EXECUTION
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CREDIT AGREEMENT
DATED AS OF AUGUST 26, 1996
AMONG
PRIME SUCCESSION, INC.
(TO BE RENAMED PRIME SUCCESSION HOLDINGS, INC.),
AS GUARANTOR,
PRIME SUCCESSION ACQUISITION CORP.
(TO BE RENAMED PRIME SUCCESSION, INC.),
AS BORROWER,
THE LENDERS FROM TIME TO TIME PARTIES HERETO,
AS LENDERS,
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.,
AS SYNDICATION AGENT
AND ARRANGING AGENT,
AND
THE BANK OF NOVA SCOTIA,
AS ADMINISTRATIVE AGENT
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EXECUTION
PRIME SUCCESSION, INC.
CREDIT AGREEMENT
TABLE OF CONTENTS
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SECTION 1.
DEFINITIONS.............................. 2
1.1 Certain Defined Terms.................................... 2
1.2 Accounting Terms; Utilization of GAAP for Purposes of
Calculations Under Agreement............................. 33
1.3 Other Definitional Provisions and Rules of Construction.. 33
SECTION 2.
AMOUNTS AND TERMS OF COMMITMENTS AND LOANS............... 33
2.1 Commitments; Making of Loans; the Register; Notes........ 33
2.2 Interest on the Loans.................................... 40
2.3 Fees..................................................... 44
2.4 Repayments, Prepayments and Reductions in Revolving Loan
Commitments; General Provisions Regarding Payments;
Application of Proceeds of Collateral and Payments Under
Guaranties............................................... 44
2.5 Use of Proceeds.......................................... 52
2.6 Special Provisions Governing Eurodollar Rate Loans....... 53
2.7 Increased Costs; Taxes; Capital Adequacy................. 55
2.8 Obligation of Lenders and Issuing Lender to Mitigate..... 60
SECTION 3.
LETTERS OF CREDIT........................... 61
3.1 Issuance of Letters of Credit and Lenders' Purchase of
Participations Therein................................... 61
3.2 Letter of Credit Fees.................................... 63
3.3 Drawings and Reimbursement of Amounts Paid Under Letters
of Credit................................................ 64
3.4 Obligations Absolute..................................... 66
3.5 Indemnification; Nature of Issuing Lender's Duties....... 67
3.6 Increased Costs and Taxes Relating to Letters of Credit.. 68
SECTION 4.
CONDITIONS TO LOANS AND LETTERS OF CREDIT............... 69
4.1 Conditions to AXELs and Initial Revolving Loans and
Swing Line Loans......................................... 70
4.2 Conditions to All Loans.................................. 76
4.3 Conditions to Letters of Credit.......................... 77
EXECUTION
(i)
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SECTION 5.
REPRESENTATIONS AND WARRANTIES..................... 77
5.1 Organization, Powers, Qualification, Good Standing,
Business and Subsidiaries................................ 78
5.2 Authorization of Borrowing, etc.......................... 78
5.3 Financial Condition...................................... 80
5.4 No Material Adverse Change; No Restricted Junior
Payments................................................. 80
5.5 Title to Properties; Liens............................... 81
5.6 Litigation; Adverse Facts................................ 81
5.7 Payment of Taxes......................................... 81
5.8 Performance of Agreements; Materially Adverse
Agreements; Material Contracts........................... 82
5.9 Governmental Regulation.................................. 82
5.10 Securities Activities.................................... 82
5.11 Employee Benefit Plans................................... 82
5.12 Certain Fees............................................. 83
5.13 Environmental Protection................................. 83
5.14 Employee Matters......................................... 84
5.15 Solvency................................................. 85
5.16 Matters Relating to Collateral........................... 85
5.17 Representations and Warranties in Acquisition Agreement.. 86
5.18 Disclosure............................................... 86
SECTION 6.
AFFIRMATIVE COVENANTS......................... 86
6.1 Financial Statements and Other Reports................... 87
6.2 Corporate Existence, etc................................. 92
6.3 Payment of Taxes and Claims; Tax Consolidation........... 92
6.4 Maintenance of Properties; Insurance; Application of Net
Insurance/Condemnation Proceeds.......................... 92
6.5 Inspection Rights........................................ 94
6.6 Compliance with Laws, etc................................ 94
6.7 Environmental Review and Investigation, Disclosure,
Etc.; Borrower's Actions Regarding Hazardous Materials
Activities, Environmental Claims and Violations of
Environmental Laws....................................... 94
6.8 Execution of Subsidiary Guaranty and Personal Property
Collateral Documents by Certain Subsidiaries and Future
Subsidiaries............................................. 98
6.9 Interest Rate Protection................................. 98
6.10 Future Capital Contributions............................. 99
6.11 Delivery of Certain Pledged Shares....................... 99
6.12 Post Closing Deliveries.
EXECUTION
(ii)
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SECTION 7.
NEGATIVE COVENANTS.......................... 99
7.1 Indebtedness............................................ 100
7.2 Liens and Related Matters............................... 102
7.3 Investments; Joint Ventures............................. 104
7.4 Contingent Obligations.................................. 105
7.5 Restricted Junior Payments.............................. 106
7.6 Financial Covenants..................................... 106
7.7 Restriction on Fundamental Changes; Asset Sales and
Acquisitions............................................ 110
7.8 Consolidated Adjusted Capital Expenditures.............. 111
7.9 Sales and Lease-Backs................................... 112
7.10 Transactions with Shareholders and Affiliates........... 112
7.11 Disposal of Subsidiary Stock............................ 113
7.12 Conduct of Business..................................... 113
7.13 Amendments or Waivers of Certain Related Agreements;
Designation of "Senior Indebtedness".................... 113
7.14 Fiscal Year............................................. 114
SECTION 8.
EVENTS OF DEFAULT.......................... 114
8.1 Failure to Make Payments When Due....................... 114
8.2 Default in Other Agreements............................. 114
8.3 Breach of Certain Covenants............................. 115
8.4 Breach of Warranty...................................... 115
8.5 Other Defaults Under Loan Documents..................... 115
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.... 115
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc...... 116
8.8 Judgments and Attachments............................... 116
8.9 Dissolution............................................. 116
8.10 Employee Benefit Plans.................................. 116
8.11 Change in Control....................................... 117
8.12 Invalidity of Guaranties; Failure of Security;
Repudiation of Obligations.............................. 117
8.13 Subordinated Indebtedness............................... 117
SECTION 9.
AGENTS................................ 118
9.1 Appointment............................................. 118
9.2 Powers and Duties; General Immunity..................... 120
9.3 Representations and Warranties; No Responsibility For
Appraisal of Creditworthiness........................... 121
9.4 Right to Indemnity...................................... 122
9.5 Successor Administrative Agent and Swing Line Lender.... 122
EXECUTION
(iii)
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9.6 Collateral Documents and Guaranties..................... 123
SECTION 10.
MISCELLANEOUS............................ 124
10.1 Assignments and Participations in Loans and Letters of
Credit.................................................. 124
10.2 Expenses................................................ 127
10.3 Indemnity............................................... 128
10.4 Set-Off; Security Interest in Deposit Accounts.......... 129
10.5 Ratable Sharing......................................... 129
10.6 Amendments and Waivers.................................. 130
10.7 Independence of Covenants............................... 131
10.8 Notices................................................. 131
10.9 Survival of Representations, Warranties and Agreements.. 132
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative... 132
10.11 Marshalling; Payments Set Aside......................... 132
10.12 Severability............................................ 132
10.13 Obligations Several; Independent Nature of Lenders'
Rights.................................................. 133
10.14 Headings................................................ 133
10.15 Applicable Law.......................................... 133
10.16 Successors and Assigns.................................. 133
10.17 Consent to Jurisdiction and Service of Process.......... 133
10.18 Waiver of Jury Trial.................................... 134
10.19 Confidentiality......................................... 135
10.20 Maximum Amount.......................................... 135
10.21 Counterparts; Effectiveness............................. 136
Signature pages S-1
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(iv)
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF AXEL NOTE
V FORM OF REVOLVING NOTE
VI FORM OF SWING LINE NOTE
VII FORM OF COMPLIANCE CERTIFICATE
VIII FORM OF OPINION OF COUNSEL TO LOAN PARTIES
IX FORM OF OPINION OF O'MELVENY & ▇▇▇▇▇ LLP
X FORM OF ASSIGNMENT AGREEMENT
XI FORM OF CERTIFICATE RE NON-BANK STATUS
XII FORM OF COLLATERAL ACCOUNT AGREEMENT
XIII FORM OF BORROWER PLEDGE AGREEMENT
XIV FORM OF BORROWER SECURITY AGREEMENT
XV FORM OF SUBSIDIARY GUARANTY
XVI FORM OF SUBSIDIARY PLEDGE AGREEMENT
XVII FORM OF SUBSIDIARY SECURITY AGREEMENT
XVIII FORM OF HOLDINGS GUARANTY
XIX FORM OF HOLDINGS PLEDGE AGREEMENT
XX FORM OF INTERCOMPANY NOTE
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(v)
SCHEDULES
1.1A EXISTING INDEBTEDNESS
1.1B PRO FORMA EBITDA ADJUSTMENT
1.1C REMAINING EXISTING INDEBTEDNESS
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
3.1 CERTAIN STANDBY LETTERS OF CREDIT EXCEEDING ONE YEAR
5.1 SUBSIDIARIES OF COMPANY
5.3 CONTINGENT OBLIGATIONS
5.4 MATERIAL ADVERSE CHANGES
5.6 LITIGATION
5.8 MATERIAL CONTRACTS
5.11 CERTAIN EMPLOYEE BENEFIT PLANS
5.13 ENVIRONMENTAL MATTERS
6.11 ENCUMBERED SUBSIDIARY SHARES
6.12 POST CLOSING DELIVERIES
7.1 CERTAIN EXISTING INDEBTEDNESS
7.2A CERTAIN EXISTING LIENS
7.2D PERMITTED RESTRICTIONS ON SUBSIDIARIES
7.3 CERTAIN EXISTING INVESTMENTS
7.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
EXECUTION
(vi)
PRIME SUCCESSION, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of August 26, 1996 and entered into by
and among PRIME SUCCESSION, INC., a Delaware corporation (to be renamed Prime
Succession Holdings, Inc.) ("Holdings"), PRIME SUCCESSION ACQUISITION CORP., a
Delaware corporation (to be renamed Prime Succession, Inc.) ("Borrower"),
▇▇▇▇▇▇▇, SACHS & CO., as syndication agent and arranging agent (in such
capacities, "Syndication Agent" and "Arranging Agent", respectively), THE
FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTIES HERETO (each individually
referred to herein as a "Lender" and collectively as "Lenders"), and THE BANK OF
NOVA SCOTIA ("Scotiabank"), as administrative agent for Lenders (in such
capacity, "Administrative Agent").
R E C I T A L S
WHEREAS, Borrower, a corporation newly formed by the Investors (this and
other capitalized terms used in these recitals without definition being used as
defined in subsection 1.1), has entered into the Acquisition Agreement with the
Existing Stockholders and Holdings, pursuant to which Borrower has the right to
acquire all of the outstanding capital stock of Holdings;
WHEREAS, (i) on or before the Closing Date, Borrower will assign to the
Investors all of its rights and obligations under the Acquisition Agreement and
the Investors will in turn assign all such rights and obligations to Holdings
and (ii) on the Closing Date, Holdings will acquire all of the outstanding
capital stock of Holdings owned by the Existing Stockholders pursuant to the
terms of the Acquisition Agreement;
WHEREAS, on the Closing Date, (i) ▇▇▇▇▇▇ and the Blackstone Investors will
purchase $130,000,000 in the aggregate of Holdings Preferred Stock and Holdings
Common Stock, (ii) the Investors will contribute to Holdings all of the
outstanding capital stock of Borrower and Borrower will become a wholly owned
subsidiary of Holdings, (iii) Holdings will contribute all of the outstanding
capital stock of each of its directly owned Subsidiaries together with all of
its other assets (other than the cash proceeds referred to in (i) above) to
Borrower, and Borrower will assume all existing liabilities of Holdings, so that
Holdings shall have no assets or liabilities other than the capital stock of
Borrower, and (iv) the name of Holdings will be changed from Prime Succession,
Inc. to Prime Succession Holdings, Inc. and the name of Borrower will be changed
from Prime Succession Acquisition Corp. to Prime Succession, Inc. (all of the
foregoing herein referred to collectively as the "Reorganization");
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WHEREAS, on or before the Closing Date, Borrower will issue and sell the
Senior Subordinated Notes for gross proceeds of not less than $100,000,000 and
Borrower will distribute approximately $52,000,000 of such proceeds to Holdings
in the form of a dividend or intercompany loan (the "Borrower Distribution");
WHEREAS, Holdings will use the proceeds of the $130,000,000 from the sale
of the Holdings Common Stock and Holdings Preferred Stock to the Investors
together with the $52,000,000 received from the Borrower Distribution to fund
the purchase price under the Acquisition Agreement;
WHEREAS, Lenders have agreed to extend certain credit facilities to
Borrower, the proceeds of which will be used (i) together with a portion of the
proceeds of the issuance and sale of the Senior Subordinated Notes, to repay the
Existing Indebtedness, (ii) to prefund certain capital expenditures in an amount
not to exceed $4,000,000, (iii) to pay fees and expenses in connection with the
Acquisition, the Reorganization and the other transactions contemplated hereby
and (iv) to provide financing for working capital and other general corporate
purposes of Borrower and its Subsidiaries;
WHEREAS, Borrower desires to secure all of the Obligations hereunder and
under the other Loan Documents by granting to Administrative Agent, on behalf of
Lenders, a First Priority Lien on substantially all of its personal property
including a pledge of all of the capital stock of each of its domestic
Subsidiaries, 65% of the capital stock of each direct foreign Subsidiary and a
pledge of all Intercompany Notes; and
WHEREAS, Holdings and all of the domestic Subsidiaries of Borrower have
agreed to guarantee the Obligations hereunder and under the other Loan Documents
and to secure their guaranties by granting to Administrative Agent, on behalf of
Lenders, a First Priority Lien on substantially all of their respective personal
property including a pledge of all of the capital stock of each of their
respective domestic Subsidiaries and 65% of the capital stock of each direct
foreign Subsidiary and a pledge of all Intercompany Notes:
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Holdings, Borrower, Lenders and
Agents agree as follows:
SECTION 1.
DEFINITIONS
1.1 Certain Defined Terms.
The following terms used in this Agreement shall have the following
meanings:
"Acquired Business" has the meaning assigned to that term in the
definition of "Business Acquisition".
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"Acquisition" means the transactions contemplated by the Acquisition
Agreement.
"Acquisition Agreement" means that certain Stock Purchase Agreement
by and among Holdings, the other individuals or entities listed on the
signature pages thereof (the "Existing Stockholders"), ▇▇▇▇▇▇ Group and
Borrower, dated as of June 14, 1996, in the form delivered to Arranging
Agent prior to the execution of this Agreement and as such agreement may
be amended from time to time thereafter to the extent permitted under
subsection 7.13A.
"Adjusted Eurodollar Rate" means, for any Interest Rate
Determination Date with respect to an Interest Period for a Eurodollar
Rate Loan, the rate per annum obtained by dividing (i) (a) the per annum
rate for deposits in Dollars for a period corresponding to the duration of
the relevant Interest Period which appears on Telerate Page 3750 at
approximately 11:00 a.m. (London time) on such Interest Rate Determination
Date or (b) if such rate does not appear on Telerate Page 3750 on such
Interest Rate Determination Date, the per annum rate (rounded upward to
the nearest 1/16 of one percent) at which deposits in Dollars are offered
by Administrative Agent to first-class banks in the London interbank
market, in the approximate amount of Administrative Agent's relevant
Eurodollar Loan and having a maturity approximately equal to such Interest
Period, at approximately 11:00 a.m. (London time) on such Interest Rate
Determination Date by (ii) one minus the Reserve Requirement (expressed as
a decimal) applicable on such Interest Rate Determination Date. The
reference to Telerate Page 3750 in this definition shall be construed to
be a reference to the relevant page or any other page that may replace
such page on the Telerate service or any other service that may be
nominated by the British Bankers' Association as the information vendor
for the purpose of displaying British Bankers' Association Interest
Settlement Rates for deposits in Dollars.
"Administrative Agent" has the meaning assigned to that term in the
introduction to this Agreement and also means and includes any successor
Administrative Agent appointed pursuant to subsection 9.5A.
"Administrative Agreement" means the Administrative Services
Agreement dated as of August 26, 1996, by and between Borrower and ▇▇▇▇▇▇,
as such agreement may be amended from time to time to the extent permitted
under subsection 7.13A.
"Affected Lender" has the meaning assigned to that term in
subsection 2.6C.
"Affiliate", as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control
with, that Person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling",
"controlled by" and "under common control with"), as applied to any
Person, means the possession, directly or indirectly, of the power to
direct or
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cause the direction of the management and policies of that Person, whether
through the ownership of voting securities or by contract or otherwise.
"Agent" means, individually, each of Arranging Agent, Syndication
Agent and Administrative Agent and "Agents" means Arranging Agent,
Syndication Agent and Administrative Agent, collectively.
"Agreement" means this Credit Agreement dated as of August 26, 1996,
as it may be amended, supplemented or otherwise modified from time to
time.
"Applicable Margin" means, for each AXEL and Revolving Loan, as of
any date of determination, a percentage per annum as set forth below plus
the Pricing Premium, if any, less the Pricing Reduction, if any:
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AXELs | Revolving Loans
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| | |
Base Rate | Eurodollar | Base | Eurodollar
Rate Loans | Rate Loans | Rate Loans | Rate Loans
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| | |
2.00% | 3.00% | 1.75% | 2.75%
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"Arranging Agent" has the meaning assigned to that term in the
introduction to this Agreement.
"Asset Sale" means the sale by Holdings or any of its Subsidiaries
to any Person other than Holdings or any of its Wholly Owned Subsidiaries
of (i) any of the stock of any of Holdings' Subsidiaries, (ii)
substantially all of the assets of any division or line of business of
Holdings or any of its Subsidiaries, or (iii) any other assets (whether
tangible or intangible) of Holdings or any of its Subsidiaries (other than
(a) inventory sold in the ordinary course of business and (b) any such
other assets to the extent that the aggregate value of such assets sold in
any single transaction or related series of transactions is equal to or
less than $500,000).
"Assignment Agreement" means an Assignment Agreement in
substantially the form of Exhibit X annexed hereto.
"Available Excess Consolidated Capital Expenditure Amount" means, as
of any date of determination, the Excess Consolidated Capital Expenditure
Amount as of the date of determination minus the aggregate portion of the
Excess Consolidated Capital Expenditure Amount used to make Consolidated
Adjusted Capital Expenditures and Permitted Acquisitions as of the date of
determination. For purposes of calculating the Available Excess
Consolidated Capital Expenditure Amount, (i) Consolidated Adjusted Capital
Expenditures for each Fiscal Year shall be deemed to have been made first
from any carry forward of the Maximum
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Consolidated Capital Expenditures Amount from the previous Fiscal Year
permitted pursuant to subsection 7.8, second from the Maximum Consolidated
Capital Expenditures Amount for such Fiscal Year, and third from the
Available Excess Consolidated Capital Expenditure Amount and (ii)
Permitted Acquisitions shall be deemed to have been made first from the
Permitted Acquisition Amount set forth in subsection 7.7(v) and second
from the Available Excess Consolidated Capital Expenditure Amount.
"AXEL" means a Loan made by a Lender to Borrower as an amortization
extended loan pursuant to subsection 2.1A(i), and "AXELs" means any such
Loan or Loans, collectively.
"AXEL Commitment" means the commitment of a Lender to make an AXEL
to Borrower pursuant to subsection 2.1A(i), and "AXEL Commitments" means
such commitments of all Lenders in the aggregate.
"AXEL Exposure" means, with respect to any Lender as of any date of
determination (i) prior to the funding of the AXELs, that Lender's AXEL
Commitment and (ii) after the funding of the AXELs, the outstanding
principal amount of the AXEL of that Lender.
"AXEL Notes" means (i) the promissory notes of Borrower issued
pursuant to subsection 2.1E(i)(a) on the Closing Date and (ii) any
promissory notes issued by Borrower pursuant to the last sentence of
subsection 10.1B(i) in connection with assignments of the AXEL Commitments
or AXELs of any Lenders, in each case substantially in the form of Exhibit
IV annexed hereto, as they may be amended, supplemented or otherwise
modified from time to time.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as now and hereafter in effect, or any successor statute.
"Base Rate" means, at any time, the higher of (i) the Prime Rate or
(ii) the rate which is 1/2 of 1% in excess of the Federal Funds Effective
Rate.
"Base Rate Loans" means Loans bearing interest at rates determined
by reference to the Base Rate as provided in subsection 2.2A.
"Batesville Agreement" means that certain Casket Supply Agreement
dated as of January 1, 1993 between Batesville Casket Company, Inc. and
Holdings, as in effect on the Closing Date, which agreement will be
assumed by Borrower on the Closing Date.
"Batesville Liability" means any liability of Holdings or any of its
Subsidiaries arising under the Batesville Agreement.
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"Blackstone Investors" means Blackstone Capital Partners II Merchant
Banking Fund L.P. and its Affiliates.
"Borrower" means Prime Succession Acquisition Corp., a Delaware
corporation, to be renamed Prime Succession, Inc. as of the Closing Date.
"Borrower Distribution" has the meaning assigned to that term in the
Recitals.
"Borrower Pledge Agreement" means the Borrower Pledge Agreement
executed and delivered by Borrower and Administrative Agent on the Closing
Date, substantially in the form of Exhibit XIII annexed hereto, as such
Borrower Pledge Agreement may thereafter be amended, supplemented or
otherwise modified from time to time.
"Borrower Security Agreement" means the Borrower Security Agreement
executed and delivered by Borrower and Administrative Agent on the Closing
Date, substantially in the form of Exhibit XIV annexed hereto, as such
Borrower Security Agreement may thereafter be amended, supplemented or
otherwise modified from time to time.
"Business Acquisition" means any acquisition by Holdings or any of
its Subsidiaries (whether by purchase of assets or stock or by merger,
consolidation or otherwise) of any funeral home or cemetery (including any
peripheral business relating to the death care industry such as monument
companies, flower shops or vault companies) (each, an "Acquired Business")
in a single transaction or series of related transactions.
