may not be converted to a Eurodollar Rate Loan.
(b) Following receipt of a Committed Loan Notice, Administrative
Agent shall promptly notify each Lender of the amount of its Applicable
Percentage of the applicable Committed Loans, and if no timely notice of a
conversion or continuation is provided by Borrower, Administrative Agent shall
notify each Lender of the details of any automatic conversion to Base Rate Loans
described in the preceding subsection. In the case of a Committed Borrowing,
each Lender shall make the amount of its Committed Loan available to
Administrative Agent in immediately available funds at Administrative Agent's
Office not later than 1:00 p.m. on the Business Day specified in the applicable
Committed Loan Notice. Upon satisfaction of the applicable conditions set forth
in Section 4.02 (and, if such Committed Borrowing is the initial Credit
Extension, Section 4.01), Administrative Agent shall make all funds so received
available to Borrower in like funds as received by Administrative Agent either
by (i) crediting the account of Borrower on the books of Bank of America with
the amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to (and reasonably acceptable to)
Administrative Agent by Borrower; provided, however, that if, on the date the
Committed Loan Notice with respect to such Committed Borrowing is given by
Borrower, there are L/C Borrowings outstanding, then the proceeds of such
Committed Borrowing first, shall be applied, to the payment in full of any such
L/C Borrowings, and second, shall be made available to Borrower as provided
above.
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(c) Except as otherwise provided herein, a Eurodollar Rate Loan may
be continued or converted only on the last day of an Interest Period for such
Eurodollar Rate Loan. During the existence of a Default, no Committed Loans may
be requested as, converted to or continued as Eurodollar Rate Loans without the
consent of the Required Lenders.
(d) Administrative Agent shall promptly notify Borrower and Lenders
of the interest rate applicable to any Interest Period for Eurodollar Rate Loans
upon determination of such interest rate. The determination of the Eurodollar
Rate by Administrative Agent shall be conclusive in the absence of manifest
error. At any time that Base Rate Loans are outstanding, Administrative Agent
shall notify Borrower and the Lenders holding such Base Rate Loans of any change
in the Base Rate promptly following such change.
(e) After giving effect to all Committed Borrowings, all conversions
of Committed Loans from one Type to the other, and all continuations of
Committed Loans of the same Type, there shall not be more than ten Interest
Periods in effect with respect to Committed Loans.
2.03. Letters of Credit. d) The Letter of Credit Commitment.
(i)Subject to the terms and conditions set forth herein,
(a) the L/C Issuer agrees, in reliance upon the agreements of the other
Lenders set forth in this Section, (1) from time to time on any Business
Day during the period from the Closing Date until the L/C Expiration Date,
to issue standby Letters of Credit for the account of Borrower or its
Subsidiaries, and to amend or extend Letters of Credit previously issued
by it, in accordance with subsection (b) below, and (2) to honor drawings
under the Letters of Credit; and (b) the Lenders severally agree to
participate in Letters of Credit issued for the account of Borrower or its
Subsidiaries and any drawings thereunder; provided that after giving
effect to any L/C Credit Extension with respect to any Letter of Credit,
(x) the Total Outstandings shall not exceed the Aggregate Commitments, (y)
the aggregate Outstanding Amount of the Committed Loans of any Lender,
plus such Lender's Applicable Percentage of the Outstanding Amount of all
L/C Obligations, plus such Lender's Applicable Percentage of the
Outstanding Amount of all Swing Line Loans shall not exceed such Lender's
Commitment, or (z) the Outstanding Amount of the L/C Obligations shall not
exceed the L/C Sublimit. Each request by Borrower for the issuance or
amendment of a Letter of Credit shall be deemed to be a representation by
Borrower that the L/C Credit Extension so requested complies with the
conditions set forth in the proviso to the preceding sentence. Within the
foregoing limits, and subject to the terms and conditions hereof,
Borrower's ability to obtain Letters of Credit shall be fully revolving,
and accordingly Borrower may, during the foregoing period, obtain Letters
of Credit to replace Letters of Credit that have expired or that have been
drawn upon and reimbursed. Each Existing Letter of Credit shall be deemed
to have been issued pursuant hereto, and from and after the Closing Date
shall be subject to and governed by the terms and conditions hereof.
(ii) The L/C Issuer shall not issue any Letter of Credit,
if:
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(A) subject to Section 2.03(b)(iv), the expiry date of
such requested Letter of Credit would occur more than two years
after the date of issuance or last extension, unless the Required
Lenders have approved such expiry date; or
(B) the expiry date of such requested Letter of Credit
would occur after the L/C Expiration Date, unless all the Lenders
have approved such expiry date.
(iii) The L/C Issuer shall be under no obligation to issue
any Letter of Credit if:
(A) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or
restrain the L/C Issuer from issuing such Letter of Credit, or any
Law applicable to the L/C Issuer or any request or directive
(whether or not having the force of law) from any Governmental
Authority with jurisdiction over the L/C Issuer shall prohibit, or
request that the L/C Issuer refrain from, the issuance of letters of
credit generally or such Letter of Credit in particular or shall
impose upon the L/C Issuer with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the L/C
Issuer is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon the L/C Issuer any unreimbursed
loss, cost or expense which was not applicable on the Closing Date
and which the L/C Issuer in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(B) the issuance of such Letter of Credit would violate
one or more policies of the L/C Issuer;
(C) except as otherwise agreed by Administrative Agent
and the L/C Issuer, such Letter of Credit is in an initial stated
amount less than $25,000;
(D) such Letter of Credit is to be denominated in a
currency other than Dollars;
(E) a default of any Lender's obligations to fund under
Section 2.03(c) exists or any Lender is at such time a Defaulting
Lender hereunder, unless the L/C Issuer has entered into
satisfactory arrangements with Borrower or such Lender to eliminate
the L/C Issuer's risk with respect to such Lender; or
(F) unless specifically provided for in this Agreement,
such Letter of Credit contains any provisions for automatic
reinstatement of the stated amount after any drawing thereunder.
(iv) The L/C Issuer shall not amend any Letter of Credit if
the L/C Issuer would not be permitted at such time to issue such Letter of
Credit in its amended form under the terms hereof.
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(v)The L/C Issuer shall be under no obligation to amend any
Letter of Credit if (a) the L/C Issuer would have no obligation at such
time to issue such Letter of Credit in its amended form under the terms
hereof, or (b) the beneficiary of such Letter of Credit does not accept
the proposed amendment to such Letter of Credit.
(vi) The L/C Issuer shall act on behalf of the Lenders with
respect to any Letters of Credit issued by it and the documents associated
therewith, and the L/C Issuer shall have all of the benefits and
immunities (a) provided to Administrative Agent in Article IX with respect
to any acts taken or omissions suffered by the L/C Issuer in connection
with Letters of Credit issued by it or proposed to be issued by it and
Issuer Documents pertaining to such Letters of Credit as fully as if the
term "Administrative Agent" or "Administrative Agent" as used in Article
IX included the L/C Issuer with respect to such acts or omissions, and (b)
as additionally provided herein with respect to the L/C Issuer.
(b) Procedures for Issuance and Amendment of Letters of Credit.
(i)Each Letter of Credit shall be issued or amended, as the
case may be, upon the request of Borrower delivered to the L/C Issuer
(with a copy to Administrative Agent) in the form of an L/C Application,
appropriately completed and signed by a Responsible Officer of Borrower.
Such L/C Application must be received by the L/C Issuer and Administrative
Agent not later than 11:00 a.m. at least two Business Days (or such later
date and time as Administrative Agent and the L/C Issuer may agree in a
particular instance in their sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be. In the case of a
request for an initial issuance of a Letter of Credit, such L/C
Application shall specify in form and detail satisfactory to the L/C
Issuer: (a) the proposed issuance date of the requested Letter of Credit
(which shall be a Business Day); (b) the amount thereof; (c) the expiry
date thereof; (d) the name and address of the beneficiary thereof; (e) the
documents to be presented by such beneficiary in case of any drawing
thereunder; (f) the full text of any certificate to be presented by such
beneficiary in case of any drawing thereunder; and (g) such other matters
as the L/C Issuer may require. In the case of a request for an amendment
of any outstanding Letter of Credit, such L/C Application shall specify in
form and detail satisfactory to the L/C Issuer (a) the Letter of Credit to
be amended; (b) the proposed date of amendment thereof (which shall be a
Business Day); (c) the nature of the proposed amendment; and (d) such
other matters as the L/C Issuer may require. Additionally, Borrower shall
furnish to the L/C Issuer and Administrative Agent such other documents
and information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as the L/C Issuer or
Administrative Agent may require.
(ii) Promptly after receipt of any L/C Application at the
address set forth in Section 10.02 for receiving L/C Applications and
related correspondence, the L/C Issuer will confirm with Administrative
Agent (by telephone or in writing) that Administrative Agent has received
a copy of such L/C Application from Borrower and, if not, the L/C Issuer
will provide Administrative Agent with a copy thereof. Unless the L/C
Issuer has received written notice from any Lender, Administrative Agent
or any Loan Party, at least one Business Day prior to the requested date
of issuance or amendment of the applicable Letter of Credit, that one or
more applicable conditions in Article IV shall not then be satisfied,
then, subject to the terms and conditions hereof, the L/C Issuer shall, on
the requested date, issue a Letter of Credit for the account of Borrower
(or the applicable Subsidiary) or enter into the applicable amendment, as
the case may be, in each case in accordance with the L/C Issuer's usual
and customary business practices. Immediately upon the issuance of each
Letter of Credit, each Lender shall be deemed to, and hereby irrevocably
and unconditionally agrees to, purchase from the L/C Issuer a risk
participation in such Letter of Credit in an amount equal to the product
of such Lender's Applicable Percentage times the amount of such Letter of
Credit.
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(iii) Promptly after its delivery of any Letter of Credit
or any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver to
Borrower and Administrative Agent a true and complete copy of such Letter
of Credit or amendment.
(iv) If Borrower so requests in any applicable L/C
Application, the L/C Issuer may, in its sole and absolute discretion,
agree to issue a Letter of Credit that has automatic extension provisions
(each, an "Auto-Extension Letter of Credit"); provided that any such
Auto-Extension Letter of Credit must permit the L/C Issuer to prevent any
such extension at least once in each twelve-month period (commencing with
the date of issuance of such Letter of Credit) by giving prior notice to
the beneficiary thereof not later than a day (the "Non-Extension Notice
Date") in each such twelve-month period to be agreed upon at the time such
Letter of Credit is issued. Unless otherwise directed by the L/C Issuer,
Borrower shall not be required to make a specific request to the L/C
Issuer for any such extension. Once an Auto-Extension Letter of Credit has
been issued, the Lenders shall be deemed to have authorized (but may not
require) the L/C Issuer to permit the extension of such Letter of Credit
at any time to an expiry date not later than the L/C Expiration Date;
provided, however, that the L/C Issuer shall not permit any such extension
if (a) the L/C Issuer has determined that it would not be permitted, or
would have no obligation, at such time to issue such Letter of Credit in
its revised form (as extended) under the terms hereof (by reason of the
provisions of clause (ii) or (iii) of Section 2.03(a) or otherwise), or
(b) it has received notice (which may be by telephone or in writing) on or
before the day that is five Business Days before the Non-Extension Notice
Date (1) from Administrative Agent that the Required Lenders have elected
not to permit such extension or (2) from Administrative Agent, any Lender
or Borrower that one or more of the applicable conditions specified in
Section 4.02 is not then satisfied, and in each such case directing the
L/C Issuer not to permit such extension.
(c) Drawings and Reimbursements; Funding of Participations.
(i)Upon receipt from the beneficiary of any Letter of
Credit of any notice of a drawing under such Letter of Credit, the L/C
Issuer shall notify Borrower and Administrative Agent thereof. Not later
than 11:00 a.m. on the first Business Day following the date of any
payment by the L/C Issuer under a Letter of Credit (each such payment date
by the L/C Issuer, an "Honor Date"), Borrower shall reimburse the L/C
Issuer through Administrative Agent in an amount equal to the amount of
such drawing plus interest on the amount drawn at the rate per annum equal
to the Base Rate plus the Applicable Rate from the Honor Date through such
reimbursement date. If Borrower fails to so reimburse the L/C Issuer by
such time, Administrative Agent shall promptly notify each Lender of the
Honor Date, the amount of the unreimbursed drawing (the "Unreimbursed
Amount"), and the amount of such Lender's Applicable Percentage thereof.
In such event, Borrower shall be deemed to have requested a Committed
Borrowing of Base Rate Loans to be disbursed on the Honor Date in an
amount equal to the Unreimbursed Amount, without regard to the minimum and
multiples specified in Section 2.02 for the principal amount of Base Rate
Loans, but subject to the amount of the unutilized portion of the
Aggregate Commitments and the conditions set forth in Section 4.02 (other
than the delivery of a Committed Loan Notice). Any notice given by the L/C
Issuer or Administrative Agent pursuant to this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided that the
lack of such an immediate confirmation shall not affect the conclusiveness
or binding effect of such notice.
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(ii) Each Lender shall upon any notice pursuant to Section
2.03(c)(i) make funds available to Administrative Agent for the account of
the L/C Issuer at the Administrative Agent's Office in an amount equal to
its Applicable Percentage of the Unreimbursed Amount not later than 1:00
p.m. on the Business Day specified in such notice by Administrative Agent,
whereupon, subject to the provisions of Section 2.03(c)(iii), each Lender
that so makes funds available shall be deemed to have made a Base Rate
Committed Loan to Borrower in such amount. Administrative Agent shall
remit the funds so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Committed Borrowing of Base Rate Loans because the
conditions set forth in Section 4.02 cannot be satisfied or for any other
reason, Borrower shall be deemed to have incurred from the L/C Issuer an
L/C Borrowing in the amount of the Unreimbursed Amount that is not so
refinanced, which L/C Borrowing shall be due and payable on demand
(together with interest) and shall bear interest at the Default Rate. In
such event, each Lender's payment to Administrative Agent for the account
of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed payment
in respect of its participation in such L/C Borrowing and shall constitute
an L/C Advance from such Lender in satisfaction of its participation
obligation under this Section 2.03.
(iv) Until each Lender funds its Committed Loan or L/C
Advance pursuant to this Section 2.03(c) to reimburse the L/C Issuer for
any amount drawn under any Letter of Credit, interest in respect of such
Lender's Applicable Percentage of such amount shall be solely for the
account of the L/C Issuer.
(v)Each Lender's obligation to make Committed Loans or L/C
Advances to reimburse the L/C Issuer for amounts drawn under Letters of
Credit, as contemplated by this Section 2.03(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including (a)
any setoff, counterclaim, recoupment, defense or other right which such
Lender may have against the L/C Issuer, Borrower or any other Person for
any reason whatsoever; (b) the occurrence or continuance of a Default, or
(c) any other occurrence, event or condition, whether or not similar to
any of the foregoing; provided, however, that each Lender's obligation to
make Committed Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 4.02 (other than delivery by Borrower of a
Committed Loan Notice). No such making of an L/C Advance shall relieve or
otherwise impair the obligation of Borrower to reimburse the L/C Issuer
for the amount of any payment made by the L/C Issuer under any Letter of
Credit, together with interest as provided herein.
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(vi) If any Lender fails to make available to
Administrative Agent for the account of the L/C Issuer any amount required
to be paid by such Lender pursuant to the foregoing provisions of this
Section 2.03(c) by the time specified in Section 2.03(c)(ii), the L/C
Issuer shall be entitled to recover from such Lender (acting through
Administrative Agent), on demand, such amount with interest thereon for
the period from the date such payment is required to the date on which
such payment is immediately available to the L/C Issuer at a rate per
annum equal to the greater of the Federal Funds Rate and a rate determined
by the L/C issuer in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees
customarily charged by the LC/ Issuer in connection with the foregoing. A
certificate of the L/C Issuer submitted to any Lender (through
Administrative Agent) with respect to any amounts owing under this clause
(vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i)At any time after the L/C Issuer has made a payment
under any Letter of Credit and has received from any Lender such Lender's
L/C Advance in respect of such payment in accordance with Section 2.03(c),
if Administrative Agent receives for the account of the L/C Issuer any
payment in respect of the related Unreimbursed Amount or interest thereon
(whether directly from Borrower or otherwise, including proceeds of Cash
Collateral applied thereto by Administrative Agent), Administrative Agent
will promptly distribute to such Lender its Applicable Percentage thereof
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's L/C Advance was outstanding) in
the same funds as those received by Administrative Agent.
(ii) If any payment received by Administrative Agent for
the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required
to be returned under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by the L/C Issuer in
its discretion), each Lender shall pay to Administrative Agent for the
account of the L/C Issuer its Applicable Percentage thereof on demand of
Administrative Agent, plus interest thereon from the date of such demand
to the date such amount is returned by such Lender, at a rate per annum
equal to the Federal Funds Rate from time to time in effect. The
obligations of Lenders under this clause shall survive the payment in full
of the Obligations and the termination of this Agreement.
(e) Obligations Absolute. The obligation of Borrower to reimburse
the L/C Issuer for each drawing under each Letter of Credit and to repay each
L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
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(i)any lack of validity or enforceability of such Letter of
Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, setoff,
defense or other right that Borrower or any Subsidiary may have at any
time against any beneficiary or any transferee of such Letter of Credit
(or any Person for whom any such beneficiary or any such transferee may be
acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such Letter of
Credit or any agreement or instrument relating thereto, or any unrelated
transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment
made by the L/C Issuer under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other representative
of or successor to any beneficiary or any transferee of such Letter of
Credit, including any arising in connection with any proceeding under any
Debtor Relief Law; or
(v)any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including any other circumstance
that might otherwise constitute a defense available to, or a discharge of,
Borrower or any Subsidiary.
Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with Borrower's instructions or other irregularity, Borrower will
promptly notify the L/C Issuer. Borrower shall be conclusively deemed to have
waived any such claim against the L/C Issuer and its correspondents unless such
notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and Borrower agree that, in
paying any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the L/C Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the request
or with the approval of Lenders or the Required Lenders, as applicable; (ii) any
action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of Credit or
Issuer Document. Borrower hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of Credit;
provided, however, that this assumption is not intended to, and shall not,
preclude Borrower's pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. None of the L/C
Issuer, Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the L/C Issuer, shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 2.03(e); provided, however, that anything in such clauses to the
contrary notwithstanding, Borrower may have a claim against the L/C Issuer, and
the L/C Issuer may be liable to Borrower, to the extent, but only to the extent,
of any direct, as opposed to consequential or exemplary, damages suffered by
Borrower which Borrower proves were caused by the L/C Issuer's willful
misconduct or gross negligence or the L/C Issuer's willful failure to pay under
any Letter of Credit after the presentation to it by the beneficiary of a sight
draft and certificate(s) strictly complying with the terms and conditions of a
Letter of Credit. In furtherance and not in limitation of the foregoing, the L/C
Issuer may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.
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(g) Cash Collateral. Upon the request of Administrative Agent, if,
as of the L/C Expiration Date, any L/C Obligation for any reason remains
outstanding, Borrower shall, in each case, immediately Cash Collateralize the
then Outstanding Amount of all L/C Obligations. Sections 2.05 and 8.02(c) set
forth certain additional requirements to deliver Cash Collateral hereunder. For
purposes hereof, "Cash Collateralize" means to pledge and deposit with or
deliver to Administrative Agent, for the benefit of the L/C Issuer and the
Lenders, as collateral for the L/C Obligations, cash or deposit account balances
pursuant to documentation in form and substance reasonably satisfactory to
Administrative Agent and the L/C Issuer (which documents are hereby consented to
by Lenders). Derivatives of such term have corresponding meanings. Borrower
hereby grants to Administrative Agent, for the benefit of the L/C Issuer and
Lenders, a security interest in all such cash, deposit accounts and all balances
therein and all proceeds of the foregoing. Cash collateral shall be maintained
in blocked, interest bearing deposit accounts at Bank of America.
(h) Applicability of ISP. Unless otherwise expressly agreed by the
L/C Issuer and Borrower when a Letter of Credit is issued (including any such
agreement applicable to an Existing Letter of Credit) the rules of the ISP shall
apply to each standby Letter of Credit.
(i) L/C Fees. Borrower shall pay to Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage an L/C fee
(the "L/C Fee") for each Letter of Credit equal to the Applicable Rate times the
daily amount available to be drawn under such Letter of Credit. For purposes of
computing the daily amount available to be drawn under any Letter of Credit, the
amount of such Letter of Credit shall be determined in accordance with Section
1.06. L/C Fees shall be (i) computed on a quarterly basis in arrears and (ii)
due and payable on each Quarterly Payment Date commencing with the first such
date to occur after the issuance of such Letter of Credit, and on the L/C
Expiration Date and thereafter on demand. If there is any change in the
Applicable Rate during any quarter, the daily amount available to be drawn under
each Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect. Notwithstanding anything to the contrary contained herein, upon the
request of the Required Lenders, while any Event of Default exists, all L/C Fees
shall accrue at the Default Rate.
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(j) Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer. Borrower shall pay directly to the L/C Issuer for its own account a
fronting fee with respect to each Letter of Credit, at the rate per annum
specified in the Fee Letter, computed on the daily amount available to be drawn
under such Letter of Credit and on a quarterly basis in arrears. Such fronting
fee shall be due and payable on each Quarterly Payment Date commencing with the
first such date to occur after the issuance of such Letter of Credit, and on the
L/C Expiration Date. For purposes of computing the daily amount available to be
drawn under any Letter of Credit, the amount of such Letter of Credit shall be
determined in accordance with Section 1.06. In addition, Borrower shall pay
directly to the L/C Issuer for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and
charges, of the L/C Issuer relating to letters of credit as from time to time in
effect. Such customary fees and standard costs and charges are due and payable
on demand and are nonrefundable.
(k) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Documents, the terms hereof
shall control.