"Business Day" means (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which is
a legal holiday under the laws of the State of New York or is a day on
which banking institutions located in such state are authorized or
required by law or other governmental action to close, and (ii) with
respect to all notices, determinations, fundings and payments in
connection with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans,
any day that is a Business Day described in clause (i) above and that is
also a day for trading by and between banks in Dollar deposits in the
interbank Eurodollar market.
"Capital Lease", as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee that,
in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of that Person.
"Cash" means money, currency or a credit balance in a Deposit
Account.
"Cash Equivalents" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally
guaranteed as to interest and
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principal by the United States Government or (b) issued by any agency of
the United States the obligations of which are backed by the full faith
and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of
the United States of America or any political subdivision of any such
state or any public instrumentality thereof, in each case maturing within
one year after such date and having, at the time of the acquisition
thereof, the highest rating obtainable from either Standard & Poor's
Ratings Group ("S&P") or ▇▇▇▇▇'▇ Investors Service, Inc. ("Moody's");
(iii) commercial paper maturing no more than one year from the date of
creation thereof and having, at the time of the acquisition thereof, a
rating of at least A-1 from S&P or at least P-1 from Moody's; (iv)
certificates of deposit or bankers' acceptances maturing within one year
after such date and issued or accepted by any Lender or by any commercial
bank organized under the laws of the United States of America or any state
thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of
not less than $100,000,000; and (v) shares of any money market mutual fund
that (a) has at least 95% of its assets invested continuously in the types
of investments referred to in clauses (i) and (ii) above, (b) has net
assets of not less than $500,000,000, and (c) has the highest rating
obtainable from either S&P or Moody's.
"Certificate re Non-Bank Status" means a certificate substantially
in the form of Exhibit XI annexed hereto delivered by a Lender to
Administrative Agent pursuant to subsection 2.7B(iii).
"Class" means, as applied to Lenders, each of the following classes
of Lenders: (i) Lenders having AXEL Exposure and (ii) Lenders having
Revolving Loan Exposure.
"Closing Date" means the date on or before November 15, 1996, on
which the initial Loans are made.
"Collateral" means, collectively, all of the personal property
(including capital stock) in which Liens are purported to be granted
pursuant to the Collateral Documents as security for the Obligations.
"Collateral Account" has the meaning assigned to that term in the
Collateral Account Agreement.
"Collateral Account Agreement" means the Collateral Account
Agreement executed and delivered by Borrower and Administrative Agent on
the Closing Date, substantially in the form of Exhibit XII annexed hereto,
as such Collateral Account Agreement may hereafter be amended,
supplemented or otherwise modified from time to time.
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"Collateral Documents" means the Holdings Pledge Agreement, the
Borrower Pledge Agreement, the Borrower Security Agreement, the Collateral
Account Agreement, the Subsidiary Pledge Agreement, the Subsidiary
Security Agreement, and all other instruments or documents delivered by
any Loan Party pursuant to this Agreement or any of the other Loan
Documents in order to grant to Administrative Agent, on behalf of Lenders,
a Lien on any personal property of that Loan Party as security for the
Obligations.
"Commercial Letter of Credit" means any letter of credit or similar
instrument issued for the purpose of providing the primary payment
mechanism in connection with the purchase of any materials, goods or
services by Borrower or any of its Subsidiaries.
"Commitments" means the commitments of Lenders to make Loans as set
forth in subsection 2.1A.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit VII annexed hereto delivered to Administrative Agent and
Lenders by Borrower pursuant to subsection 6.1(iv).
"Confidential Information Memorandum" means that certain
Confidential Information Memorandum prepared by Borrower relating to the
AXELs and Revolving Loans dated July 1996, together with any supplements
thereto.
"Consolidated Adjusted Capital Expenditures" means, for any period,
Consolidated Capital Expenditures for that period minus any portion of
such Consolidated Capital Expenditures (i) in respect of Permitted
Acquisitions or (ii) financed with insurance or condemnation proceeds.
"Consolidated Adjusted EBITDA" means, for any period, the amounts
(without duplication) for such period of (i) Consolidated Net Income, (ii)
Consolidated Interest Expense, (iii) provisions for taxes, (iv) total
depreciation expense, (v) total amortization expense, (vi) Management
Fees, (vii)(a) other non-cash items reducing Consolidated Net Income less
(b) non-cash items increasing Consolidated Net Income and (viii)(a)
non-recurring items reducing Consolidated Net Income less (b)
non-recurring items increasing Consolidated Net Income, all of the
foregoing as determined on a consolidated basis for Holdings and its
Subsidiaries in conformity with GAAP.
"Consolidated Capital Expenditures" means, for any period, the
aggregate of all expenditures (whether paid in Cash or other consideration
or accrued as a liability and including that portion of Capital Leases
which is capitalized on the consolidated balance sheet of Holdings and its
Subsidiaries) by Holdings and its Subsidiaries during that period that, in
conformity with GAAP, are included in "additions to
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property, plant or equipment" or comparable items reflected in the
consolidated statement of cash flows of Holdings and its Subsidiaries.
"Consolidated Cash Interest Expense" means, for any period,
Consolidated Interest Expense, but excluding, however, interest expense
(including amortization of financing fees) not payable in Cash.
"Consolidated Current Assets" means, as at any date of
determination, the total assets of Holdings and its Subsidiaries on a
consolidated basis which may properly be classified as current assets in
conformity with GAAP, excluding Cash and Cash Equivalents.
"Consolidated Current Liabilities" means, as at any date of
determination, the total liabilities of Holdings and its Subsidiaries on a
consolidated basis which may properly be classified as current liabilities
in conformity with GAAP.
"Consolidated Excess Cash Flow" means, for any period, an amount (if
positive) equal to (i) the sum, without duplication, of the amounts for
such period of (a) Consolidated Adjusted EBITDA, (b) the Consolidated
Working Capital Adjustment and (c) the Deferred Merchandising Adjustment
minus (ii) the sum, without duplication, of the amounts for such period of
(a) voluntary and scheduled repayments of Consolidated Total Debt
(excluding repayments of Revolving Loans except to the extent the
Revolving Loan Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Adjusted Capital Expenditures minus any
portion of Consolidated Adjusted Capital Expenditures financed during such
period with the proceeds of Indebtedness permitted under subsection
7.1(vi), (c) Consolidated Cash Interest Expense, (d) the provision for
current taxes of Holdings and its Subsidiaries payable in cash with
respect to such period, (e) to the extent not included in Consolidated
Interest Expense, Cash payments in respect of Covenants not to Compete and
the Batesville Liability, and (f) to the extent not included in the
determination of Consolidated Adjusted EBITDA, (1) non-recurring Cash
charges, (2) Management Fees and (3) Cash costs of purchasing Hedge
Agreements during such period.
"Consolidated Fixed Charges" means, for any period, the sum (without
duplication) of the amounts for such period of (i) Consolidated Cash
Interest Expense, (ii) scheduled repayments of Indebtedness included in
Consolidated Total Debt and (iii) taxes based on income actually paid by
Holdings and its Subsidiaries during such period, all of the foregoing as
determined on a consolidated basis for Holdings and its Subsidiaries.
"Consolidated Interest Expense" means, for any period, total
interest expense (including that portion attributable to Capital Leases,
Covenants not to Compete and the Batesville Liability in accordance with
GAAP and capitalized interest) of Holdings and its Subsidiaries on a
consolidated basis with respect to all outstanding
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Indebtedness of Holdings and its Subsidiaries, including all commissions,
discounts and other fees and charges owed with respect to letters of
credit and bankers' acceptance financing and net costs under Interest Rate
Agreements, but excluding, however, any amounts referred to in subsection
2.3 payable to Agents and Lenders on or before the Closing Date and
excluding interest expense incurred on the Remaining Existing Indebtedness
prior to but not after January 31, 1997.
"Consolidated Net Income" means, for any period, the net income (or
loss) of Holdings and its Subsidiaries on a consolidated basis for such
period taken as a single accounting period determined in conformity with
GAAP; provided that there shall be excluded (i) the income (or loss) of
any Person (other than a Subsidiary of Holdings) in which any other Person
(other than Holdings or any of its Subsidiaries) has a joint interest,
except to the extent of the amount of dividends or other distributions
actually paid to Holdings or any of its Subsidiaries by such Person during
such period, (ii) the income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary of Holdings or is merged into or consolidated
with Holdings or any of its Subsidiaries or that Person's assets are
acquired by Holdings or any of its Subsidiaries, (iii) the income of any
Subsidiary of Holdings to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of that income is
not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary, (iv) any after-tax
gains or losses attributable to Asset Sales or returned surplus assets of
any Pension Plan, and (v) (to the extent not included in clauses (i)
through (iv) above) any net extraordinary gains or net non-cash
extraordinary losses.
"Consolidated Total Debt" means, as at any date of determination,
the aggregate stated balance sheet amount of all Indebtedness and
Contingent Obligations of Holdings and its Subsidiaries in respect of
Indebtedness, in each case other than Indebtedness in respect of Covenants
not to Compete and the Batesville Liability, determined on a consolidated
basis in accordance with GAAP.
"Consolidated Working Capital" means, as at any date of
determination, the excess of Consolidated Current Assets over Consolidated
Current Liabilities.
"Consolidated Working Capital Adjustment" means, for any period on a
consolidated basis, the amount (which may be a negative number) by which
Consolidated Working Capital as of the beginning of such period exceeds
(or is less than) Consolidated Working Capital as of the end of such
period.
"Contingent Obligation", as applied to any Person, means any direct
or indirect liability, contingent or otherwise, of that Person (i) with
respect to any Indebtedness, lease, dividend or other obligation of
another if the primary purpose or intent thereof by the Person incurring
the Contingent Obligation is to provide assurance to the obligee of such
obligation of another that such obligation of another
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will be paid or discharged, or that any agreements relating thereto will
be complied with, or that the holders of such obligation will be protected
(in whole or in part) against loss in respect thereof, (ii) with respect
to any letter of credit issued for the account of that Person or as to
which that Person is otherwise liable for reimbursement of drawings, or
(iii) under Hedge Agreements. Contingent Obligations shall include (a) the
direct or indirect guaranty, endorsement (otherwise than for collection or
deposit in the ordinary course of business), co-making, discounting with
recourse or sale with recourse by such Person of the obligation of
another, (b) the obligation to make take-or-pay or similar payments if
required regardless of non-performance by any other party or parties to an
agreement, and (c) any liability of such Person for the obligation of
another through any agreement (contingent or otherwise) (1) to purchase,
repurchase or otherwise acquire such obligation or any security therefor,
or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital
contributions or otherwise) or (2) to maintain the solvency or any balance
sheet item, level of income or financial condition of another if, in the
case of any agreement described under subclauses (1) or (2) of this
sentence, the primary purpose or intent thereof is as described in the
preceding sentence. The amount of any Contingent Obligation shall be equal
to the amount of the obligation so guaranteed or otherwise supported or,
if less, the amount to which such Contingent Obligation is specifically
limited.
"Contractual Obligation", as applied to any Person, means any
provision of any Security issued by that Person or of any material
indenture, mortgage, deed of trust, contract, undertaking, agreement or
other instrument to which that Person is a party or by which it or any of
its properties is bound or to which it or any of its properties is
subject.
"Covenants not to Compete" means any covenants not to compete,
consulting agreements, former owner agreements (including employment
agreements) or other similar arrangements pursuant to which Holdings or
any of its Subsidiaries agree to make periodic payments to certain Persons
in connection with the acquisition of funeral homes and cemeteries.
"Cumulative Consolidated Adjusted EBITDA" means, at any date of
determination, Consolidated Adjusted EBITDA for the period from the
Closing Date through such date.
"Cure Amount" means the amount of Cash received by Holdings and
contributed to Borrower from the issuance of Permitted Cure Securities by
Holdings or from other contributions to the capital of Holdings pursuant
to the exercise by Holdings of any Cure Right.
"Cure Right" has the meaning assigned to that term in subsection
7.6F.
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"Currency Agreement" means any foreign exchange contract, currency
swap agreement, futures contract, option contract, synthetic cap or other
similar agreement or arrangement to which Holdings or any of its
Subsidiaries is a party.
"Deferred Merchandising Adjustment" means, for any period, the
difference (whether positive or negative) between (a) cash flow from
pre-need funeral sales during such period and (b) Consolidated Adjusted
EBITDA from pre-need funeral sales during such period, in each case
determined pursuant to the calculations set forth in the form of the
Compliance Certificate.
"Deposit Account" means a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate
of deposit.
"Dollars" and the sign "$" mean the lawful money of the United
States of America.
"Eligible Assignee" means (i)(a) a commercial bank organized under
the laws of the United States or any state thereof; (b) a savings and loan
association or savings bank organized under the laws of the United States
or any state thereof; (c) a commercial bank organized under the laws of
any other country or a political subdivision thereof; provided that (1)
such bank is acting through a branch or agency located in the United
States or (2) such bank is organized under the laws of, and acting through
a branch or agency located in, a country that is a member of the
Organization for Economic Cooperation and Development or a political
subdivision of such country; and (d) any finance company, insurance
company, or other financial institution or fund (whether a corporation,
partnership, trust or other entity) that is engaged in making, purchasing
or otherwise investing in commercial loans in the ordinary course of its
business and having a combined capital and surplus or net assets of at
least $100,000,000; and (ii) any Lender and any Affiliate of any Lender;
provided that no Affiliate of Borrower shall be an Eligible Assignee.
"Employee Benefit Plan" means any "employee benefit plan" as defined
in Section 3(3) of ERISA which is or was maintained or contributed to by
Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates.
"Environmental Claim" means any investigation, written notice,
written notice of violation, claim, action, suit, proceeding, written
demand, written abatement order or other written order or directive
(conditional or otherwise), by any governmental authority or any other
Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law, (ii) in connection with any
Hazardous Materials or any actual or alleged Hazardous Materials Activity,
or (iii) in connection with any actual or alleged damage, injury, threat
or harm to health, safety, natural resources or the environment.
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"Environmental Laws" means any and all applicable statutes,
ordinances, orders, rules, regulations, judgments, Governmental
Authorizations, or any other binding requirements of governmental
authorities relating to (i) environmental matters, including those
relating to any Hazardous Materials Activity, (ii) the generation, use,
storage, transportation or disposal of Hazardous Materials, or (iii)
occupational safety and health, industrial hygiene, land use or the
protection of human, plant or animal health or welfare as relating to the
environment, in any manner applicable to Holdings or any of its
Subsidiaries or any Facility, including the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. ss. 9601 et seq.),
the Hazardous Materials Transportation Act (49 U.S.C. ss. 1801 et seq.),
the Resource Conservation and Recovery Act (42 U.S.C. ss. 6901 et seq.),
the Federal Water Pollution Control Act (33 U.S.C. ss. 1251 et seq.), the
Clean Air Act (42 U.S.C. ss. 7401 et seq.), the Toxic Substances Control
Act (15 U.S.C. ss. 2601 et seq.), the Federal Insecticide, Fungicide and
Rodenticide Act (7 U.S.C. ss.136 et seq.), the Occupational Safety and
Health Act (29 U.S.C. ss. 651 et seq.), the Oil Pollution Act (33 U.S.C.
ss. 2701 et seq) and the Emergency Planning and Community Right-to-Know
Act (42 U.S.C. ss. 11001 et seq.), each as amended or supplemented, any
analogous state or local statutes or laws, and any regulations promulgated
pursuant to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and any successor thereto.
"ERISA Affiliate" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations within
the meaning of Section 414(b) of the Internal Revenue Code of which that
Person is a member; (ii) any trade or business (whether or not
incorporated) which is a member of a group of trades or businesses under
common control within the meaning of Section 414(c) of the Internal
Revenue Code of which that Person is a member; and (iii) any member of an
affiliated service group within the meaning of Section 414(m) or (o) of
the Internal Revenue Code of which that Person, any corporation described
in clause (i) above or any trade or business described in clause (ii)
above is a member. Any former ERISA Affiliate of Holdings or any of its
Subsidiaries shall continue to be considered an ERISA Affiliate of
Holdings or such Subsidiary within the meaning of this definition with
respect to the period such entity was an ERISA Affiliate of Holdings or
such Subsidiary and with respect to liabilities arising after such period
for which Holdings or such Subsidiary could be liable under the Internal
Revenue Code or ERISA.
"ERISA Event" means (i) a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations issued thereunder with respect
to any Pension Plan (excluding those for which the provision for 30-day
notice to the PBGC has been waived by regulation); (ii) the failure to
meet the minimum funding standard of Section 412 of the Internal Revenue
Code with respect to any Pension Plan (whether or not waived in accordance
with Section 412(d) of the Internal Revenue
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Code) or the failure to make by its due date a required installment under
Section 412(m) of the Internal Revenue Code with respect to any Pension
Plan or the failure to make any required contribution to a Multiemployer
Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate
such plan in a distress termination described in Section 4041(c) of ERISA;
(iv) the withdrawal by Holdings, any of its Subsidiaries or any of their
respective ERISA Affiliates from any Pension Plan with two or more
contributing sponsors or the termination of any such Pension Plan
resulting in liability pursuant to Section 4063 or 4064 of ERISA; (v) the
institution by the PBGC of proceedings to terminate any Pension Plan, or
the occurrence of any event or condition which could reasonably be
expected to constitute grounds under ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan; (vi) the
imposition of material liability on Holdings, any of its Subsidiaries or
any of their respective ERISA Affiliates pursuant to Section 4062(e) or
4069 of ERISA or by reason of the application of Section 4212(c) of ERISA;
(vii) the withdrawal of Holdings, any of its Subsidiaries or any of their
respective ERISA Affiliates in a complete or partial withdrawal (within
the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer
Plan if there could reasonably be expected to be any material liability
therefor, or the receipt by Holdings, any of its Subsidiaries or any of
their respective ERISA Affiliates of notice from any Multiemployer Plan
that it is in reorganization or insolvency pursuant to Section 4241 or
4245 of ERISA, or that it intends to terminate or has terminated under
Section 4041A or 4042 of ERISA; (viii) the occurrence of an act or
omission which could give rise to the imposition on Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates of material
fines, material penalties, material taxes or material related charges
under Chapter 43 of the Internal Revenue Code or under Section 409,
Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any
Employee Benefit Plan; (ix) the assertion of a material claim (other than
routine claims for benefits) against any Employee Benefit Plan other than
a Multiemployer Plan or the assets thereof, or against Holdings, any of
its Subsidiaries or any of their respective ERISA Affiliates in connection
with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other
Employee Benefit Plan intended to be qualified under Section 401(a) of the
Internal Revenue Code) to qualify under Section 401(a) of the Internal
Revenue Code, or the failure of any trust forming part of any Pension Plan
to qualify for exemption from taxation under Section 501(a) of the
Internal Revenue Code; or (xi) the imposition of a material Lien pursuant
to Section 401(a)(29) or 412(n) of the Internal Revenue Code or pursuant
to ERISA with respect to any Pension Plan.
"Eurodollar Rate Loans" means Loans bearing interest at rates
determined by reference to the Adjusted Eurodollar Rate as provided in
subsection 2.2A.
"Event of Default" means each of the events set forth in Section 8.
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"Excess Consolidated Capital Expenditure Amount" means, as of any
date of determination, the sum of the Yearly Excess Cash Flow Amounts for
each Fiscal Year ending after the Closing Date and on or prior to the date
of determination. As used in this definition, "Yearly Excess Cash Flow
Amount" means, for each Fiscal Year, the lesser of (i) Consolidated Excess
Cash Flow for such Fiscal Year and (ii) the sum of $5,000,000 and 50% of
Consolidated Excess Cash Flow in excess of $5,000,000 for such Fiscal
Year; provided in no event shall the Yearly Excess Cash Flow Amount be
less than zero in any Fiscal Year.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute.
"Existing Indebtedness" means the Indebtedness set forth on Schedule
1.1A annexed hereto which shall be repaid in full on the Closing Date.
"Existing Stockholders" has the meaning assigned to that term in the
definition of Acquisition Agreement.
"Facilities" means any and all real property (including all
buildings, fixtures or other improvements located thereon) now, hereafter
or heretofore owned, leased, operated or used by Holdings or any of its
Subsidiaries or any of their respective predecessors or Affiliates.
"Federal Funds Effective Rate" means, for any period, a fluctuating
interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the
next preceding Business Day) by the Federal Reserve Bank of New York, or,
if such rate is not so published for any day which is a Business Day, the
average of the quotations for such day on such transactions received by
Administrative Agent from three Federal funds brokers of recognized
standing selected by Administrative Agent.
"Financial Performance Covenants" means the covenants of Holdings
and Borrower set forth in subsections 7.6A, 7.6B, 7.6C and 7.6D.
"Financial Plan" has the meaning assigned to that term in subsection
6.1(xiii).
"First Priority" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that (i)
such Lien has priority over any other Lien on such Collateral (other than
Liens permitted pursuant to subsection 7.2A) and (ii) such Lien is the
only Lien (other than Permitted Encumbrances and Liens permitted pursuant
to subsection 7.2) to which such Collateral is subject.
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"Fiscal Quarter" means a fiscal quarter of any Fiscal Year.
"Fiscal Year" means the fiscal year of Holdings and its Subsidiaries
ending on December 31 of each calendar year.
"Funding and Payment Office" means (i) the office of Administrative
Agent and Swing Line Lender located at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ or (ii) such other office of Administrative Agent
and Swing Line Lender located in the United States as may from time to
time hereafter be designated as such in a written notice delivered by
Administrative Agent and Swing Line Lender to Borrower and each Lender.
"Funding Date" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application thereof
set forth in subsection 1.2, generally accepted accounting principles set
forth in opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such
other statements by such other entity as may be approved by a significant
segment of the accounting profession, in each case as the same are
applicable to the circumstances as of the date of determination; provided
that to the extent there exist differences in GAAP as applied in the
preparation of the interim, non-restated financial statements of Holdings
and its Subsidiaries as at March 31, 1995 and the interim financial
statements of Holdings and its Subsidiaries as at March 31, 1996 presented
in the Offering Memorandum dated August 13, 1996 relating to the Senior
Subordinated Notes, GAAP as applied in the preparation of such
non-restated financial statements shall not be considered to be GAAP for
purposes of this Agreement to the extent of such differences.
"Governmental Authorization" means any permit, license,
authorization, plan, directive, consent order or consent decree of or from
any federal, state or local governmental authority, agency or court.
"Guaranties" means the Holdings Guaranty and the Subsidiary
Guaranty.
"Hazardous Materials" means (i) any chemical, material or substance
at any time defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely
hazardous waste", "acutely hazardous waste", "radioactive waste",
"biohazardous waste", "pollutant", "toxic pollutant", "contaminant",
"restricted hazardous waste", "infectious waste", "toxic substances", or
any other term or expression intended to define, list or classify
substances by reason of properties harmful to health, safety or the indoor
or outdoor environment (including harmful properties such as ignitability,
corrosivity, reactivity, carcinogenicity, toxicity, reproductive toxicity,
"TCLP toxicity" or "EP toxicity" or words of similar import under any
applicable Environmental Laws); (ii) any oil, petroleum, petroleum
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fraction or petroleum derived substance; (iii) any drilling fluids,
produced waters and other wastes associated with the exploration,
development or production of crude oil, natural gas or geothermal
resources; (iv) any explosives; (v) any radioactive materials; (vi) any
asbestos-containing materials; (vii) urea formaldehyde foam insulation;
(viii) electrical equipment which contains any oil or dielectric fluid
containing polychlorinated biphenyls; (ix) pesticides; and (x) any other
chemical, material or substance, exposure to which is prohibited, limited
or regulated by any governmental authority or which may or could pose a
hazard to the health and safety of the owners, occupants or any Persons in
the vicinity of any Facility or to the indoor or outdoor environment.
"Hazardous Materials Activity" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous
Materials, including the use, manufacture, possession, storage, holding,
presence, existence, location, Release, threatened Release, discharge,
placement, generation, transportation, processing, construction,
treatment, abatement, removal, remediation, disposal, disposition or
handling of any Hazardous Materials, and any corrective action or response
action with respect to any of the foregoing.
"Hedge Agreement" means an Interest Rate Agreement or a Currency
Agreement designed to hedge against fluctuations in interest rates or
currency values, respectively.
"Holdings" means Prime Succession, Inc., a Delaware corporation, to
be renamed Prime Succession Holdings, Inc. as of the Closing Date.
"Holdings Certificate of Designations" means the provisions of
Holdings' Certificate of Incorporation relating to the Holdings Preferred
Stock, in the form delivered to Arranging Agent, prior to the execution of
this Agreement and as such provisions may be amended from time to time
thereafter to the extent permitted under subsection 7.13A.
"Holdings Common Stock" means the common stock of Holdings, par
value $.01 per share.
"Holdings Guaranty" means the Holdings Guaranty executed and
delivered by Holdings on the Closing Date, substantially in the form of
Exhibit XVIII annexed hereto, as such Holdings Guaranty may thereafter be
amended, supplemented or otherwise modified from time to time.
"Holdings Preferred Stock" means the Preferred Stock of Holdings,
with a liquidation preference of $10,000 per share and with the other
terms set forth in the Holdings Certificate of Designations.
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"Holdings Pledge Agreement" means the Holdings Pledge Agreement
executed and delivered by Holdings and Administrative Agent on the Closing
Date, substantially in the form of Exhibit XIX annexed hereto, as such
Holdings Pledge Agreement may thereafter be amended, supplemented or
otherwise modified from time to time.
"Indebtedness", as applied to any Person, means (i) all indebtedness
for borrowed money, (ii) that portion of obligations with respect to
Capital Leases that is properly classified as a liability on a balance
sheet in conformity with GAAP, (iii) notes payable and drafts accepted
representing extensions of credit whether or not representing obligations
for borrowed money, (iv) any obligation owed for all or any part of the
deferred purchase price of property or services (including those portions
of obligations with respect to Covenants not to Compete and the Batesville
Liability that are properly classified as liabilities on a balance sheet
in conformity with GAAP, but excluding any such obligations incurred under
ERISA), which purchase price is (a) due more than six months from the date
of incurrence of the obligation in respect thereof or (b) evidenced by a
note or similar written instrument, (v) all indebtedness secured by any
Lien on any property or asset owned or held by that Person regardless of
whether the indebtedness secured thereby shall have been assumed by that
Person or is nonrecourse to the credit of that Person and (vi) any
reimbursement obligations of that Person in respect of letters of credit.
Obligations under Interest Rate Agreements and Currency Agreements
constitute (1) in the case of Hedge Agreements, Contingent Obligations,
and (2) in all other cases, Investments, and in neither case constitute
Indebtedness.
"Indemnitee" has the meaning assigned to that term in subsection
10.3.
"Intellectual Property" means all patents, trademarks, tradenames,
copyrights, technology, know-how and processes used in or necessary for
the conduct of the business of Borrower and its Subsidiaries as currently
conducted that are material to the condition (financial or otherwise),
business or operations of Borrower and its Subsidiaries, taken as a whole.
"Intercompany Note" means a promissory note executed by a Loan Party
or any of its Subsidiaries evidencing intercompany Indebtedness
substantially in the form of Exhibit XX annexed hereto.
"Interest Payment Date" means (i) with respect to any Base Rate
Loan, each February 1, May 1, August 1 and November 1 of each year,
commencing on the first such date to occur after the Closing Date, and
(ii) with respect to any Eurodollar Rate Loan, the last day of each
Interest Period applicable to such Loan; provided that in the case of each
Interest Period of longer than three months "Interest Payment Date" shall
also include each date that is three months, or an integral multiple
thereof, after the commencement of such Interest Period.
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"Interest Period" has the meaning assigned to that term in
subsection 2.2B.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other
similar agreement or arrangement to which Borrower or any of its
Subsidiaries is a party.
"Interest Rate Determination Date" means, with respect to any
Interest Period, the second Business Day prior to the first day of such
Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter, and any
successor statute.
"Inventory" means, with respect to any Person as of any date of
determination, all goods, merchandise and other personal property which
are then held by such Person for sale or lease, including raw materials
and work in process.
"Investment" means (i) any direct or indirect purchase or other
acquisition by Holdings or any of its Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person (including any Subsidiary
of Holdings), (ii) any direct or indirect redemption, retirement, purchase
or other acquisition for value, by any Subsidiary of Holdings from any
Person other than Holdings or any of its Subsidiaries, of any equity
Securities of such Subsidiary, (iii) any direct or indirect loan, advance
(other than advances to employees for moving, entertainment and travel
expenses, drawing accounts and similar expenditures in the ordinary course
of business) or capital contribution by Holdings or any of its
Subsidiaries to any other Person (other than a Wholly Owned Subsidiary of
Holdings), including all indebtedness and accounts receivable from that
other Person that are not current assets or did not arise from sales to
that other Person in the ordinary course of business, or (iv) Interest
Rate Agreements or Currency Agreements not constituting Hedge Agreements.
The amount of any Investment shall be (a) the original cost of such
Investment plus (b) the cost of all additions thereto, without any
adjustments for increases or decreases in value, or write-ups, write-downs
or write-offs with respect to such Investment minus (c) the lesser of (1)
the aggregate amount of any repayments, redemptions, dividends or
distributions thereon or proceeds from the sale thereof, in each case to
the extent of any Cash payments (including any Cash received by way of
deferred payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) actually received by Borrower
or any of its Subsidiaries in connection therewith, and (2) the aggregate
amount described in the immediately preceding clauses (a) and (b).
"Investors" means collectively ▇▇▇▇▇▇ and the Blackstone Investors.
"Issuing Lender" means, Scotiabank, or any Person serving as
successor Administrative Agent hereunder, in its capacity as Issuing
Lender.
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"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form;
provided that in no event shall any corporate Subsidiary of any Person be
considered to be a Joint Venture to which such Person is a party.
"Lender" and "Lenders" means the persons identified as "Lenders" and
listed on the signature pages of this Agreement, together with their
successors and permitted assigns pursuant to subsection 10.1, and the term
"Lenders" shall include Swing Line Lender unless the context otherwise
requires; provided that the term "Lenders", when used in the context of a
particular Commitment, shall mean Lenders having that Commitment.
"Letter of Credit" or "Letters of Credit" means Commercial Letters
of Credit and Standby Letters of Credit issued or to be issued by Issuing
Lender for the account of Borrower pursuant to subsection 3.1.
"Letter of Credit Usage" means, as at any date of determination, the
sum of (i) the maximum aggregate amount which is or at any time thereafter
may become available for drawing under all Letters of Credit then
outstanding plus (ii) the aggregate amount of all drawings under Letters
of Credit honored by Issuing Lender and not theretofore reimbursed by
Borrower (including any such reimbursement out of the proceeds of
Revolving Loans pursuant to subsection 3.3B).
"Leverage Ratio" means the ratio of (i) Consolidated Total Debt as
of the last day of any Fiscal Quarter to (ii) Consolidated Adjusted EBITDA
for the four-Fiscal Quarter period then ended, in each case as set forth
in the most recent Compliance Certificate delivered by Borrower to
Administrative Agent and Lenders pursuant to clause (iii) of subsection
6.1.
"Lien" means any lien, mortgage, pledge, collateral assignment,
security interest, charge or encumbrance of any kind (including any
conditional sale or other title retention agreement, any lease in the
nature thereof, and any agreement to give any security interest) and any
option or trust having the practical effect of any of the foregoing.
"Loan" or "Loans" means one or more of the AXELs, Revolving Loans or
Swing Line Loans or any combination thereof.
"Loan Documents" means this Agreement, the Notes, any applications
for, or reimbursement agreements or other documents or certificates
executed by Borrower in favor of Issuing Lender relating to, the Letters
of Credit, the Guaranties, the Collateral Documents and any Hedge
Agreements entered into with Lenders or their Affiliates.
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"Loan Party" means each of Holdings, Borrower and any of Holdings'
Subsidiaries from time to time executing a Loan Document, and "Loan
Parties" means all such Persons, collectively.
"▇▇▇▇▇▇" means ▇▇▇▇▇▇ Group International Inc., a Delaware
corporation and a wholly owned Subsidiary of ▇▇▇▇▇▇ Group.
"▇▇▇▇▇▇ Group" means The ▇▇▇▇▇▇ Group, Inc., a corporation organized
under the laws of British Columbia.
"Management Fees" means fees payable to Affiliates of the Blackstone
Investors in an aggregate amount not to exceed $250,000 per annum, as
adjusted for inflation.
"Margin Stock" has the meaning assigned to that term in Regulation U
of the Board of Governors of the Federal Reserve System as in effect from
time to time.
"Material Adverse Effect" means (i) any material adverse effect on
or affecting the financial position, prospects or results of operations of
Holdings and its Subsidiaries, taken as a whole, or (ii) the impairment of
the ability of Holdings, Borrower or the Loan Parties, taken as a whole,
to perform, or of Administrative Agent or Lenders to enforce, the
Obligations.
"Material Contract" means any contract or other arrangement to which
Holdings or any of its Subsidiaries is a party (other than the Loan
Documents) for which breach, nonperformance, cancellation or failure to
renew could have a Material Adverse Effect.
"Maximum Consolidated Capital Expenditures Amount" has the meaning
assigned to that term in subsection 7.8.
"Multiemployer Plan" means any Employee Benefit Plan which is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"Net Asset Sale Proceeds" means, with respect to any Asset Sale,
Cash payments (including any Cash received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but
only as and when so received) received from such Asset Sale, net of any
bona fide direct costs incurred in connection with such Asset Sale,
including (i) taxes reasonably estimated to be actually payable within two
years of the date of such Asset Sale as a result of any gain recognized in
connection with such Asset Sale and (ii) payment of the outstanding
principal amount of, interest on, and premium or penalty, if any, with
respect to any Indebtedness (other than the Loans) that is secured by a
Lien on the stock or assets in question and that is required to be repaid
under the terms thereof as a result of such Asset Sale.
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"Net Insurance/Condemnation Proceeds" means any Cash payments or
proceeds received by Holdings or any of its Subsidiaries (i) under any
business interruption or casualty insurance policy in respect of a covered
loss thereunder or (ii) as a result of the taking of any assets of
Holdings or any of its Subsidiaries by any Person pursuant to the power of
eminent domain, condemnation or otherwise, or pursuant to a sale of any
such assets to a purchaser with such power under threat of such a taking
(a "Condemnation"), in each case net of (a) any actual and reasonable
documented costs incurred by Holdings or any of its Subsidiaries in
connection with the adjustment or settlement of any claims of Holdings or
such Subsidiary in respect thereof and (b) any bona fide direct costs
incurred in connection with such Condemnation or casualty, including (1)
taxes reasonably estimated to be actually payable within two years of the
date of such Condemnation or casualty as a result of any gain recognized
in connection with such Condemnation or casualty and (2) payment of the
outstanding principal amount of, interest on, and premium or penalty, if
any, with respect to any Indebtedness (other than the Loans) that is
secured by a Lien on the assets in question and that is required to be
repaid under the terms thereof as a result of such Condemnation or
casualty.
"Notes" means one or more of the AXEL Notes, Revolving Notes or
Swing Line Note or any combination thereof.
"Notice of Borrowing" means a notice substantially in the form of
Exhibit I annexed hereto delivered by Borrower to Administrative Agent
pursuant to subsection 2.1B with respect to a proposed borrowing.
"Notice of Conversion/Continuation" means a notice substantially in
the form of Exhibit II annexed hereto delivered by Borrower to
Administrative Agent pursuant to subsection 2.2D with respect to a
proposed conversion or continuation of the applicable basis for
determining the interest rate with respect to the Loans specified therein.
"Notice of Issuance of Letter of Credit" means a notice
substantially in the form of Exhibit III annexed hereto delivered by
Borrower to Administrative Agent pursuant to subsection 3.1B(i) with
respect to the proposed issuance of a Letter of Credit.
"Obligations" means all obligations of every nature of each Loan
Party from time to time owed to Agents, Lenders or their respective
Affiliates or any of them under the Loan Documents, whether for principal,
interest, reimbursement of amounts drawn under Letters of Credit, fees,
expenses, indemnification or otherwise.
"Officers' Certificate" means, as applied to any corporation, a
certificate executed on behalf of such corporation by its chairman of the
board (if an officer) or its president or one of its vice presidents and
by its chief financial officer or its treasurer; provided that any
Officers' Certificate with respect to compliance with a
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condition precedent to the making of the initial Loans hereunder shall
include (i) a statement that the officer or officers making or giving such
Officers' Certificate have read such condition and any definitions or
other provisions contained in this Agreement relating thereto, (ii) a
statement that, in the opinion of the signers, they have made or have
caused to be made such examination or investigation as is necessary to
enable them to express an informed opinion as to whether or not such
condition has been complied with, and (iii) a statement as to whether, in
the opinion of the signers, such condition has been complied with.
"Operating Lease" means, as applied to any Person, any lease
(including leases that may be terminated by the lessee at any time) of any
property (whether real, personal or mixed) that is not a Capital Lease
other than any such lease under which that Person is the lessor.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Pension Plan" means any Employee Benefit Plan, other than a
Multi-employer Plan, which is subject to Section 412 of the Internal
Revenue Code or Section 302 of ERISA.
"Permitted Acquisition" means a Business Acquisition for an
aggregate purchase price (including any Covenants not to Compete
reasonably discounted to present value) (i) that is less than or equal to
5.5 times the Pro Forma Projected EBITDA for an Acquired Business
(the"Maximum Acquisition Amount") or (ii) if such aggregate purchase price
exceeds the Maximum Acquisition Amount, that is funded to the extent of
such excess by common equity contributions to, or purchases of common
equity from, Holdings by the Investors, the proceeds of which are
contributed to Borrower.
"Permitted Cure Security" means an equity Security of Holdings
having no mandatory redemption, repurchase or similar requirements prior
to February 1, 2004 and upon which all dividends, at the election of
Holdings, may be payable in additional shares of such equity Security.
"Permitted Encumbrances" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or 412(n)
of the Internal Revenue Code or by ERISA, any such Lien relating to or
imposed in connection with any Environmental Claim, and any such Lien
expressly prohibited by any applicable terms of any of the Collateral
Documents):
(i) Liens for taxes, assessments or governmental charges or
claims the payment of which is not, at the time, required by
subsection 6.3;
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(ii) statutory Liens of landlords, statutory Liens of banks
and rights of set-off, statutory Liens of carriers, warehousemen,
mechanics, repairmen, workmen and materialmen, and other Liens
imposed by law, in each case incurred in the ordinary course of
business (a) for amounts not yet overdue or (b) for amounts that are
overdue and that are being contested in good faith by appropriate
proceedings, so long as (1) such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been
made for any such contested amounts, and (2) in the case of a Lien
with respect to any material portion of the Collateral, such contest
proceedings conclusively operate to stay the sale of any portion of
the Collateral on account of such Lien;
(iii) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money), so
long as no foreclosure, sale or similar proceedings have been
commenced with respect to any material portion of the Collateral on
account thereof;
(iv) any attachment or judgment Lien not constituting an Event
of Default under subsection 8.8;
(v) leases or subleases granted to third parties in accordance
with any applicable terms of the Collateral Documents and not
interfering in any material respect with the ordinary conduct of the
business of Borrower or any of its Subsidiaries or resulting in a
material diminution in the value of any Collateral as security for
the Obligations;
(vi) easements, rights-of-way, restrictions, encroachments,
and other minor defects or irregularities in title, in each case
which do not and will not interfere in any material respect with the
ordinary conduct of the business of Borrower or any of its
Subsidiaries or result in a material diminution in the value of any
Collateral as security for the Obligations;
(vii) any (a) interest or title of a lessor or sublessor under
any lease, (b) restriction or encumbrance that the interest or title
of such lessor or sublessor may be subject to, or (c) subordination
of the interest of the lessee or sublessee under such lease to any
restriction or encumbrance referred to in the preceding clause (b),
so long as the holder of such restriction or encumbrance agrees to
recognize the rights of such lessee or sublessee under such lease;
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(viii) Liens arising from filing UCC financing statements
relating solely to leases permitted by this Agreement;
(ix) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection
with the importation of goods;
(x) any zoning or similar law or right reserved to or vested
in any governmental office or agency to control or regulate the use
of any real property; and
(xi) Liens securing obligations (other than obligations
representing Indebtedness for borrowed money) under operating,
reciprocal easement or similar agreements entered into in the
ordinary course of business of Borrower and its Subsidiaries.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures,
associations, companies, trusts, banks, trust companies, land trusts,
business trusts or other organizations, whether or not legal entities, and
governments (whether federal, state or local, domestic or foreign, and
including political subdivisions thereof) and agencies or other
administrative or regulatory bodies thereof.
"Pledged Collateral" means, collectively, the "Pledged Collateral"
as defined in the Holdings Pledge Agreement, the Borrower Pledge Agreement
and the Subsidiary Pledge Agreement.
"Potential Event of Default" means a condition or event that, after
notice or lapse of time or both, would constitute an Event of Default.
"Pricing Premium" means, if as of the end of any Fiscal Quarter,
commencing with the Fiscal Quarter ending March 31, 1997, the ratio of
Consolidated Adjusted EBITDA to Consolidated Interest Expense (excluding
Premium Interest, as hereinafter defined) for the four Fiscal Quarter
period then ended is less than 1.50:1.00, then the Applicable Margin set
forth in the chart in the definition of "Applicable Margin" shall be
increased by 0.25% per annum (such additional .25% referred to herein as
"Premium Interest") on all Loans outstanding during such Fiscal Quarter
(or with respect to the initial test on March 31, 1997, on all Loans at
any time outstanding during the period from the Closing Date through March
31, 1997). The Pricing Premium shall be determined on the basis of the
financial statements and Compliance Certificates delivered by Borrower to
Administrative Agent and Lenders pursuant to clauses (ii) or (iii) and
(iv) of subsection 6.1.
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"Pricing Reduction" means (i) if at any time after the first
anniversary of the Closing Date as of the end of any Fiscal Quarter, the
Leverage Ratio is equal to or less than 6.00:1.00, a pricing reduction
equal to .25% and (ii) if at any time after the second anniversary of the
Closing Date, as of the end of any Fiscal Quarter, the Leverage Ratio is
equal to or less than 5.25:1.00, a pricing reduction equal to .50%. The
Pricing Reduction shall be determined by reference to the Leverage Ratio
set forth in the most recent financial statements delivered by Borrower to
Administrative Agent and Lenders pursuant to clause (i) or (ii) of
subsection 6.1 (accompanied by a Compliance Certificate delivered by
Borrower pursuant to clause (iii) of subsection 6.1). Any changes in the
Pricing Reduction shall become effective on the day following delivery of
the relevant Compliance Certificate to Administrative Agent and Lenders
and shall remain in effect through the next scheduled date for delivery of
a Compliance Certificate. It is understood and agreed that the Pricing
Reductions set forth in clause (i) and (ii) are not cumulative.
Notwithstanding anything herein to the contrary, (a) from the Closing Date
to and including the date of the first anniversary of the Closing Date,
the Pricing Reduction shall be zero and (b) at any time an Event of
Default shall have occurred and be continuing, the Pricing Reduction shall
be zero.
"Prime Rate" means the rate that Administrative Agent announces from
time to time as its prime lending rate for Dollars at its Funding and
Payment Office, as in effect from time to time. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. Administrative Agent or any other Lender
may make commercial loans or other loans at rates of interest at, above or
below the Prime Rate.
"Pro Forma EBITDA Adjustment" means, as of any date of determination
prior to the first anniversary of the Closing Date, the sum of the pro
forma cost savings set forth on Schedule 1.1B annexed hereto multiplied by
a fraction, the numerator of which is 365 minus the number of days elapsed
since the Closing Date and the denominator of which is 365.
"Pro Forma Projected EBITDA" means, with respect to any Acquired
Business to be acquired in a Permitted Acquisition, the net income
attributable to the Acquired Business for the most recently ended four
quarter period of the Acquired Business, after giving effect on a pro
forma basis to (i) the elimination of any expense items attributable to
the Acquired Business which will not be assumed by Borrower in connection
with the proposed acquisition of the Acquired Business and (ii) any
projected cost savings reasonably projected by Borrower and reasonably
acceptable to Administrative Agent in connection with the proposed
acquisition of the Acquired Business plus, to the extent deducted in
computing the net income attributable to the Acquired Business, the sum of
(a) interest expense, (b) provisions for taxes based on income
attributable to the Acquired Business, (c) depreciation and amortization
expenses and (d) any other non-cash items reducing net income less, to the
extent added in calculating net income attributable to the Acquired
Business
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(e) any non-cash items increasing net income and (f) any extraordinary
gains, all as determined with respect to the Acquired Business in
conformity with GAAP and as set forth in reasonable detail in an Officers'
Certificate delivered by Borrower to Administrative Agent, accompanied by
the financial statements of the Acquired Business for the periods covered
by the Officers' Certificate and accompanied by such other supporting
documentation as may be reasonably requested by Administrative Agent.