(l) Letters of Credit Issued for Subsidiaries. Notwithstanding that
a Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary, Borrower shall be
obligated to reimburse the L/C Issuer hereunder for any and all drawings under
such Letter of Credit. Borrower hereby acknowledges that the issuance of Letters
of Credit for the account of Subsidiaries inures to the benefit of Borrower, and
that Borrower's business derives substantial benefits from the businesses of
such Subsidiaries.
2.04. Swing Line Loans. e) The Swing Line. Subject to the terms and
conditions set forth herein, Swing Line Lender agrees, in reliance upon the
agreements of the other Lenders set forth in this Section 2.04, to make loans
(each such loan, a "Swing Line Loan") to Borrower from time to time on any
Business Day during the Availability Period in an aggregate amount not to exceed
at any time outstanding the amount of the Swing Line Sublimit, notwithstanding
the fact that such Swing Line Loans, when aggregated with the Applicable
Percentage of the Outstanding Amount of Committed Loans and L/C Obligations of
the Lender acting as Swing Line Lender, may exceed the amount of such Lender's
Commitment; provided, however, that after giving effect to any Swing Line Loan,
(i) the Total Outstandings shall not exceed the Aggregate Commitments, and (ii)
the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such
Lender's Applicable Percentage of the Outstanding Amount of all L/C Obligations,
plus such Lender's Applicable Percentage of the Outstanding Amount of all Swing
Line Loans shall not exceed such Lender's Commitment, and provided further that
the Borrower shall not use the proceeds of any Swing Line Loan to refinance any
outstanding Swing Line Loan. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Borrower may borrow under this Section
2.04, prepay under Section 2.05, and reborrow under this Section 2.04. Each
Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a
Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from Swing Line Lender a risk participation
in such Swing Line Loan in an amount equal to the product of such Lender's
Applicable Percentage times the amount of such Swing Line Loan.
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(b) Borrowing Procedures. Each Swing Line Borrowing shall be made
upon Borrower's irrevocable notice to Swing Line Lender and Administrative
Agent, which may be given by telephone. Each such notice must be received by
Swing Line Lender and Administrative Agent not later than 1:00 p.m. on the
requested borrowing date, and shall specify (i) the amount to be borrowed, which
shall be a minimum of $100,000, and (ii) the requested borrowing date, which
shall be a Business Day. Each such telephonic notice must be confirmed promptly
by delivery to Swing Line Lender and Administrative Agent of a written Swing
Line Loan Notice, appropriately completed and signed by a Responsible Officer of
Borrower. Promptly after receipt by Swing Line Lender of any telephonic Swing
Line Loan Notice, Swing Line Lender will confirm with Administrative Agent (by
telephone or in writing) that Administrative Agent has also received such Swing
Line Loan Notice and, if not, Swing Line Lender will notify Administrative Agent
(by telephone or in writing) of the contents thereof. Unless the Swing Line
Lender has received notice (by telephone or in writing) from Administrative
Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of
the proposed Swing Line Borrowing (A) directing Swing Line Lender not to make
such Swing Line Loan as a result of the limitations set forth in the proviso to
the first sentence of Section 2.04(a), or (B) that one or more of the applicable
conditions specified in Article IV is not then satisfied, then, subject to the
terms and conditions hereof, Swing Line Lender will, not later than 3:00 p.m. on
the borrowing date specified in such Swing Line Loan Notice, make the amount of
its Swing Line Loan available to Borrower at its office by crediting the account
of Borrower on the books of Swing Line Lender in immediately available funds.
Lenders agree that Swing Line Lender may agree to modify the borrowing
procedures used in connection with the Swing Line in its discretion and without
affecting any of the obligations of Lenders hereunder other than notifying
Administrative Agent of a Swing Line Loan Notice.
(c) Refinancing of Swing Line Loans.
(i)Swing Line Lender at any time in its sole and absolute
discretion may request, on behalf of Borrower (which hereby irrevocably
authorizes Swing Line Lender to so request on its behalf), that each
Lender make a Base Rate Committed Loan in an amount equal to such Lender's
Applicable Percentage of the amount of Swing Line Loans then outstanding.
Such request shall be made in writing (which written request shall be
deemed to be a Committed Loan Notice for purposes hereof) and in
accordance with the requirements of Section 2.02, without regard to the
minimum and multiples specified therein for the principal amount of Base
Rate Loans, but subject to the unutilized portion of the Aggregate
Commitments and the conditions set forth in Section 4.02. Swing Line
Lender shall furnish Borrower with a copy of the applicable Committed Loan
Notice promptly after delivering such notice to Administrative Agent. Each
Lender shall make an amount equal to its Applicable Percentage of the
amount specified in such Committed Loan Notice available to Administrative
Agent in immediately available funds for the account of Swing Line Lender
at the Administrative Agent's Office not later than 1:00 p.m. on the day
specified in such Committed Loan Notice, whereupon, subject to Section
2.04(c)(ii), each Lender that so makes funds available shall be deemed to
have made a Base Rate Committed Loan to Borrower in such amount.
Administrative Agent shall remit the funds so received to Swing Line
Lender.
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(ii) If for any reason any Swing Line Loan cannot be
refinanced by such a Committed Borrowing in accordance with Section
2.04(c)(i), the request for Base Rate Committed Loans submitted by Swing
Line Lender as set forth herein shall be deemed to be a request by Swing
Line Lender that each of the Lenders fund its risk participation in the
relevant Swing Line Loan and each Lender's payment to Administrative Agent
for the account of Swing Line Lender pursuant to Section 2.04(c)(i) shall
be deemed payment in respect of such participation.
(iii) If any Lender fails to make available to
Administrative Agent for the account of Swing Line Lender any amount
required to be paid by such Lender pursuant to the foregoing provisions of
this Section 2.04(c) by the time specified in Section 2.04(c)(i), Swing
Line Lender shall be entitled to recover from such Lender (acting through
Administrative Agent), on demand, such amount with interest thereon for
the period from the date such payment is required to the date on which
such payment is immediately available to Swing Line Lender at a rate per
annum equal to the greater of the Federal Funds Rate and a rate determined
by Swing Line Lender in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar
fees customarily charged by Swing Line Lender in connection with the
foregoing. A certificate of Swing Line Lender submitted to any Lender
(through Administrative Agent) with respect to any amounts owing under
this clause (iii) shall be conclusive absent manifest error.
(iv) Each Lender's obligation to make Committed Loans or to
purchase and fund risk participations in Swing Line Loans pursuant to this
Section 2.04(c) shall be absolute and unconditional and shall not be
affected by any circumstance, including (a) any setoff, counterclaim,
recoupment, defense or other right which such Lender may have against
Swing Line Lender, Borrower or any other Person for any reason whatsoever,
(b) the occurrence or continuance of a Default, or (c) any other
occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Lender's obligation to make
Committed Loans pursuant to this Section 2.04(c) is subject to the
conditions set forth in Section 4.02. No such funding of risk
participations shall relieve or otherwise impair the obligation of
Borrower to repay Swing Line Loans, together with interest as provided
herein.
(d) Repayment of Participations.
(i)At any time after any Lender has purchased and funded a
risk participation in a Swing Line Loan, if Swing Line Lender receives any
payment on account of such Swing Line Loan, Swing Line Lender will
promptly distribute to such Lender its Applicable Percentage of such
payment (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's risk participation
was funded) in the same funds as those received by Swing Line Lender.
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(ii) If any payment received by Swing Line Lender in
respect of principal or interest on any Swing Line Loan is required to be
returned by Swing Line Lender under any of the circumstances described in
Section 10.05 (including pursuant to any settlement entered into by Swing
Line Lender in its discretion), each Lender shall pay to Swing Line Lender
its Applicable Percentage thereof on demand of Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is
returned, at a rate per annum equal to the Federal Funds Rate.
Administrative Agent will make such demand upon the request of Swing Line
Lender. The obligations of Lenders under this clause shall survive the
payment in full of the Obligations and the termination of this Agreement.
(e) Interest for Account of Swing Line Lender. Swing Line Lender
shall be responsible for invoicing Borrower for interest on the Swing Line
Loans. Until each Lender funds its Base Rate Committed Loan or risk
participation pursuant to this Section 2.04 to refinance such Lender's
Applicable Percentage of any Swing Line Loan, interest in respect of such
Applicable Percentage shall be solely for the account of Swing Line Lender.
(f) Payments Directly to Swing Line Lender. Borrower shall make all
payments of principal and interest in respect of the Swing Line Loans directly
to Swing Line Lender.
2.05. Prepayments.
f) Borrower may, upon notice to Administrative Agent, at any time or
from time to time voluntarily prepay Committed Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received by
Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to
any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Committed Loans; (ii) any prepayment of Eurodollar Rate
Loans shall be in a principal amount of $1,000,000 or a whole multiple of
$200,000 in excess thereof; and (iii) any prepayment of Base Rate Committed
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof or, in each case, if less, the entire principal amount thereof
then outstanding.
(b) Borrower shall prepay the Committed Loans in an amount equal to
100% of the aggregate Net Sales Proceeds received upon the consummation of each
Disposition (in one transaction or any series of related transactions) other
than any Disposition which results in Net Sales Proceeds of less than
$7,500,000, as promptly as practical and in any event within two Business Days
following receipt by Borrower or its Subsidiaries of such Net Sales Proceeds
(but without any permanent reduction in the Aggregate Commitments).
(c) Each notice of prepayment shall specify the date and amount of
the prepayment and the Type(s) of Committed Loans to be prepaid. Administrative
Agent will promptly notify each Lender of its receipt of each such notice, and
of the amount of such Lender's Applicable Percentage of such prepayment. If such
notice is given by Borrower, Borrower shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein; provided, however, that, in the case of any such notice of an optional
prepayment made in connection with a proposed refinancing in full of the
Obligations, Borrower shall be permitted to make its notice of such prepayment
contingent upon the consummation of such refinancing. Each prepayment of a
Eurodollar Rate Loan shall be accompanied by all accrued interest on the amount
prepaid, together with any additional amounts required pursuant to Section 3.05.
Each such prepayment shall be applied to the Committed Loans of Lenders in
accordance with their respective Applicable Percentages.
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(d) Borrower may, upon notice to Swing Line Lender (with a copy to
Administrative Agent), at any time or from time to time, voluntarily prepay
Swing Line Loans in whole or in part without premium or penalty; provided that
(i) such notice must be received by Swing Line Lender and Administrative Agent
not later than 1:00 p.m. on the date of the prepayment, and (ii) any such
prepayment shall be in a minimum principal amount of $100,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by
Borrower, Borrower shall make such prepayment and the payment amount specified
in such notice shall be due and payable on the date specified therein.
(e) If for any reason the Total Outstandings at any time exceed the
Aggregate Commitments then in effect, Borrower shall immediately prepay Loans
and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to
such excess; provided, however, that Borrower shall not be required to Cash
Collateralize the L/C Obligations pursuant to this Section 2.05(e) unless after
the prepayment in full of the Loans the Total Outstandings exceed the Aggregate
Commitments then in effect.
2.06. Voluntary Termination or Reduction of Commitments. Borrower may,
upon notice to Administrative Agent, terminate the Aggregate Commitments, or
from time to time permanently reduce the Aggregate Commitments; provided that
(i) any such notice shall be received by Administrative Agent not later than
11:00 a.m. three Business Days prior to the date of termination or reduction,
(ii) any such partial reduction shall be in an aggregate amount of $5,000,000 or
any whole multiple of $1,000,000 in excess thereof, (iii) Borrower shall not
terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed
the Aggregate Commitments, and (iv) if, after giving effect to any reduction of
the Aggregate Commitments, the L/C Sublimit or the Swing Line Sublimit exceeds
the amount of the Aggregate Commitments, such L/C Sublimit or Swing Line
Sublimit shall be automatically reduced by the amount of such excess. In the
case of any such notice to terminate the Aggregate Commitments which is made in
connection with a proposed refinancing in full of the Obligations, Borrower
shall be permitted to make such termination contingent upon the consummation of
such refinancing. Administrative Agent will promptly notify the Lenders of any
such notice of termination or reduction of the Aggregate Commitments. Any
reduction of the Aggregate Commitments pursuant to this Section 2.06 shall be
applied to the Commitment of each Lender according to its Applicable Percentage.
All fees accrued until the effective date of any termination of the Aggregate
Commitments shall be paid on the effective date of such termination.
2.07. Optional Increase in Commitments. g) Provided that no Default or
Event of Default shall have occurred and remain continuing, Borrower may by
written notice to the Administrative Agent, elect to increase the Aggregate
Commitments pursuant to this Section 2.07 by an amount not in excess of
$75,000,000 during the term of this Agreement (the "Maximum Increase Amount")
and not less than $5,000,000 or, if less, the remaining available portion of the
Maximum Increase Amount.
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(b) Each such notice shall specify the date (each, an "Increased
Amount Date") on which Borrower proposes that the increase shall be effective,
which shall be a date not less than 10 Business Days after the date on which
such notice is delivered to the Administrative Agent; provided that Borrower
shall first offer one or more of the Lenders the opportunity to provide all of
the increase prior to approaching any other Person that is an Eligible Assignee;
provided, further, that any Lender offered or approached to provide all or a
portion of the increase may elect or decline, in its sole discretion, to provide
any portion of the increase, and no Lender shall, as a result of such rejection,
be deemed to be in default in any respect hereunder.
(c) Subject to the foregoing, any such increase in the Aggregate
Commitments shall become effective as of such Increased Amount Date or such
later date as may be mutually agreeable to Borrower, Administrative Agent and
the Lenders or Eligible Assignees providing the increased Aggregate Commitments
(the "Participating Lenders"). Upon the effectiveness of any such increase,
Borrower shall issue replacement Notes to each Participating Lender, and the
Applicable Percentage of each Lender and each Participating Lender will be
adjusted to give effect to the increase in the Aggregate Commitments and set
forth in a new Schedule 2.01 issued by Administrative Agent. In addition, each
Participating Lender shall execute and deliver to Borrower and Administrative
Agent an agreement whereby such Participating Lender agrees to provide the
portion of the Aggregate Commitments identified to such Participating Lender in
the revised Schedule 2.01 referred to in the preceding sentence and each
Participating Lender that is not already a Lender agrees to become a Lender and
be bound by the terms and conditions of this Agreement.
2.08. Repayment of Loans.
(a) Borrower shall repay to Lenders on the Maturity Date the
aggregate principal amount of Committed Loans outstanding on such date.
(b) Borrower shall repay to Swing Line Lender each Swing Line Loan
on the Maturity Date.
2.09. Interest. h) Subject to the provisions of subsection (b) below, (i)
each Eurodollar Rate Loan shall bear interest on the outstanding principal
amount thereof for each Interest Period at a rate per annum equal to the
Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each
Base Rate Committed Loan shall bear interest on the outstanding principal amount
thereof from the applicable borrowing date at a rate per annum equal to the Base
Rate plus the Applicable Rate; and (iii) each Swing Line Loan shall bear
interest on the outstanding principal amount thereof from the applicable
borrowing date at a rate per annum equal to the Base Rate plus the Applicable
Rate.
(b) (i) If any amount of principal of any Loan is not paid when due
(without regard to any applicable grace periods), whether at stated maturity, by
acceleration or otherwise, such amount shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.
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(ii) If any amount (other than principal of any Loan)
payable by Borrower under any Loan Document is not paid when due (without
regard to any applicable grace periods), whether at stated maturity, by
acceleration or otherwise, then upon the request of the Required Lenders,
such amount shall thereafter bear interest at a fluctuating interest rate
per annum at all times equal to the Default Rate to the fullest extent
permitted by applicable Laws.
(iii) Upon the request of the Required Lenders, while any
Event of Default exists, Borrower shall pay interest on the principal
amount of all outstanding Obligations hereunder at a fluctuating interest
rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws.
(iv) Accrued and unpaid interest on past due amounts
(including interest on past due interest) shall be due and payable upon
demand.
(c) Interest on each Loan shall be due and payable in arrears on
each Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.10. Fees. In addition to the fees described in subsections (i) and (j)
of Section 2.03:
(a) Non-Use Fee. Borrower shall pay to Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a non-use
fee equal to the Applicable Rate times the actual daily amount by which the
Aggregate Commitments exceed the sum of (i) the Outstanding Amount of Committed
Loans and (ii) the Outstanding Amount of L/C Obligations. The non-use fee shall
accrue at all times during the Availability Period, including at any time during
which one or more of the conditions in Article IV is not met, and shall be due
and payable quarterly in arrears on each Quarterly Payment Date to occur after
the Closing Date, and on the Maturity Date. The non-use fee shall be calculated
quarterly in arrears, and if there is any change in the Applicable Rate during
any quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect. For purposes of computing the non-use fee, Swing
Line Loans shall not be counted towards or considered usage of the Aggregate
Commitments.
(b) Administrative Agent's Fees. Borrower shall pay to
Administrative Agent for Administrative Agent's own account, fees in the amounts
and at the times specified in the Fee Letter. Such fees shall be fully earned
when paid and shall be nonrefundable for any reason whatsoever.
(c) Lenders' Upfront Fee. On the Closing Date, Borrower shall pay to
Administrative Agent, for the account of each Lender, an upfront fee in an
amount specified in the Fee Letter. Such upfront fees are for the credit
facilities committed by Lenders under this Agreement and are fully earned on the
date paid. The upfront fee paid to each Lender is solely for its own account and
is nonrefundable for any reason whatsoever.
2.11. Computation of Interest and Fees.
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(a) All computations of interest for Base Rate Loans when the Base
Rate is determined by Bank of America's "prime rate" shall be made on the basis
of a year of 365 or 366 days, as the case may be, and actual days elapsed. All
other computations of fees and interest shall be made on the basis of a 360-day
year and actual days elapsed (which results in more fees or interest, as
applicable, being paid than if computed on the basis of a 365-day year).
Interest shall accrue on each Loan for the day on which the Loan is made, and
shall not accrue on a Loan, or any portion thereof, for the day on which the
Loan or such portion is paid, provided that any Loan that is repaid on the same
day on which it is made shall, subject to Section 2.13(a), bear interest for one
day. Each determination by Administrative Agent of an interest rate or fee
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
(b) If, as a result of any restatement of or other adjustment to the
financial statements of the Borrower or for any other reason, the Borrower or
the Lenders determine that (i) the Total Capitalization Ratio as calculated by
the Borrower as of any applicable date was inaccurate and (ii) a proper
calculation of the Total Capitalization Ratio would have resulted in higher
pricing for such period, the Borrower shall immediately and retroactively be
obligated to pay to the Administrative Agent for the account of the applicable
Lenders, promptly on demand by the Administrative Agent (or, after the
occurrence of an actual or deemed entry of an order for relief with respect to
the Borrower under the Bankruptcy Code of the United States, automatically and
without further action by the Administrative Agent, any Lender or the L/C
Issuer), an amount equal to the excess of the amount of interest and fees that
should have been paid for such period over the amount of interest and fees
actually paid for such period. This paragraph shall not limit the rights of the
Administrative Agent, any Lender or the L/C Issuer, as the case may be, under
Section 2.03(c)(iii), 2.03(i) or 2.09(b) or under Article VIII. The Borrower's
obligations under this paragraph shall survive the termination of the Aggregate
Commitments and the repayment of all other Obligations hereunder.
2.12. Evidence of Debt. i) The Credit Extensions made by each Lender shall
be evidenced by one or more accounts or records maintained by such Lender and by
Administrative Agent in the ordinary course of business. The accounts or records
maintained by Administrative Agent and each Lender shall be conclusive absent
manifest error of the amount of the Credit Extensions made by Lenders to
Borrower and the interest and payments thereon. Any failure to so record or any
error in doing so shall not, however, limit or otherwise affect the obligation
of Borrower hereunder to pay any amount owing with respect to the Obligations.
In the event of any conflict between the accounts and records maintained by any
Lender and the accounts and records of Administrative Agent in respect of such
matters, the accounts and records of Administrative Agent shall control in the
absence of manifest error. Upon the request of any Lender made through
Administrative Agent, Borrower shall execute and deliver to such Lender (through
Administrative Agent) a Note, which shall evidence such Lender's Loans in
addition to such accounts or records. Each Lender may attach schedules to its
Note and endorse thereon the date, Type (if applicable), amount and maturity of
its Loans and payments with respect thereto.
(b) In addition to the accounts and records referred to in
subsection (a), each Lender and Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit and Swing Line
Loans. In the event of any conflict between the accounts and records maintained
by Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of Administrative Agent shall control in
the absence of manifest error.
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2.13. Payments Generally; Administrative Agent's Clawback. j) General. All
payments to be made by Borrower shall be made without condition or deduction for
any counterclaim, defense, recoupment or setoff. Except as otherwise expressly
provided herein, all payments by Borrower hereunder shall be made to
Administrative Agent, for the account of the respective Lenders to which such
payment is owed, at the Administrative Agent's Office in Dollars and in
immediately available funds not later than 12:00 noon on the date specified
herein. Administrative Agent will promptly distribute to each Lender its
Applicable Percentage(or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by Administrative Agent after 12:00 noon shall be
deemed received on the next succeeding Business Day and any applicable interest
or fee shall continue to accrue. If any payment to be made by Borrower shall
come due on a day other than a Business Day, payment shall be made on the next
following Business Day, and such extension of time shall be reflected in
computing interest or fees, as the case may be.
(b) (i) Funding by Lenders; Presumption by Administrative Agent.
Unless Administrative Agent shall have received notice from a Lender prior to
the proposed date of any Committed Borrowing of Eurodollar Rate Loans (or, in
the case of any Committed Borrowing of Base Rate Loans, prior to 12:00 noon on
the date of such Committed Borrowing) that such Lender will not make available
to Administrative Agent such Lender's share of such Committed Borrowing,
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with Section 2.02 (or, in the case of a Committed
Borrowing of Base Rate Loans, that such Lender has made such share available in
accordance with and at the time required by Section 2.02) and may, in reliance
upon such assumption, make available to Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Committed
Borrowing available to Administrative Agent, then the applicable Lender and
Borrower severally agree to pay to Administrative Agent forthwith on demand such
corresponding amount in immediately available funds with interest thereon, for
each day from and including the date such amount is made available to Borrower
to but excluding the date of payment to Administrative Agent, at (a) in the case
of a payment to be made by such Lender, the greater of the Federal Funds Rate
and a rate determined by Administrative Agent in accordance with banking
industry rules on interbank compensation, plus any administrative, processing or
similar fees customarily charged by Administrative Agent in connection with the
foregoing and (b) in the case of a payment to be made by Borrower, the interest
rate applicable to Base Rate Loans. If Borrower and such Lender shall pay such
interest to Administrative Agent for the same or an overlapping period,
Administrative Agent shall promptly remit to Borrower the amount of such
interest paid by Borrower for such period. If such Lender pays its share of the
applicable Committed Borrowing to Administrative Agent, then the amount so paid
shall constitute such Lender's Committed Loan included in such Committed
Borrowing. Any payment by Borrower shall be without prejudice to any claim
Borrower may have against a Lender that shall have failed to make such payment
to Administrative Agent.
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(ii) Payments by Borrower; Presumptions by Administrative
Agent. Unless Administrative Agent shall have received notice from Borrower
prior to the date on which any payment is due to Administrative Agent for the
account of the Lenders or the L/C Issuer hereunder that Borrower will not make
such payment, Administrative Agent may assume that Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to Lenders or the L/C Issuer, as the case may be, the
amount due. In such event, if Borrower has not in fact made such payment, then
each of Lenders or the L/C Issuer, as the case may be, severally agrees to repay
to Administrative Agent forthwith on demand the amount so distributed to such
Lender or the L/C Issuer, in immediately available funds with interest thereon,
for each day from and including the date such amount is distributed to it to but
excluding the date of payment to Administrative Agent, at the greater of the
Federal Funds Rate and a rate determined by Administrative Agent in accordance
with banking industry rules on interbank compensation. A notice of
Administrative Agent to any Lender or Borrower with respect to any amount owing
under this subsection (b) shall be conclusive, absent manifest error.
(c) Failure to Satisfy Conditions Precedent. If any Lender makes
available to Administrative Agent funds for any Loan to be made by such Lender
as provided in the foregoing provisions of this Article II, and such funds are
not made available to Borrower by Administrative Agent because the conditions to
the applicable Credit Extension set forth in Article IV are not satisfied or
waived in accordance with the terms hereof, Administrative Agent shall promptly
return such funds (in like funds as received from such Lender) to such Lender,
without interest.
(d) Obligations of Lenders Several. The obligations of Lenders
hereunder to make Committed Loans, to fund participations in Letters of Credit
and Swing Line Loans and to make payments under Section 10.04(c) are several and
not joint. The failure of any Lender to make any Committed Loan, to fund any
such participation or to make any payment under Section 10.04(c) on any date
required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other Lender to so make its Committed Loan, purchase its
participation or to make its payment under Section 10.04(c).
(e) Funding Source. Nothing herein shall be deemed to obligate any
Lender to obtain the funds for any Loan in any particular place or manner or to
constitute a representation by any Lender that it has obtained or will obtain
the funds for any Loan in any particular place or manner.
2.14. Sharing of Payments. If any Lender shall, by exercising any right of
setoff or counterclaim or otherwise, obtain payment in respect of any principal
of or interest on any of the Committed Loans made by it, or the participations
in L/C Obligations or in Swing Line Loans held by it resulting in such Lender's
receiving payment of a proportion of the aggregate amount of such Committed
Loans or participations and accrued interest thereon greater than its pro rata
share thereof as provided herein, then the Lender receiving such greater
proportion shall (a) notify Administrative Agent of such fact, and (b) purchase
(for cash at face value) participations in the Committed Loans and
subparticipations in L/C Obligations and Swing Line Loans of the other Lenders,
or make such other adjustments as shall be equitable, so that the benefit of all
such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Committed Loans and other amounts owing them, provided that:
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(i) if any such participations or subparticipations are
purchased and all or any portion of the payment giving rise thereto is
recovered, such participations or subparticipations shall be rescinded and
the purchase price restored to the extent of such recovery, without
interest; and
(ii) the provisions of this Section shall not be construed
to apply to (x) any payment made by Borrower pursuant to and in accordance
with the express terms of this Agreement or (y) any payment obtained by a
Lender as consideration for the assignment of or sale of a participation
in any of its Committed Loans or subparticipations in L/C Obligations or
Swing Line Loans to any assignee or participant, other than to Borrower or
any Subsidiary thereof (as to which the provisions of this Section shall
apply).
Each Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY
3.01. Taxes.
(a) Payments Free of Taxes. Subject to Section 3.01(e), any and all
payments by Borrower to or on account of any obligation of Borrower hereunder or
under any other Loan Document shall be made free and clear of and without
reduction or withholding for any Indemnified Taxes or Other Taxes, provided that
if Borrower shall be required by any applicable law to deduct any Indemnified
Taxes (including any Other Taxes) from such payments, then, subject to Section
3.01(e), (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section), Administrative Agent, Lender or L/C Issuer, as
the case may be, receives an amount equal to the sum it would have received had
no such deductions been made, (ii) Borrower shall make such deductions, and
(iii) Borrower shall timely pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.
(b) Payment of Other Taxes by Borrower. Without limiting the
provisions of subsection (a) above, Borrower shall timely pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable law.
(c) Indemnification by Borrower. Subject to Section 3.01(e),
Borrower shall indemnify Administrative Agent, each Lender and the L/C Issuer,
within 10 days after demand therefor, for the full amount of any Indemnified
Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) paid by
Administrative Agent, such Lender or the L/C Issuer, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to Borrower
by a Lender or the L/C Issuer (with a copy to Administrative Agent), or by
Administrative Agent on its own behalf or on behalf of a Lender or the L/C
Issuer, shall be conclusive absent manifest error.
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(d) Evidence of Payments. As soon as practicable after any payment
of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
Borrower shall deliver to Administrative Agent the original or a certified copy
of a receipt issued by such Governmental Authority evidencing such payment, a
copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to Administrative Agent.
(e) If Administrative Agent, the L/C Issuer or any Lender is not a
United States Person (each a "Foreign Lender"), it shall, on or prior to the
date of its execution and delivery of this Agreement in the case of each Foreign
Lender party hereto on the Closing Date and on the date of the Assignment and
Acceptance pursuant to which it becomes a party hereto in the case of each other
Foreign Lender, and from time to time thereafter as reasonably requested in
writing by Borrower (but only so long thereafter as such Foreign Lender remains
lawfully able to do so), provide each of Administrative Agent and Borrower with
two original Internal Revenue Service Forms W-8BEN and/or Form W-8IMY, as
applicable (in each case, certifying that it is entitled to benefits under an
income tax treaty to which the United States is a party) or W-8ECI, or in the
case of a Foreign Lender that has certified in writing to the Administrative
Agent that it is not (i) a "bank" as defined in Section 881(c)(3)(A) of the
Internal Revenue Code, (ii) a 10-percent shareholder (within the meaning of
Section 871(h)(3)(B) of the Code) of Borrower or any Subsidiary of Borrower or
(iii) a controlled foreign corporation related to Borrower (within the meaning
of Section 864(d)(4) of the Code), Internal Revenue Service Form W-8BENI or Form
W-8IMY, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that such Foreign Lender is exempt from or
entitled to a reduced rate of United States withholding tax on payments pursuant
to this Agreement. If the forms provided by a Foreign Lender at the time such
Foreign Lender first becomes a party to this Agreement indicate a United States
interest withholding tax rate in excess of zero, withholding tax at such rate
shall be considered excluded from Indemnified Taxes; provided, however, that if,
at the effective date of the Assignment and Acceptance pursuant to which a
Foreign Lender becomes a party to this Agreement, the Foreign Lender assignor
was entitled to payments under subsection (a) of this Section 3.01 in respect of
United States withholding tax with respect to interest paid at such date, then,
to such extent, the term Indemnified Taxes shall include (in addition to
withholding taxes that may be imposed in the future or other amounts otherwise
includable in Indemnified Taxes) United States withholding tax, if any,
applicable with respect to the Foreign Lender assignee on such date. To the
extent required by applicable law, each Foreign Lender that is a United States
person shall, on the date of its execution and delivery of this Agreement in the
case of each Foreign Lender party to the Closing Date and on the date of the
Assignment and Acceptance pursuant to which it becomes a Foreign Lender in the
case of each other Foreign Lender, upon expiration or obsolescence of any form
previously submitted under this Section 3.01(e), and from time to time
thereafter as reasonably requested in writing by Borrower or Administrative
Agent (but only so long thereafter as such Foreign Lender remains lawfully able
to do so), provide each of Administrative Agent and Borrower with two original
Internal Revenue Service Forms W-9 (or successor forms) establishing that such
Foreign Lender is not subject to U.S. backup withholding tax. If any form or
document referred to in this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service Form W-8BEN
or W-8EC1 or the related certificate described above, that the applicable
Foreign Lender reasonably considers to be confidential, such Foreign Lender
shall give notice thereof to Borrower and shall not be obligated to include in
such form or document such confidential information.
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(f) For any period with respect to which a Foreign Lender has failed
to provide Borrower with the appropriate form, certificate or other document
described in subsection (e) above (other than if such failure is due to a change
in law, or in the interpretation or application thereof, occurring after the
date on which a form, certificate or other document originally was required to
be provided or if such form, certificate or other document otherwise is not
required under subsection (e) above), such Foreign Lender shall not be entitled
to payments of additional amounts or indemnification under subsection (a) or (c)
of this Section 3.01 with respect to Taxes imposed by the United States by
reason of such failure; provided, however, that should a Foreign Lender become
subject to Taxes because of its failure to deliver a form, certificate or other
document required hereunder, Borrower shall take such steps as such Foreign
Lender shall reasonably request to assist such Foreign Lender to recover such
Taxes.
(g) Treatment of Certain Refunds. If Administrative Agent, any
Lender or the L/C Issuer determines, in its sole discretion, that it has
received a refund of any Taxes or Other Taxes as to which it has been
indemnified by Borrower or with respect to which Borrower has paid additional
amounts pursuant to this Section, it shall pay to Borrower an amount equal to
such refund (but only to the extent of indemnity payments made, or additional
amounts paid, by Borrower under this Section with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of
Administrative Agent, such Lender or the L/C Issuer, as the case may be, and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that Borrower, upon the request
of Administrative Agent, such Lender or the L/C Issuer, agrees to repay the
amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to Administrative Agent, such
Lender or the L/C Issuer in the event Administrative Agent, such Lender or the
L/C Issuer is required to repay such refund to such Governmental Authority. This
subsection shall not be construed to require Administrative Agent, any Lender or
the L/C Issuer to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to the Borrower or any other
Person.
3.02. Illegality. If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or to determine or charge interest rates based upon the
Eurodollar Rate, or any Governmental Authority has imposed material restrictions
on the authority of such Lender to purchase or sell, or to take deposits of,
Dollars in the London interbank market, then, on notice thereof by such Lender
to Borrower through Administrative Agent, any obligation of such Lender to make
or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to
Eurodollar Rate Loans shall be suspended until such Lender notifies
Administrative Agent and Borrower that the circumstances giving rise to such
determination no longer exist. Upon receipt of such notice, Borrower shall, upon
demand from such Lender (with a copy to Administrative Agent), prepay or, if
applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans,
either on the last day of the Interest Period therefor, if such Lender may
lawfully continue to maintain such Eurodollar Rate Loans to such day, or
immediately, if such Lender may not lawfully continue to maintain such
Eurodollar Rate Loans. Upon any such prepayment or conversion, Borrower shall
also pay accrued interest on the amount so prepaid or converted and all amounts
due under Section 3.05 in accordance with the terms thereof due to such
prepayment or conversion.
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3.03. Inability to Determine Rates. If Administrative Agent determines in
connection with any request for a Eurodollar Rate Loan or a conversion to or
continuation thereof that (a) Dollar deposits are not being offered to banks in
the London interbank eurodollar market for the applicable amount and Interest
Period of such Eurodollar Rate Loan, (b) adequate and reasonable means do not
exist for determining the Eurodollar Base Rate for any requested Interest Period
with respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar Base Rate
for any requested Interest Period with respect to a proposed Eurodollar Rate
Loan does not adequately and fairly reflect the cost to such Lenders of funding
such Loan, Administrative Agent will promptly so notify Borrower and each
Lender. Thereafter, the obligation of Lenders to make or maintain Eurodollar
Rate Loans shall be suspended until Administrative Agent (upon the instruction
of the Required Lenders) revokes such notice. Upon receipt of such notice,
Borrower may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Committed Borrowing of Base Rate
Loans in the amount specified therein.
3.04. Increased Costs. k) Increased Costs Generally. If any Change in Law
shall:
(i) impose, modify or deem applicable any reserve, special
deposit, compulsory loan, insurance charge or similar requirement against
assets of, deposits with or for the account of, or credit extended or
participated in by, any Lender (except any reserve requirement reflected
in the Eurodollar Rate) or the L/C Issuer;
(ii) subject any Lender or the L/C Issuer to any tax of any
kind whatsoever with respect to this Agreement, any Letter of Credit, any
participation in a Letter of Credit or any Eurodollar Rate Loan made by
it, or change the basis of taxation of payments to such Lender or the L/C
Issuer in respect thereof (except for Indemnified Taxes or Other Taxes
covered by Section 3.01 and the imposition of, or any change in the rate
of, any Excluded Tax payable by such Lender or the L/C Issuer); or
(iii) impose on any Lender or the L/C Issuer or the London
interbank market any other condition, cost or expense affecting this
Agreement or Eurodollar Rate Loans made by such Lender or any Letter of
Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Rate Loan (or of maintaining its
obligation to make any such Loan), or to increase the cost to such Lender or the
L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or
of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such
Lender or the L/C Issuer hereunder (whether of principal, interest or any other
amount) then, upon request of such Lender or the L/C Issuer, Borrower will pay
to such Lender or the L/C Issuer, as the case may be, such additional amount or
amounts as will compensate such Lender or the L/C Issuer, as the case may be,
for such additional costs incurred or reduction suffered.
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(b) Capital Requirements. If any Lender or the L/C Issuer determines
that any Change in Law affecting such Lender or the L/C Issuer or any Lending
Office of such Lender or such Lender's or the L/C Issuer's holding company, if
any, regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender's or the L/C Issuer's capital or on the capital of
such Lender's or the L/C Issuer's holding company, if any, as a consequence of
this Agreement, the Commitments of such Lender or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by the L/C Issuer, to a level below that which such Lender or the
L/C Issuer or such Lender's or the L/C Issuer's holding company could have
achieved but for such Change in Law (taking into consideration such Lender's or
the L/C Issuer's policies and the policies of such Lender's or the L/C Issuer's
holding company with respect to capital adequacy), then from time to time
Borrower will pay to such Lender or the L/C Issuer, as the case may be, such
additional amount or amounts as will compensate such Lender or the L/C Issuer or
such Lender's or the L/C Issuer's holding company for any such reduction
suffered.
(c) Certificates for Reimbursement. A certificate of a Lender or the
L/C Issuer setting forth the amount or amounts necessary to compensate such
Lender or the L/C Issuer or its holding company, as the case may be, as
specified in subsection (a) or (b) of this Section and delivered to Borrower
shall be conclusive absent manifest error. Borrower shall pay such Lender or the
L/C Issuer, as the case may be, the amount shown as due on any such certificate
within 10 days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or
the L/C Issuer to demand compensation pursuant to the foregoing provisions of
this Section shall not constitute a waiver of such Lender's or the L/C Issuer's
right to demand such compensation, provided that Borrower shall not be required
to compensate a Lender or the L/C Issuer pursuant to the foregoing provisions of
this Section for any increased costs incurred or reductions suffered more than
180 days prior to the date that such Lender or the L/C Issuer, as the case may
be, notifies Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender's or the L/C Issuer's intention to claim
compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the 180-day period referred
to above shall be extended to include the period of retroactive effect thereof).
3.05. Compensation for Losses. Upon demand of any Lender (with a copy to
Administrative Agent) from time to time, Borrower shall promptly compensate such
Lender for and hold such Lender harmless from any reasonable loss, cost or
expense incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the Interest
Period for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise); or
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(b) any failure by Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by Borrower;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
Borrower shall also pay any customary administrative fees charged by such Lender
in connection with the foregoing. For purposes of calculating amounts payable by
Borrower to Lenders under this Section 3.05, each Lender shall be deemed to have
funded each Eurodollar Rate Loan made by it at the Eurodollar Base Rate used in
determining the Eurodollar Rate for such Loan by a matching deposit or other
borrowing in the London interbank eurodollar market for a comparable amount and
for a comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.
3.06. Mitigation Obligations. If any Lender requests compensation under
Section 3.04, or Borrower is required to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section
3.01, or if any Lender gives a notice pursuant to Section 3.02, then such Lender
shall use reasonable efforts to designate a different Lending Office for funding
or booking its Loans hereunder or to assign its rights and obligations hereunder
to another of its offices, branches or affiliates, if, in the judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable pursuant to Section 3.01 or 3.04, as the case may be, in the future, or
eliminate the need for the notice pursuant to Section 3.02, as applicable, and
(ii) in each case, would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
3.07. Survival. All of Borrower's obligations under this Article III shall
survive termination of the Aggregate Commitments and repayment of all other
Obligations hereunder.
3.08. Replacement Lenders. If (i) any Lender requests compensation under
Section 3.01 or 3.04, (ii) any Lender is not obligated to fund or maintain
Eurodollar Rate Loans pursuant to Section 3.02, (iii) the Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 3.01, (iv) any Lender has failed to
fund any portion of its Loans hereunder required to be funded by it within one
Business Day of the date required to be funded by it or (v) any Lender has not
consented to a proposed amendment, modification or waiver under this Agreement
that requires the consent of all Lenders and which has been approved by Required
Lenders, then Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in, and consents required by, Section 10.06), all of its interests, rights and
obligations under this Agreement and the related Loan Documents to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment), provided that:
(a) either Borrower or the new Lender shall have paid to the
Administrative Agent the assignment fee specified in Section 10.06(b); and
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(b) such Lender shall have received payment of an amount equal to
the outstanding principal of its Loans, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder and under the other Loan Documents
(including any amounts under Section 3.05) from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or Borrower (in the
case of all other amounts).
A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling Borrower to require such assignment and delegation cease
to apply.
ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
4.01. Conditions of Initial Credit Extension. The obligation of the L/C
Issuer and each Lender to make its initial Credit Extension hereunder is subject
to satisfaction of the following conditions precedent:
(a) Administrative Agent's receipt of the following, each of which
shall be originals or telecopies (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer of the
signing Loan Party, each dated the Closing Date (or, in the case of certificates
of governmental officials, a recent date before the Closing Date) and each in
form and substance satisfactory to Administrative Agent and each of the Lenders:
(i) executed counterparts of this Agreement and the
Guaranty, sufficient in number for distribution to Administrative Agent,
each Lender and Borrower;
(ii) a Note executed by Borrower in favor of each Lender
requesting a Note;
(iii) such certified resolutions or other action,
incumbency certificates and/or other certificates of Responsible Officers
of each Loan Party as Administrative Agent may require evidencing the
identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this
Agreement and the other Loan Documents to which such Loan Party is a
party;
(iv) such documents and certifications as Administrative
Agent may reasonably require to evidence that each Loan Party is duly
organized or formed, and that each Loan Party is validly existing, in good
standing and qualified to engage in business in each jurisdiction where
such Loan Party is qualified to do business, other than the good standing
certificates permitted to be delivered by the Borrower following the
Closing Date pursuant to Section 6.05;
(v)The favorable opinion of DLA ▇▇▇▇▇ ▇▇▇▇▇▇▇ addressed to
Administrative Agent and each Lender, as to the matters set forth
concerning the Loan Parties and the Loan Documents in form and substance
reasonably satisfactory to Administrative Agent;
(vi) a certificate of a Responsible Officer of each Loan
Party either (a) attaching copies of all consents, licenses and approvals
required in connection with the execution, delivery and performance by
such Loan Party and the validity against such Loan Party of the Loan
Documents to which it is a party, and such consents, licenses and
approvals shall be in full force and effect, or (b) stating that no such
consents, licenses or approvals are so required;
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(vii) a certificate signed by a Responsible Officer of
Borrower certifying (a) that the conditions specified in Sections 4.02(a)
and (b) have been satisfied, (b) that there has been no event or
circumstance since December 31, 2006 that has had or could be reasonably
expected to have, either individually or in the aggregate, a Material
Adverse Effect, (c) stating the Total Capitalization Ratio as of December
31, 2007, (d) that no Internal Control Event has occurred since December
31, 2006 which involves (A) an impact upon EBITDA in an amount which is in
excess of $1,000,000, or (B) fraud, error or irregularity on the part of
any Responsible Officer of the Borrower or its Significant Subsidiaries or
any other management staff of Borrower and its Significant Subsidiaries
having responsibility for the design or supervision of internal controls
or the preparation of financial statements of Borrower and its
Subsidiaries, and (e) that, as of the Closing Date, there is no action,
suit, investigation or proceeding pending or, to the knowledge of
Borrower, threatened against Borrower or any of its Subsidiaries in any
court or before any arbitrator or governmental authority that could
reasonably be expected to have a Material Adverse Effect;
(viii) evidence that all insurance required to be
maintained pursuant to the Loan Documents has been obtained and is in
effect;
(ix) such other assurances, certificates, documents,
consents or opinions as Administrative Agent, the L/C Issuer, Swing Line
Lender or the Required Lenders reasonably may require.
(b) Any fees required to be paid on or before the Closing Date shall
have been paid.