"Pro Rata Share" means (i) with respect to all payments,
computations and other matters relating to the AXEL Commitment or the AXEL
of any Lender, the percentage obtained by dividing (a) the AXEL Exposure
of that Lender by (b) the aggregate AXEL Exposure of all Lenders, (ii)
with respect to all payments, computations and other matters relating to
the Revolving Loan Commitment or the Revolving Loans of any Lender or any
Letters of Credit issued or participations therein purchased by any Lender
or any participations in any Swing Line Loans purchased by any Lender, the
percentage obtained by dividing (a) the Revolving Loan Exposure of that
Lender by (b) the aggregate Revolving Loan Exposure of all Lenders, and
(iii) for all other purposes with respect to each Lender, the percentage
obtained by dividing (a) the sum of the AXEL Exposure of that Lender plus
the Revolving Loan Exposure of that Lender by (b) the sum of the aggregate
AXEL Exposure of all Lenders plus the aggregate Revolving Loan Exposure of
all Lenders, in any such case as the applicable percentage may be adjusted
by assignments permitted pursuant to subsection 10.1. The initial Pro Rata
Share of each Lender for purposes of each of clauses (i), (ii) and (iii)
of the preceding sentence is set forth opposite the name of that Lender in
Schedule 2.1 annexed hereto.
"Refunded Swing Line Loans" has the meaning assigned to that term in
subsection 2.1A(iii).
"Register" has the meaning assigned to that term in subsection 2.1D.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Reimbursement Date" has the meaning assigned to that term in
subsection 3.3B.
"Related Agreements" means, collectively, the Acquisition Agreement,
the Holdings Certificate of Designations, the Senior Subordinated Note
Indenture and the Administrative Agreement.
"Release" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal,
dumping, leaching or migration of Hazardous Materials into the indoor or
outdoor environment (including the abandonment or disposal of any barrels,
containers or other closed receptacles
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containing any Hazardous Materials), including the movement of any
Hazardous Materials through the air, soil, surface water or groundwater.
"Remaining Existing Indebtedness" means the Indebtedness set forth
on Schedule 1.1C annexed hereto in an aggregate amount not to exceed
$7,556,583.53 which shall remain outstanding after the Closing Date, of
which all Indebtedness in excess of $1,000,000 shall be repaid or defeased
in full on or prior to January 31, 1997.
"Reorganization" has the meaning assigned to that term in the
Recitals.
"Requisite Class Lenders" means, at any time of determination (i)
for the Class of Lenders having AXEL Exposure, Lenders having or holding
more than 50% of the sum of the aggregate AXEL Exposure of all Lenders and
(ii) for the Class of Lenders having Revolving Loan Exposure, Lenders
having or holding more than 50% of the sum of the aggregate Revolving Loan
Exposure of all Lenders.
"Requisite Lenders" means Lenders having or holding more than 50% of
the sum of the aggregate AXEL Exposure of all Lenders plus the aggregate
Revolving Loan Exposure of all Lenders.
"Reserve Requirement" means, for any Interest Rate Determination
Date, the maximum aggregate reserve requirement (including all basic,
supplemental, marginal and other reserves) which is imposed under
Regulation D on such Interest Rate Determination Date.
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of
stock of Holdings or Borrower now or hereafter outstanding, except a
dividend payable solely in shares of that class of stock to the holders of
that class, (ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of
any shares of any class of stock of Borrower or Holdings now or hereafter
outstanding, (iii) any payment made to retire, or to obtain the surrender
of, any outstanding warrants, options or other rights to acquire shares of
any class of stock of Borrower or Holdings now or hereafter outstanding,
and (iv) any payment or prepayment of principal of, premium, if any, or
interest on, or redemption, purchase, retirement, defeasance (including
in-substance or legal defeasance), sinking fund or similar payment with
respect to, any Subordinated Indebtedness.
"Revolving Loan Commitment" means the commitment of a Lender to make
Revolving Loans to Borrower pursuant to subsection 2.1A(ii), and
"Revolving Loan Commitments" means such commitments of all Lenders in the
aggregate.
"Revolving Loan Commitment Termination Date" means August 26, 2001.
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"Revolving Loan Exposure" means, with respect to any Lender as of
any date of determination (i) prior to the termination of the Revolving
Loan Commitments, that Lender's Revolving Loan Commitment and (ii) after
the termination of the Revolving Loan Commitments, the sum of (a) the
aggregate outstanding principal amount of the Revolving Loans of that
Lender plus (b) in the event that Lender is Issuing Lender, the aggregate
Letter of Credit Usage in respect of all Letters of Credit issued by that
Lender (in each case net of any participations purchased by other Lenders
in such Letters of Credit or any unreimbursed drawings thereunder) plus
(c) the aggregate amount of all participations purchased by that Lender in
any outstanding Letters of Credit or any unreimbursed drawings under any
Letters of Credit plus (d) in the case of Swing Line Lender, the aggregate
outstanding principal amount of all Swing Line Loans (net of any
participations therein purchased by other Lenders) plus (e) the aggregate
amount of all participations purchased by that Lender in any outstanding
Swing Line Loans.
"Revolving Loans" means the Loans made by Lenders to Borrower
pursuant to subsection 2.1A(ii).
"Revolving Notes" means (i) the promissory notes of Borrower issued
pursuant to subsection 2.1E(i)(b) on the Closing Date and (ii) any
promissory notes issued by Borrower pursuant to the last sentence of
subsection 10.1B(i) in connection with assignments of the Revolving Loan
Commitments and Revolving Loans of any Lenders, in each case substantially
in the form of Exhibit V annexed hereto, as they may be amended,
supplemented or otherwise modified from time to time.
"Securities" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds,
debentures, notes, or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as "securities" or any certificates of
interest, shares or participations in temporary or interim certificates
for the purchase or acquisition of, or any right to subscribe to, purchase
or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, and any successor statute.
"Senior Subordinated Note Indenture" means the indenture pursuant to
which the Senior Subordinated Notes are issued, as such indenture may be
amended from time to time to the extent permitted under subsection 7.13A.
"Senior Subordinated Notes" means the $100,000,000 in aggregate
principal amount of 10.75% Senior Subordinated Notes due 2004 of Borrower
issued pursuant to the Senior Subordinated Note Indenture.
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"Solvent" means, with respect to any Person, that as of the date of
determination both (i)(a) the then fair saleable value of the property of
such Person is (1) greater than the total amount of liabilities (including
contingent liabilities) of such Person and (2) not less than the amount
that will be required to pay the probable liabilities on such Person's
then existing debts as they become absolute and matured considering all
financing alternatives and potential asset sales reasonably available to
such Person; (b) such Person's capital is not unreasonably small in
relation to its business or any contemplated or undertaken transaction;
and (c) such Person does not intend to incur, or believe (nor should it
reasonably believe) that it will incur, debts beyond its ability to pay
such debts as they become due; and (ii) such Person is "solvent" within
the meaning given that term and similar terms under applicable laws
relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be
computed as the amount that, in light of all of the facts and
circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"Standby Letter of Credit" means any standby letter of credit or
similar instrument issued for the purpose of supporting (i) Indebtedness
of Borrower or any of its Subsidiaries in respect of industrial revenue or
development bonds or financings, (ii) workers' compensation liabilities of
Borrower or any of its Subsidiaries, (iii) the obligations of third party
insurers of Borrower or any of its Subsidiaries arising by virtue of the
laws of any jurisdiction requiring third party insurers, (iv) obligations
with respect to Capital Leases or Operating Leases of Borrower or any of
its Subsidiaries, (v) performance, payment, deposit or surety obligations
of Borrower or any of its Subsidiaries, in any case if required by law or
governmental rule or regulation or in accordance with custom and practice
in the industry and (vi) other obligations of Borrower and its
Subsidiaries permitted hereunder; provided that Standby Letters of Credit
may not be issued without the consent of Issuing Lender (which consent may
be withheld in the sole discretion of Issuing Lender) for the purpose of
supporting (a) trade payables or (b) any Indebtedness constituting
"antecedent debt" (as that term is used in Section 547 of the Bankruptcy
Code).
"Subordinated Indebtedness" means (i) Indebtedness of Borrower
evidenced by the Senior Subordinated Notes and (ii) any other Indebtedness
of Borrower subordinated in right of payment to the Obligations pursuant
to documentation containing maturities, amortization schedules, covenants,
defaults, remedies, subordination provisions and other material terms in
form and substance satisfactory to Administrative Agent and Requisite
Lenders.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or
other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to
the occurrence of any contingency) to vote in the election of the Person
or Persons (whether directors, managers, trustees or other
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Persons performing similar functions) having the power to direct or cause
the direction of the management and policies thereof is at the time owned
or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person or a combination thereof.
"Subsidiary Guarantor" means any Subsidiary of Borrower that
executes and delivers a counterpart of the Subsidiary Guaranty on the
Closing Date or from time to time thereafter pursuant to subsection 6.8.
"Subsidiary Guaranty" means the Subsidiary Guaranty executed and
delivered by existing domestic Subsidiaries of Borrower on the Closing
Date and to be executed and delivered by additional domestic Subsidiaries
of Borrower from time to time thereafter in accordance with subsection
6.8, substantially in the form of Exhibit XV annexed hereto, as such
Subsidiary Guaranty may hereafter be amended, supplemented or otherwise
modified from time to time.
"Subsidiary Pledge Agreement" means the Subsidiary Pledge Agreement
executed and delivered by existing Subsidiary Guarantors and
Administrative Agent on the Closing Date and to be executed and delivered
by any additional Subsidiary Guarantors from time to time thereafter in
accordance with subsection 6.8, substantially in the form of Exhibit XVI
annexed hereto, as such Subsidiary Pledge Agreement may be amended,
supplemented or otherwise modified from time to time.
"Subsidiary Security Agreement" means the Subsidiary Security
Agreement executed and delivered by existing Subsidiary Guarantors and
Administrative Agent on the Closing Date and to be executed and delivered
by any additional Subsidiary Guarantors from time to time thereafter in
accordance with subsection 6.8, substantially in the form of Exhibit XVII
annexed hereto, as such Subsidiary Security Agreement may be amended,
supplemented or otherwise modified from time to time.
"Supplemental Collateral Agent" has the meaning assigned to that
term in subsection 9.1D.
"Swing Line Lender" means Scotiabank, or any Person serving as a
successor Administrative Agent hereunder, in its capacity as Swing Line
Lender hereunder.
"Swing Line Loan Commitment" means the commitment of Swing Line
Lender to make Swing Line Loans to Borrower pursuant to subsection
2.1A(iii).
"Swing Line Loans" means the Loans made by Swing Line Lender to
Borrower pursuant to subsection 2.1A(iii).
"Swing Line Note" means (i) the promissory note of Borrower issued
pursuant to subsection 2.1E(ii) on the Closing Date and (ii) any
promissory note issued by Borrower to any successor Administrative Agent
and Swing Line Lender pursuant to
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the last sentence of subsection 9.5B, in each case substantially in the
form of Exhibit VI annexed hereto, as it may be amended, supplemented or
otherwise modified from time to time.
"Syndication Agent" has the meaning assigned to that term in the
introduction to this Agreement.
"Tax" or "Taxes" means any present or future tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature and whatever
called, by whomsoever, on whomsoever and wherever imposed, levied,
collected, withheld or assessed; provided that "Tax on the overall net
income" of a Person shall be construed as a reference to a tax imposed by
the jurisdiction in which that Person is organized or in which that
Person's principal office (and/or, in the case of a Lender, its lending
office) is located or in which that Person (and/or, in the case of a
Lender, its lending office) is deemed to be doing business on all or part
of the net income, profits or gains (whether worldwide, or only insofar as
such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction, or otherwise) of that Person (and/or, in the case
of a Lender, its lending office).
"Total Senior Debt" means, as at any date of determination, the
aggregate stated balance sheet amount of all Indebtedness and Contingent
Obligations of Holdings and its Subsidiaries in respect of Indebtedness,
in each case other than Indebtedness evidenced by the Senior Subordinated
Notes and Indebtedness in respect of the Batesville Liability and
Covenants not to Compete, all as determined on a consolidated basis in
accordance with GAAP.
"Total Utilization of Revolving Loan Commitments" means, as at any
date of determination, the sum of (i) the aggregate principal amount of
all outstanding Revolving Loans (other than Revolving Loans made for the
purpose of repaying any Refunded Swing Line Loans or reimbursing Issuing
Lender for any amount drawn under any Letter of Credit but not yet so
applied) plus (ii) the aggregate principal amount of all outstanding Swing
Line Loans plus (iii) the Letter of Credit Usage.
"Transaction Costs" means the fees, costs and expenses payable by
Borrower on or before the Closing Date in connection with the transactions
contemplated by the Loan Documents and the Related Agreements.
"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
"Wholly Owned Subsidiary" means, with respect to any Person, any
Subsidiary of such Person of which such Person owns, directly or
indirectly, 90% or more of all classes of the capital stock.
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1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement.
Except as otherwise expressly provided in this Agreement, all accounting
terms not otherwise defined herein shall have the meanings assigned to them in
conformity with GAAP. Financial statements and other information required to be
delivered by Borrower to Lenders pursuant to clauses (i), (ii), (iii) and (xi)
of subsection 6.1 shall be prepared in accordance with GAAP as in effect at the
time of such preparation (and delivered together with the reconciliation
statements provided for in subsection 6.1(iv)). Calculations in connection with
the definitions, covenants and other provisions of this Agreement shall utilize
accounting principles and policies in conformity with those used to prepare the
restated financial statements referred to in subsection 5.3; provided that the
purchase accounting adjustments made in connection with the Acquisition shall be
included; and provided further, that if Borrower notifies Lenders that Borrower
wishes to amend any covenant in subsection 2.4B(iii)(d), 7.6 or 7.8 or any
related definition to eliminate the effect of any change in GAAP occurring after
the date of this Agreement on the operation of such covenant (or if
Administrative Agent notifies Borrower that Lenders wish to amend subsection
2.4B(iii)(d), 7.6 or 7.8 or any related definition for such purpose), then
Borrower and Lenders hereby agree to negotiate in good faith to agree upon an
appropriate amendment to such covenant.
1.3 Other Definitional Provisions and Rules of Construction.
Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.
References to "Sections" and "subsections" shall be to Sections and subsections,
respectively, of this Agreement unless otherwise specifically provided. The use
herein of the word "include" or "including", when following any general
statement, term or matter, shall not be construed to limit such statement, term
or matter to the specific items or matters set forth immediately following such
word or to similar items or matters, whether or not nonlimiting language (such
as "without limitation" or "but not limited to" or words of similar import) is
used with reference thereto, but rather shall be deemed to refer to all other
items or matters that fall within the broadest possible scope of such general
statement, term or matter.
SECTION 2.
AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Making of Loans; the Register; Notes.
A. Commitments. Subject to the terms and conditions of this Agreement and
in reliance upon the representations and warranties of Borrower herein set
forth, each Lender hereby severally agrees to make the Loans described in
subsections 2.1A(i) and 2.1A(ii) and Swing Line Lender hereby agrees to make the
Loans described in subsection 2.1A(iii).
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(i) AXELs. Each Lender severally agrees to lend to Borrower on the
Closing Date an amount not exceeding its Pro Rata Share of the aggregate
amount of the AXEL Commitments to be used for the purposes identified in
subsection 2.5A. The amount of each Lender's AXEL Commitment is set forth
opposite its name on Schedule 2.1 annexed hereto and the aggregate amount
of the AXEL Commitments is $90,000,000; provided that the AXEL Commitments
of Lenders shall be adjusted to give effect to any assignments of the AXEL
Commitments pursuant to subsection 10.1B. Each Lender's AXEL Commitment
shall expire immediately and without further action on November 15, 1996
if the AXELs are not made on or before that date. Borrower may make only
one borrowing under the AXEL Commitments. Amounts borrowed under this
subsection 2.1A(i) and subsequently repaid or prepaid may not be
reborrowed.
(ii) Revolving Loans. Each Lender severally agrees, subject to the
limitations set forth below with respect to the maximum amount of
Revolving Loans permitted to be outstanding from time to time, to lend to
Borrower from time to time during the period from the Closing Date to but
excluding the Revolving Loan Commitment Termination Date an aggregate
amount not exceeding its Pro Rata Share of the aggregate amount of the
Revolving Loan Commitments to be used for the purposes identified in
subsection 2.5B. The original amount of each Lender's Revolving Loan
Commitment is set forth opposite its name on Schedule 2.1 annexed hereto
and the aggregate original amount of the Revolving Loan Commitments is
$25,000,000; provided that the Revolving Loan Commitments of Lenders shall
be adjusted to give effect to any assignments of the Revolving Loan
Commitments pursuant to subsection 10.1B; and provided, further that the
amount of the Revolving Loan Commitments shall be reduced from time to
time by the amount of any reductions thereto made pursuant to subsections
2.4B(ii) and 2.4B(iii). Each Lender's Revolving Loan Commitment shall
expire on the Revolving Loan Commitment Termination Date and all Revolving
Loans and all other amounts owed hereunder with respect to the Revolving
Loans and the Revolving Loan Commitments shall be paid in full no later
than that date; provided that each Lender's Revolving Loan Commitment
shall expire immediately and without further action on November 15, 1996
if the AXELs are not made on or before that date. Amounts borrowed under
this subsection 2.1A(ii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Revolving Loans and the Revolving Loan Commitments
shall be subject to the limitations that (i) in no event shall the Total
Utilization of Revolving Loan Commitments at any time exceed the Revolving
Loan Commitments then in effect and (ii) no Revolving Loans shall be made
on the Closing Date.
(iii) Swing Line Loans. Swing Line Lender hereby agrees, subject to
the limitations set forth below with respect to the maximum amount of
Swing Line Loans permitted to be outstanding from time to time, to make a
portion of the Revolving
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Loan Commitments available to Borrower from time to time during the period
from the Closing Date to but excluding the Revolving Loan Commitment
Termination Date by making Swing Line Loans to Borrower in an aggregate
amount not exceeding the amount of the Swing Line Loan Commitment to be
used for the purposes identified in subsection 2.5B, notwithstanding the
fact that such Swing Line Loans, when aggregated with Swing Line Lender's
outstanding Revolving Loans and Swing Line Lender's Pro Rata Share of the
Letter of Credit Usage then in effect, may exceed Swing Line Lender's
Revolving Loan Commitment. The original amount of the Swing Line Loan
Commitment is $5,000,000; provided that any reduction of the Revolving
Loan Commitments made pursuant to subsection 2.4B(ii) or 2.4B(iii) which
reduces the aggregate Revolving Loan Commitments to an amount less than
the then current amount of the Swing Line Loan Commitment shall result in
an automatic corresponding reduction of the Swing Line Loan Commitment to
the amount of the Revolving Loan Commitments, as so reduced, without any
further action on the part of Borrower, Administrative Agent or Swing Line
Lender. The Swing Line Loan Commitment shall expire on the Revolving Loan
Commitment Termination Date and all Swing Line Loans and all other amounts
owed hereunder with respect to the Swing Line Loans shall be paid in full
no later than that date; provided that the Swing Line Loan Commitment
shall expire immediately and without further action on November 15, 1996
if the AXELs are not made on or before that date. Amounts borrowed under
this subsection 2.1A(iii) may be repaid and reborrowed to but excluding
the Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Swing Line Loans and the Swing Line Loan Commitment
shall be subject to the limitations that (i) in no event shall the Total
Utilization of Revolving Loan Commitments at any time exceed the Revolving
Loan Commitments then in effect and (ii) no Swing Line Loans shall be made
on the Closing Date.
With respect to any Swing Line Loans which have not been voluntarily
prepaid by Borrower pursuant to subsection 2.4B(i), Swing Line Lender may,
at any time in its sole and absolute discretion, deliver to Administrative
Agent (with a copy to Borrower), no later than 10:00 A.M. (New York City
time) on the first Business Day in advance of the proposed Funding Date, a
notice requesting Lenders to make Revolving Loans that are Base Rate Loans
on such Funding Date in an amount equal to the amount of such Swing Line
Loans (the "Refunded Swing Line Loans") outstanding on the date such
notice is given which Swing Line Lender requests Lenders to prepay (which
request shall be deemed to have also been made by Borrower). Anything
contained in this Agreement to the contrary notwithstanding, (i) the
proceeds of such Revolving Loans made by Lenders other than Swing Line
Lender shall be immediately delivered by Administrative Agent to Swing
Line Lender (and not to Borrower) and applied to repay a corresponding
portion of the Refunded Swing Line Loans and (ii) on the day such
Revolving Loans are made, Swing Line Lender's Pro Rata Share of the
Refunded Swing Line Loans shall be
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deemed to be paid with the proceeds of a Revolving Loan made by Swing Line
Lender, and such portion of the Swing Line Loans deemed to be so paid
shall no longer be outstanding as Swing Line Loans and shall no longer be
due under the Swing Line Note of Swing Line Lender but shall instead
constitute part of Swing Line Lender's outstanding Revolving Loans and
shall be due under the Revolving Note of Swing Line Lender. Borrower
hereby authorizes Administrative Agent and Swing Line Lender to charge
Borrower's accounts with Administrative Agent and Swing Line Lender (up to
the amount available in each such account) one Business Day after
requesting Borrower to repay the Refunded Swing Line Loans in order to pay
Swing Line Lender the amount of the Refunded Swing Line Loans to the
extent the proceeds of such Revolving Loans made by Lenders, including the
Revolving Loan deemed to be made by Swing Line Lender, are not sufficient
to repay in full the Refunded Swing Line Loans. If any portion of any such
amount paid (or deemed to be paid) to Swing Line Lender should be
recovered by or on behalf of Borrower from Swing Line Lender in
bankruptcy, by assignment for the benefit of creditors or otherwise, the
loss of the amount so recovered shall be ratably shared among all Lenders
in the manner contemplated by subsection 10.5.
If for any reason (a) Revolving Loans are not made upon the request
of Swing Line Lender as provided in the immediately preceding paragraph in
an amount sufficient to repay any amounts owed to Swing Line Lender in
respect of any outstanding Swing Line Loans or (b) the Revolving Loan
Commitments are terminated at a time when any Swing Line Loans are
outstanding, each Lender shall be deemed to, and hereby agrees to, have
purchased a participation in such outstanding Swing Line Loans in an
amount equal to its Pro Rata Share (calculated, in the case of the
foregoing clause (b), immediately prior to such termination of the
Revolving Loan Commitments) of the unpaid amount of such Swing Line Loans
together with accrued interest thereon. Upon one Business Day's notice
from Swing Line Lender, each Lender shall deliver to Swing Line Lender an
amount equal to its respective participation in same day funds at the
Funding and Payment Office. In order to further evidence such
participation (and without prejudice to the effectiveness of the
participation provisions set forth above), each Lender agrees to enter
into a separate participation agreement at the request of Swing Line
Lender in form and substance reasonably satisfactory to Swing Line Lender.
In the event any Lender fails to make available to Swing Line Lender the
amount of such Lender's participation as provided in this paragraph, Swing
Line Lender shall be entitled to recover such amount on demand from such
Lender together with interest thereon at the rate customarily used by
Swing Line Lender for the correction of errors among banks for three
Business Days and thereafter at the Base Rate. In the event Swing Line
Lender receives a payment of any amount in which other Lenders have
purchased participations as provided in this paragraph, Swing Line Lender
shall promptly distribute to each such other Lender its Pro Rata Share of
such payment.
Anything contained herein to the contrary notwithstanding, each
Lender's obligation to make Revolving Loans for the purpose of repaying
any Refunded Swing
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Line Loans pursuant to the second preceding paragraph and each Lender's
obligation to purchase a participation in any unpaid Swing Line Loans
pursuant to the immediately preceding paragraph shall be absolute and
unconditional and shall not be affected by any circumstance, including (a)
any set-off, counterclaim, recoupment, defense or other right which such
Lender may have against Swing Line Lender, Borrower or any other Person
for any reason whatsoever; (b) the occurrence or continuation of an Event
of Default or a Potential Event of Default; (c) any adverse change in the
business, operations, properties, assets, condition (financial or
otherwise) or prospects of Borrower or any of its Subsidiaries; (d) any
breach of this Agreement or any other Loan Document by any party thereto;
or (e) any other circumstance, happening or event whatsoever, whether or
not similar to any of the foregoing; provided that such obligations of
each Lender are subject to the condition that (1) Swing Line Lender
believed in good faith that all conditions under Section 4 to the making
of the applicable Refunded Swing Line Loans or other unpaid Swing Line
Loans, as the case may be, were satisfied at the time such Refunded Swing
Line Loans or unpaid Swing Line Loans were made or (2) the satisfaction of
any such condition not satisfied had been waived in accordance with
subsection 10.6 prior to or at the time such Refunded Swing Line Loans or
other unpaid Swing Line Loans were made.
B. Borrowing Mechanics. AXELs or Revolving Loans made on any Funding Date
(other than Revolving Loans made pursuant to a request by Swing Line Lender
pursuant to subsection 2.1A(iii) for the purpose of repaying any Refunded Swing
Line Loans or Revolving Loans made pursuant to subsection 3.3B for the purpose
of reimbursing Issuing Lender for the amount of a drawing under a Letter of
Credit issued by it) shall be in an aggregate minimum amount of $1,000,000.
Swing Line Loans made on any Funding Date shall be in an aggregate minimum
amount of $100,000. Whenever Borrower desires that Lenders make AXELs or
Revolving Loans it shall deliver to Administrative Agent a Notice of Borrowing
no later than 10:00 A.M. (New York City time) at least three Business Days in
advance of the proposed Funding Date (in the case of a Eurodollar Rate Loan) or
at least one Business Day in advance of the proposed Funding Date (in the case
of a Base Rate Loan). Whenever Borrower desires that Swing Line Lender make a
Swing Line Loan, it shall deliver to Administrative Agent a Notice of Borrowing
no later than 12:00 Noon (New York City time) on the proposed Funding Date. The
Notice of Borrowing shall specify (i) the proposed Funding Date (which shall be
a Business Day), (ii) the amount and type of Loans requested, (iii) in the case
of Swing Line Loans, that such Loans shall be Base Rate Loans, (iv) in the case
of AXELs and Revolving Loans, whether such Loans shall be Base Rate Loans or
Eurodollar Rate Loans, and (v) in the case of any Loans requested to be made as
Eurodollar Rate Loans, the initial Interest Period requested therefor. AXELs and
Revolving Loans may be continued as or converted into Base Rate Loans and
Eurodollar Rate Loans in the manner provided in subsection 2.2D. In lieu of
delivering the above-described Notice of Borrowing, Borrower may give
Administrative Agent telephonic notice by the required time of any proposed
borrowing under this subsection 2.1B; provided that such notice shall be
promptly confirmed in writing by delivery of a Notice of Borrowing to
Administrative Agent on or before the applicable Funding Date.
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Neither Administrative Agent nor any Lender shall incur any liability to
Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.1B, and upon funding
of Loans by Lenders in accordance with this Agreement pursuant to any such
telephonic notice Borrower shall have effected Loans hereunder.
Borrower shall notify Administrative Agent prior to the funding of any
Loans in the event that any of the matters to which Borrower has certified in
the applicable Notice of Borrowing is no longer true and correct as of the
applicable Funding Date, and the acceptance by Borrower of the proceeds of any
Loans shall constitute a re-certification by Borrower, as of the applicable
Funding Date, as to the matters to which Borrower is required to certify in the
applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B and 2.6C, a Notice of
Borrowing for a Eurodollar Rate Loan (or telephonic notice in lieu thereof)
shall be irrevocable on and after the related Interest Rate Determination Date,
and Borrower shall be bound to make a borrowing in accordance therewith.
C. Disbursement of Funds. All AXELs and Revolving Loans under this
Agreement shall be made by Lenders simultaneously and proportionately to their
respective Pro Rata Shares, it being understood that no Lender shall be
responsible for any default by any other Lender in that other Lender's
obligation to make a Loan requested hereunder nor shall the Commitment of any
Lender to make the particular type of Loan requested be increased or decreased
as a result of a default by any other Lender in that other Lender's obligation
to make a Loan requested hereunder. Promptly after receipt by Administrative
Agent of a Notice of Borrowing pursuant to subsection 2.1B (or telephonic notice
in lieu thereof), Administrative Agent shall notify each Lender or Swing Line
Lender, as the case may be, of the proposed borrowing. Each Lender shall make
the amount of its Loan available to Administrative Agent not later than 12:00
Noon (New York City time) on the applicable Funding Date, and Swing Line Lender
shall make the amount of its Swing Line Loan available to Administrative Agent
not later than 12:00 Noon (New York City time) on the applicable Funding Date,
in each case in same day funds in Dollars, at the Funding and Payment Office.
Except as provided in subsection 2.1A(iii) or subsection 3.3B with respect to
Revolving Loans used to repay Refunded Swing Line Loans or to reimburse Issuing
Lender for the amount of a drawing under a Letter of Credit issued by it, upon
satisfaction or waiver of the conditions precedent specified in subsections 4.1
(in the case of Loans made on the Closing Date) and 4.2 (in the case of all
Loans), Administrative Agent shall make the proceeds of such Loans available to
Borrower on the applicable Funding Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Loans received by Administrative
Agent from Lenders or Swing Line Lender, as the case may be, to be credited to
the account of Borrower at the Funding and Payment Office.
Unless Administrative Agent shall have been notified by any Lender prior
to the Funding Date for any Loans that such Lender does not intend to make
available to
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Administrative Agent the amount of such Lender's Loan requested on such Funding
Date, Administrative Agent may assume that such Lender has made such amount
available to Administrative Agent on such Funding Date and Administrative Agent
may, in its sole discretion, but shall not be obligated to, make available to
Borrower a corresponding amount on such Funding Date. If such corresponding
amount is not in fact made available to Administrative Agent by such Lender,
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Lender together with interest thereon, for each day from such
Funding Date until the date such amount is paid to Administrative Agent, at the
customary rate set by Administrative Agent for the correction of errors among
banks for three Business Days and thereafter at the Base Rate. If such Lender
does not pay such corresponding amount forthwith upon Administrative Agent's
demand therefor, Administrative Agent shall promptly notify Borrower and
Borrower shall immediately pay such corresponding amount to Administrative Agent
together with interest thereon, for each day from such Funding Date until the
date such amount is paid to Administrative Agent, at the rate payable under this
Agreement for Base Rate Loans. Nothing in this subsection 2.1C shall be deemed
to relieve any Lender from its obligation to fulfill its Commitments hereunder
or to prejudice any rights that Borrower may have against any Lender as a result
of any default by such Lender hereunder.
D. The Register.
(i) Administrative Agent shall maintain, at its address referred to
in subsection 10.8, a register for the recordation of the names and
addresses of Lenders and the Commitments and Loans of each Lender from
time to time (the "Register"). The Register shall be available for
inspection by Borrower or any Lender at any reasonable time and from time
to time upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register the AXEL
Commitment and Revolving Loan Commitment and the AXEL and Revolving Loans
from time to time of each Lender, the Swing Line Loan Commitment and the
Swing Line Loans from time to time of Swing Line Lender, and each
repayment or prepayment in respect of the principal amount of the AXEL or
Revolving Loans of each Lender or the Swing Line Loans of Swing Line
Lender. Any such recordation shall be conclusive and binding on Borrower
and each Lender, absent demonstrable error; provided that failure to make
any such recordation, or any error in such recordation, shall not affect
any Lender's Commitments or Borrower's Obligations in respect of any
applicable Loans.
(iii) Each Lender shall record on its internal records (including
the Notes held by such Lender) the amount of the AXEL and each Revolving
Loan made by it and each payment in respect thereof. Any such recordation
shall be conclusive and binding on Borrower, absent demonstrable error;
provided that failure to make any such recordation, or any error in such
recordation, shall not affect any Lender's Commitments or Borrower's
Obligations in respect of any applicable Loans; and
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provided, further that in the event of any inconsistency between the
Register and any Lender's records, the recordations in the Register shall
govern.
(iv) Borrower, Administrative Agent and Lenders shall deem and treat
the Persons listed as Lenders in the Register as the holders and owners of
the corresponding Commitments and Loans listed therein for all purposes
hereof, and no assignment or transfer of any such Commitment or Loan shall
be effective, in each case unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted by
Administrative Agent and recorded in the Register as provided in
subsection 10.1B(ii). Prior to such recordation, all amounts owed with
respect to the applicable Commitment or Loan shall be owed to the Lender
listed in the Register as the owner thereof, and any request, authority or
consent of any Person who, at the time of making such request or giving
such authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or transferee of
the corresponding Commitments or Loans.
(v) Borrower hereby designates Administrative Agent to serve as
Borrower's agent solely for purposes of maintaining the Register as
provided in this subsection 2.1D, and Borrower hereby agrees that, to the
extent Administrative Agent serves in such capacity, Administrative Agent
and its officers, directors, employees, agents and affiliates shall
constitute Indemnitees for all purposes under subsection 10.3.
E. Notes. Borrower shall execute and deliver on the Closing Date (i) to
each Lender (or to Administrative Agent for that Lender) (a) an AXEL Note
substantially in the form of Exhibit IV annexed hereto to evidence that Lender's
AXEL, in the principal amount of that Lender's AXEL and with other appropriate
insertions, and (b) a Revolving Note substantially in the form of Exhibit V
annexed hereto to evidence that Lender's Revolving Loans, in the principal
amount of that Lender's Revolving Loan Commitment and with other appropriate
insertions, and (ii) to Swing Line Lender (or to Administrative Agent for Swing
Line Lender) a Swing Line Note substantially in the form of Exhibit VI annexed
hereto to evidence Swing Line Lender's Swing Line Loans, in the principal amount
of the Swing Line Loan Commitment and with other appropriate insertions.
2.2 Interest on the Loans.
A. Rate of Interest. Subject to the provisions of subsections 2.6 and 2.7,
each AXEL and each Revolving Loan shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether by acceleration or
otherwise) at a rate determined by reference to the Base Rate or the Adjusted
Eurodollar Rate. Subject to the provisions of subsection 2.7, each Swing Line
Loan shall bear interest on the unpaid principal amount thereof from the date
made through maturity (whether by acceleration or otherwise) at a rate
determined by reference to the Base Rate. The applicable basis for determining
the rate of interest with respect to any AXEL or any Revolving Loan shall be
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selected by Borrower initially at the time a Notice of Borrowing is given with
respect to such Loan pursuant to subsection 2.1B. The basis for determining the
interest rate with respect to any AXEL or any Revolving Loan may be changed from
time to time pursuant to subsection 2.2D. If on any day an AXEL or Revolving
Loan is outstanding with respect to which notice has not been delivered to
Administrative Agent in accordance with the terms of this Agreement specifying
the applicable basis for determining the rate of interest, then for that day
that Loan shall bear interest determined by reference to the Base Rate.
(i) Subject to the provisions of subsections 2.2E and 2.7, the AXELs
and the Revolving Loans shall bear interest through maturity as follows:
(a) if a Base Rate Loan, then at the sum of the Base Rate plus
the Applicable Margin in effect from time to time, or
(b) if a Eurodollar Rate Loan, then at the sum of the Adjusted
Eurodollar Rate plus the Applicable Margin in effect from time to
time; and
(ii) Subject to the provisions of subsections 2.2E and 2.7, the
Swing Line Loans shall bear interest through maturity at the sum of the
Base Rate plus 1.75% per annum plus the Pricing Premium, if any, less the
Pricing Reduction, if any.
B. Interest Periods. In connection with each Eurodollar Rate Loan,
Borrower may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"Interest Period") to be applicable to such Loan, which Interest Period shall
be, at Borrower's option, either a one-, two-, three- or six-month period or, if
deposits in the interbank Eurodollar market are generally available for such
period (as determined by each Lender making, converting to or continuing such
Eurodollar Rate Loan), a nine- or twelve-month period; provided that:
(i) the initial Interest Period for any Eurodollar Rate Loan shall
commence on the Funding Date in respect of such Loan, in the case of a
Loan initially made as a Eurodollar Rate Loan, or on the date specified in
the applicable Notice of Conversion/Continuation, in the case of a Loan
converted to a Eurodollar Rate Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a Eurodollar Rate Loan continued as such pursuant to a
Notice of Conversion/Continuation, each successive Interest Period shall
commence on the day on which the next preceding Interest Period expires;
(iii) if an Interest Period would otherwise expire on a day that is
not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; provided that, if any Interest Period would
otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such
Interest Period shall expire on the next preceding Business Day;
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(iv) 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, subject to clause (v) of this subsection 2.2B, end on the
last Business Day of a calendar month;
(v) there shall be no more than six Interest Periods outstanding at
any time;
(vi) in the event Borrower fails to specify an Interest Period for
any Eurodollar Rate Loan in the applicable Notice of Borrowing or Notice
of Conversion/Continuation, Borrower shall be deemed to have selected an
Interest Period of one month; and
(vii) Borrower may not select an Interest Period in excess of one
month with respect to any Eurodollar Rate Loan until the earlier of (a)
the date the Arranging Agent advises Borrower that the AXELs have been
fully syndicated or any earlier date agreed to by Arranging Agent and (b)
the date which is 60 days after the Closing Date.
C. Interest Payments. Subject to the provisions of subsection 2.2E,
interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity); provided that in the event any Swing Line Loans or any Revolving
Loans that are Base Rate Loans are prepaid pursuant to subsection 2.4B(i),
interest accrued on such Swing Line Loans or Revolving Loans through the date of
such prepayment shall be payable on the next succeeding Interest Payment Date
applicable to Base Rate Loans (or, if earlier, at final maturity).
D. Conversion or Continuation. Subject to the provisions of subsection
2.6, Borrower shall have the option (i) to convert at any time all or any part
of its outstanding AXELs or Revolving Loans equal to at least $1,000,000 from
Loans bearing interest at a rate determined by reference to one basis to Loans
bearing interest at a rate determined by reference to an alternative basis or
(ii) upon the expiration of any Interest Period applicable to a Eurodollar Rate
Loan, to continue all or any portion of such Loan equal to at least $1,000,000
as a Eurodollar Rate Loan.
Borrower shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 10:00 A.M. (New York City time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan). A Notice of Conversion/Continuation
shall specify (i) the proposed conversion/continuation date (which shall be a
Business Day), (ii) the amount and type of the Loan to be converted/continued,
(iii) the nature of the proposed conversion/continuation and (iv) in the case of
a conversion to, or a continuation of, a Eurodollar Rate Loan, the requested
Interest Period. In lieu of
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delivering the above-described Notice of Conversion/Continuation, Borrower may
give Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D; provided that such notice
shall be promptly confirmed in writing by delivery of a Notice of
Conversion/Continuation to Administrative Agent on or before the proposed
conversion/continuation date. Upon receipt of written or telephonic notice of
any proposed conversion/continuation under this subsection 2.2D, Administrative
Agent shall promptly transmit such notice by telefacsimile or telephone to each
Lender.
Neither Administrative Agent nor any Lender shall incur any liability to
Borrower in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Borrower or
for otherwise acting in good faith under this subsection 2.2D, and upon
conversion or continuation of the applicable basis for determining the interest
rate with respect to any Loans in accordance with this Agreement pursuant to any
such telephonic notice Borrower shall have effected a conversion or
continuation, as the case may be, hereunder.
Except as otherwise provided in subsections 2.6B and 2.6C, a Notice of
Conversion/Continuation for conversion to, or continuation of, a Eurodollar Rate
Loan (or telephonic notice in lieu thereof) shall be irrevocable on and after
the related Interest Rate Determination Date, and Borrower shall be bound to
effect a conversion or continuation in accordance therewith.
E. Post-Maturity Interest. Any principal payments on the Loans not paid
when due and, to the extent permitted by applicable law, any interest payments
on the Loans or any fees or other amounts owed hereunder not paid when due, in
each case whether at stated maturity, by notice of prepayment, by acceleration
or otherwise, shall thereafter bear interest (including post-petition interest
in any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate which is 2% per annum in excess of the interest rate
otherwise payable under this Agreement with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2% per annum
in excess of the interest rate otherwise payable under this Agreement for Base
Rate Loans); provided that, in the case of Eurodollar Rate Loans, upon the
expiration of the Interest Period in effect at the time any such increase in
interest rate is effective, such Eurodollar Rate Loans shall thereupon become
Base Rate Loans and shall thereafter bear interest payable upon demand at a rate
which is 2% per annum in excess of the interest rate otherwise payable under
this Agreement for Base Rate Loans. Payment or acceptance of the increased rates
of interest provided for in this subsection 2.2E is not a permitted alternative
to timely payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of Agent or any Lender.
F. Computation of Interest. Interest on the Loans shall be computed (i) in
the case of Base Rate Loans, on the basis of a 365-day or 366-day year, as the
case may be, and (ii) in the case of Eurodollar Rate Loans, on the basis of a
360-day year, in each case for
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the actual number of days elapsed in the period during which it accrues. In
computing interest on any Loan, the date of the making of such Loan or the first
day of an Interest Period applicable to such Loan or, with respect to a Base
Rate Loan being converted from a Eurodollar Rate Loan, the date of conversion of
such Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be
included, and the date of payment of such Loan or the expiration date of an
Interest Period applicable to such Loan or, with respect to a Base Rate Loan
being converted to a Eurodollar Rate Loan, the date of conversion of such Base
Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded;
provided that if a Loan is repaid on the same day on which it is made, one day's
interest shall be paid on that Loan.
2.3 Fees.
A. Commitment Fees. Borrower agrees to pay to Administrative Agent, for
distribution to each Lender in proportion to that Lender's Pro Rata Share,
commitment fees for the period from and including the Closing Date to and
excluding the Revolving Loan Commitment Termination Date equal to the average of
the daily excess of the Revolving Loan Commitments over the sum of (i) the
aggregate principal amount of outstanding Revolving Loans (but not any
outstanding Swing Line Loans) plus (ii) the Letter of Credit Usage multiplied by
1/2 of 1% per annum, such commitment fees to be calculated on the basis of a
365- or 366-day year and the actual number of days elapsed and to be payable
quarterly in arrears on February 1, May 1, August 1 and November 1 of each year,
commencing on the first such date to occur after the Closing Date, and on the
Revolving Loan Commitment Termination Date.
B. Other Fees. Borrower agrees to pay to Arranging Agent and
Administrative Agent such other fees in the amounts and at the times separately
agreed upon between Borrower, Arranging Agent and Administrative Agent.
2.4 Repayments, Prepayments and Reductions in Revolving Loan Commitments;
General Provisions Regarding Payments; Application of Proceeds of
Collateral and Payments Under Guaranties.
A. Scheduled Payments of AXELs.
(i) Scheduled Payments of AXELs. Borrower shall make principal
payments on the AXELs in installments on the dates and in the amounts set
forth below:
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==========================================================
(A) | (B)
| Scheduled
Payment | Repayment of
Date | AXELs
==========================================================
|
February 1, 1997 | $500,000
----------------------------------------------------------
August 1, 1997 | $500,000
----------------------------------------------------------
February 1, 1998 | $500,000
----------------------------------------------------------
August 1, 1998 | $500,000
----------------------------------------------------------
February 1, 1999 | $500,000
----------------------------------------------------------
August 1, 1999 | $500,000
----------------------------------------------------------
February 1, 2000 | $2,000,000
----------------------------------------------------------
August 1, 2000 | $2,000,000
----------------------------------------------------------
February 1, 2001 | $4,500,000
----------------------------------------------------------
August 1, 2001 | $4,500,000
----------------------------------------------------------
February 1, 2002 | $6,250,000
----------------------------------------------------------
August 1, 2002 | $6,250,000
----------------------------------------------------------
February 1, 2003 | $30,750,000
----------------------------------------------------------
August 1, 2003 | $30,750,000
----------------------------------------------------------
TOTAL | $90,000,000
==========================================================
; provided that the scheduled installments of principal of the AXELs set
forth above shall be reduced in connection with any voluntary or mandatory
prepayments of the AXELs in accordance with subsection 2.4B(iv); and
provided, further that the AXELs and all other amounts owed hereunder with
respect to the AXELs shall be paid in full no later than August 1, 2003,
and the final installment payable by Borrower in respect of the AXELs on
such date shall be in an amount, if such amount is different from that
specified above, sufficient to repay all amounts owing by Borrower under
this Agreement with respect to the AXELs.
B. Prepayments and Reductions in Revolving Loan Commitments.
(i) Voluntary Prepayments.
(a) Notice of Prepayment. Borrower may, upon written or
telephonic notice to Administrative Agent on or prior to 12:00 Noon
(New
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York City time) on the date of prepayment, which notice, if
telephonic, shall be promptly confirmed in writing, at any time and
from time to time prepay any Swing Line Loan on any Business Day in
whole or in part in an aggregate minimum amount of $100,000.