(c) Unless waived by Administrative Agent, Borrower shall have paid
all fees, charges and disbursements of counsel to Administrative Agent to the
extent invoiced prior to or on the Closing Date, plus such additional amounts of
such fees, charges and disbursements as shall constitute its reasonable estimate
of such fees, charges and disbursements incurred or to be incurred by it through
the closing proceedings (provided that such estimate shall not thereafter
preclude a final settling of accounts between Borrower and Administrative
Agent).
Without limiting the generality of the provisions of Section 9.04, for
purposes of determining compliance with the conditions specified in this Section
4.01, each Lender that has signed this Agreement shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or
other matter required thereunder to be consented to or approved by or acceptable
or satisfactory to a Lender unless Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.
4.02. Conditions to all Credit Extensions. The obligation of each Lender
to honor any Request for Credit Extension is subject to the following conditions
precedent:
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(a) The representations and warranties of Borrower and each other
Loan Party contained in Article V or any other Loan Document, or which are
contained in any document furnished at any time under or in connection herewith
or therewith, shall be true and correct on and as of the date of such Credit
Extension, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date, and except that for purposes of this Section
4.02, the representations and warranties contained in subsections (a) and (b) of
Section 5.05 shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a) and (b), respectively, of Section 6.01.
(b) No Default shall exist, or would result from such proposed
Credit Extension or from the application of the proceeds thereof.
(c) Administrative Agent and, if applicable, the L/C Issuer or Swing
Line Lender shall have received a Request for Credit Extension in accordance
with the requirements hereof.
(d) Administrative Agent shall have received, in form and substance
reasonably satisfactory to it, such other assurances, certificates, documents or
consents related to the foregoing as Administrative Agent or the Required
Lenders reasonably may require.
Each Request for Credit Extension submitted by Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections 4.02(a)
and (b) have been satisfied on and as of the date of the applicable Credit
Extension.
ARTICLE V. REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Administrative Agent and the Lenders,
on the Closing Date, and on each other date that the Borrower makes or is deemed
to have made such representations, that:
5.01. Existence, Qualification and Power; Compliance with Laws. Each Loan
Party and each Subsidiary thereof (a) is duly organized or formed, validly
existing and in good standing under the Laws of the jurisdiction of its
incorporation or organization, (b) has all requisite power and authority and all
requisite governmental licenses, authorizations, consents and approvals to (i)
own or lease its assets and carry on its business and (ii) execute, deliver and
perform its obligations under the Loan Documents to which it is a party, (c) is
duly qualified and is licensed and in good standing under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification or license, and (d) is in
compliance with all Laws; except in each case referred to in clause (b)(i), (c)
or (d), to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.
5.02. Authorization; No Contravention. The execution, delivery and
performance by each Loan Party of each Loan Document to which such Person is
party, have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any
of such Person's Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, or require any
payment to be made under (i) any Contractual Obligation to which Borrower or any
of its Subsidiaries is a party or affecting the properties of Borrower or any of
its Subsidiaries or (ii) any order, injunction, writ or decree of any
Governmental Authority or any arbitral award to which Borrower or any of its
Subsidiaries or their property is subject; or (c) violate any Law in any
material respect (or, in any event, in any manner known to Borrower). Borrower
and each Subsidiary thereof is in compliance with all Contractual Obligations
referred to in clause (b)(i), except to the extent that failure to do so could
not reasonably be expected to have a Material Adverse Effect.
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5.03. Governmental Authorization; Other Consents. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document. No
Subsidiary of the Borrower is not a party to the Guaranty as of the Closing Date
except to the extent that (a) such Subsidiary is not a Significant Subsidiary,
or (b) such Subsidiary is not permitted to be a party to the Guaranty based upon
a Law applicable to such Subsidiary by reason of its status as a regulated
utility (provided that no such Subsidiary shall be obligated to apply for any
discretionary regulatory approvals which would be required to permit its
execution of the Guaranty).
5.04. Binding Effect. This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by each Loan Party that is party thereto. This Agreement constitutes, and each
other Loan Document when so delivered will constitute, a legal, valid and
binding obligation of such Loan Party, enforceable against each Loan Party that
is party thereto in accordance with its terms subject to applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws now or hereafter in
effect relating to creditors' rights generally, and general principles of
equity.
5.05. Financial Statements; No Material Adverse Effect. l) The Audited
Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; (ii) fairly present the financial condition of Borrower and its
Subsidiaries as of the date thereof and their results of operations for the
period covered thereby in accordance with GAAP consistently applied throughout
the period covered thereby, except as otherwise expressly noted therein; and
(iii) show all material indebtedness and other liabilities, direct or
contingent, of Borrower and its Subsidiaries as of the date thereof, including
liabilities for taxes, material commitments and Indebtedness.
(b) The unaudited consolidated balance sheets of Borrower and its
Subsidiaries dated September 30, 2007, and the related consolidated statements
of income or operations, shareholders' equity and cash flows for the fiscal
quarter ended on that date (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein, and (ii) fairly present the financial condition of
Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby, subject, in the case of clauses (i)
and (ii), to the absence of footnotes and to normal year-end adjustments.
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(c) Since the date of the Audited Financial Statements, there has
been no event or circumstance, either individually or in the aggregate, that has
had or could reasonably be expected to have a Material Adverse Effect.
(d) The consolidated forecasted balance sheet and statements of
income and cash flows of Borrower and its Subsidiaries delivered pursuant to
Section 6.01(c) were prepared in good faith on the basis of the assumptions
stated therein, which assumptions were fair in light of the conditions existing
at the time of delivery of such forecasts, and represented, at the time of
delivery, the Borrower's best estimate of its future financial performance.
5.06. Litigation. There are no actions, suits, proceedings, claims or
disputes pending or, to the knowledge of Borrower after due and diligent
investigation, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, by or against Borrower or any of its
Subsidiaries or against any of their properties or revenues that (a) purport to
affect or pertain to this Agreement or any other Loan Document, or any of the
transactions contemplated hereby, or (b) either individually or in the aggregate
could reasonably be expected to have a Material Adverse Effect There are no
material actions, suits, proceedings, claims or disputes pending against
Borrower and its Subsidiaries not listed on Schedule 5.06. Without limitation on
the foregoing (a) the aggregate exposure of Borrower and its Subsidiaries for
effluent treatment fees to the Albuquerque Bernalillo County Water Utility
Authority as of the Closing Date does not exceed $5,700,000, plus approximately
$90,000 per month thereafter (it being understood that the foregoing amount is a
statement of the maximum amount of the claim asserted against NMUI in the NMUI
Litigation and is contested by the Borrower), and (b) as of the Closing Date
there are no other material monetary claims in the NMUI Litigation against NMUI,
the Borrower or its other Subsidiaries, it being understood that the NMUI
Litigation, other than the portions described in part (a) of this sentence,
involves claims over the ownership of certain water rights credits and a
condemnation action rather than a monetary claim against NMUI, the Borrower or
its other Subsidiaries.
5.07. No Default. Neither Borrower nor any Subsidiary is in default under
or with respect to any Contractual Obligation that could, either individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect. No
Default has occurred and is continuing or would result from the consummation of
the transactions contemplated by this Agreement or any other Loan Document.
5.08. Ownership of Property; Liens. Each of Borrower and each Subsidiary
has good record and marketable title in fee simple to, or valid leasehold
interests in, all real property necessary or used in the ordinary conduct of its
business, except for such defects in title as could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The
property of Borrower and its Subsidiaries is subject to no Liens, other than
Liens permitted by Section 7.01.
5.09. Environmental Compliance. Borrower and its Subsidiaries conduct in
the ordinary course of business a review of the effect of existing Environmental
Laws and claims alleging potential liability or responsibility for violation of
any Environmental Law on their respective businesses, operations and properties,
and as a result thereof Borrower has reasonably concluded that (i), such
Environmental Laws and claims could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, and (ii) except as
disclosed on Schedule 5.09, there are no proceedings pending against Borrower or
any of its Subsidiaries alleging any violation of Environmental Laws.
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5.10. Insurance. The properties of Borrower and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of Borrower, in such amounts (after giving effect to any self-insurance
compatible with the following standards), with such deductibles and covering
such risks as are customarily carried by companies engaged in similar businesses
and owning similar properties in localities where Borrower or the applicable
Subsidiary operates.
5.11. Taxes. Borrower and its Subsidiaries have filed all federal, state
and other material tax returns and reports required to be filed, and have paid
all federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP and except immaterial taxes
and tax returns. To the best knowledge of Borrower, there is no proposed tax
assessment against Borrower or any Subsidiary that would, if made, have a
Material Adverse Effect.
5.12. ERISA Compliance. m) Each Plan is in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state Laws. Each Plan that is intended to qualify under Section 401(a) of the
Code has received a favorable determination letter from the IRS or an
application for such a letter is currently being processed by the IRS with
respect thereto and, to the best knowledge of Borrower, nothing has occurred
which would prevent, or cause the loss of, such qualification. Borrower and each
ERISA Affiliate have made all required contributions to each Plan subject to
Section 412 of the Code, and no application for a funding waiver or an extension
of any amortization period pursuant to Section 412 of the Code has been made
with respect to any Plan.
(b) There are no pending or, to the best knowledge of Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could reasonably be expected to have a Material
Adverse Effect. There has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur,
any liability under Title IV of ERISA with respect to any Pension Plan (other
than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither
Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur,
any liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither Borrower nor
any ERISA Affiliate has engaged in a transaction that could be subject to
Sections 4069 or 4212(c) of ERISA.
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5.13. Subsidiaries. As of the Closing Date, Borrower has no Subsidiaries
other than those specifically disclosed in Part (a) of Schedule 5.13, and all of
the outstanding Equity Interests in such Subsidiaries have been validly issued,
are fully paid and nonassessable and are owned by a Loan Party in the amounts
specified on Part (a) of Schedule 5.13 free and clear of all Liens (other than
any such Equity Interests not owned by Borrower or one of its Subsidiaries).
Borrower has no equity investments in any other corporation or entity other than
those specifically disclosed in Part (b) of Schedule 5.13. All of the
outstanding Equity Interests in Borrower have been validly issued and are fully
paid and nonassessable.
5.14. Margin Regulations; Investment Company Act; Public Utility Holding
Company Act. n) Borrower is not engaged and will not engage, principally or as
one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.
(b) None of Borrower, any Person Controlling Borrower, or any
Subsidiary is or is required to be registered as an "investment company" under
the Investment Company Act of 1940, or is otherwise subject thereto in any
manner which would prohibit the credit facilities described herein.
5.15. Disclosure. Borrower has disclosed to Administrative Agent and
Lenders all agreements, instruments and corporate or other restrictions to which
it or any of its Subsidiaries is subject, and all other matters known to it,
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. No report, financial statement, certificate or
other written information furnished by or on behalf of any Loan Party to
Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder
(as modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial
information, Borrower represents only that such information was prepared in good
faith based upon assumptions believed to be reasonable at the time.
5.16. Compliance with Laws. Each of Borrower and each Subsidiary is in
compliance in all material respects with the requirements of all Laws and all
orders, writs, injunctions and decrees applicable to it or to its properties,
except in such instances in which (a) such requirement of Law or order, writ,
injunction or decree is being contested in good faith by appropriate proceedings
diligently conducted or (b) the failure to comply therewith, either individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.
5.17. Intellectual Property; Licenses, Etc. Borrower and its Subsidiaries
own, or possess the right to use, all of the trademarks, service marks, trade
names, copyrights, patents, patent rights, franchises, licenses and other
intellectual property rights that are reasonably necessary for the operation of
their respective businesses, without conflict with the rights of any other
Person, except to the extent that such conflicts may not reasonably be expected
to have a Material Adverse Effect. To the best knowledge of Borrower, no slogan
or other advertising device, product, process, method, substance, part or other
material now employed, or now contemplated to be employed, by Borrower or any
Subsidiary infringes upon any rights held by any other Person, except to the
extent that such conflicts may not reasonably be expected to have a Material
Adverse Effect. No claim or litigation regarding any of the foregoing is pending
or, to the best knowledge of Borrower, threatened, which, either individually or
in the aggregate, could reasonably be expected to have a Material Adverse
Effect.
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5.18. Debt Instruments; Restrictions on Restricted Payments and Loans. As
of the Closing Date, neither Borrower nor any of its Subsidiaries is a party to
any instrument, document or agreement governing Indebtedness in an amount which
is in excess of $1,000,000 other than the Existing Indentures, the Monarch Loan
Agreement and each of the items identified on Schedule 7.03 as being in excess
of $1,000,000. No Subsidiary of the Borrower is subject to any restriction upon
its ability to make Restricted Payments or to make loans to or investments in
the Borrower except:
(a) the restrictions set forth in the Existing Indentures and the
Monarch Loan Agreement as of the date hereof;
(b) restrictions set forth in future instruments, documents and
agreements which have been entered into in compliance with Section 7.09; and
(c) restrictions imposed by Law.
ARTICLE VI. AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder (other than Unmatured Surviving Obligations) shall
remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding,
Borrower shall, and shall (except in the case of the covenants set forth in
Sections 6.01, 6.02, and 6.03) cause each Subsidiary to:
6.01. Financial Statements. Deliver to Administrative Agent a sufficient
number of copies for delivery by Administrative Agent to each Lender, in form
and detail reasonably satisfactory to Administrative Agent and the Required
Lenders:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of Borrower, a consolidated balance sheet of Borrower
and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, such statements to be audited and accompanied by a report
and opinion of KPMG, LLP, PricewaterhouseCoopers or another independent
certified public accountant of nationally recognized standing reasonably
acceptable to the Required Lenders, which report and opinion shall be prepared
in accordance with generally accepted auditing standards and applicable
Securities Laws and shall not be subject to any "going concern" or like
qualification or exception or any qualification or exception as to the scope of
such audit;
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(b) as soon as available, but in any event within 45 days after the
end of each of the first three fiscal quarters of each fiscal year of Borrower,
a consolidated balance sheet of Borrower and its Subsidiaries as at the end of
such fiscal quarter, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for such fiscal quarter and for
the portion of Borrower's fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail, such statements to be certified by a Responsible
Officer of Borrower as fairly presenting the financial condition, results of
operations, shareholders' equity and cash flows of Borrower and its Subsidiaries
in accordance with GAAP, subject only to normal year-end adjustments and the
absence of footnotes; and
(c) concurrently with the financial statements set forth in (a),
forecasts prepared by management of Borrower, in a form similar to the
projections heretofore presented to the Administrative Agent and in any event
reasonably satisfactory to Administrative Agent, of consolidated balance sheets
and statements of income or operations and cash flows of Borrower and its
Subsidiaries on an annual basis for a period, not less than three years,
including the Maturity Date.
Documents required to be delivered pursuant to Section 6.01(a) or (b) or Section
6.02(b) (to the extent any such documents are included in materials otherwise
filed with the SEC) may be delivered electronically and if so delivered, shall
be deemed to have been delivered on the date (i) on which Borrower posts such
documents, or provides a link thereto on Borrower's website on the Internet at
the website address listed on Schedule 10.02; or (ii) on which such documents
are posted on Borrower's behalf on an Internet or intranet website, if any, to
which each Lender and Administrative Agent have access (whether a commercial,
third-party website or whether sponsored by Administrative Agent); provided
that: (i) Borrower shall deliver paper copies of such documents to
Administrative Agent upon request of Administrative Agent or any Lender until a
written request to cease delivering paper copies is given by Administrative
Agent or such Lender and (ii) Borrower shall provide to Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents and
Administrative Agent shall post such documents and notify (which may be by
facsimile or electronic mail) each Lender of the posting of any such documents.
6.02. Certificates; Other Information. Deliver to Administrative Agent a
sufficient number of copies for delivery by Administrative Agent to each Lender,
in form and detail satisfactory to Administrative Agent and the Required
Lenders:
(a) concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a duly completed Compliance Certificate
signed by a Responsible Officer of Borrower;
(b) promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication sent to
the stockholders of Borrower, and copies of all annual, regular, periodic and
special reports and registration statements which Borrower may file or be
required to file with the SEC under Section 13 or 15(d) of the Securities
Exchange Act of 1934, and not otherwise required to be delivered to
Administrative Agent pursuant hereto;
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(c) promptly after the furnishing thereof, copies of any material
statement or report furnished to any holder of debt securities of any Loan Party
or any Subsidiary thereof pursuant to the terms of any indenture, loan or credit
or similar agreement governing Indebtedness in a principal amount which exceeds
$5,000,000 and not otherwise required to be furnished to the Lenders pursuant to
Section 6.01 or any other clause of this Section 6.02;
(d) promptly, and in any event within five Business Days after
receipt thereof by any Loan Party or any Subsidiary thereof, copies of each
notice or other correspondence received from the SEC (or comparable agency in
any applicable non-United States jurisdiction) concerning any investigation or
possible investigation or other inquiry by such agency regarding financial or
other operational results of any Loan Party or any Subsidiary thereof;
(e) promptly, and in any event within five Business Days following
the execution thereof, copies of (i) each amendment to the Existing Indentures,
the Monarch Loan Agreement, and (ii) each instrument, document or agreement
governing Indebtedness of the Borrower or any of its Subsidiaries;
(f) promptly, such additional information regarding the business,
financial or corporate affairs of Borrower or any Subsidiary, or compliance with
the terms of the Loan Documents, as Administrative Agent or any Lender may from
time to time reasonably request; and
(g) provide the notices required by Section 6.13.
Borrower hereby acknowledges that (a) Administrative Agent will make available
to Lenders and the L/C Issuer materials and/or information provided by or on
behalf of Borrower hereunder (collectively, "Borrower Materials") by posting
Borrower Materials on IntraLinks or another similar electronic system (the
"Platform") and (b) certain of the Lenders may be "public-side" Lenders (i.e.,
Lenders that do not wish to receive material non-public information with respect
to Borrower or its securities) (each, a "Public Lender"). Borrower hereby agrees
that (w) all Borrower Materials that are to be made available to Public Lenders
shall be clearly and conspicuously marked "PUBLIC" which, at a minimum, shall
mean that the word "PUBLIC" shall appear prominently on the first page thereof;
(x) by marking Borrower Materials "PUBLIC", Borrower shall be deemed to have
authorized Administrative Agent, the L/C Issuer and the Lenders to treat such
Borrower Materials as either publicly available information or not containing
any material non-public information (although it may be sensitive and
proprietary) with respect to Borrower or its securities for purposes of United
States federal and state securities laws (provided, however, that to the extent
such Borrower Materials constitute Information, they shall be treated as set
forth in Section 10.07); (y) all Borrower Materials marked "PUBLIC" are
permitted to be made available through a portion of the Platform designated
"Public Investor"; and (z) Administrative Agent shall be entitled to treat any
Borrower Materials that are not marked "PUBLIC" as being suitable only for
posting on a portion of the Platform not designated "Public Investor".
The Administrative Agent will promptly distribute to the Lenders any
information supplied to the Administrative Agent by the Borrower which the
Borrower requests that they distribute to the Lenders.
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6.03. Notices. Promptly notify Administrative Agent and each Lender:
(a) of the occurrence of any Default;
(b) of any matter that has resulted or could reasonably be expected
to result in a Material Adverse Effect, including (i) breach or non-performance
of, or any default under, a Contractual Obligation of Borrower or any
Subsidiary; (ii) any dispute, litigation, investigation, proceeding or
suspension between Borrower or any Subsidiary and any Governmental Authority; or
(iii) the commencement of, or any material development in, any litigation or
proceeding affecting Borrower or any Subsidiary, including pursuant to any
applicable Environmental Laws;
(c) of the occurrence of any ERISA Event;
(d) of any material change in accounting policies or financial
reporting practices by Borrower or any Subsidiary, including any determination
by the Borrower referred to in Section 2.11(b); and
(e) of the occurrence of any Internal Control Event.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer of Borrower setting forth details of the occurrence referred
to therein and stating what action Borrower has taken and proposes to take with
respect thereto. Each notice pursuant to Section 6.03(a) shall describe with
particularity any and all provisions of this Agreement and any other Loan
Document that have been breached.
6.04. Payment of Obligations. Pay and discharge as the same shall become
due and payable, all its obligations and liabilities, including (a) all tax
liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by Borrower or such Subsidiary; (b) all lawful
claims which, if unpaid, would by law become a Lien upon its property, unless
the same are being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
Borrower or such Subsidiary; and (c) all material Indebtedness, as and when due
and payable, (including any applicable grace periods) but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
6.05. Preservation of Existence, Etc. (a) Preserve, renew and maintain in
full force and effect its legal existence and good standing under the Laws of
the jurisdiction of its organization except in a transaction permitted by
Section 7.04 or 7.05; (b) take all reasonable action to maintain all rights,
privileges, permits, licenses and franchises necessary or desirable in the
normal conduct of its business, except to the extent that failure to do so could
not reasonably be expected to have a Material Adverse Effect; and (c) preserve
or renew all of its registered patents, trademarks, trade names and service
marks, the non-preservation of which could reasonably be expected to have a
Material Adverse Effect. Borrower agrees that it shall deliver to the
Administrative Agent, no later than 30 days after the Closing Date (i) with
respect to ECO Resources, Inc., a Texas corporation, a certificate of good
standing from the State of Alabama Department of Revenue and (ii) with respect
to SWWC Services, Inc., a Delaware corporation, a certificate of good standing
from the State of Alabama Department of Revenue and certificates of good
standing from the Secretary of State of each of Louisiana and New Mexico.
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6.06. Maintenance of Properties. (a) Maintain, preserve and protect all of
its material properties and equipment necessary in the operation of its business
in good working order and condition, ordinary wear and tear excepted; (b) make
all necessary repairs thereto and renewals and replacements thereof except where
the failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (c) use the standard of care typical in the industry in the
operation and maintenance of its facilities.
6.07. Maintenance of Insurance. Maintain with financially sound and
reputable insurance companies not Affiliates of Borrower, insurance with respect
to its properties and business against loss or damage of the kinds customarily
insured against by Persons engaged in the same or similar business, of such
types and in such amounts (after giving effect to any self-insurance compatible
with the following standards) as are customarily carried under similar
circumstances by such other Persons and providing for not less than 30 days'
prior notice to Administrative Agent of termination, lapse or cancellation of
such insurance, provided that 10 days' prior notice shall be given to
Administrative Agent when such termination, lapse or cancellation is due to
Borrower's failure to pay insurance premiums.