Borrower may, upon not less than one Business Day's prior written or
telephonic notice, in the case of Base Rate Loans, and three
Business Days' prior written or telephonic notice, in the case of
Eurodollar Rate Loans, in each case given to Administrative Agent by
12:00 Noon (New York City time) on the date required and, if given
by telephone, promptly confirmed in writing to Administrative Agent
(which original written or telephonic notice Administrative Agent
will promptly transmit by telefacsimile or telephone to each
Lender), at any time and from time to time prepay any AXELs or
Revolving Loans on any Business Day in whole or in part in an
aggregate minimum amount of $1,000,000; provided, however, that with
respect to any Eurodollar Rate Loan not prepaid on the expiration of
the Interest Period applicable thereto, Borrower shall pay any
amounts payable pursuant to subsection 2.6D. Notice of prepayment
having been given as aforesaid, the principal amount of the Loans
specified in such notice shall become due and payable on the
prepayment date specified therein. Any such voluntary prepayment
shall be applied as specified in subsection 2.4B(iv).
(b) Prepayment Fees. If any portion of the AXELs is prepaid
for any reason other than (1) pursuant to subsection 2.4A, (2)
pursuant to subsection 2.4B(iii), or (3) pursuant to an acceleration
other than an acceleration upon the occurrence of an Event of
Default under subsection 8.11, on or prior to the second anniversary
of the Closing Date, Borrower shall pay to Administrative Agent, for
distribution to Lenders having AXELs so prepaid in accordance with
their Pro Rata Shares, a fee equal to (x) 2.75% of the principal
amount of AXELs so prepaid during the period commencing on the
Closing Date and ending on the day prior to the first anniversary of
the Closing Date and (y) 1.75% of the principal amount of AXELs so
prepaid during the period commencing on the first anniversary of the
Closing Date and ending on the second anniversary of the Closing
Date.
(ii) Voluntary Reductions of Revolving Loan Commitments. Borrower
may, upon not less than three Business Days' prior written or telephonic
notice confirmed in writing to Administrative Agent (which original
written or telephonic notice Administrative Agent will promptly transmit
by telefacsimile or telephone to each Lender), at any time and from time
to time terminate in whole or permanently reduce in part, without premium
or penalty, the Revolving Loan Commitments in an amount up to the amount
by which the Revolving Loan Commitments exceed the Total Utilization of
Revolving Loan Commitments at the time of such proposed termination or
reduction; provided that any such partial reduction of the Revolving Loan
Commitments shall be in an aggregate minimum amount of $1,000,000.
Borrower's notice to Administrative Agent shall designate the date (which
shall be
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a Business Day) of such termination or reduction and the amount of any
partial reduction, and such termination or reduction of the Revolving Loan
Commitments shall be effective on the date specified in Borrower's notice
and shall reduce the Revolving Loan Commitment of each Lender
proportionately to its Pro Rata Share.
(iii) Mandatory Prepayments and Mandatory Reductions of Revolving
Loan Commitments. The Loans shall be prepaid and/or the Revolving Loan
Commitments shall be permanently reduced in the amounts and under the
circumstances set forth below, all such prepayments be applied as set
forth below or as more specifically provided in subsection 2.4B(iv):
(a) Prepayments and Reductions From Net Asset Sale Proceeds.
No later than the first Business Day following the date of receipt
by Holdings or any of its Subsidiaries of any Net Asset Sale
Proceeds in respect of any Asset Sale, Borrower shall prepay the
Loans and/or the Revolving Loan Commitments shall be permanently
reduced in an aggregate amount equal to such Net Asset Sale
Proceeds. Notwithstanding the foregoing, Borrower shall not be
required to make a mandatory prepayment pursuant to this subsection
2.4B(iii)(a) if the Net Asset Sale Proceeds are reinvested in assets
of substantially equivalent value within 365 days of the receipt
thereof; provided, however, that the total Net Asset Sale Proceeds
which may be so reinvested shall not exceed $10,000,000 in the
aggregate. If upon any Asset Sale, Borrower elects to reinvest the
Net Asset Sale Proceeds as permitted under this subsection
2.4B(iii)(a), (1) no later than the First Business Day following the
consummation of such Asset Sale, Borrower shall deliver an Officers'
Certificate to Administrative Agent indicating Borrower's election
to reinvest the Net Asset Sale Proceeds and (2) upon the expiration
of 365 days after the date of receipt of the Net Asset Sale Proceeds
of such Asset Sale, Borrower shall deliver to Administrative Agent
an Officers' Certificate indicating the amount of Net Asset Sale
Proceeds reinvested as of such date, the assets in which such Net
Asset Sale Proceeds have been reinvested, and the amount of any
remaining Net Asset Sale Proceeds which shall be applied to prepay
the Loans and/or reduce the Revolving Loan Commitments as set forth
in this subsection 2.4B(iii)(a).
(b) Prepayments and Reductions from Net Insurance/Condemnation
Proceeds. No later than the first Business Day following the date of
receipt by Administrative Agent or by Holdings or any of its
Subsidiaries of any Net Insurance/Condemnation Proceeds that are
required to be applied to prepay the Loans and/or reduce the
Revolving Loan Commitments pursuant to the provisions of subsection
6.4C, Borrower shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate amount
equal to the amount of such Net Insurance/Condemnation Proceeds.
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(c) Prepayments and Reductions Due to Reversion of Surplus
Assets of Pension Plans. No later than the first Business Day
following date of return to Holdings or any of its Subsidiaries of
any surplus assets of any pension plan of Borrower or any of its
Subsidiaries, Borrower shall prepay the Loans and/or the Revolving
Loan Commitments shall be permanently reduced in an aggregate amount
(such amount being the "Net Pension Proceeds") equal to 100% of such
returned surplus assets, net of transaction costs and expenses
incurred in obtaining such return, including incremental taxes
payable as a result thereof.
(d) Prepayments and Reductions from Consolidated Excess Cash
Flow. In the event that there shall be Consolidated Excess Cash Flow
for any Fiscal Year (commencing with Fiscal Year 1997) in amount
greater than $5,000,000, Borrower shall, no later than 90 days after
the end of such Fiscal Year, prepay the Loans and/or the Revolving
Loan Commitments shall be permanently reduced in an aggregate amount
equal to 50% of such Consolidated Excess Cash Flow in excess of
$5,000,000.
(e) Prepayments Upon Receipt of Capital Contributions from
Holdings. Upon receipt by Borrower of any capital contribution from
Holdings of the Cash proceeds (any such proceeds, net of
underwriting discounts and commissions and other reasonable costs
and expenses associated therewith, including reasonable legal fees
and expenses, being "Net Contribution Proceeds") from the issuance
of any equity Securities of Holdings (other than any Permitted Cure
Securities or any such equity Securities the proceeds of which are
contributed to Borrower to fund a Permitted Acquisition), Borrower
shall prepay the Loans and/or the Revolving Loan Commitments shall
be permanently reduced in an aggregate amount equal to 50% of such
Net Contribution Proceeds.
(f) Prepayments Due to Reductions or Restrictions of Revolving
Loan Commitments. Borrower shall from time to time prepay first the
Swing Line Loans and second the Revolving Loans to the extent
necessary so that the Total Utilization of Revolving Loan
Commitments shall not at any time exceed the Revolving Loan
Commitments then in effect.
(g) Calculations of Net Proceeds Amounts; Additional
Prepayments and Reductions Based on Subsequent Calculations.
Concurrently with any prepayment of the Loans and/or reduction of
the Revolving Loan Commitments pursuant to subsections
2.4B(iii)(a)-(e), Borrower shall deliver to Administrative Agent an
Officers' Certificate demonstrating the calculation of the amount
(the "Net Proceeds Amount") of the applicable Net Asset Sale
Proceeds or Net Insurance/Condemnation Proceeds, the applicable Net
Pension Proceeds or Net Contribution Proceeds (as such terms are
defined in subsections 2.4B(iii)(c) and (e), respectively) or the
applicable Consolidated
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Excess Cash Flow, as the case may be, that gave rise to such
prepayment and/or reduction. In the event that Borrower shall
subsequently determine that the actual Net Proceeds Amount was
greater than the amount set forth in such Officers' Certificate,
Borrower shall promptly make an additional prepayment of the Loans
(and/or, if applicable, the Revolving Loan Commitments shall be
permanently reduced) in an amount equal to the amount of such
excess, and Borrower shall concurrently therewith deliver to
Administrative Agent an Officers' Certificate demonstrating the
derivation of the additional Net Proceeds Amount resulting in such
excess.
(iv) Application of Prepayments.
(a) Application of Voluntary Prepayments by Type of Loans and
Order of Maturity. Any voluntary prepayments pursuant to subsection
2.4B(i) shall be applied as specified by Borrower in the applicable
notice of prepayment; provided that in the event Borrower fails to
specify the Loans to which any such prepayment shall be applied,
such prepayment shall be applied first to repay outstanding Swing
Line Loans to the full extent thereof, second to repay outstanding
Revolving Loans to the full extent thereof, and third to repay
outstanding AXELs to the full extent thereof. Any voluntary
prepayments of the AXELs pursuant to subsection 2.4B(i) shall be
applied to reduce the scheduled installments of principal of the
AXELs set forth in subsections 2.4A(i) on a pro rata basis.
(b) Application of Mandatory Prepayments by Type of Loans. Any
amount (the "Applied Amount") required to be applied as a mandatory
prepayment of the Loans and/or a reduction of the Revolving Loan
Commitments pursuant to subsections 2.4B(iii)(a)-(e) shall be
applied first to prepay the AXELs to the full extent thereof,
second, to the extent of any remaining portion of the Applied
Amount, to prepay the Swing Line Loans to the full extent thereof
and to permanently reduce the Revolving Loan Commitments by the
amount of such prepayment, third, to the extent of any remaining
portion of the Applied Amount, to prepay the Revolving Loans to the
full extent thereof and to further permanently reduce the Revolving
Loan Commitments by the amount of such prepayment, and fourth, to
the extent of any remaining portion of the Applied Amount, to
further permanently reduce the Revolving Loan Commitments to the
full extent thereof.
(c) Application of Mandatory Prepayments of AXELs to the
Scheduled Installments of Principal Thereof. Any mandatory
prepayments of the AXELs pursuant to subsection 2.4B(iii) shall be
applied to each scheduled installment of principal of the AXELs, set
forth in subsection 2.4A(i) on a pro rata basis.
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(d) Application of Prepayments to Base Rate Loans and
Eurodollar Rate Loans. Considering AXELs and Revolving Loans being
prepaid separately, any prepayment thereof shall be applied first to
Base Rate Loans to the full extent thereof before application to
Eurodollar Rate Loans, in each case in a manner which minimizes the
amount of any payments required to be made by Borrower pursuant to
subsection 2.6D.
(e) Prepayment of Certain Eurodollar Rate Loans. In the event
the amount of any prepayment required to be made above shall exceed
the aggregate principal amount of the Base Rate Loans outstanding
required to be prepaid (the amount of any such excess being called
the "Excess Amount"), Borrower shall have the right, in lieu of
making such prepayment in full, to prepay all the outstanding
applicable Base Rate Loans and to deposit an amount equal to the
Excess Amount with Administrative Agent in the Collateral Account.
Any amounts so deposited shall be held by Administrative Agent as
collateral for the Obligations and applied to the prepayment of the
applicable Eurodollar Rate Loans at the end of the current Interest
Periods applicable thereto.
C. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Borrower of
principal, interest, fees and other Obligations hereunder and under the
Notes shall be made in Dollars in same day funds, without defense, setoff
or counterclaim, free of any restriction or condition, and delivered to
Administrative Agent not later than 1:00 P.M. (New York City time) on the
date due at the Funding and Payment Office for the account of Lenders;
funds received by Administrative Agent after that time on such due date
shall be deemed to have been paid by Borrower on the next succeeding
Business Day. Borrower hereby authorizes Administrative Agent to charge
its accounts with Administrative Agent in order to cause timely payment to
be made to Administrative Agent of all principal, interest, fees and
expenses due hereunder (subject to sufficient funds being available in its
accounts for that purpose).
(ii) Application of Payments to Principal and Interest. Except as
provided in subsection 2.2C, all payments in respect of the principal
amount of any Loan shall include payment of accrued interest on the
principal amount being repaid or prepaid, and all such payments shall be
applied to the payment of interest before application to principal.
(iii) Apportionment of Payments. Aggregate principal and interest
payments in respect of AXELs and Revolving Loans shall be apportioned
among all outstanding Loans to which such payments relate, in each case
proportionately to Lenders' respective Pro Rata Shares. Administrative
Agent shall promptly distribute to each Lender, at its primary address set
forth below its name on the appropriate signature page hereof or at such
other address as such Lender may request, its Pro
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Rata Share of all such payments received by Administrative Agent and the
commitment fees of such Lender when received by Administrative Agent
pursuant to subsection 2.3. Notwithstanding the foregoing provisions of
this subsection 2.4C(iii), if, pursuant to the provisions of subsection
2.6C, any Notice of Conversion/Continuation is withdrawn as to any
Affected Lender or if any Affected Lender makes Base Rate Loans in lieu of
its Pro Rata Share of any Eurodollar Rate Loans, Administrative Agent
shall give effect thereto in apportioning payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to be made
hereunder shall be stated to be due on a day that is not a Business Day,
such payment shall be made on the next succeeding Business Day and such
extension of time shall be included in the computation of the payment of
interest hereunder or of the commitment fees hereunder, as the case may
be.
(v) Notation of Payment. Each Lender agrees that before disposing of
any Note held by it, or any part thereof (other than by granting
participations therein), that Lender will make a notation thereon of all
Loans evidenced by that Note and all principal payments previously made
thereon and of the date to which interest thereon has been paid; provided
that the failure to make (or any error in the making of) a notation of any
Loan made under such Note shall not limit or otherwise affect the
obligations of Borrower hereunder or under such Note with respect to any
Loan or any payments of principal or interest on such Note.
D. Application of Proceeds of Collateral and Payments Under Guaranties:
(i) Application of Proceeds of Collateral. Except as provided in
subsection 2.4B(iii)(a) with respect to prepayments from Net Asset Sale
Proceeds, all proceeds received by Administrative Agent in respect of any
sale of, collection from, or other realization upon all or any part of the
Collateral under any Collateral Document shall be applied by
Administrative Agent against the applicable Secured Obligations (used
hereinafter as defined in such Collateral Document) then due and owing in
the following order of priority:
(a) To the payment of all costs and expenses of such sale,
collection or other realization, including reasonable compensation
to Administrative Agent and its agents and counsel, and all other
expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, and all amounts for
which Administrative Agent is entitled to indemnification under such
Collateral Document and all advances made by Administrative Agent
thereunder for the account of the applicable Loan Party, and to the
payment of all costs and expenses paid or incurred by Administrative
Agent in connection with the exercise of any right or remedy under
such Collateral Document, all in accordance with the terms of this
Agreement and such Collateral Document;
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(b) thereafter, to the extent of any excess such proceeds, to
the payment of all other such Secured Obligations for the ratable
benefit of the holders thereof; and
(c) thereafter, to the extent of any excess such proceeds, to
the payment to or upon the order of such Loan Party or to whosoever
may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct.
(ii) Application of Payments Under Guaranties. All payments received
by Administrative Agent under any Guaranty shall be applied promptly from
time to time by Administrative Agent in the following order of priority:
(a) To the payment of the costs and expenses of any collection
or other realization under such Guaranty, including reasonable
compensation to Administrative Agent and its agents and counsel, and
all expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, all in accordance with
the terms of this Agreement and such Guaranty;
(b) thereafter, to the extent of any excess such payments, to
the payment of all other Guarantied Obligations (as defined in such
Guaranty) for the ratable benefit of the holders thereof; and
(c) thereafter, to the extent of any excess such payments, to
the payment to Holdings or the applicable Subsidiary Guarantor or to
whosoever may be lawfully entitled to receive the same or as a court
of competent jurisdiction may direct.
2.5 Use of Proceeds.
A. AXELs. The proceeds of the AXELs, together with a portion of the
proceeds of the issuance and sale of the Senior Subordinated Notes, shall be
applied by Borrower to repay Existing Indebtedness, to pay Transaction Costs,
and to prefund Consolidated Capital Expenditures in an amount not to exceed
$4,000,000.
B. Revolving Loans; Swing Line Loans. The proceeds of any Revolving Loans
and any Swing Line Loans shall be applied by Borrower for general corporate
purposes, which may include the making of Permitted Acquisitions.
C. Margin Regulations. No portion of the proceeds of any borrowing under
this Agreement shall be used by Borrower or any of its Subsidiaries in any
manner that might cause the borrowing or the application of such proceeds to
violate Regulation G, Regulation U, Regulation T or Regulation X of the Board of
Governors of the Federal
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Reserve System or to violate any other law, in each case as in effect on the
date or dates of such borrowing and such use of proceeds.
2.6 Special Provisions Governing Eurodollar Rate Loans.
Notwithstanding any other provision of this Agreement to the contrary, the
following provisions shall govern with respect to Eurodollar Rate Loans as to
the matters covered:
A. Determination of Applicable Interest Rate. As soon as practicable after
10:00 A.M. (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent
demonstrable error, be final, conclusive and binding upon all parties) the
interest rate that shall apply to the Eurodollar Rate Loans for which an
interest rate is then being determined for the applicable Interest Period and
shall promptly give notice thereof (in writing or by telephone confirmed in
writing) to Borrower and each Lender.
B. Inability to Determine Applicable Interest Rate. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any Eurodollar Rate Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted Eurodollar Rate, Administrative
Agent shall on such date give notice (by telefacsimile or by telephone confirmed
in writing) to Borrower and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, Eurodollar Rate Loans until such time as
Administrative Agent notifies Borrower and Lenders that the circumstances giving
rise to such notice no longer exist (which Administrative Agent agrees to do
promptly after such
circumstances cease to exist) and (ii) any Notice of Borrowing or Notice of
Conversion/Continuation given by Borrower with respect to the Loans in respect
of which such determination was made shall be deemed to be rescinded by
Borrower.
C. Illegality or Impracticability of Eurodollar Rate Loans. In the event
that on any date any Lender shall have determined (which determination shall be
final and conclusive and binding upon all parties hereto but shall be made only
after consultation with Borrower and Administrative Agent) that the making,
maintaining or continuation of its Eurodollar Rate Loans (i) has become unlawful
as a result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful)
or (ii) has become impracticable, or would cause such Lender material hardship,
as a result of contingencies occurring after the date of this Agreement which
materially and adversely affect the interbank Eurodollar market or the position
of such Lender in that market, then, and in any such event, such Lender shall be
an "Affected Lender" and it shall on that day give notice (by telefacsimile or
by telephone confirmed in writing) to Borrower and Administrative Agent of such
determination (which notice Administrative Agent shall
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promptly transmit to each other Lender). Thereafter (a) the obligation of the
Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate Loans
shall be suspended until such notice shall be withdrawn by the Affected Lender
(which such Lender agrees to do promptly after such Lender ceases to be so
affected), (b) to the extent such determination by the Affected Lender relates
to a Eurodollar Rate Loan then being requested by Borrower pursuant to a Notice
of Borrowing or a Notice of Conversion/Continuation, the Affected Lender shall
make such Loan as (or convert such Loan to, as the case may be) a Base Rate
Loan, (c) the Affected Lender's obligation to maintain its outstanding
Eurodollar Rate Loans (the "Affected Loans") shall be terminated at the earlier
to occur of the expiration of the Interest Period then in effect with respect to
the Affected Loans or when required by law, and (d) the Affected Loans shall
automatically convert into Base Rate Loans on the date of such termination.
Notwithstanding the foregoing, to the extent a determination by an Affected
Lender as described above relates to a Eurodollar Rate Loan then being requested
by Borrower pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, Borrower shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by telefacsimile or
by telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which the Affected Lender gives notice of its determination as
described above (which notice of rescission Administrative Agent shall promptly
transmit to each other Lender). Except as provided in the immediately preceding
sentence, nothing in this subsection 2.6C shall affect the obligation of any
Lender other than an Affected Lender to make or maintain Loans as, or to convert
Loans to, Eurodollar Rate Loans in accordance with the terms of this Agreement.
D. Compensation For Breakage or Non-Commencement of Interest Periods.
Borrower shall compensate each Lender, upon written request by that Lender
(which request shall set forth the basis for requesting such amounts and the
calculation thereof in reasonable detail), for all reasonable losses, expenses
and liabilities (including any interest paid by that Lender to lenders of funds
borrowed by it to make or carry its Eurodollar Rate Loans and any loss, expense
or liability sustained by that Lender in connection with the liquidation or
re-employment of such funds) which that Lender may sustain: (i) if for any
reason (other than a default by that Lender) a borrowing of any Eurodollar Rate
Loan does not occur on a date specified therefor in a Notice of Borrowing or a
telephonic request for borrowing, or a conversion to or continuation of any
Eurodollar Rate Loan does not occur on a date specified therefor in a Notice of
Conversion/Continuation or a telephonic request for conversion or continuation,
(ii) if any prepayment (including any prepayment pursuant to subsection 2.4B(i))
or other principal payment or any conversion of any of its Eurodollar Rate Loans
occurs on a date prior to the last day of an Interest Period applicable to that
Loan, (iii) if any prepayment of any of its Eurodollar Rate Loans is not made on
any date specified in a notice of prepayment given by Borrower, or (iv) as a
consequence of any other default by Borrower in the repayment of its Eurodollar
Rate Loans when required by the terms of this Agreement.
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E. Booking of Eurodollar Rate Loans. Any Lender may make, carry or
transfer Eurodollar Rate Loans at, to, or for the account of any of its branch
offices or the office of an Affiliate of that Lender.
F. Assumptions Concerning Funding of Eurodollar Rate Loans. Calculation of
all amounts payable to a Lender under this subsection 2.6 and under subsection
2.7A may be made as though that Lender had actually funded each of its relevant
Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing
interest at the rate obtained pursuant to clause (i) of the definition of
Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of that
Lender to a domestic office of that Lender in the United States of America;
provided, however, that each Lender may fund each of its Eurodollar Rate Loans
in any manner it sees fit and the foregoing assumptions shall be utilized only
for the purposes of calculating amounts payable under this subsection 2.6 and
under subsection 2.7A.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the provisions
of subsection 2.7B (which shall be controlling with respect to the matters
covered thereby), in the event that any Lender shall determine (which
determination shall, absent demonstrable error, be final and conclusive and
binding upon all parties hereto) that any law, treaty or governmental rule,
regulation or order, or any change therein or in the interpretation,
administration or application thereof (including the introduction of any new
law, treaty or governmental rule, regulation or order), or any determination of
a court or governmental authority, in each case that becomes effective after the
date hereof, or compliance by such Lender with any guideline, request or
directive issued or made after the date hereof by any central bank or other
governmental or quasi-governmental authority (whether or not having the force of
law):
(i) subjects such Lender (or its applicable lending office) to any
additional Tax (other than any Tax on the overall net income of such
Lender) with respect to this Agreement or any of its obligations hereunder
or any payments to such Lender (or its applicable lending office) of
principal, interest, fees or any other amount payable hereunder;
(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve), special
deposit, compulsory loan, FDIC insurance or similar requirement against
assets held by, or deposits or other liabilities in or for the account of,
or advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Lender (other than any such
reserve or other requirements with respect to Eurodollar Rate Loans that
are reflected in the definition of Adjusted Eurodollar Rate); or
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(iii) imposes any other condition (other than with respect to a Tax
matter) on or affecting such Lender (or its applicable lending office) or
its obligations hereunder or the interbank Eurodollar market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Borrower shall within 10 days pay to
such Lender, upon receipt of the statement referred to in the next sentence,
such additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Borrower (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this subsection
2.7A, which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
Promptly after any Lender has determined, in its sole judgment, that it
will make a request for increased compensation pursuant to this Section 2.7A,
such Lender will notify Borrower thereof. Failure on the part of any Lender so
to notify Borrower or to demand compensation for any increased costs or
reduction in amounts received or receivable or reduction in return on capital
with respect to any period shall not constitute a waiver of such Lender's right
to demand compensation with respect to such period or any other period; provided
that Borrower shall not be under any obligation to compensate any Lender with
respect to increased costs or reductions with respect to any period prior to the
date that is six months prior to such request if such Lender knew of the
circumstances giving rise to such increased costs or reductions and of the fact
that such circumstances would in fact result in a claim for increased
compensation by reason of such increased costs or reductions; and provided,
further, that the foregoing limitation shall not apply to any increased costs or
reductions arising out of the retroactive application of any law, regulation,
rule, guideline or directive as aforesaid within such six-month period.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. All sums payable by Borrower
under this Agreement and the other Loan Documents shall (except to the
extent required by law) be paid free and clear of, and without any
deduction or withholding on account of, any Tax (other than a Tax on the
overall net income of any Lender) imposed, levied, collected, withheld or
assessed by or within the United States of America or any political
subdivision in or of the United States of America or any other
jurisdiction from or to which a payment is made by or on behalf of
Borrower or by any federation or organization of which the United States
of America or any such jurisdiction is a member at the time of payment.
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(ii) Grossing-up of Payments. If Borrower or any other Person is
required by law to make any deduction or withholding on account of any
such Tax from any sum paid or payable by Borrower to Administrative Agent
or any Lender under any of the Loan Documents:
(a) Borrower shall notify Administrative Agent of any such
requirement or any change in any such requirement as soon as
Borrower becomes aware of it;
(b) Borrower shall pay any such Tax before the date on which
penalties attach thereto, such payment to be made (if the liability
to pay is imposed on Borrower) for its own account or (if that
liability is imposed on Administrative Agent or such Lender, as the
case may be) on behalf of and in the name of Administrative Agent or
such Lender;
(c) the sum payable by Borrower in respect of which the
relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the making
of that deduction, withholding or payment, Administrative Agent or
such Lender, as the case may be, receives on the due date a net sum
equal to what it would have received had no such deduction,
withholding or payment been required or made; and
(d) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required
by clause (b) above to pay, Borrower shall deliver to Administrative
Agent evidence satisfactory to the other affected parties of such
deduction, withholding or payment and of the remittance thereof to
the relevant taxing or other authority;
provided that no such additional amount shall be required to be paid to
any Lender under clause (c) above except to the extent that any change
after the date hereof (in the case of each Lender listed on the signature
pages hereof) or after the date of the Assignment Agreement pursuant to
which such Lender became a Lender (in the case of each other Lender) in
any such requirement for a deduction, withholding or payment as is
mentioned therein shall result in an increase in the rate of such
deduction, withholding or payment from that in effect at the date of this
Agreement or at the date of such Assignment Agreement, as the case may be,
in respect of payments to such Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof (for purposes of this subsection
2.7B(iii), a "Non-US Lender") shall deliver to Administrative Agent
for transmission to Borrower, on or prior to the
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Closing Date (in the case of each Lender listed on the signature
pages hereof) or on or prior to the date of the Assignment Agreement
pursuant to which it becomes a Lender (in the case of each other
Lender), and at such other times as may be necessary in the
determination of Borrower or Administrative Agent (each in the
reasonable exercise of its discretion), (1) two original copies of
Internal Revenue Service Form 1001 or 4224 (or any successor forms),
properly completed and duly executed by such Lender, together with
any other certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to any
payments to such Lender of principal, interest, fees or other
amounts payable under any of the Loan Documents or (2) if such
Lender is not a "bank" or other Person described in Section
881(c)(3) of the Internal Revenue Code and cannot deliver either
Internal Revenue Service Form 1001 or 4224 pursuant to clause (1)
above, a Certificate re Non-Bank Status together with two original
copies of Internal Revenue Service Form W-8 (or any successor form),
properly completed and duly executed by such Lender, together with
any other certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to any
payments to such Lender of interest payable under any of the Loan
Documents.
(b) Each Lender required to deliver any forms, certificates or
other evidence with respect to United States federal income tax
withholding matters pursuant to subsection 2.7B(iii)(a) hereby
agrees, from time to time after the initial delivery by such Lender
of such forms, certificates or other evidence, whenever a lapse in
time or change in circumstances renders such forms, certificates or
other evidence obsolete or inaccurate in any material respect, that
such Lender shall promptly (1) deliver to Administrative Agent for
transmission to Borrower two new original copies of Internal Revenue
Service Form 1001 or 4224, or a Certificate re Non-Bank Status and
two original copies of Internal Revenue Service Form W-8, as the
case may be, properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption
required in order to confirm or establish that such Lender is not
subject to deduction or withholding of United States federal income
tax with respect to payments to such Lender under the Loan Documents
or (2) notify Administrative Agent and Borrower of its inability to
deliver any such forms, certificates or other evidence.
(c) Borrower shall not be required to pay any additional
amount to any Non-US Lender under clause (c) of subsection 2.7B(ii)
if such Lender shall have failed to satisfy the requirements of
clause (a) or (b)(1) of this subsection 2.7B(iii); provided that if
such Lender shall have satisfied the requirements of subsection
2.7B(iii)(a) on the Closing Date (in the case of
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each Lender listed on the signature pages hereof) or on the date of
the Assignment Agreement pursuant to which it became a Lender (in
the case of each other Lender), nothing in this subsection
2.7B(iii)(c) shall relieve Borrower of its obligation to pay any
additional amounts pursuant to clause (c) of subsection 2.7B(ii) in
the event that, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any change in
the interpretation, administration or application thereof, such
Lender is no longer properly entitled to deliver forms, certificates
or other evidence at a subsequent date establishing the fact that
such Lender is not subject to withholding as described in subsection
2.7B(iii)(a).
C. Capital Adequacy Adjustment. If any Lender shall have determined that
the adoption, effectiveness, phase-in or applicability after the date hereof of
any law, rule or regulation (or any provision thereof) regarding capital
adequacy, or any change therein or in the interpretation or administration
thereof by the National Association of Insurance Commissioners, any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its applicable lending
office) with any guideline, request or directive regarding capital adequacy
(whether or not having the force of law) of the National Association of
Insurance Commissioners, any such governmental authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on the capital of such Lender or any corporation controlling such Lender as a
consequence of, or with reference to, such Lender's Loans or Commitments or
Letters of Credit or participations therein or other obligations hereunder with
respect to the Loans or the Letters of Credit to a level below that which such
Lender or such controlling corporation could have achieved but for such
adoption, effectiveness, phase-in, applicability, change or compliance (taking
into consideration the policies of such Lender or such controlling corporation
with regard to capital adequacy), then from time to time, within ten Business
Days after receipt by Borrower from such Lender of the statement referred to in
the next sentence, Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender or such controlling corporation on an
after-tax basis for such reduction. Such Lender shall deliver to Borrower (with
a copy to Administrative Agent) a written statement, setting forth in reasonable
detail the basis of the calculation of such additional amounts, which statement
shall be conclusive and binding upon all parties hereto absent demonstrable
error.
D. Substitute Lenders. In the event Borrower is required under the
provisions of this subsection 2.7 or subsection 3.6 to make payments in a
material amount to any Lender or in the event any Lender fails to lend to
Borrower in accordance with this Agreement or if any Lender becomes an Affected
Lender, Borrower may, so long as no Event of Default or Potential Event of
Default shall have occurred and be continuing, elect to terminate such Lender as
a party to this Agreement; provided that, concurrently with such termination,
(i) Borrower shall pay that Lender all principal, interest and fees and other
amounts (including without limitation, amounts, if any, owed under this
subsection 2.7 or subsection 3.6) owed to such Lender through such date of
termination, (ii) another financial institution satisfactory to Borrower and
Administrative Agent (or if Administrative Agent
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is also the Lender to be terminated, the successor Administrative Agent) shall
agree, as of such date, to become a Lender for all purposes under this Agreement
(whether by assignment or amendment) and to assume all obligations of the Lender
to be terminated as of such date, and (iii) all documents and supporting
materials necessary, in the judgment of Administrative Agent (or if
Administrative Agent is also the Lender to be terminated, the successor
Administrative Agent), to evidence the substitution of such Lender shall have
been received and approved by Administrative Agent as of such date.
2.8 Obligation of Lenders and Issuing Lender to Mitigate.
Each Lender and Issuing Lender agrees that, as promptly as practicable
after the officer of such Lender or Issuing Lender responsible for administering
the Loans or Letters of Credit of such Lender or Issuing Lender, as the case may
be, becomes aware of the occurrence of an event or the existence of a condition
that would cause such Lender to become an Affected Lender or that would entitle
such Lender or Issuing Lender to receive payments under subsection 2.7 or
subsection 3.6, it will, to the extent not inconsistent with the internal
policies of such Lender or Issuing Lender and any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, issue, fund or maintain the
Commitments of such Lender or the affected Loans or Letters of Credit of such
Lender or Issuing Lender through another lending or letter of credit office of
such Lender or Issuing Lender, or (ii) take such other measures as such Lender
or Issuing Lender may deem reasonable, if as a result thereof the circumstances
which would cause such Lender to be an Affected Lender would cease to exist or
the additional amounts which would otherwise be required to be paid to such
Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6 would be
materially reduced and if, as determined by such Lender or Issuing Lender in its
sole discretion, the making, issuing, funding or maintaining of such Commitments
or Loans or Letters of Credit through such other lending or letter of credit
office or in accordance with such other measures, as the case may be, would not
otherwise materially adversely affect such Commitments or Loans or Letters of
Credit or the interests of such Lender or Issuing Lender; provided that such
Lender or Issuing Lender will not be obligated to utilize such other lending or
letter of credit office pursuant to this subsection 2.8 unless Borrower agrees
to pay all incremental expenses incurred by such Lender or Issuing Lender as a
result of utilizing such other lending or letter of credit office as described
in clause (i) above. A certificate as to the amount of any such expenses payable
by Borrower pursuant to this subsection 2.8 (setting forth in reasonable detail
the basis for requesting such amount) submitted by such Lender or Issuing Lender
to Borrower (with a copy to Administrative Agent) shall be conclusive absent
demonstrable error.
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SECTION 3.
LETTERS OF CREDIT
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein.
A. Letters of Credit. In addition to Borrower requesting that Lenders make
Revolving Loans pursuant to subsection 2.1A(ii) and that Swing Line Lender make
Swing Line Loans pursuant to subsection 2.1A(iii), Borrower may request, in
accordance with the provisions of this subsection 3.1, from time to time during
the period from the Closing Date to but excluding the Revolving Loan Commitment
Termination Date, that Issuing Lender issue Letters of Credit for the account of
Borrower for the purposes specified in the definitions of Commercial Letters of
Credit and Standby Letters of Credit. Subject to the terms and conditions of
this Agreement and in reliance upon the representations and warranties of
Borrower herein set forth, Issuing Lender shall issue such Letters of Credit in
accordance with the provisions of this subsection 3.1; provided that Borrower
shall not request that Issuing Lender issue (and Lender shall not issue):
(i) any Letter of Credit if, after giving effect to such issuance,
the Total Utilization of Revolving Loan Commitments would exceed the
Revolving Loan Commitments then in effect; or
(ii) any Letter of Credit if, after giving effect to such issuance,
the Letter of Credit Usage would exceed $10,000,000; or
(iii) any Standby Letter of Credit having an expiration date later
than the earlier of (a) the Revolving Loan Commitment Termination Date and
(b) the date which is one year from the date of issuance of such Standby
Letter of Credit (other than the Standby Letters of Credit set forth on
Schedule 3.1 annexed hereto which shall have the expiration dates set
forth on Schedule 3.1); provided that the immediately preceding clause (b)
shall not prevent Issuing Lender from agreeing that a Standby Letter of
Credit will automatically be extended for one or more successive periods
not to exceed one year each unless Issuing Lender elects not to extend for
any such additional period; and provided, further that Issuing Lender
shall elect not to extend such Standby Letter of Credit if it has
knowledge that an Event of Default has occurred and is continuing (and has
not been waived in accordance with subsection 10.6) at the time Issuing
Lender must elect whether or not to allow such extension; or
(iv) any Commercial Letter of Credit having an expiration date (a)
later than the earlier of (a) the date which is 30 days prior to the
Revolving Loan Commitment Termination Date and (b) the date which is 180
days from the date of issuance of such Commercial Letter of Credit or (b)
that is otherwise unacceptable to Issuing Lender in its reasonable
discretion; or
(v) any Letter of Credit denominated in a currency other than
Dollars.
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B. Mechanics of Issuance.
(i) Notice of Issuance. Whenever Borrower desires the issuance of a
Letter of Credit, it shall deliver to Issuing Lender a Notice of Issuance
of Letter of Credit substantially in the form of Exhibit III annexed
hereto no later than 12:00 Noon (New York City time) at least three
Business Days, or such shorter period as may be agreed to by Issuing
Lender in any particular instance, in advance of the proposed date of
issuance. The Notice of Issuance of Letter of Credit shall specify (a) the
proposed date of issuance (which shall be a Business Day), (b) whether the
Letter of Credit is to be a Standby Letter of Credit or a Commercial
Letter of Credit, (c) the face amount of the Letter of Credit, (d) the
expiration date of the Letter of Credit, (e) the name and address of the
beneficiary, and (f) either the verbatim text of the proposed Letter of
Credit or the proposed terms and conditions thereof, including a precise
description of any documents to be presented by the beneficiary which, if
presented by the beneficiary prior to the expiration date of the Letter of
Credit, would require Issuing Lender to make payment under the Letter of
Credit; provided that Issuing Lender, in its reasonable discretion, may
require changes in the text of the proposed Letter of Credit or any such
documents; and provided, further that, unless otherwise agreed by the
Issuing Lender, no Letter of Credit shall require payment against a
conforming draft to be made thereunder on the same business day (under the
laws of the jurisdiction in which the office of Issuing Lender to which
such draft is required to be presented is located) that such draft is
presented if such presentation is made after 10:00 A.M. (in the time zone
of such office of Issuing Lender) on such business day.
Borrower shall notify Issuing Lender (and Administrative Agent, if
Administrative Agent is not Issuing Lender) prior to the issuance of any
Letter of Credit in the event that any of the matters to which Borrower
has certified in the applicable Notice of Issuance of Letter of Credit is
no longer true and correct as of the proposed date of issuance of such
Letter of Credit, and upon the issuance of any Letter of Credit Borrower
shall be deemed to have re-certified, as of the date of such issuance, as
to the matters to which Borrower is required to certify in the applicable
Notice of Issuance of Letter of Credit.
(ii) Issuance of Letter of Credit. Upon satisfaction or waiver (in
accordance with subsection 10.6) of the conditions set forth in subsection
4.3, Issuing Lender shall issue the requested Letter of Credit in
accordance with Issuing Lender's standard operating procedures.
(iii) Notification to Lenders. Upon the issuance of any Letter of
Credit Issuing Lender shall promptly notify Administrative Agent (if
Issuing Lender is not Administrative Agent) and each other Lender of such
issuance, which notice shall be accompanied by a copy of such Letter of
Credit. Promptly after receipt of such notice (or, if Administrative Agent
is Issuing Lender, together with such notice), Administrative Agent shall
notify each Lender of the amount of such Lender's
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respective participation in such Letter of Credit, determined in
accordance with subsection 3.1C.
(iv) Reports to Lenders. Within 30 days after the end of each
calendar quarter ending after the Closing Date, so long as any Letter of
Credit shall have been outstanding during such calendar quarter, Issuing
Lender shall deliver to each other Lender a report setting forth for such
calendar quarter the daily aggregate amount available to be drawn under
the Letters of Credit issued by Issuing Lender that were outstanding
during such calendar quarter.
C. Lenders' Purchase of Participations in Letters of Credit. Immediately
upon the issuance of each Letter of Credit, each Lender shall be deemed to, and
hereby agrees to, have irrevocably purchased from Issuing Lender a participation
in such Letter of Credit and any drawings honored thereunder in an amount equal
to such Lender's Pro Rata Share of the maximum amount which is or at any time
may become available to be drawn thereunder.
3.2 Letter of Credit Fees.
Borrower agrees to pay the following amounts with respect to Letters of
Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting fee,
payable directly to Issuing Lender for its own account, equal to the
greater of (1) $500 and (2) 0.25% per annum of the daily amount available
to be drawn under such Letter of Credit and (b) a letter of credit fee,
payable to Administrative Agent for the account of Lenders, equal to the
product of the Applicable Margin for Revolving Loans that are Eurodollar
Rate Loans and the daily amount available to be drawn under such Letter of
Credit, each such fronting fee or letter of credit fee to be payable in
arrears on and to (but excluding) each February 1, May 1, August 1 and
November 1 of each year and computed on the basis of a 365-day or 366-day
year, as the case may be, for the actual number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of each
Letter of Credit and each payment of a drawing made thereunder (without
duplication of the fees payable under clause (i) above), documentary and
processing charges payable directly to Issuing Lender for its own account
in accordance with Issuing Lender's standard schedule for such charges in
effect at the time of such issuance, amendment, transfer or payment, as
the case may be.
For purposes of calculating any fees payable under clause (i) of this subsection
3.2, the daily amount available to be drawn under any Letter of Credit shall be
determined as of the close of business on any date of determination. Promptly
upon receipt by Administrative Agent of any amount described in clause (i)(b) of
this subsection 3.2, Administrative Agent shall distribute to each Lender its
Pro Rata Share of such amount.
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3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit.
A. Responsibility of Issuing Lender With Respect to Drawings. In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, Issuing Lender shall be responsible only to examine the
documents delivered under such Letter of Credit with reasonable care so as to
ascertain whether they appear on their face to be in accordance with the terms
and conditions of such Letter of Credit.
B. Reimbursement by Borrower of Amounts Paid Under Letters of Credit. In
the event Issuing Lender has determined to honor a drawing under a Letter of
Credit issued by it, Issuing Lender shall immediately notify Borrower and
Administrative Agent, and Borrower shall reimburse Issuing Lender on or before
the Business Day immediately following the date on which such drawing is honored
(the "Reimbursement Date") in an amount in Dollars and in same day funds equal
to the amount of such honored drawing; provided that, anything contained in this
Agreement to the contrary notwithstanding, (i) unless Borrower shall have
notified Administrative Agent and Issuing Lender prior to 10:00 A.M. (New York
City time) on the date such drawing is honored that Borrower intends to
reimburse Issuing Lender for the amount of such honored drawing with funds other
than the proceeds of Revolving Loans, Borrower shall be deemed to have given a
timely Notice of Borrowing to Administrative Agent requesting Lenders to make
Revolving Loans that are Base Rate Loans on the Reimbursement Date in an amount
in Dollars equal to the amount of such honored drawing and (ii) subject to
satisfaction or waiver of the conditions specified in subsection 4.2B, Lenders
shall, on the Reimbursement Date, make Revolving Loans that are Base Rate Loans
in the amount of such honored drawing, the proceeds of which shall be applied
directly by Administrative Agent to reimburse Issuing Lender for the amount of
such honored drawing; and provided, further that if for any reason proceeds of
Revolving Loans are not received by Issuing Lender on the Reimbursement Date in
an amount equal to the amount of such honored drawing, Borrower shall reimburse
Issuing Lender, on demand, in an amount in same day funds equal to the excess of
the amount of such honored drawing over the aggregate amount of such Revolving
Loans, if any, which are so received. Nothing in this subsection 3.3B shall be
deemed to relieve any Lender from its obligation to make Revolving Loans on the
terms and conditions set forth in this Agreement, and Borrower shall retain any
and all rights it may have against any Lender resulting from the failure of such
Lender to make such Revolving Loans under this subsection 3.3B.
C. Payment by Lenders of Unreimbursed Amounts Paid Under Letters of
Credit.
(i) Payment by Lenders. In the event that Borrower shall fail for
any reason to reimburse Issuing Lender as provided in subsection 3.3B in
an amount equal to the amount of any drawing honored by Issuing Lender
under a Letter of Credit issued by it, Issuing Lender shall promptly
notify each other Lender of the unreimbursed amount of such honored
drawing and of such other Lender's respective participation therein based
on such Lender's Pro Rata Share. Each Lender shall make available to
Issuing Lender an amount equal to its respective participation, in
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Dollars and in same day funds, at the office of Issuing Lender specified
in such notice, not later than 12:00 Noon (New York City time) on the
first business day (under the laws of the jurisdiction in which such
office of Issuing Lender is located) after the date notified by Issuing
Lender. In the event that any Lender fails to make available to Issuing
Lender on such business day the amount of such Lender's participation in
such Letter of Credit as provided in this subsection 3.3C, Issuing Lender
shall be entitled to recover such amount on demand from such Lender
together with interest thereon at the rate customarily used by Issuing
Lender for the correction of errors among banks for three Business Days
and thereafter at the Base Rate. Nothing in this subsection 3.3C shall be
deemed to prejudice the right of any Lender to recover from Issuing Lender
any amounts made available by Lender to Issuing Lender pursuant to this
subsection 3.3C in the event that it is determined by the final judgment
of a court of competent jurisdiction that the payment with respect to a
Letter of Credit by Issuing Lender in respect of which payment was made by
Lender constituted gross negligence or willful misconduct on the part of
Issuing Lender.