6.08. Compliance with Laws. Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, write, injunction or decree is being
contested in good faith by appropriate proceedings diligently conducted; or (b)
the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect.
6.09. Books and Records. (a) Maintain proper books of record and account,
in which full, true and correct entries in conformity with GAAP consistently
applied shall be made of all financial transactions and matters involving the
assets and business of Borrower or such Subsidiary, as the case may be; and (b)
maintain such books of record and account in material conformity with all
applicable requirements of any Governmental Authority having regulatory
jurisdiction over Borrower or such Subsidiary, as the case may be.
6.10. Inspection Rights. Permit representatives and independent
contractors of Administrative Agent and each Lender to visit and inspect any of
its properties, to examine its corporate, financial and operating records, and
make copies thereof or abstracts therefrom, and to discuss its affairs, finances
and accounts with its officers, and independent public accountants, all at the
reasonable expense of Borrower and at such reasonable times during normal
business hours and as often as may be reasonably desired, upon reasonable
advance notice to Borrower, provided that, unless a Default or Event of Default
has occurred and remains continuing:
(a) Administrative Agent shall provide Borrower with five Business Days
prior notice of any visit or inspection under this Section 6.10; and
(b) Borrower shall not be required to pay expenses for more than one visit
in any calendar year.
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6.11. Use of Proceeds. Use the proceeds of the Credit Extensions for
general corporate purposes not in contravention of any Law or of any Loan
Document and to repay its obligations under the Existing Credit Agreement.
6.12. Financial Covenants.
(a) Total Capitalization Ratio. Maintain, as of the last day of each
Fiscal Quarter, Total Capitalization Ratio which is not greater than 60% as of
the last day of each Fiscal Quarter.
(b) EBITDA Coverage Ratio. Maintain, as of the last day of each
Fiscal Quarter, an EBITDA Coverage Ratio, of not less than 1.20 to 1.00 as of
the last day of each Fiscal Quarter.
(c) Bondable Capacity Ratio. Maintain, as of the last day of each
Fiscal Quarter, a ratio of (i) aggregate Bondable Capacity as of that date minus
the aggregate principal amount of the Total Indebtedness of Borrower's
Subsidiaries (but not Borrower) as of that date to (ii) the Total Indebtedness
of Borrower (but not its Subsidiaries) minus Subordinated Indebtedness, of not
less than 1.20 to 1.00.
(d) Operating Income. Maintain, as of the last day of each Fiscal
Quarter, a ratio of (i) aggregate segment operating income of the Regulated
Subsidiaries, to (ii) consolidated total segment operating income (excluding
corporate and other) in each case determined consistently with GAAP and
consistently with the past practices of Borrower for the twelve month period
then ended, of not less than 0.65 to 1.00.
6.13. Additional Guarantors. Notify Administrative Agent at the time that
any Person becomes a Significant Subsidiary, and promptly thereafter (and in any
event within 10 days), cause such Person to:
(a) become a Guarantor by executing and delivering to Administrative
Agent a counterpart of the Guaranty or such other document as Administrative
Agent shall deem appropriate for such purpose, except to the extent that such
Subsidiary is not permitted to be a party to the Guaranty based upon a Law
applicable to such Subsidiary by reason of its status as a regulated utility
(provided that no such Subsidiary shall be obligated to apply for any
discretionary regulatory approvals which would be required to permit its
execution of the Guaranty) or a Contractual Obligation of such Subsidiary
existing on the date of the Acquisition thereof (and not created in
contemplation of such Acquisition); and
(b) deliver to Administrative Agent documents of the types referred
to in clauses (iii) and (iv) of Section 4.01(a) and, to the extent such Person
is a Guarantor, favorable opinions of counsel to such Person, all in form,
content and scope reasonably satisfactory to Administrative Agent.
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ARTICLE VII. NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder (other than an Unmatured Surviving Obligation) shall
remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding,
Borrower shall not, nor shall it permit any Subsidiary to, directly or
indirectly:
7.01. Liens. Create, incur, assume or suffer to exist any Lien upon any of
its property, assets or revenues, whether now owned or hereafter acquired, other
than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on Schedule 7.01;
(c) Liens on property of any Regulated Subsidiary securing
Indebtedness of that Subsidiary incurred pursuant to Section 7.03(e), but not
securing any other obligations or Indebtedness;
(d) Liens on property of any Unregulated Subsidiary securing
Indebtedness of that Subsidiary incurred pursuant to Section 7.03(f), but not
securing any other obligations or Indebtedness;
(e) Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings diligently conducted, if adequate reserves
with respect thereto are maintained on the books of the applicable Person in
accordance with GAAP;
(f) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business which
are not overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of the applicable
Person;
(g) pledges or deposits in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other social
security legislation, other than any Lien imposed by ERISA;
(h) deposits to secure the performance of bids, trade contracts and
leases (other than Indebtedness), statutory obligations, surety and appeal bonds
(other than bonds related to judgments or litigation), performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
(i) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;
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(j) Liens securing judgments for the payment of money not
constituting an Event of Default under Section 8.01(h) or securing appeal or
other surety bonds related to such judgments;
(k) Liens on Property of Monarch securing the Indebtedness under the
Monarch Loan Agreement;
(l) Liens, deposits and/or pledges made in the ordinary course of
business to secure the performance of operating leases;
(m) Liens on restricted cash held by Borrower or any of its
Subsidiaries which is the proceeds of Indebtedness issued in accordance with the
terms of Section 7.03 in favor of or otherwise contractually benefiting the
holders of such Indebtedness, pending application thereof to the specific
purpose for which such restricted cash was delivered to Borrower or the
respective Subsidiary;
(n) Liens benefiting customers of Borrower and its Subsidiaries on
cash collected by Borrower and its Subsidiaries on behalf of such customers, or
provided to Borrower and its Subsidiaries by such customers, and held by
Borrower or any of its Subsidiaries pending distribution thereof to such
customers;
(o) Liens on property of Borrower securing Indebtedness of Borrower
incurred pursuant to Section 7.03(e)(v); and
(p) Liens on property of Borrower and its Subsidiaries acquired
using the proceeds of Indebtedness incurred pursuant to Section 7.03(h),
securing such Indebtedness and permitted refinancings thereof.
7.02. Investments. Make any Investments, except:
(a) Investments held by Borrower or such Subsidiary in the form of
cash equivalents or short-term marketable debt securities;
(b) Permitted Acquisitions;
(c) advances to officers, directors and employees of Borrower and
its Subsidiaries in the ordinary course of business;
(d) Investments of Borrower in any Subsidiary and Investments of any
Subsidiary in Borrower or in another Subsidiary;
(e) Endorsement of negotiable instruments for deposit or collection
or similar transactions in the ordinary course of business;
(f) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from account debtors to the extent reasonably
necessary in order to prevent or limit loss;
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(g) Investments of restricted cash described in Section 7.01(m) in
accordance with the documents governing such restricted cash; and
(h) Other Investments made on a date when no Default or Event of
Default has occurred and remains continuing in an aggregate amount not to exceed
$10,000,000.
7.03. Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Indebtedness under the Monarch Loan Agreement which is
outstanding on the Closing Date;
(c) Indebtedness under the Existing Indentures which is outstanding
on the Closing Date, and refinancings thereof which do not increase the
principal amount outstanding thereunder;
(d) Other Indebtedness outstanding on the date hereof and listed on
Schedule 7.03 and, subject to Section 7.09, renewals, extensions or refinancings
thereof;
(e) Indebtedness of Borrower and the Regulated Subsidiaries
(including any increase of the amount outstanding under the Existing Indentures
which would not be permitted by clause (c)); provided that such Indebtedness,
(i) shall not be secured by, or contain a Negative Pledge binding upon the
properties of Borrower, (ii) shall not be secured by, or contain a Negative
Pledge binding upon any Person other than the Person which is the primary
obligor in respect of such Indebtedness, (iii) shall not be supported by any
guarantees of any other Subsidiary, (iv) shall not be in an aggregate principal
amount which is in excess of $40,000,000 at any time, and (v) except to the
extent of Indebtedness in an aggregate amount not to exceed $5,000,000 at any
time, such Indebtedness is governed by instruments, documents and agreements
which comply with the provisions of Section 7.09;
(f) Indebtedness of Unregulated Subsidiaries in an aggregate
principal amount not to exceed $10,000,000;
(g) Subordinated Indebtedness of Borrower; and
(h) Indebtedness of Borrower (including obligations in respect of
Capital Lease Obligations) incurred to directly finance the acquisition of fixed
or capital assets, and refinancings thereof which do not increase the principal
amount outstanding thereunder, in each case in an aggregate principal amount
which does not exceed $40,000,000 at any time.
7.04. Fundamental Changes. Merge, dissolve, liquidate, consolidate with or
into another Person, or make any Disposition of (whether in one transaction or
in a series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except that, so long
as no Default exists or would result therefrom:
(a) any Subsidiary may merge or consolidate with or liquidate or
dissolve into (i) Borrower, provided that Borrower shall be the continuing or
surviving Person and that Borrower does not assume any substantial Indebtedness
(other than Indebtedness permitted to be incurred by Borrower pursuant to this
Agreement) by reason of such merger, or (ii) any one or more other Subsidiaries,
provided that (x) when any wholly-owned Subsidiary is merging with another
Subsidiary, the wholly-owned Subsidiary shall be the continuing or surviving
Person, and (y) when a Guarantor is merging with another Subsidiary, a Guarantor
shall be the surviving Person;
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(b) any Person may merge or consolidate with or into a Subsidiary of
Borrower in connection with a Permitted Acquisition;
(c) any Subsidiary may make a Disposition of all or substantially
all of its assets (upon voluntary liquidation or otherwise) to Borrower or to
another Subsidiary; provided that if the transferor in such a transaction is a
Subsidiary, then the transferee must either be Borrower or a Subsidiary and,
provided further that if the transferor of such assets is a Guarantor, the
transferee must either be Borrower or a Guarantor;
(d) Dispositions permitted by Section 7.05.
7.05. Dispositions. Make any Disposition or enter into any agreement to
make any Disposition, except:
(a) Dispositions of obsolete or worn out property, whether now owned
or hereafter acquired, in the ordinary course of business;
(b) Dispositions of inventory in the ordinary course of business;
(c) Dispositions of property by any Subsidiary to Borrower or to a
wholly-owned Subsidiary; provided that if the transferor of such property is a
Guarantor, the transferee thereof must either be Borrower or a Guarantor;
(d) Dispositions of cash equivalents or short-term marketable debt
securities;
(e) Dispositions of delinquent accounts receivable in the ordinary
course of business;
(f) Leases, subleases and licenses in ordinary course of business;
(g) Dispositions in connection with transactions that are permitted
pursuant to Section 7.02 or Section 7.04 (other than clause (d) thereof);
(h) Dispositions for fair market value made when no Default or Event
of Default has occurred and remains continuing or would result therefrom
(including any Pro Forma Covenant Default), for an aggregate consideration not
to exceed $25,000,000 during the term of this Agreement; and
(i) Dispositions of NMUI or all or substantially all of its assets
which are required by compulsory process of law pursuant to the NMUI litigation,
provided that not less than ten Business Days prior to the making of any such
Disposition, the Borrower shall deliver a certificate to the Administrative
Agent stating that no Default or Event of Default would result therefrom
(including any Pro Forma Covenant Default).
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7.06. Restricted Payments(a) . Declare or make, directly or indirectly,
any Restricted Payment, or incur any obligation (contingent or otherwise) to do
so, or issue or sell any Equity Interests, if a Default or Event of Default
shall have occurred and remains continuing or if a Default or Event of Default
would occur as a result thereof.
7.07. Change in Nature of Business. Engage in any material line of
business substantially different from those lines of business conducted by
Borrower and its Subsidiaries on the date hereof or any business substantially
related or incidental thereto or reasonable extensions thereof.
7.08. Transactions with Affiliates. Enter into any transaction of any kind
with any Affiliate of Borrower, whether or not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to
Borrower or such Subsidiary as would be obtainable by Borrower or such
Subsidiary at the time in a comparable arm's length transaction with a Person
other than an Affiliate, provided that the foregoing restriction shall not apply
to transactions between or among Borrower and it Subsidiaries or between and
among Subsidiaries.
7.09. Burdensome Agreements. Amend or modify any Contractual Obligation in
effect as of the Closing Date (including without limitation any amendments to
the Existing Indentures or the Monarch Loan Agreement), or enter into or assume
any Contractual Obligation which:
(a) limits the ability of any Subsidiary to make loans,
distributions or other Restricted Payments to Borrower or any Guarantor or
to otherwise transfer property to Borrower or any Guarantor, in each case
in a manner which either (i) is more restrictive than the provisions of
the Existing Indentures, as in effect on the Closing Date (as determined
by the Administrative Agent in the reasonable exercise of its discretion)
or (ii) has not been approved by the Administrative Agent in writing in
the exercise of its reasonable discretion within five Business Days after
the distribution of draft documentation to the Lenders relating to such
proposed amendment or modification;
(b) limits the ability of any Subsidiary to Guarantee the
Indebtedness of Borrower in a manner which either (i) is more restrictive
than the provisions of the Existing Indentures as of the Closing Date (as
determined by the Administrative Agent in the reasonable exercise of its
discretion), or (ii) has not been approved by the Administrative Agent in
the exercise of its reasonable discretion within five Business Days after
distribution of draft documentation to the Lenders relating to such
proposed amendment or modification;
(c) limits the ability of any Subsidiary (other than the Subsidiary
which is the nominal obligor with respect to such Contractual Obligation)
to create, incur, assume or suffer to exist Liens on its property; or
(d) limits the ability of the Borrower to create, incur, assume or
suffer to exist Liens on its property, except (i) in respect of, and to
the extent of, any property which is financed with Indebtedness incurred
pursuant to such Contractual Obligation, or (ii) such limitations as do
not restrict the granting of Liens to the Administrative Agent.
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7.10. Use of Proceeds. Use the proceeds of any Credit Extension, whether
directly or indirectly, and whether immediately, incidentally or ultimately, to
purchase or carry margin stock (within the meaning of Regulation U of the FRB)
or to extend credit to others for the purpose of purchasing or carrying margin
stock or to refund indebtedness originally incurred for such purpose.
7.11. Subordinated Indebtedness. Make any prepayments of principal,
interest or other amounts due in respect of any Subordinated Indebtedness,
provided that the Borrower may make prepayments of any Subordinated Indebtedness
(a) to the extent using the proceeds of new Subordinated Indebtedness which has
no payments due within one year following the Maturity Date and an average life
to maturity which is longer than the Subordinated Indebtedness being prepaid,
and (b) to the extent required by the estate redemption provisions of the
Borrower's 6.85% convertible subordinated debentures due 2021 (as in effect on
the Closing Date) or the similar provisions of any future Subordinated
Indebtedness.
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES
8.01. Events of Default. Any of the following shall constitute an Event of
Default:
(a) Non-Payment. Borrower or any other Loan Party fails to pay (i)
when and as required to be paid herein, any amount of principal of any Loan or
any L/C Obligation, or (ii) within three Business Days after the same becomes
due, any interest on any Loan or on any L/C Obligation, any fee or other amount
payable hereunder; or
(b) Specific Covenants. (i) Borrower fails to perform or observe any
term, covenant or agreement contained in any of Section 6.05 (as to the
preservation of the existence of Borrower and its Significant Subsidiaries),
6.10, 6.12, 6.13, 7.01, 7.03, 7.04, 7.05, 7.06, 7.09, 7.10 or 7.11, (ii)
Borrower fails to perform or observe any term, covenant or agreement contained
in any of Section 7.02 and such failure continues for 10 days after notice shall
have been given to Borrower by Administrative Agent or (iii) any Guarantor fails
to perform or observe any term, covenant or agreement contained in the Guaranty;
or
(c) Other Defaults. Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for 30 days after notice shall have been given to Borrower by
Administrative Agent; or
(d) Representations and Warranties. Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of
Borrower or any other Loan Party herein, in any other Loan Document, or in any
document delivered in connection herewith or therewith shall be incorrect or
misleading in any material respect when made or deemed made; or
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(e) Cross-Default. Borrower or any Subsidiary (a) fails to make any
payment when due after giving effect to any applicable notice and cure periods
(whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) in respect of any Indebtedness or Guarantee (other than Indebtedness
hereunder) having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than $5,000,000 (including
any such Indebtedness or Guarantee which is in default as a result of being
cross-defaulted to any Indebtedness or Guarantee of a smaller amount), or (b)
fails to observe or perform any other agreement or condition relating to any
such Indebtedness or Guarantee or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event occurs in each case
after giving effect to any applicable notice and cure periods, the effect of
which default or other event is to cause, or to permit the holder or holders of
such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a
trustee or administrative agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guarantee to become payable or cash collateral in respect
thereof to be demanded; or
(f) Insolvency Proceedings, Etc. Any Loan Party or any of its
Significant Subsidiaries institutes or consents to the institution of any
proceeding under any Debtor Relief Law, or makes an assignment for the benefit
of creditors; or applies for or consents to the appointment of any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer
for it or for all or any material part of its property; or any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer is
appointed without the application or consent of such Person and the appointment
continues undischarged or unstayed for 60 calendar days; or any proceeding under
any Debtor Relief Law relating to any such Person or to all or any material part
of its property is instituted without the consent of such Person and continues
undismissed or unstayed for 60 calendar days, or an order for relief is entered
in any such proceeding; or
(g) Inability to Pay Debts; Attachment. (i) Borrower or any
Significant Subsidiary becomes unable or admits in writing its inability or
fails generally to pay its debts as they become due, or (ii) any writ or warrant
of attachment or execution or similar process is issued or levied against all or
any material part of the property of any such Person and is not released,
vacated or fully bonded within 30 days after its issue or levy; or
(h) Judgments. There is entered against Borrower or any Subsidiary a
final judgment or order for the payment of money in an aggregate amount
exceeding $5,000,000 (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage), and (a)
enforcement proceedings are commenced by any creditor upon such judgment or
order, or (b) there is a period of 20 consecutive days during which a stay of
enforcement of such judgment, by reason of a pending appeal or otherwise, is not
in effect, provided that no judgment against Borrower and its Subsidiaries in
respect of the NUMI Litigation shall be construed to constitute an Event of
Default under this clause (h) unless the amount thereof is in excess of
$6,000,000 and there have been one or more other judgments against Borrower and
its Subsidiaries aggregating $1,000,000 or more during the twelve month period
prior to the entry of any such judgment in the NUMI Litigation; or
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(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $5,000,000,
or (ii) Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $5,000,000; or
(j) Invalidity of Loan Documents. Any Loan Document or any provision
thereof, at any time after its execution and delivery and for any reason other
than as expressly permitted hereunder or thereunder or satisfaction in full of
all the Obligations, ceases to be in full force and effect; or any Loan Party or
any other Person contests in any manner the validity or enforceability of any
Loan Document or any provision thereof; or any Loan Party denies that it has any
or further liability or obligation under any Loan Document, or purports to
revoke, terminate or rescind any Loan Document or any provision thereof; or
(k) Change of Control. There occurs any Change of Control with
respect to Borrower; or
(l) Material Adverse Effect. There occurs any event or circumstance
that has a Material Adverse Effect.
8.02. Remedies Upon Event of Default. If any Event of Default occurs and
is continuing, Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders, take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by Borrower;
(c) require that Borrower Cash Collateralize the L/C Obligations (in
an amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of Borrower to Cash Collateralize the L/C Obligations as aforesaid
shall automatically become effective, in each case without further act of
Administrative Agent or any Lender.
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8.03. Application of Funds. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall be applied by Administrative Agent
in the following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to Administrative Agent (including fees and time
charges for attorneys who may be employees of Administrative Agent) and amounts
payable under Article III) payable to Administrative Agent in its capacity as
such;
Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest and L/C fees)
payable to Lenders and the L/C Issuer (including fees, charges and disbursements
of counsel to the respective Lenders and the L/C Issuer (including fees and time
charges for attorneys who may be employees of any Lender or the L/C Issuer) and
amounts payable under Article III), ratably among them in proportion to the
respective amounts described in this clause Second payable to them;
Third, to payment of that portion of the Obligations constituting accrued
and unpaid L/C fees and interest on the Loans, L/C Borrowings and other
Obligations, ratably among Lenders and the L/C Issuer in proportion to the
respective amounts described in this clause Third payable to them;
Fourth, to payment, pari passu, (a) of that portion of the Obligations
constituting unpaid principal of the Loans and L/C Borrowings, ratably among
Lenders and the L/C Issuer in proportion to the respective amounts described in
this clause Fourth held by them (b) to Administrative Agent for the account of
the L/C Issuer, to Cash Collateralize that portion of L/C Obligations comprised
of the aggregate undrawn amount of Letters of Credit and (c) to payment of that
portion of the Obligations arising under any Swap Contract between Borrower and
any Lender or any Affiliate of a Lender; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to Borrower or as otherwise required by Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the
aggregate undrawn amount of Letters of Credit pursuant to clause Fourth above
shall be applied to satisfy drawings under such Letters of Credit as they occur.
If any amount remains on deposit as Cash Collateral after all Letters of Credit
have either been fully drawn or expired, such remaining amount shall be applied
to the other Obligations, if any, in the order set forth above.
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ARTICLE IX. ADMINISTRATIVE AGENT.
9.01. Appointment and Authorization of Administrative Agent. Each of the
Lenders and the L/C issuer hereby irrevocably appoints Bank of America to act on
its behalf as Administrative Agent hereunder and under the other Loan Documents
and authorizes Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to Administrative Agent by the terms
hereof and thereof, together with such actions and powers as are reasonably
incidental thereto. The provisions of this Article are solely for the benefit of
Administrative Agent, the Lenders and the L/C Issuer, and neither the Borrower
nor any other Loan Party shall have rights as a third party beneficiary of any
of such provisions.
9.02. Rights as a Lender. The Person serving as Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not Administrative
Agent and the term "Lender" or "Lenders" shall, unless otherwise expressly
indicated or unless the context otherwise requires, include the Person serving
as Administrative Agent hereunder in its individual capacity. Such Person and
its Affiliates may accept deposits from, lend money to, act as the financial
advisor or in any other advisory capacity for and generally engage in any kind
of business with the Borrower or any Subsidiary or other Affiliate thereof as if
such Person were not Administrative Agent hereunder and without any duty to
account therefor to Lenders.
9.03. Exculpatory Provisions. Administrative Agent shall not have any
duties or obligations except those expressly set forth herein and in the other
Loan Documents. Without limiting the generality of the foregoing, Administrative
Agent:
(a) shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;
(b) shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that Administrative
Agent is required to exercise as directed in writing by the Required Lenders (or
such other number or percentage of the Lenders as shall be expressly provided
for herein or in the other Loan Documents), provided that Administrative Agent
shall not be required to take any action that, in its opinion or the opinion of
its counsel, may expose Administrative Agent to liability or that is contrary to
any Loan Document or applicable Law;
(c) shall not, except as expressly set forth herein and in the other
Loan Documents, have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to Borrower or any of its
Affiliates that is communicated to or obtained by the Person serving as
Administrative Agent or any of its Affiliates in any capacity; and
(d) Administrative Agent shall not be liable for any action taken or
not taken by it (i) with the consent or at the request of the Required Lenders
(or such other number or percentage of the Lenders as shall be necessary, or as
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Sections 8.02 and 10.01) or (ii) in the absence of
its own gross negligence or willful misconduct. Administrative Agent shall be
deemed not to have knowledge of any Default unless and until written notice
describing such Default is given to Administrative Agent by Borrower, a Lender
or the L/C Issuer. Administrative Agent shall not be responsible for or have any
duty to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with this Agreement or any other Loan Document, (ii)
the contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document or (v) the satisfaction
of any condition set forth in Article IV or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to Administrative
Agent.
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9.04. Reliance by Administrative Agent. Administrative Agent shall be
entitled to rely upon, and shall not incur any liability for relying upon, any
notice, request, certificate, consent, statement, instrument, document or other
writing (including any electronic message, Internet or intranet website posting
or other distribution) believed by it to be genuine and to have been signed,
sent or otherwise authenticated by the proper Person. Administrative Agent also
may rely upon any statement made to it orally or by telephone and believed by it
to have been made by the proper Person, and shall not incur any liability for
relying thereon. In determining compliance with any condition hereunder to the
making of a Loan, or the issuance of a Letter of Credit, that by its terms must
be fulfilled to the satisfaction of a Lender or the L/C Issuer, Administrative
Agent may presume that such condition is satisfactory to such Lender or the L/C
Issuer unless Administrative Agent shall have received notice to the contrary
from such Lender or the L/C Issuer prior to the making of such Loan or the
issuance of such Letter of Credit. Administrative Agent may consult with legal
counsel (who may be counsel for Borrower), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.
9.05. Delegation of Duties. Administrative Agent may perform any and all
of its duties and exercise its rights and powers hereunder or under any other
Loan Document by or through any one or more sub Administrative Agents appointed
by Administrative Agent. Administrative Agent and any such sub Administrative
Agent may perform any and all of its duties and exercise its rights and powers
by or through their respective Related Parties. The exculpatory provisions of
this Article shall apply to any such sub Administrative Agent and to the Related
Parties of Administrative Agent and any such sub Administrative Agent, and shall
apply to their respective activities in connection with the syndication of the
credit facilities provided for herein as well as activities as Administrative
Agent.
9.06. Resignation of Administrative Agent. Administrative Agent may at any
time give notice of its resignation to Lenders, the L/C Issuer and Borrower.
Upon receipt of any such notice of resignation, the Required Lenders shall have
the right, in consultation with Borrower, to appoint a successor, which shall be
a bank with an office in the United States, or an Affiliate of any such bank
with an office in the United States, provided that the Borrower will have the
right to approve the successor unless it is one of the original Lenders party to
this Agreement. If no such successor shall have been so appointed and shall have
accepted such appointment within 30 days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent may on
behalf of Lenders and the L/C Issuer, appoint a successor Administrative Agent
(without consultation or approval of any other party) meeting the qualifications
set forth above; provided that if Administrative Agent shall notify the Borrower
and the Lenders that no qualifying Person has accepted such appointment, then
such resignation shall nonetheless become effective in accordance with such
notice and (1) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents (except that
in the case of any collateral security held by Administrative Agent on behalf of
the Lenders or the L/C Issuer under any of the Loan Documents, the retiring
Administrative Agent shall continue to hold such collateral security until such
time as a successor Administrative Agent is appointed) and (2) all payments,
communications and determinations provided to be made by, to or through
Administrative Agent shall instead be made by or to each Lender and the L/C
Issuer directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section. Upon the acceptance
of a successor's appointment as Administrative Agent hereunder, such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring (or retired) Administrative Agent, and the retiring
Administrative Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents (if not already discharged therefrom
as provided above in this Section). The fees payable by Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between Borrower and such successor. After the retiring
Administrative Agent's resignation hereunder and under the other Loan Documents,
the provisions of this Article and Section 10.04 shall continue in effect for
the benefit of such retiring Administrative Agent, its sub Administrative Agents
and their respective Related Parties in respect of any actions taken or omitted
to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.
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Any resignation by Bank of America as Administrative Agent pursuant to
this Section shall also constitute its resignation as L/C Issuer and Swing Line
Lender. Upon the acceptance of a successor's appointment as Administrative Agent
hereunder, (a) such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring L/C Issuer and Swing Line
Lender, (b) the retiring L/C Issuer and Swing Line Lender shall be discharged
from all of their respective duties and obligations hereunder or under the other
Loan Documents, and (c) the successor L/C Issuer shall issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or make other arrangements satisfactory to the retiring L/C
Issuer to effectively assume the obligations of the retiring L/C Issuer with
respect to such Letters of Credit.
9.07. Non-Reliance on Administrative Agent and Other Lenders. Each Lender
and the L/C Issuer acknowledges that it has, independently and without reliance
upon Administrative Agent or any other Lender or any of their Related Parties
and based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Lender
and the L/C Issuer also acknowledges that it will, independently and without
reliance upon Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it shall from time to
time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement, any other Loan Document or any
related agreement or any document furnished hereunder or thereunder.
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9.08. No Other Duties, Etc. Anything herein to the contrary
notwithstanding, no Person holding a title listed on the cover page hereof shall
have any powers, duties or responsibilities under this Agreement or any of the
other Loan Documents, except in its capacity, as applicable, as the
Administrative Agent, a Lender or the L/C Issuer hereunder.
9.09. Administrative Agent May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether Administrative Agent shall have made any demand on Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans, L/C Obligations and all
other Obligations that are owing and unpaid and to file such other documents as
may be necessary or advisable in order to have the claims of Lenders, the L/C
Issuer and Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of Lenders, the L/C Issuer
and Administrative Agent and their respective Administrative Agents and counsel
and all other amounts due Lenders, the L/C Issuer and Administrative Agent under
Sections 2.03(i) and (j), 2.10 and 10.04) allowed in such judicial proceeding;
and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Lender and the L/C Issuer to make such payments to Administrative Agent
and, in the event that Administrative Agent shall consent to the making of such
payments directly to Lenders and the L/C Issuer, to pay to Administrative Agent
any amount due for the reasonable compensation, expenses, disbursements and
advances of Administrative Agent and its administrative agents and counsel, and
any other amounts due Administrative Agent under Sections 2.10 and 10.04.
Nothing contained herein shall be deemed to authorize Administrative Agent to
authorize or consent to or accept or adopt on behalf of any Lender or the L/C
Issuer any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
9.10. Guaranty Matters. Each Lender and the L/C Issuer hereby irrevocably
authorizes Administrative Agent, at its option and in its discretion, to release
any Guarantor from its obligations under the Guaranty if such Person ceases to
be a Significant Subsidiary. Upon request by Administrative Agent at any time,
each Lender and the L/C Issuer will confirm in writing Administrative Agent's
authority to release any Guarantor from its obligations under the Guaranty
pursuant to this Section 9.10.
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ARTICLE X. MISCELLANEOUS
10.01. Amendments, Etc. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by
Borrower or any other Loan Party therefrom, shall be effective unless in writing
signed by the Required Lenders and Borrower or the applicable Loan Party, as the
case may be, and acknowledged by Administrative Agent, and each such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment, waiver or
consent shall:
(a) extend or increase the Commitment of any Lender (or reinstate
any Commitment terminated pursuant to Section 8.02) without the written consent
of such Lender;
(b) postpone any date fixed by this Agreement or any other Loan
Document for any payment (excluding mandatory prepayments) of principal,
interest, fees or other amounts due to Lenders (or any of them) hereunder or
under any other Loan Document without the written consent of each Lender
directly affected thereby;
(c) reduce the principal of, or the rate of interest specified
herein on, any Loan or L/C Borrowing, or (subject to clause (iv) of the second
proviso to this Section 10.01) any fees or other amounts payable hereunder or
under any other Loan Document, without the written consent of each Lender
directly affected thereby; provided, however, that only the consent of the
Required Lenders shall be necessary (i) to amend the definition of "Default
Rate" or to waive any obligation of Borrower to pay interest or L/C Fees at the
Default Rate or (ii) to amend any financial covenant hereunder (or any defined
term used therein) even if the effect of such amendment would be to reduce the
rate of interest on any Loan or L/C Borrowing or to reduce any fee payable
hereunder;
(d) change Section 2.14 or Section 8.03 in a manner that would alter
the pro rata sharing of payments required thereby without the written consent of
each Lender;
(e) change any provision of this Section or the definition of
"Required Lenders" or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender; or
(f) release any Guarantor from the Guaranty except in accordance
with the terms of any Loan Document without the written consent of each Lender;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Issuer
Document relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or consent shall, unless in writing and signed by Swing Line
Lender in addition to the Lenders required above, affect the rights or duties of
Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent
shall, unless in writing and signed by Administrative Agent in addition to the
Lenders required above, affect the rights or duties of Administrative Agent
under this Agreement or any other Loan Document; and (iv) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver or consent hereunder, except that the Commitment of such Lender may not
be increased or extended without the consent of such Lender.
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10.02. Notices; Effectiveness; Electronic Communications. o) Notices
Generally. Except in the case of notices and other communications expressly
permitted to be given by telephone (and except as provided in subsection (b)
below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by telecopier as follows, and all notices
and other communications expressly permitted hereunder to be given by telephone
shall be made to the applicable telephone number, as follows:
(i)if to Borrower, Administrative Agent, the L/C Issuer or
Swing Line Lender, to the address, telecopier number, electronic mail
address or telephone number specified for such Person on Schedule 10.02;
and
(ii) if to any other Lender, to the address, telecopier
number, electronic mail address or telephone number specified in its
Administrative Questionnaire.
Notices sent by hand or overnight courier service, or mailed by certified
or registered mail, shall be deemed to have been given when received; notices
sent by telecopier shall be deemed to have been given when sent (except that, if
not given during normal business hours for the recipient, shall be deemed to
have been given at the opening of business on the next Business Day for the
recipient). Notices delivered through electronic communications to the extent
provided in subsection (b) below, shall be effective as provided in such
subsection (b).
(b) Electronic Communications. Notices and other communications to
Lenders and the L/C Issuer hereunder may be delivered or furnished by electronic
communication (including e-mail and Internet or intranet websites) pursuant to
procedures approved by Administrative Agent, provided that the foregoing shall
not apply to notices to any Lender or the L/C Issuer pursuant to Article II if
such Lender or the L/C Issuer, as applicable, has notified the Administrative
Agent that it is incapable of receiving notices under such Article by electronic
communication. Administrative Agent or Borrower may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of
such procedures may be limited to particular notices or communications. Unless
Administrative Agent otherwise prescribes, (i) notices and other communications
sent to an e-mail address shall be deemed received upon the sender's receipt of
an acknowledgement from the intended recipient (such as by the "return receipt
requested" function, as available, return e-mail or other written
acknowledgement), provided that if such notice or other communication is not
sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next Business Day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.
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(c) The Platform. THE PLATFORM IS PROVIDED "AS IS" AND "AS
AVAILABLE." THE ADMINISTRATIVE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT
THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE
PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE
BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY,
INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE
DEFECTS, IS MADE BY ANY ADMINISTRATIVE AGENT PARTY IN CONNECTION WITH THE
BORROWER MATERIALS OR THE PLATFORM. In no event shall Administrative Agent or
any of its Related Parties (collectively, the "Administrative Agent Parties")
have any liability to Borrower, any Lender, the L/C Issuer or any other Person
for losses, claims, damages, liabilities or expenses of any kind (whether in
tort, contract or otherwise) arising out of Borrower's or Administrative Agent's
transmission of Borrower Materials through the Internet, except to the extent
that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Administrative
Agent Party; provided, however, that in no event shall any Administrative Agent
Party have any liability to Borrower, any Lender, the L/C Issuer or any other
Person for indirect, special, incidental, consequential or punitive damages (as
opposed to direct or actual damages).
(d) Change of Address, Etc. Each of the Borrower, Administrative
Agent, the L/C Issuer and Swing Line Lender may change its address, telecopier
or telephone number for notices and other communications hereunder by notice to
the other parties hereto. Each other Lender may change its address, telecopier
or telephone number for notices and other communications hereunder by notice to
Borrower, Administrative Agent, the L/C Issuer and Swing Line Lender. In
addition, each Lender agrees to notify Administrative Agent from time to time to
ensure that Administrative Agent has on record (i) an effective address, contact
name, telephone number, telecopier number and electronic mail address to which
notices and other communications may be sent and (ii) accurate wire instructions
for such Lender.
(e) Reliance by Administrative Agent. L/C Issuer and Lenders.
Administrative Agent, the L/C Issuer and Lenders shall be entitled to rely and
act upon any notices (including telephonic Committed Loan Notices and Swing Line
Loan Notices) believed in good faith to have been given by or on behalf of
Borrower even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. Borrower shall indemnify Administrative
Agent, the L/C Issuer, each Lender and the Related Parties of each of them from
all losses, costs, expenses and liabilities resulting from the reliance by such
Person on each notice believed by it in good faith to be given by or on behalf
of Borrower. All telephonic notices to and other telephonic communications with
Administrative Agent may be recorded by Administrative Agent, and each of the
parties hereto hereby consents to such recording.
10.03. No Waiver; Cumulative Remedies. No failure by any Lender, the L/C
Issuer or Administrative Agent to exercise, and no delay by any such Person in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights,
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.
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10.04. Expenses; Indemnity; Damage Waiver. p) Costs and Expenses. Borrower
shall pay (i) all reasonable out of pocket expenses incurred by Administrative
Agent and its Affiliates (including the reasonable fees, charges and
disbursements of counsel for Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the
other Loan Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out of pocket
expenses incurred by the L/C Issuer in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all reasonable out of pocket expenses incurred by
Administrative Agent, any Lender or the L/C Issuer (including the fees, charges
and disbursements of any counsel for Administrative Agent, any Lender or the L/C
Issuer), and shall pay all reasonable fees and time charges for attorneys who
may be employees of Administrative Agent, any Lender or the L/C Issuer, in
connection with the enforcement or protection of its rights (a) in connection
with this Agreement and the other Loan Documents, including its rights under
this Section, or (b) in connection with the Loans made or Letters of Credit
issued hereunder, including all such out of pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.
(b) Indemnification by the Borrower. Borrower shall indemnify
Administrative Agent (and any sub-Administrative Agent thereof), each Lender and
the L/C Issuer, and each Related Party of any of the foregoing Persons (each
such Person being called an "Indemnitee") against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses (including the fees, charges and disbursements of any counsel for any
Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees
and time charges and disbursements for attorneys who may be employees of any
Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any
third party or by Borrower or any other Loan Party arising out of, in connection
with, or as a result of (i) the execution or delivery of this Agreement, any
other Loan Document or any agreement or instrument contemplated hereby or
thereby, the performance by the parties hereto of their respective obligations
hereunder or thereunder, or the consummation of the transactions contemplated
hereby or thereby, or, in the case of Administrative Agent (and any
sub-Administrative Agent thereof) and its Related Parties only, the
administration of this Agreement and the other Loan Documents, (ii) any Loan or
Letter of Credit or the use or proposed use of the proceeds therefrom (including
any refusal by the L/C Issuer to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not strictly
comply with the terms of such Letter of Credit), (iii) any actual or alleged
presence or release of Hazardous Materials on or from any property owned or
operated by the Borrower or any of its Subsidiaries, or any Environmental
Liability related in any way to the Borrower or any of its Subsidiaries, or (iv)
any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory, whether brought by a third party or by the Borrower or any other Loan
Party, and regardless of whether any Indemnitee is a party thereto, in all
cases, whether or not caused by or arising, in whole or in part, out of the
comparative, contributory or sole negligence of the Indemnitee; provided that
such indemnity shall not, as to any Indemnitee, be available to the extent that
such losses, claims, damages, liabilities or related expenses (x) are determined
by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by Borrower or any other Loan Party against an
Indemnitee for breach in bad faith of such Indemnitee's obligations hereunder or
under any other Loan Document, if Borrower or such Loan Party has obtained a
final and nonappealable judgment in its favor on such claim as determined by a
court of competent jurisdiction.
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(c) Reimbursement by Lenders. To the extent that Borrower for any
reason fails to indefeasibly pay any amount required under subsection (a) or (b)
of this Section to be paid by it to Administrative Agent (or any
sub-Administrative Agent thereof), the L/C Issuer or any Related Party of any of
the foregoing, each Lender severally agrees to pay to Administrative Agent (or
any such sub-Administrative Agent), the L/C Issuer or such Related Party, as the
case may be, such Lender's Applicable Percentage (determined as of the time that
the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount, provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred by
or asserted against Administrative Agent (or any such sub-Administrative Agent)
or the L/C Issuer in its capacity as such, or against any Related Party of any
of the foregoing acting for Administrative Agent (or any such sub-Administrative
Agent) or L/C Issuer in connection with such capacity. The obligations of the
Lenders under this subsection (c) are subject to the provisions of Section
2.13(d).
(d) Waiver of Consequential Damages, Etc. To the fullest extent
permitted by applicable law, Borrower shall not assert, and hereby waives, any
claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof. No Indemnitee referred to in subsection (b) above
shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed by it through telecommunications,
electronic or other information transmission systems in connection with this
Agreement or the other Loan Documents or the transactions contemplated hereby or
thereby.
(e) Payments. All amounts due under this Section shall be payable
not later than ten Business Days after demand therefor.
(f) Survival. The agreements in this Section shall survive the
resignation of Administrative Agent and the L/C Issuer, the replacement of any
Lender, the termination of the Aggregate Commitments and the repayment,
satisfaction or discharge of all the other Obligations.
10.05. Payments Set Aside. To the extent that any payment by or on behalf
of Borrower is made to Administrative Agent, the L/C Issuer or any Lender, or
Administrative Agent, the L/C Issuer or any Lender exercises its right of
setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by Administrative
Agent, the L/C Issuer or such Lender in its discretion) to be repaid to a
trustee, receiver or any other party, in connection with any proceeding under
any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or
such setoff had not occurred, and (b) each Lender and the L/C Issuer severally
agrees to pay to Administrative Agent upon demand its applicable share (without
duplication) of any amount so recovered from or repaid by Administrative Agent,
plus interest thereon from the date of such demand to the date such payment is
made at a rate per annum equal to the Federal Funds Rate from time to time in
effect. The obligations of the Lenders and the L/C Issuer under clause (b) of
the preceding sentence shall survive the payment in full of the Obligations and
the termination of this Agreement.
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10.06. Successors and Assigns. q) Successors and Assigns Generally. The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby,
except that neither Borrower nor any other Loan Party may assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of Administrative Agent, the L/C Issuer and each Lender and no Lender
may assign or otherwise transfer any of its rights or obligations hereunder
except (i) to an assignee in accordance with the provisions of subsection (b) of
this Section, (ii) by way of participation in accordance with the provisions of
subsection (d) of this Section, or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of subsection (f) of this Section
(and any other attempted assignment or transfer by any party hereto shall be
null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent
provided in subsection (d) of this Section and, to the extent expressly
contemplated hereby, the Related Parties of each of Administrative Agent, the
L/C Issuer and the Lenders) any legal or equitable right, remedy or claim under
or by reason of this Agreement.
(b) Assignments by Lenders. Any Lender may at any time assign to one
or more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans (including
for purposes of this subsection (b), participations in L/C Obligations and in
Swing Line Loans) at the time owing to it); provided that any such assignment
shall be subject to the following conditions:
(i) Minimum Amounts.
(A) in the case of an assignment of the entire remaining
amount of the assigning Lender's Commitment and the Loans at
the time owing to it or in the case of an assignment to a
Lender, an Affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and
(B) in any case not described in subsection (b)(i)(A) of
this Section, the aggregate amount of the Commitment (which
for this purpose includes Loans outstanding thereunder) or, if
the Commitment is not then in effect, the principal
outstanding balance of the Loans of the assigning Lender
subject to each such assignment, determined as of the date the
Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent or, if "Trade Date" is
specified in the Assignment and Assumption, as of the Trade
Date, shall not be less than $5,000,000, unless each of the
Administrative Agent and, so long as no Event of Default has
occurred and is continuing, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or
delayed); provided, however, that concurrent assignments to
members of an Assignee Group and concurrent assignments from
members of an Assignee Group to a single Eligible Assignee (or
to an Eligible Assignee and members of its Assignee Group)
will be treated as a single assignment for purposes of
determining whether such minimum amount has been met;
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(ii) Proportionate Amounts. Each partial assignment shall
be made as an assignment of a proportionate part of all the assigning
Lender's rights and obligations under this Agreement with respect to the
Loans or the Commitment assigned, except that this clause (ii) shall not
apply to the Swing Line Lender's rights and obligations in respect of
Swing Line Loans;
(iii) Required Consents. No consent shall be required for
any assignment except to the extent required by subsection (b)(i)(B) of
this Section and, in addition:
(A) the consent of the Borrower (such consent not to be
unreasonably withheld or delayed) shall be required unless (1)
an Event of Default has occurred and is continuing at the time
of such assignment or (2) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund;
(B) the consent of the Administrative Agent (such
consent not to be unreasonably withheld or delayed) shall be
required for assignments if such assignment is to a Person
that is not a Lender, an Affiliate of a Lender or an Approved
Fund;
(C) the consent of the L/C Issuer (such consent not to
be unreasonably withheld or delayed) shall be required for any
assignment that increases the obligation of the assignee to
participate in exposure under one or more Letters of Credit
(whether or not then outstanding); and
(D) the consent of the Swing Line Lender (such consent
not to be unreasonably withheld or delayed) shall be required
for any assignment.
(iv) Assignment and Assumption. The parties to each
assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee
in the amount of $3,500; provided, however, that the Administrative Agent
may, in its sole discretion, elect to waive such processing and
recordation fee in the case of any assignment. The assignee, if it is not
a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.
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(v) No Assignment to Borrower. No such assignment shall be
made to the Borrower or any of the Borrower's Affiliates or Subsidiaries.
(vi) No Assignment to Natural Persons. No such assignment
shall be made to a natural person.
Subject to acceptance and recording thereof by the Administrative Agent pursuant
to subsection (c) of this Section, from and after the effective date specified
in each Assignment and Assumption, the assignee thereunder shall be a party to
this Agreement and, to the extent of the interest assigned by such Assignment
and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05 and 10.04 with
respect to facts and circumstances occurring prior to the effective date of such
assignment. Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
subsection (d) of this Section.
(c) Register. Administrative Agent, acting solely for this purpose
as an Administrative Agent of Borrower, shall maintain at Administrative Agent's
Office a copy of each Assignment and Assumption delivered to it and a register
for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts of the Loans and L/C Obligations owing to,
each Lender pursuant to the terms hereof from time to time (the "Register"). The
entries in the Register shall be conclusive, and Borrower, Administrative Agent
and the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by each of Borrower, the L/C Issuer and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Participations. Any Lender may at any time, without the consent
of, or notice to, Borrower or Administrative Agent or any other Lender, sell
participations to any Person (other than a natural person or Borrower or any of
Borrower's Affiliates or Subsidiaries) (each, a "Participant") in all or a
portion of such Lender's rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans (including such
Lender's participations in L/C Obligations and/or Swing Line Loans) owing to
it); provided that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) Borrower,
Administrative Agent, the L/C Issuer and the Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in the first proviso to Section 10.01 that affects such Participant.
Subject to subsection (e) of this Section, Borrower agrees that each Participant
shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to subsection (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.08 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.14 as
though it were a Lender.
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(e) Limitations upon Participant Rights. A Participant shall not be
entitled to receive any greater payment under Section 3.01 or 3.04 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with Borrower's prior written consent. A Participant
that would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 3.01 unless the Borrower is notified of the participation
sold to such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 3.01(e) as though it were a Lender.
(f) Certain Pledges. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under its Note, if any) to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge or assignment shall release such Lender from
any of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.
(g) Electronic Execution of Assignments. The words "execution,"
"signed," "signature," and words of like import in any Assignment and Assumption
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.
(h) Resignation as L/C Issuer or Swing Line Lender. Notwithstanding
anything to the contrary contained herein, if at any time Bank of America
assigns all of its Commitment and Loans pursuant to subsection (b) above, Bank
of America may, (i) upon 30 days' notice to Borrower and the Lenders, resign as
L/C Issuer and/or (ii) upon 30 days' notice to Borrower, resign as Swing Line
Lender. In the event of any such resignation as L/C Issuer or Swing Line Lender,
Borrower shall be entitled to appoint from among Lenders a successor L/C Issuer
or Swing Line Lender hereunder; provided, however, that no failure by Borrower
to appoint any such successor shall affect the resignation of Bank of America as
L/C Issuer or Swing Line Lender, as the case may be. If Bank of America resigns
as L/C Issuer, it shall retain all the rights, powers, privileges, obligations
and duties of the L/C Issuer hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as L/C Issuer and all
L/C Obligations with respect thereto (including the right to require the Lenders
to make Base Rate Committed Loans or fund risk participations in Unreimbursed
Amounts pursuant to Section 2.03(c)). If Bank of America resigns as Swing Line
Lender, it shall retain all the rights of Swing Line Lender provided for
hereunder with respect to Swing Line Loans made by it and outstanding as of the
effective date of such resignation, including the right to require the Lenders
to make Base Rate Committed Loans or fund risk participations in outstanding
Swing Line Loans pursuant to Section 2.04(c). Upon the appointment of a
successor L/C Issuer and/or Swing Line Lender, (a) such successor shall succeed
to and become vested with all of the rights, powers, privileges, obligations and
duties of the retiring L/C Issuer or Swing Line Lender, as the case may be, and
(b) the successor L/C Issuer shall issue letters of credit in substitution for
the Letters of Credit, if any, outstanding at the time of such succession or
make other arrangements satisfactory to Bank of America to effectively assume
the obligations of Bank of America with respect to such Letters of Credit.
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10.07. Treatment of Certain Information; Confidentiality. Each of
Administrative Agent, Lenders and the L/C Issuer agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates' respective
partners, directors, officers, employees, administrative agents, advisors and
representatives (it being understood that the Persons to whom such disclosure is
made will be informed of the confidential nature of such Information and agreed
to, or shall have a legal obligation to, keep such Information confidential),
(b) to the extent requested by any regulatory authority, purporting to have
jurisdiction over it (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
Borrower and its obligations, (g) with the consent of Borrower or (h) to the
extent such Information (x) becomes publicly available other than as a result of
a breach of this Section or (y) becomes available to Administrative Agent, any
Lender, the L/C Issuer or any of their respective Affiliates on a
nonconfidential basis from a source other than Borrower. For purposes of this
Section, "Information" means all information received from Borrower or any
Subsidiary relating to Borrower or any Subsidiary or any of their respective
businesses, other than any such information that is available to Administrative
Agent, any Lender or the L/C Issuer on a nonconfidential basis prior to
disclosure by Borrower or any Subsidiary, provided that, in the case of
information received from Borrower or any Subsidiary after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information. Each of Administrative Agent, the Lenders and the L/C
Issuer acknowledges that (a) the Information may include material non-public
information concerning the Borrower or a Subsidiary, as the case may be, (b) it
has developed compliance procedures regarding the use of material non-public
information and (c) it will handle such material non-public information in
accordance with applicable Law, including Federal and state securities Laws.
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10.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, the L/C Issuer and each of their respective Affiliates
is hereby authorized at any time and from time to time, to the fullest extent
permitted by applicable law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final, in whatever currency) at any
time held and other obligations (in whatever currency) at any time owing by such
Lender, the L/C Issuer or any such Affiliate to or for the credit or the account
of Borrower or any other Loan Party against any and all of the obligations of
Borrower or such Loan Party now or hereafter existing under this Agreement or
any other Loan Document to such Lender or the L/C Issuer or any such Affiliate,
irrespective of whether or not such Lender or the L/C Issuer shall have made any
demand under this Agreement or any other Loan Document and although such
obligations of Borrower or such Loan Party may be contingent or unmatured or are
owed to a branch or office of such Lender or the L/C Issuer different from the
branch or office holding such deposit or obligated on such indebtedness. The
rights of each Lender, the L/C Issuer and their respective Affiliates under this
Section are in addition to other rights and remedies (including other rights of
setoff) that such Lender, the L/C Issuer or their respective Affiliates may
have. Each Lender and the L/C Issuer agrees to notify Borrower and
Administrative Agent promptly after any such setoff and application, provided
that the failure to give such notice shall not affect the validity of such
setoff and application.
10.09. Interest Rate Limitation. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the "Maximum Rate"). If Administrative Agent or any
Lender shall receive interest in an amount that exceeds the Maximum Rate, the
excess interest shall be applied to the principal of the Loans or, if it exceeds
such unpaid principal, refunded to Borrower. In determining whether the interest
contracted for, charged, or received by Administrative Agent or a Lender exceeds
the Maximum Rate, such Person may, to the extent permitted by applicable Law,
(a) characterize any payment that is not principal as an expense, fee, or
premium rather than interest, (b) exclude voluntary prepayments and the effects
thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal
parts the total amount of interest throughout the contemplated term of the
Obligations hereunder.
10.10. Counterparts ; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and the other
Loan Documents constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings (including without limitation the Existing Credit Agreement),
oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by Administrative Agent and when Administrative Agent shall have
received counterparts hereof that, when taken together, bear the signatures of
each of the other parties hereto. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of a
manually executed counterpart of this Agreement.
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10.11. Survival of Representations and Warranties. All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by
Administrative Agent and each Lender, regardless of any investigation made by
Administrative Agent or any Lender or on their behalf and notwithstanding that
Administrative Agent or any Lender may have had notice or knowledge of any
Default at the time of any Credit Extension, and shall continue in full force
and effect as long as any Loan or any other Obligation hereunder shall remain
unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
10.12. Severability. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.13. Governing Law; Jurisdiction; Etc. r) GOVERNING LAW. THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CALIFORNIA.
(b) SUBMISSION TO JURISDICTION. THE BORROWER AND EACH OTHER LOAN
PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO
THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA SITTING
IN LOS ANGELES COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE CENTRAL
DISTRICT OF CALIFORNIA, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT
OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH CALIFORNIA
STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT
THAT ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO
BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE
COURTS OF ANY JURISDICTION.
-87-
(c) WAIVER OF VENUE. THE BORROWER AND EACH OTHER LOAN PARTY
IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (b) OF THIS
SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING
IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.
10.14. Waiver of Right to Trial by Jury. EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY). EACH PARTY HERETO (a) CERTIFIES THAT NO REPRESENTATIVE,
ADMINISTRATIVE AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
10.15. California Judicial Reference. If any action or proceeding is filed
in a court of the State of California by or against any party hereto in
connection with any of the transactions contemplated by this Agreement or any
other Loan Document, (a) the court shall, and is hereby directed to, make a
general reference pursuant to California Code of Civil Procedure Section 638 to
a referee (who shall be a single active or retired judge) to hear and determine
all of the issues in such action or proceeding (whether of fact or of law) and
to report a statement of decision, provided that at the option of any party to
such proceeding, any such issues pertaining to a "provisional remedy" as defined
in California Code of Civil Procedure Section 1281.8 shall be heard and
determined by the court, and (b) without limiting the generality of Section
10.04, but subject to the proviso of Section 10.04(b), the Borrower shall be
solely responsible to pay all fees and expenses of any referee appointed in such
action or proceeding.
-88-
10.16. No Advisory or Fiduciary Responsibility. In connection with all
aspects of each transaction contemplated hereby (including in connection with
any amendment, waiver or other modification hereof or of any other Loan
Document), each of the Borrower and the other Loan Parties acknowledges and
agrees, and acknowledges its Affiliates' understanding, that: (i) (A) the
arranging and other services regarding this Agreement provided by the
Administrative Agent and the Arranger are arm's-length commercial transactions
between the Borrower, the other Loan Parties and their respective Affiliates, on
the one hand, and the Administrative Agent and the Arranger, on the other hand,
(B) each of the Borrower and the other Loan Parties has consulted its own legal,
accounting, regulatory and tax advisors to the extent it has deemed appropriate,
and (C) each of the Borrower and the other Loan Parties is capable of
evaluating, and understands and accepts, the terms, risks and conditions of the
transactions contemplated hereby and by the other Loan Documents; (ii) (A) the
Administrative Agent and the Arranger each is and has been acting solely as a
principal and, except as expressly agreed in writing by the relevant parties,
has not been, is not, and will not be acting as an advisor, agent or fiduciary
for the Borrower, the Loan Parties or any of their respective Affiliates, or any
other Person and (B) neither the Administrative Agent nor the Arranger has any
obligation to the Borrower, the other Loan Parties or any of their respective
Affiliates with respect to the transactions contemplated hereby except those
obligations expressly set forth herein and in the other Loan Documents; and
(iii) the Administrative Agent and the Arranger and their respective Affiliates
may be engaged in a broad range of transactions that involve interests that
differ from those of the Borrower, the other Loan Parties and their respective
Affiliates, and neither the Administrative Agent nor the Arranger has any
obligation to disclose any of such interests to the Borrower, the other Loan
Parties or any of their respective Affiliates. To the fullest extent permitted
by law, each of the Borrower and the other Loan Parties hereby waives and
releases any claims that it may have against the Administrative Agent and the
Arranger with respect to any breach or alleged breach of agency or fiduciary
duty in connection with any aspect of any transaction contemplated hereby.
10.17. USA PATRIOT Act Notice. Each Lender that is subject to the Act (as
hereinafter defined) and Administrative Agent (for itself and not on behalf of
any Lender) hereby notifies Borrower that pursuant to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the "Act"), it is required to obtain, verify and record information that
identifies Borrower, which information includes the name and address of Borrower
and other information that will allow such Lender or Administrative Agent, as
applicable, to identify Borrower in accordance with the Act.
10.18. Time of the Essence. Time is of the essence of the Loan Documents.
[Remainder of this page intentionally left blank; signature pages follows]
-89-
Schedule 1.01
Southwest Water Company (SWWC)
Schedule of Regulated and Unregulated Subsidiaries
--------------------------------------------------------------------------------------------------------------------------------
Name Regulated Non-Regulated Incorporated Percent Owned by:
--------------------------------------- --------- ------------- ------------ --------------------------------------
SWWC Enterprises, Inc x Delaware 100% by SWWC
North County Water Reclamation, Inc. x Alabama
Services Group
---------------------------------------
SWWC Services, Inc. x Delaware 100% by SWWC Enterprises, Inc.
Aqua Services, LP. x Texas 100% by SC
1% by AquaSources Services I, LLC
as General Partner
99% by AquaSource Services II, LLC
as Limited Partner
AquaSource Services I, LLC x Delaware 100% by SWWC
AquaSource Services II, LLC x Delaware 100% by AquaSource Services I, LLC
CDC Maintenance, Inc. x Texas 100% by SWWC
Colorado Bend Utilities, LLC x Texas 100% by Eco Resources, Inc.
Crossroads Utilities Ltd. x Texas 1% by Colorado Bend as General Partner
99% by SWWC as Limited Partner
ECO Capistrano Valley, Inc. x Delaware 100% by ECO Resources, Inc.
ECO Resources, Inc. x Texas 100% by SWWC
Lab-Tech Corporation x Texas 100% by Aqua Services, LP
Metro-H20 Utilities, Ltd. x Texas 1% by Metro, ▇▇▇.▇▇ General Partner
99% by SWWC as Limited Partner
Metro-H20 Utilities, Inc. x Texas 100% by SWWC
Novus Utilties, Inc. x Delaware 100% by ECO Resources, Inc.
Operations Technologies, Inc. x Georgia 100% by SWWC
Southwest Enviromnmental Laboratories, Inc. x Texas 100% by ECO Resources, Inc.
Southwest Water Government Services Company x Delaware 100% by SC
Southwest Water Services Group Houston, Inc. x Delaware 100% by SWWC
Wastewater Rehabilitation Inspections, Inc. x Texas 100% by SC
Water Quality Management Corporation x Colorado 100% by SWWC
Schedule 1.01
Southwest Water Company (SWWC)
Schedule of Regulated and Unregulated Subsidiaries
--------------------------------------------------------------------------------------------------------------------------------
Name Regulated Non-Regulated Incorporated Percent Owned by:
--------------------------------------- --------- ------------- ------------ --------------------------------------
Utility Group
---------------------------------------
SWWC Utilities, Inc. x Delaware 100% by SWWC
CHA Utilities Company Ltd. x Texas 1% by SWWC
99% by CHA Utilities, LLC
CHA Utilities, LLC x Texas 1% by SWWC
99% by CHA Utilities Company Ltd.
Diamond Water Company x Texas 100% by SW Utility Company
▇▇▇▇▇▇▇ Bend Utility Company, Inc. x Texas 100% by SW Utility Company
Huntington Utility Company, LLC x Texas SW Utility Company is Sole Member
Inverness Utility Company, Inc. x Texas 100% by SW Utility Company
IU Merger Subsidiary x Texas 100% by SWWC
Mid-Tex Utilities, Inc. x Texas 100% by SW Utility Company
Midway Water Utilities, Inc. x Texas 100% by Monarch Utilities, Inc.
Monarch Utilities, Inc. x Texas 100% by SWWC
Monarch Utilities I, LP x Texas .1% by Texas Water Services Group
as General Partner
99.9% by Monarch Utilities, Inc.
as Limited Partner
New Mexico Utilities, Inc. x New Mexico 100% by SWWC
Southwest Water Alabama, Inc. x Alabama 100% by SWWC
Southwest Water Alabama
Onsite System Services, LLC x Alabama Sole Member is Southwest Water
Alabama, Inc.
Southwest Water Florida, Inc. x Florida 100% by SWWC
Suthwest Water Mississippi, Inc. x Mississippi 100% by SWWC
Suburban Water Systems x California 100% by SWWC
SW Resource Management Company x Delaware 100% by SWWC
SW Utility Company x Texas 100% by SWWC
Tenkiller Utility Company x Texas 100% by SWWC
Texas Water Services Group, LLC x Texas Sole Member is Monarch Utilities, Inc.
TWC Utility Company, LLC x Texas Sole Member is Monarch I LP
Water Services, Inc. x Texas 100% by SW Utility Company
Water Suppliers Mobile
Communication Service x California 100% by Suburban Water Systems
Windermere Utility Co., Inc. x Texas 100% by SW Utility Company
Schedule 5.03
Southwest Water Company
Organizations with Covenant Restrictions
on Guarantees
------------------------------------------------------------------------
Regulated Significant Subsidiaries:
Suburban Water Systems
New Mexico Utilities, Inc.
Monarch Utilities, Inc.
Schedule 5.06
Southwest Water Company (SWWC)
Schedule of Litigation
a. NMUI: A condemnation suit by eminent domain was filed against NMUI on
January 19, 2007 by the Albuquerque Bernalillo County Water Authority ("ABCWUA"
or "Authority")) and The City of Rio Rancho. The suit seeks to condemn this
utility on the pretense that NMUI is not properly managing the water utility and
is thereby harming the Rio Grande water basin and further improperly utilizing
certain return flow credits. A companion case has also been filed by NMUI
against the Authority as a result of the Authority increasing certain sewer rate
charges from $1300 per month to over $90,000 per month, allegedly in violation
of an existing agreement. The return flow credit dispute is being litigated as
part of this companion case. The matters remain pending in litigation; however,
the parties have entered into voluntary settlement discussions which are ongoing
at this time. The principal issue in the condemnation case turns on valuation.
The Authority claims a proper valuation is approximately $31 million while NMUI
has an independent appraisal indicating $98 million. The matters are set for
trial in the Fall 2008.
b. The items listed on Schedule 5.09 below.
Schedule 5.09
Southwest Water Company (SWWC)
Schedule of Environmental Matters
1. Southwest Environmental Laboratories (SWEL): On May 18, 2005, the EPA
executed a search warrant at the Company's Texas-based testing laboratory and on
July 20, 2006 the laboratory received a subpoena to provide additional records
and information to a grand jury. The Company is cooperating fully with the
investigation and has provided the records requested. There have been no further
significant developments since July 20, 2006.
2. State Water Resources Control Board ("SWRCB")- ECO Resources- California: On
January 29, 2008, the Company received notice from the California SWRCB that an
ongoing investigation indicates that the Company's wholly-owned subsidiary ECO
Resources (California) may be in violation of certain provisions of the
California Water Code. The SWRCB alleges that ECO Resources may be subject to
certain fines and penalties of $15,000,000 or more. ECO Resources has previously
conducted a full audit of its facilities and made necessary remediation to
certain of those facilities. We believe upon the completion of the SWRCB's
investigation and after having an opportunity to meet with the SWRCB, we will be
able to show the results of our compliance efforts at ECO Resources. We are
optimistic that this matter can be successfully concluded at that time.
Schedule 5.13
Southwest Water Company (SWWC)
Schedule of Subsidiaries and
Other Equity Investments
--------------------------------------------------------------------------------------------------------------------------------
Part (a)
--------
Name Regulated Non-Regulated Incorporated Percent Owned by:
--------------------------------------- --------- ------------- ------------ --------------------------------------
SWWC Enterprises, Inc x Delaware 100% by SWWC
North County Water Reclamation, Inc. x Alabama 100% by SWWC Enterprises, Inc.
Services Group
---------------------------------------
SWWC Services, Inc. x Delaware 100% by SWWC
Aqua Services, L.P. x Texas 1% by AquaSources Services I, LLC
as General Partner
99% by AquaSource Services
II, LLC as Limited Partner
AquaSource Services I, LLC x Delaware 100% by SWWC
AquaSource Services II, LLC x Delaware 100% by AquaSource Services I, LLC
CDC Maintenance, Inc. x Texas 100% by SWWC
Colorado Bend Utilities, LLC x Texas 100% by Eco Resources, Inc.
Crossroads Utilities Ltd. x Texas 1% by Colorado Bend as General Partner
99% by SWWC as Limited Partner
ECO Capistrano Valley, Inc. x Delaware 100% by ECO Resources, Inc.
ECO Resources, Inc. x Texas 100% by SWWC
Lab-Tech Corporation x Texas 100% by Aqua Services, LP
Metro-H20 Utilities, Ltd. x Texas 1% by Metro, Incas General Partner
99% by SWWC as Limited Partner
Metro-H20 Utilities, Inc. x Texas 100% by SWWC
Novus Utilties, Inc. x Delaware 100% by ECO Resources, Inc.
Operations Technologies, Inc. x Georgia 100% by SWWC
Southwest Enviromnmental Laboratories, Inc. x Texas 100% by ECO Resources, Inc.
Southwest Water Government Services Company x Delaware 100% by SWWC
Southwest Water Services Group Houston, Inc. x Delaware 100% by SWWC
Wastewater Rehabilitation Inspections, Inc. x Texas 100% by SWWC
Water Quality Management Corporation x Colorado 100% by SWWC
Schedule 5.13
Southwest Water Company (SWWC)
Schedule of Subsidiaries and
Other Equity Investments
--------------------------------------------------------------------------------------------------------------------------------
Part (a)
--------
Name Regulated Non-Regulated Incorporated Percent Owned by:
--------------------------------------- --------- ------------- ------------ --------------------------------------
Utility Group
---------------------------------------
SWWC Utilities, Inc. x Delaware 100% by SWWC
CHA Utilities Company Ltd. x Texas 1% by SWWC
99% by CHA Utilities, LLC
CHA Utilities, LLC x Texas 1% by SC
99% by CHA Utilities Company Ltd.
Diamond Water Company x Texas 100% by SW Utility Company
Homsby Bend Utility x Texas 100% by SW Utility Company
Huntington Utility Company, Inc. x Texas SW Utility Company is Sole Member
Inverness Utility Company, LLC x Texas 100% by SW Utility Company
IU Merger Subsidiary x Texas 100% by SWWC
Mid-Tex Utilities, Inc. x Texas 100% by SW Utility Company
Midway Water Utilities, Inc. x Texas 100% by Monarch Utilities, Inc.
Monarch Utilities, Inc. x Texas 100% by SWWC
Texas .1% by Texas Water Services Group
Monarch Utilities I, LP x as General Partner
99.9% by Monarch Utilities, Inc.
as Limited Partner
New Mexico Utilities, Inc. x New Mexico 100% by SWWC
Southwest Water Alabama, Inc. x Alabama 100% by SWWC
Southwest Water Alabama
Onsite System Services, LLC x Alabama Sole Member is Southwest Water
Alabama, Inc.
Southwest Water Florida, Inc. x Florida 100% by SWWC
Suthwest Water Mississippi, Inc. x Mississippi 100% by SWWC
Suburban Water Systems x California 100% by SWWC
SW Resource Management Company x Delaware 100% by SWWC
SW Utility Company x Texas 100% by SWWC
Tenkiller Utility Company x Texas 100% by SWWC
Texas Water Services Group, LLC x Texas Sole Member is Monarch Utilities, Inc.
TWC Utility Company, LLC x Texas Sole Member is Monarch I LP
Water Services, Inc. x Texas 100% by SW Utility Company
Water Suppliers Mobile Communication Service x California 100% by Suburban Water Systems
Windermere Utility Co., Inc. x Texas 100% by SW Utility Company
Schedule 5.13
Southwest Water Company (SWWC)
Schedule of Subsidiaries and
Other Equity Investments
--------------------------------------------------------------------------------------------------------------------------------
Part (a)
--------
Name Regulated Non-Regulated Incorporated Percent Owned by:
--------------------------------------- --------- ------------- ------------ --------------------------------------
Part (b) - Other Equity Investments
-----------------------------------
SWWC, through Suburban Water Systems, has investments in two mutual water
companies: a 13% ownership interest in Covina Irrigating Company ($.5 million
book value), and a 32% ownership interest in California Domestic Water Company
($2 million book value). Mutual water companies operate to secure water rights
and distribute the water obtained to its stockholders. The two companies in
which we have invested are not-for-profit organizations which pump specified
amounts of water from basins in the Southern California coastal watershed. The
stockholders return on investment is a supply of low cost water.
Schedule 7.01
Southwest Water Company Schedule of Existing Liens
-----------------------------------------------------------------------
1. Indenture of Mortgage and Deed of Trust dated October 1, 1986, as amended.
Suburban Water Systems to US Bank as successor Trustee.
2. Indenture of Mortgage and Deed of Trust dated February 14, 1992, as amended,
New Mexico Utilities, Inc. to ▇▇▇▇▇ Fargo Bank as Trustee.
3. Deed of Trust, Security Agreement and Assignment of Rents and Leases dated
May 1, 2002, as amended, to secure Master Loan Agreement number RX0936 dated May
1, 2002, as Amended, between Monarch Utilities I L.P. (formerly known as Tecon
Water Company, L.P.) as borrower, and CoBank ACB, as lender.
4. Computer Equipment Lease Agreement dated December 14, 2007 between Southwest
Water Company as "Lessee". and Fidelity National Capital, Inc. as "Lessor".
5. Tax lien ($232.30) dated August 16, 2007 ; State of Georgia versus Operations
Technologies, Inc., a Subsidiary of Southwest Water Company.
6. Computer Equipment Schedules one through eighteen to Master Lease Agreement
203499 among Computer Sales International, Inc. (AKA CSI Leasing, Inc.) as
"Lessor", and Southwest Water Company as "Lessee".
7. Copier financing agreement among US Bankcorp as Secured Party and Southwest
Water Company as Debtor.
8. Copier Lease Agreement among ▇▇▇▇▇▇ Leasing Corp., as "Lessor" and Southwest
Water Company as "Lessee".
9. Copier Lease Agreement among CIT Technology Financing Services, Inc. as
"Lessor" and Southwest Water Company as "Lessee".
10. Office furniture Financing Agreement among US Bankcorp as Secured Party and
Southwest Water Company as Debtor.
11. Water Supply Lease and Purchase Option Agreement dated August 21, 2002 among
Fort Bend County Municipal Utility District No. 122 as "Lessee" and ECO
Resources, Inc. as "Lessor".
12. Lease Agreement among Key Corporate Capital, Inc. as "Lessee" and ECO
Resources, Inc. as "Lessor".
13. Copier and postal equipment Lease Agreement among Great America Leasing
Corporation as "Lessee" and ECO Resources, Inc. as "Lessor".
14. Equipment Lease Agreement No. 7422419-001 dated January 1, 2006 among
General Electric Capital Corporation as "Lessee" and ECO Resources, Inc. as
"Lessor".
15. Equipment Lease Agreement dated June 15, 2003 among American Business
Machines, Inc. as "Lessor" and Southwest Water Company as "Lessee".
16. Equipment Lease Agreement among Lease Corporation of America as "Lessor" and
ECO Resources, Inc. as "Lessee".
17. Equipment Lease Agreement No. 124825-100 dated July 16, 2004 among ▇▇▇▇▇
Fargo Equipment Finance, Inc. as "Lessor" and Southwest Water Company as
"Lessee".
18. Office furniture, fixtures, equipment and services under Lease Agreement
dated December 31, 2003 among General Electric Capital Corporation as "Lessor"
and Southwest Water Company as "Lessee".
Schedule 7.03
Southwest Water Company
Schedule of Outstanding Indebtedness
------------------------------------------------------------------------
($000s)
$100 million revolving credit facility $ 82,500
Letters of credit issued under revolving credit facility: 1,970
6.85% Convertible Subordinated Debentures due 2021 12,053
Term Loans:
Monarch Utilities, Inc.:
7.37% fixed rate term loan due 2022 10,973
5.77% fixed rate term loan due 2022 754
6.10% fixed rate term loan due 2031 20,000
First Mortgage Bonds:
Suburban Water Systems:
9.09% series B first mortgage bond due 2022 8,000
5.64% series D first mortgage bond due 2024 15,000
6.295% series E first mortgage bond due 2026 10,000
New Mexico Utilities, Inc.:
6.10% series C first mortgage bond due 2024 12,000
Economic Development Revenue Bonds:
ECO Resources, Inc.:
5.5% series 1998A due 2008 115
6.0% series 1998A due 2018 1,810
Acquisition-related indebtedness 78
Lease obligations 4,671
Advances for Construction 9,210
--------
Total: $189,134
[Southwest Water AR Credit
W02-WEST:1SHN1\400595148 Agreement]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
SOUTHWEST WATER COMPANY
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
BANK OF AMERICA, N.A., as
Administrative Agent
By ▇▇▇ ▇▇▇▇
---------------------------------
Name: ▇▇▇ ▇▇▇▇
Title: Vice President
BANK OF AMERICA, N.A., as a Lender, L/C Issuer and
Swing Line Lender
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
UNION BANK OF CALIFORNIA, N.A.
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
CITIBANK, N.A.,
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
COBANK, ACB,
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
BANK OF THE WEST,
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
U.S. BANK NATIONAL ASSOCIATION, as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
JPMORGAN CHASE BANK, N.A.,
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
KEYBANK NATIONAL ASSOCIATION,
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
COMERICA BANK,
as a Lender
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
COMMITMENTS
AND APPLICABLE PERCENTAGES
Lender Commitment Applicable
Percentage
------------------------------- --------------------------- ----------------------
Bank of America, N.A. $ 24,250,000 16.166666667%
Keybank National Association $ 20,000,000 13.333333333%
CoBank ACB $ 18,000,000 12.000000000%
U.S. Bank National Association $ 18,000,000 12.000000000%
JPMorgan Chase Bank, N.A. $ 15,000,000 10.000000000%
Comerica Bank $ 15,000,000 10.000000000%
Bank of the West $ 13,500,000 9.000000000%
Citibank, N.A. $ 13,125,000 8.750000000%
Union Bank of California, N.A. $ 13,125,000 8.750000000%
Total $ 150,000,000 100%
-1-
SCHEDULE 5.03
RESTRICTIONS ON GUARANTEES
SCHEDULE 5.06
LITIGATION
SCHEDULE 5.09
ENVIRONMENTAL MATTERS
SCHEDULE 5.13
SUBSIDIARIES
AND OTHER EQUITY INVESTMENTS
Part (a). Subsidiaries.
------------
Part (b). Other Equity Investments.
------------------------
SCHEDULE 7.01
EXISTING LIENS
SCHEDULE 7.03
EXISTING INDEBTEDNESS
-2-
SCHEDULE 10.02
ADMINISTRATIVE AGENT'S OFFICE,
CERTAIN ADDRESSES FOR NOTICES
BORROWER:
---------
Southwest Water Company
One Wilshire Building
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. Bench, Treasurer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇▇▇▇@▇▇▇▇.▇▇▇
Website Address: ▇▇▇.▇▇▇▇.▇▇▇
ADMINISTRATIVE AGENT'S OFFICE
-----------------------------
Notices (other than Requests for Extensions of Credit):
BANK OF AMERICA, N.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Mail Code: WA1-501-32-37
Att: ▇▇▇ ▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇.▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
For Payments and Requests for Extensions of Credit:
BANK OF AMERICA, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Mail Code: CA4-702-02-25
Att: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Electronic Mail: ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Payments:
BANK OF AMERICA
New York, NY
ABA No. ▇▇▇▇▇▇▇▇▇
Account No: 3750836479
Account Name: Corporate FTA
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Reference: Southwest Water Company
-1-
Letters of Credit:
BANK OF AMERICA, N.A.
Trade Operations - Los Angeles #226521
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Mail Code: CA9-705-07-05
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Tel: ▇▇▇-▇▇▇-▇▇▇▇
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EXHIBIT A
FORM OF COMMITTED LOAN NOTICE
Date: ___________, _____
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to the Amended and Restated Credit Agreement, dated as
of February 15, 2008 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Agreement;" the terms defined
therein being used herein as therein defined), among Southwest Water Company, a
Delaware Company (the "Borrower"), the Lenders from time to time party thereto,
and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line
Lender.
The undersigned hereby requests (select one):
[ ] A Borrowing of Committed Loans [ ]A conversion or continuation of
Committed Loans
1. On _____________________________________________ (a Business Day).
2. In the amount of $_________________________________.
3. Comprised of ____________________________________.
[Type of Committed Loan requested]
4. For Eurodollar Rate Loans: with an Interest Period of _______
months.
The Committed Borrowing, if any, requested herein complies with the
provisos to the first sentence of Section 2.01 of the Agreement.
[[The Borrower hereby represents and warrants that the conditions
specified in Sections 4.02(a) and (b) shall be satisfied on and as of the date
set forth in item 1 above.]](1)
SOUTHWEST WATER COMPANY
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
__________________________
(1) Insert this clause only if a Borrowing of Committed Loans is
being requested.
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EXHIBIT B
FORM OF SWING LINE LOAN NOTICE
Date: ___________, 200____
To: Bank of America, N.A., as Swing Line Lender
Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to the Amended and Restated Credit Agreement, dated as
of February 15, 2008 (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the "Agreement;" the terms defined
therein being used herein as therein defined), among Southwest Water Company, a
Delaware corporation (the "Borrower"), the Lenders from time to time party
thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and
Swing Line Lender.
The undersigned hereby requests a Swing Line Loan:
1. On ________________ (a Business Day).
2. In the amount of $_____________________.
The Swing Line Borrowing requested herein complies with the requirements
of the provisos to the first sentence of Section 2.04(a) of the Agreement.
The Borrower hereby represents and warrants that the conditions specified
in Sections 4.02(a) and (b) shall be satisfied on and as of the date set forth
in item 1 above.
SOUTHWEST WATER COMPANY
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
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EXHIBIT C
FORM OF NOTE
$_______________________ _________________, 200__
FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby promises to pay
to _____________________ or registered assigns ("Lender"), in accordance with
the provisions of the Agreement (as hereinafter defined), the principal amount
of each Loan from time to time made by the Lender to Borrower under the Amended
and Restated Credit Agreement, dated as of February 15, 2008 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to
time, the "Agreement;" the terms defined therein being used herein as therein
defined), among Borrower, the Lenders from time to time party thereto, and Bank
of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender.
Borrower promises to pay interest on the unpaid principal amount of each
Loan from the date of such Loan until such principal amount is paid in full, at
such interest rates and at such times as provided in the Agreement. Except as
otherwise provided in Section 2.04(f) of the Agreement with respect to Swing
Line Loans, all payments of principal and interest shall be made to
Administrative Agent for the account of the Lender in Dollars in immediately
available funds at the Administrative Agent's Office. If any amount is not paid
in full when due hereunder, such unpaid amount shall bear interest, to be paid
upon demand, from the due date thereof until the date of actual payment (and
before as well as after judgment) computed at the per annum rate set forth in
the Agreement.
This Note is one of the Notes referred to in the Agreement, is entitled to
the benefits thereof and may be prepaid in whole or in part subject to the terms
and conditions provided therein. This Note is also entitled to the benefits of
the Guaranty. Upon the occurrence and continuation of one or more of the Events
of Default specified in the Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all as
provided in the Agreement. Loans made by the Lender shall be evidenced by one or
more loan accounts or records maintained by the Lender in the ordinary course of
business. The Lender may also attach schedules to this Note and endorse thereon
the date, amount and maturity of its Loans and payments with respect thereto.
Borrower, for itself, its successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Note.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF CALIFORNIA.
SOUTHWEST WATER COMPANY
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
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LOANS AND PAYMENTS WITH RESPECT THERETO
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Amount of
Principal Outstanding
End of or Principal
Type of Amount of Interest Interest Balance Notation
Date Loan Made Loan Made Period Paid This This Date Made By
Date
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EXHIBIT E
FORM OF
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (this "Assignment and Assumption") is dated
as of the Effective Date set forth below and is entered into by and between
[the][each](2) Assignor identified in item 1 below ([the][each, an] "Assignor")
and [the][each](3) Assignee identified in item 2 below ([the][each, an]
"Assignee"). [It is understood and agreed that the rights and obligations of
[the Assignors][the Assignees](4) hereunder are several and not joint.](5)
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (the "Credit Agreement"), receipt
of a copy of which is hereby acknowledged by the Assignee. The Standard Terms
and Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Assumption as if set forth herein in full.
For an agreed consideration, [the][each] Assignor hereby irrevocably sells
and assigns to [the Assignee][the respective Assignees], and [the][each]
Assignee hereby irrevocably purchases and assumes from [the Assignor][the
respective Assignors], subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor's][the
respective Assignors'] rights and obligations in [its capacity as a
Lender][their respective capacities as Lenders] under the Credit Agreement and
any other documents or instruments delivered pursuant thereto to the extent
related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of [the Assignor][the respective Assignors]
under the respective facilities identified below (including, without limitation,
the Letters of Credit and the Swing Line Loans included in such facilities ) and
(ii) to the extent permitted to be assigned under applicable law, all claims,
suits, causes of action and any other right of [the Assignor (in its capacity as
a Lender)][the respective Assignors (in their respective capacities as Lenders)]
against any Person, whether known or unknown, arising under or in connection
with the Credit Agreement, any other documents or instruments delivered pursuant
thereto or the loan transactions governed thereby or in any way based on or
related to any of the foregoing, including, but not limited to, contract claims,
tort claims, malpractice claims, statutory claims and all other claims at law or
in equity related to the rights and obligations sold and assigned pursuant to
clause (i) above (the rights and obligations sold and assigned by [the][any]
Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being
referred to herein collectively as [the][an] "Assigned Interest"). Each such
sale and assignment is without recourse to [the][any] Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by [the][any] Assignor.
1. Assignor[s]: ______________________________
2. Assignee[s]: ______________________________ [for each Assignee,
indicate [Affiliate][Approved Fund] of [identify Lender]]
3. Borrower: Southwest Water Company
4. Administrative Agent: Bank of America, N. A., as the Administrative
Agent under the Credit Agreement
_______________________________________________
(1) For bracketed language here and elsewhere in this form relating to the
Assignor(s), if the assignment is from a single Assignor, choose the
first bracketed language. If the assignment is from multiple
Assignors, choose the second bracketed language.
(2) For bracketed language here and elsewhere in this form relating to the
Assignee(s), if the assignment is to a single Assignee, choose the
first bracketed language. If the assignment is to multiple Assignees,
choose the second bracketed language.
(3) Select as appropriate.
(4) Include bracketed language if there are either multiple Assignors or
multiple Assignees.
-1-
5. Credit Agreement: Amended and Restated Credit Agreement, dated as of
February 15, 2008, among Southwest Water Company, the Lenders from
time to time party thereto, and Bank of America, N.A., as
Administrative Agent, L/C Issuer and Swing Line Lender
6. Assigned Interest:
----------------------------------------------------------------------------------------
Aggregate Amount of Percentage
Amount of Commitment/Assigned of
Facility Commitment/Loans Assigned Commitment/ CUSIP
--------
Assignor[s](6)Assignee[s](Assigned(8) for all Loans(10) Number Lenders(9)
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------------$---------------$--------- ------------%
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------------$---------------$--------- ------------%
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------------$---------------$--------- ------------%
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[7. Trade Date:.__________________]
Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]
The terms set forth in this Assignment and Assumption are hereby agreed
to:
ASSIGNOR
[NAME OF ASSIGNOR]
By: _____________________________
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By: _____________________________
Title:
________________________________________
(5) List each Assignor, as appropriate.
(6) List each Assignee, as appropriate.
(7) Fill in the appropriate terminology for the types of facilities
under the Credit Agreement that are being assigned under this
Assignment (e.g. ''Committed Loan'', the "Commitment", etc.).
(8) Amounts in this column and in the column immediately to the right
to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the
Effective Date.
(9) Set forth, to at least 9 decimals, as a percentage of the
Commitment/Loans of all Lenders thereunder.
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[Consented to and](10) Accepted:
Bank of America, N. A., as
Administrative Agent
By: _________________________________
Title:
[Consented to:](12)
By: _________________________________
Title:
____________________________________
(10) To be added only if the consent of the Administrative Agent is
required by the terms of the Credit Agreement.
(11) To be added only if the consent of the Borrower and/or other
parties (e.g. Swing Line Lender, L/C Issuer) is required by the terms
of the Credit Agreement.
-3-
ANNEX 1 TO ASSIGNMENT AND ASSUMPTION
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1. Assignor. [The][Each] Assignor (a) represents and warrants that (i)
it is the legal and beneficial owner of [the][[the relevant] Assigned Interest,
(ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or
other adverse claim and (iii) it has full power and authority, and has taken all
action necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Loan Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Borrower, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document.
1.2. Assignee. [The][Each] Assignee (a) represents and warrants that (i)
it has full power and authority, and has taken all action necessary, to execute
and deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all the requirements to be an assignee under Section 10.06(b)(iii), (v)
and (vi) of the Credit Agreement (subject to such consents, if any, as may be
required under Section 10.06(b)(iii) of the Credit Agreement), (iii) from and
after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of [the][the relevant]
Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is
sophisticated with respect to decisions to acquire assets of the type
represented by [the][such] Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire [the][such] Assigned
Interest, is experienced in acquiring assets of such type, (v) it has received a
copy of the Credit Agreement, and has received or has been accorded the
opportunity to receive copies of the most recent financial statements delivered
pursuant to Section 6.01 thereof, as applicable, and such other documents and
information as it deems appropriate to make its own credit analysis and decision
to enter into this Assignment and Assumption and to purchase [the][such]
Assigned Interest, (vi) it has, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase
[the][such] Assigned Interest, and (vii) if it is a Foreign Lender, attached
hereto is any documentation required to be delivered by it pursuant to the terms
of the Credit Agreement, duly completed and executed by [the][such] Assignee;
and (b) agrees that (i) it will, independently and without reliance upon the
Administrative Agent, [the][any] Assignor or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Documents, and (ii) it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.
2. Payments. From and after the Effective Date, the Administrative Agent
shall make all payments in respect of [the][each] Assigned Interest (including
payments of principal, interest, fees and other amounts) to [the][the relevant]
Assignor for amounts which have accrued to but excluding the Effective Date and
to [the][the relevant] Assignee for amounts which have accrued from and after
the Effective Date.
3. General Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be executed in any
number of counterparts, which together shall constitute one instrument. Delivery
of an executed counterpart of a signature page of this Assignment and Assumption
by telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of California.
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