(ii) Distribution to Lenders of Reimbursements Received From
Borrower. In the event Issuing Lender shall have been reimbursed by other
Lenders pursuant to subsection 3.3C(i) for all or any portion of any
drawing honored by Issuing Lender under a Letter of Credit issued by it,
Issuing Lender shall distribute to each other Lender which has paid all
amounts payable by it under subsection 3.3C(i) with respect to such
honored drawing such other Lender's Pro Rata Share of all payments
subsequently received by Issuing Lender from Borrower in reimbursement of
such honored drawing when such payments are received. Any such
distribution shall be made to a Lender at its primary address set forth
below its name on the appropriate signature page hereof or at such other
address as such Lender may request.
D. Interest on Amounts Paid Under Letters of Credit.
(i) Payment of Interest by Borrower. Borrower agrees to pay to
Issuing Lender, with respect to drawings honored under any Letters of
Credit issued by it, interest on the amount paid by Issuing Lender in
respect of each such honored drawing from the date such drawing is honored
to but excluding the date such amount is reimbursed by Borrower (including
any such reimbursement out of the proceeds of Revolving Loans pursuant to
subsection 3.3B) at a rate equal to (a) for the period from the date such
drawing is honored to but excluding the Reimbursement Date, the rate then
in effect under this Agreement with respect to Revolving Loans that are
Base Rate Loans and (b) thereafter, a rate which is 2% per annum in excess
of the rate of interest otherwise payable under this Agreement with
respect to Revolving Loans that are Base Rate Loans. Interest payable
pursuant to this subsection 3.3D(i) shall be computed on the basis of a
365-day or 366-day year, as the case may be, for the actual number of days
elapsed in the period during which it accrues and shall be payable on
demand or, if no demand is made, on the date on which the related drawing
under a Letter of Credit is reimbursed in full.
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(ii) Distribution of Interest Payments by Issuing Lender. Promptly
upon receipt by Issuing Lender of any payment of interest pursuant to
subsection 3.3D(i) with respect to a drawing honored under a Letter of
Credit issued by it, (a) Issuing Lender shall distribute to each other
Lender, out of the interest received by Issuing Lender in respect of the
period from the date such drawing is honored to but excluding the date on
which Issuing Lender is reimbursed for the amount of such drawing
(including any such reimbursement out of the proceeds of Revolving Loans
pursuant to subsection 3.3B), the amount that such other Lender would have
been entitled to receive in respect of the letter of credit fee that would
have been payable in respect of such Letter of Credit for such period
pursuant to subsection 3.2 if no drawing had been honored under such
Letter of Credit, and (b) in the event Issuing Lender shall have been
reimbursed by other Lenders pursuant to subsection 3.3C(i) for all or any
portion of such honored drawing, Issuing Lender shall distribute to each
other Lender which has paid all amounts payable by it under subsection
3.3C(i) with respect to such honored drawing such other Lender's Pro Rata
Share of any interest received by Issuing Lender in respect of that
portion of such honored drawing so reimbursed by other Lenders for the
period from the date on which Issuing Lender was so reimbursed by other
Lenders to but excluding the date on which such portion of such honored
drawing is reimbursed by Borrower. Any such distribution shall be made to
a Lender at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such Lender
may request.
3.4 Obligations Absolute.
The obligation of Borrower to reimburse Issuing Lender for drawings
honored under the Letters of Credit issued by it and to repay any Revolving
Loans made by Lenders pursuant to subsection 3.3B and the obligations of Lenders
under subsection 3.3C(i) shall be unconditional and irrevocable and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances including any of the following circumstances:
(i) any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, set-off, defense or other right
which Borrower or any Lender may have at any time against a beneficiary or
any transferee of any Letter of Credit (or any Persons for whom any such
transferee may be acting), Issuing Lender or other Lender or any other
Person or, in the case of a Lender, against Borrower, whether in
connection with this Agreement, the transactions contemplated herein or
any unrelated transaction (including any underlying transaction between
Borrower or one of its Subsidiaries and the beneficiary for which any
Letter of Credit was procured);
(iii) any draft or other document presented under any 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;
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(iv) payment by Issuing Lender under any Letter of Credit against
presentation of a draft or other document which does not substantially
comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations, properties,
assets, condition (financial or otherwise) or prospects of Borrower or any
of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document by any
party thereto;
(vii) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event of
Default shall have occurred and be continuing;
provided, in each case, that payment by Issuing Lender under the applicable
Letter of Credit shall not have constituted gross negligence, willful misconduct
or bad faith of Issuing Lender under the circumstances in question.
3.5 Indemnification; Nature of Issuing Lender's Duties.
A. Indemnification. In addition to amounts payable as provided in
subsection 3.6, Borrower hereby agrees to protect, indemnify, pay and save
harmless Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which Issuing Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by Issuing
Lender, other than as a result of (a) the gross negligence, willful misconduct
or bad faith of Issuing Lender or (b) subject to the following clause (ii), the
wrongful dishonor by Issuing Lender of a proper demand for payment made under
any Letter of Credit issued by it or (ii) the failure of Issuing Lender to honor
a drawing under any such Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure or de facto
government or governmental authority (all such acts or omissions herein called
"Governmental Acts").
B. Nature of Issuing Lender's Duties. As between Borrower and Issuing
Lender, Borrower assumes all risks of the acts and omissions of, or misuse of
the Letters of Credit issued by Issuing Lender by, the respective beneficiaries
of such Letters of Credit. In furtherance and not in limitation of the
foregoing, Issuing Lender shall not be responsible for: (i) the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for and issuance of any such Letter
of Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any such Letter of Credit or the
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rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (iii) failure of the
beneficiary of any such Letter of Credit to comply fully with any conditions
required in order to draw upon such Letter of Credit; (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex or otherwise, whether or not they be in cipher; (v)
errors in interpretation of technical terms; (vi) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of Issuing Lender, including any Governmental
Acts, and none of the above shall affect or impair, or prevent the vesting of,
any of Issuing Lender's rights or powers hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this subsection 3.5B, any action
taken or omitted by Issuing Lender under or in connection with the Letters of
Credit issued by it or any documents and certificates delivered thereunder, if
taken or omitted in good faith, shall not put Issuing Lender under any resulting
liability to Borrower.
Notwithstanding anything to the contrary contained in this subsection 3.5,
Borrower shall retain any and all rights it may have against Issuing Lender for
any liability arising solely out of the gross negligence, willful misconduct or
bad faith of Issuing Lender.
3.6 Increased Costs and Taxes Relating to Letters of Credit.
Subject to the provisions of subsection 2.7B (which shall be controlling
with respect to the matters covered thereby), in the event that Issuing Lender
or any Lender shall determine (which determination shall, absent manifest error,
be final and conclusive and binding upon all parties hereto) that any law,
treaty or governmental rule, regulation or order, or any change therein or in
the interpretation, administration or application thereof (including the
introduction of any new law, treaty or governmental rule, regulation or order),
or any determination of a court or governmental authority, in each case that
becomes effective after the date hereof, or compliance by Issuing Lender or any
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law):
(i) subjects Issuing Lender or such Lender (or its applicable
lending or letter of credit office) to any additional Tax (other than any
Tax on the overall net income of Issuing Lender or such Lender) with
respect to the issuing or maintaining of any Letters of Credit or the
purchasing or maintaining of any participations therein or any other
obligations under this Section 3, whether directly or by such being
imposed on or suffered by Issuing Lender;
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(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve), special
deposit, compulsory loan, FDIC insurance or similar requirement in respect
of any Letters of Credit issued by Issuing Lender or participations
therein purchased by such Lender; or
(iii) imposes any other condition (other than with respect to a Tax
matter) on or affecting Issuing Lender or Lender (or its applicable
lending or letter of credit office) regarding this Section 3 or any Letter
of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to Issuing Lender
or such Lender of agreeing to issue, issuing or maintaining any Letter of Credit
or agreeing to purchase, purchasing or maintaining any participation therein or
to reduce any amount received or receivable by Issuing Lender or such Lender (or
its applicable lending or letter of credit office) with respect thereto; then,
in any case, Borrower shall promptly pay to Issuing Lender or such Lender, upon
receipt of the statement referred to in the next sentence, such additional
amount or amounts as may be necessary to compensate Issuing Lender or such
Lender for any such increased cost or reduction in amounts received or
receivable hereunder. Issuing Lender or such Lender shall deliver to Borrower a
written statement, setting forth in reasonable detail the basis for calculating
the additional amounts owed to Issuing Lender or such Lender under this
subsection 3.6, which statement shall be conclusive and binding upon all parties
hereto absent demonstrable error. Promptly after Issuing Lender or any Lender
has determined, in its sole judgment, that it will make a request for increased
compensation pursuant to this subsection 3.6, Issuing Lender or such Lender, as
the case may be, will notify Borrower thereof. Failure on the part of Issuing
Lender or such Lender, as the case may be, so to notify Borrower or to demand
compensation for any increased costs or reduction in amounts received or
receivable or reduction in return on capital with respect to any period shall
not constitute a waiver of Issuing Lender's or such Lender's right to demand
compensation with respect to such period or any other period; provided that
Borrower shall not be under any obligation to compensate Issuing Lender or any
Lender with respect to increased costs or reductions with respect to any period
prior to the date that is six months prior to such request if Issuing Lender or
such Lender knew of the circumstances giving rise to such increased costs or
reductions and of the fact that such circumstances would in fact result in a
claim for increased compensation by reason of such increased costs or
reductions; provided, further, that the foregoing limitation shall not apply to
any increased costs or reductions arising out of the retroactive application of
any law, regulation, rule, guideline or directive as aforesaid within such
six-month period.
SECTION 4.
CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of Letters of
Credit hereunder are subject to the satisfaction of the following conditions.
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4.1 Conditions to AXELs and Initial Revolving Loans and Swing Line Loans.
The obligations of Lenders to make the AXELs to be made on the Closing
Date are, in addition to the conditions precedent specified in subsection 4.2,
subject to prior or concurrent satisfaction of the following conditions:
A. Loan Party Documents. On or before the Closing Date, Borrower shall,
and shall cause each other Loan Party to, deliver to Lenders (or to
Administrative Agent for Lenders with sufficient originally executed copies,
where appropriate, for each Lender and its counsel) the following with respect
to Borrower or such Loan Party, as the case may be, each, unless otherwise
noted, dated the Closing Date:
(i) Certified copies of the Certificate or Articles of Incorporation
of such Person, together with a good standing certificate from the
Secretary of State of its jurisdiction of incorporation and each other
state in which such Person is qualified as a foreign corporation to do
business and, to the extent generally available, a certificate or other
evidence of good standing as to payment of any applicable franchise or
similar taxes from the appropriate taxing authority of each of such
jurisdictions, each dated a recent date prior to the Closing Date;
(ii) Copies of the Bylaws of such Person, certified as of the
Closing Date by such Person's corporate secretary or an assistant
secretary;
(iii) Resolutions of the Board of Directors of such Person approving
and authorizing the execution, delivery and performance of the Loan
Documents and Related Agreements to which it is a party, certified as of
the Closing Date by the corporate secretary or an assistant secretary of
such Person as being in full force and effect without modification or
amendment;
(iv) Signature and incumbency certificates of the officers of such
Person executing the Loan Documents to which it is a party; and
(v) Executed originals of the Loan Documents to which such Person is
a party.
B. No Material Adverse Change. Except as set forth on Schedule 5.4, since
December 31, 1995, no event, change or development has occurred which has a
Material Adverse Effect.
C. Senior Subordinated Notes. On or prior to the Closing Date, Borrower
shall have issued and sold the Senior Subordinated Notes and received gross
proceeds of not less than $100,000,000. The Senior Subordinated Notes shall be
unsecured and shall have terms, including without limitation, maturity, interest
rates, covenants and subordination provisions in form and substance as set forth
in the Indenture dated August 15, 1996, with such changes thereto, if any, that
have been approved by Administrative Agent and Requisite
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Lenders or that would otherwise have been permitted to be made pursuant to
subsection 7.13A if the Subordinated Notes were issued and outstanding at the
time of any such change. Borrower shall deliver to Arranging Agent and
Administrative Agent true and complete copies of the all documentation relating
to the Senior Subordinated Notes, all of which shall be in form and substance
satisfactory to Arranging Agent and Administrative Agent. In no event shall the
maturity or the first scheduled repayment date on the Senior Subordinated Notes
be earlier than August 1, 2003.
D. Holdings Common Stock and Holdings Preferred Stock. On or prior to the
Closing Date, Holdings shall have (i) issued and sold $130,000,000 in the
aggregate of Holdings Common Stock and Holdings Preferred Stock to ▇▇▇▇▇▇ and
the Blackstone Investors and (ii) all of the foregoing, including the terms and
conditions thereof and all documentation executed therewith, shall be in form
and substance satisfactory to Arranging Agent and Administrative Agent.
E. Related Agreements. (i) Administrative Agent and Arranging Agent shall
have received executed or conformed copies of each of the Related Agreements and
any amendments thereto on or before the Closing Date, the terms are conditions
of which shall be in all respects satisfactory to Administrative Agent and
Arranging Agent, (ii) the Related Agreements shall be in full force and effect
and no term or condition thereof shall have been amended, modified or waived
after the execution thereof, except as provided in a written amendment thereto
delivered to and approved by Administrative Agent and Arranging Agent, (iii) no
Loan Party shall have failed in any material respect to perform any material
obligation or covenant required by the Related Agreement to be performed with or
complied with by it on or before the Closing Date and (iv) Administrative Agent
and Arranging Agent shall have received an Officers' Certificate from Holdings
and Borrower in form and substance satisfactory to Administrative Agent and
Arranging Agent to the effects set forth in clauses (i), (ii) and (iii) above.
F. Matters Relating to Existing Indebtedness. On the Closing Date,
Borrower and its Subsidiaries shall have (i) repaid in full all Existing
Indebtedness outstanding or defeased such Existing Indebtedness pursuant to
escrow agreements or other arrangements which shall be in form and substance
satisfactory to Arranging Agent and Administrative Agent, (ii) terminated any
commitments to lend or make other extensions of credit under the documentation
governing the Existing Indebtedness, (iii) deposited in the Collateral Account
amounts sufficient to repay in full or defease all Remaining Existing
Indebtedness, and (iv) delivered to Arranging Agent and Administrative Agent all
documents or instruments necessary (including termination statements and
discharges and releases of mortgages) to release all Liens securing the Existing
Indebtedness and release letters in form and substance satisfactory to Arranging
Agent and Administrative Agent from the holders of the Existing Indebtedness
releasing their claims and giving further assurances as to any other actions or
documents necessary to release all Liens securing such Existing Indebtedness.
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G. Necessary Governmental Authorizations and Consents; Expiration of
Waiting Periods, Etc. Holdings and Borrower shall have obtained all Governmental
Authorizations and all consents of other Persons, in each case that are
necessary or advisable in connection with the Acquisition the other transactions
contemplated by the Loan Documents and the Related Agreements, and the continued
operation of the business conducted by Holdings and its Subsidiaries in
substantially the same manner as conducted prior to the consummation of the
Acquisition and each of the foregoing shall be in full force and effect, in each
case other than those the failure to obtain or maintain which, either
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect. All applicable waiting periods shall have expired
without any action being taken or threatened by any competent authority which
would restrain, prevent or otherwise impose adverse conditions on the
Acquisition or the financing thereof. Except with respect to any protest or
objection of any Person to the decision of the Florida Cemetery Board approving
the Acquisition, no action, request for stay, petition for review or rehearing,
reconsideration, or appeal with respect to any of the foregoing shall be
pending, and the time for any applicable agency to take action to set aside its
consent on its own motion shall have expired.
H. Consummation of Acquisition and Reorganization.
(i) All conditions to the Acquisition set forth in the Acquisition
Agreement shall have been satisfied or the fulfillment of any such
conditions which shall not have been satisfied shall have been waived with
the consent of Arranging Agent, Administrative Agent and Requisite
Lenders;
(ii) Arranging Agent and Administrative Agent shall have received
evidence reasonably satisfactory to Arranging Agent and Administrative
Agent that (a) the Acquisition shall become effective before or
concurrently with the making of the Initial Loans and (b) all of the
transactions contemplated in connection with the Reorganization shall
become effective before or concurrently with the making of the Initial
Loans and such transactions and the documentation entered into in
connection therewith shall be in form and substance reasonably
satisfactory to Arranging Agent and Administrative Agent;
(iii) the aggregate Cash proceeds from the issuance of the equity of
Holdings to ▇▇▇▇▇▇ and the Blackstone Investors contemplated by subsection
4.1D above, plus the Cash proceeds of the Senior Subordinated Notes, plus
the amount of the AXELs made on the Closing Date will equal or exceed the
sum of (a) the aggregate Cash consideration paid to the Existing
Stockholders in connection with the Acquisition, (b) the Transaction Costs
and (c) the amounts required to repay or defease the Existing Indebtedness
as required by subsection 4.1F; and
(iv) Arranging Agent and Administrative Agent shall have received an
Officers' Certificate of Borrower to the effect set forth in clauses
(i)-(iii) above.
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I. Security Interests in Personal Property. Each of Arranging Agent and
Administrative Agent shall have received evidence satisfactory to it that each
Loan Party shall have taken or caused to be taken all such actions, executed and
delivered or caused to be executed and delivered all such agreements, documents
and instruments, and made or caused to be made all such filings and recordings
(other than the filing or recording of items described in clauses (iii) and (iv)
below) that may be necessary or, in the opinion of Arranging Agent and
Administrative Agent, desirable in order to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and (upon such filing and recording)
perfected First Priority security interest in the Collateral. Such actions shall
include the following:
(i) Schedules to Collateral Documents. Delivery to Administrative
Agent of accurate and complete schedules to all of the applicable
Collateral Documents.
(ii) Stock Certificates and Instruments. Delivery to Administrative
Agent of (a) certificates (which certificates shall be accompanied by
irrevocable undated stock powers, duly endorsed in blank and otherwise
satisfactory in form and substance to Administrative Agent) representing
all capital stock pledged pursuant to the Holdings Pledge Agreement, the
Borrower Pledge Agreement and the Subsidiary Pledge Agreement and (b) all
promissory notes or other instruments (duly endorsed, where appropriate,
in a manner satisfactory to Administrative Agent) evidencing any
Collateral;
(iii) Lien Searches and UCC Termination Statements. Delivery to
Arranging Agent and Administrative Agent of (a) the results of a recent
search, by a Person satisfactory to Arranging Agent and Administrative
Agent, of all effective UCC financing statements and fixture filings and
all tax lien filings which may have been made with respect to any personal
or mixed property of any Loan Party, together with copies of all such
filings requested by Administrative Agent disclosed by such search, and
(b) UCC termination statements duly executed by all applicable Persons for
filing in all applicable jurisdictions as may be necessary to terminate
any effective UCC financing statements or fixture filings disclosed in
such search (other than any such financing statements or fixture filings
in respect of Liens permitted to remain outstanding pursuant to the terms
of this Agreement); and
(iv) UCC Financing Statements. Delivery to Administrative Agent of
UCC financing statements duly executed by each applicable Loan Party with
respect to all personal property Collateral of such Loan Party, for filing
in all jurisdictions as may be necessary or, in the opinion of Arranging
Agent and Administrative Agent, desirable to perfect the security
interests created in such Collateral pursuant to the Collateral Documents.
J. Financial Statements; Pro Forma Balance Sheet. On or before the Closing
Date, Lenders shall have received from Borrower (i) audited and restated
financial statements of Holdings and its Subsidiaries for Fiscal Year 1995,
consisting of a balance
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sheet and the related consolidated statements of income, stockholders' equity
and cash flows for such Fiscal Year, (ii) unaudited financial statements of
Holdings and its Subsidiaries for the Fiscal Quarter ended March 31, 1996 and
for the monthly periods ended April 30, 1996 and May 31, 1996 consisting of a
balance sheet and the related consolidated statements of income, stockholders'
equity and cash flows for such periods, all in reasonable detail and certified
by the chief financial officer of Holdings that they fairly present the
financial condition of Holdings and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the periods
indicated, subject to changes resulting from audit and normal year-end
adjustments, and (iii) a pro forma consolidated balance sheet of Holdings and
its Subsidiaries for the date 55 days prior to the Closing Date, prepared in
accordance with GAAP and reflecting the consummation of the Acquisition and
Reorganization, the related financings and the other transactions contemplated
by the Loan Documents and the Related Agreements, which pro forma financial
statements shall be in form and substance consistent with the pro forma
financial statements contained in the Confidential Information Memorandum and
otherwise satisfactory to Lenders.
K. Solvency Opinion. On the Closing Date, Arranging Agent, Administrative
Agent and Lenders shall have received a letter from ▇▇▇▇▇▇, ▇▇▇▇▇▇ & Co., dated
the Closing Date and addressed to Arranging Agent, Administrative Agent and
Lenders, in form and substance reasonably satisfactory to Arranging Agent and
Administrative Agent, demonstrating that, after giving effect to the
consummation of the Acquisition, the Reorganization, the related financings and
the other transactions contemplated by the Loan Documents and the Related
Agreements, Holdings and its Subsidiaries on a consolidated basis and Borrower
will be Solvent.
L. Evidence of Insurance. Arranging Agent and Administrative Agent shall
have received a certificate from Borrower's insurance broker or other evidence
satisfactory to it that all insurance required to be maintained pursuant to
subsection 6.4 is in full force and effect and that Administrative Agent on
behalf of Lenders has been named as additional insured and/or loss payee
thereunder to the extent required under subsection 6.4.
M. Opinions of Counsel to Loan Parties. Lenders and their respective
counsel shall have received (i) originally executed copies of one or more
favorable written opinions of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for Loan
Parties, dated as of the Closing Date and substantially in the form of Exhibit
VIII annexed hereto and as to such other matters as Administrative Agent or
Arranging Agent and acting on behalf of Lenders may reasonably request and (ii)
evidence satisfactory to Arranging Agent and Administrative Agent that Borrower
has requested such counsel to deliver such opinions to Lenders.
N. Opinions of Agents' Counsel. Lenders shall have received originally
executed copies of one or more favorable written opinions of O'Melveny & ▇▇▇▇▇
LLP, counsel to Agents, dated as of the Closing Date, substantially in the form
of Exhibit IX annexed hereto and as to such other matters as Arranging Agent may
reasonably request.
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O. Opinions of Counsel Delivered Under Related Agreements. Administrative
Agent and Arranging Agent and its counsel shall have received copies of each of
the opinions of counsel delivered to the parties under the Acquisition Agreement
and the purchase or subscription agreements relating to the Senior Subordinated
Notes and the Holdings Common Stock and Holdings Preferred Stock, together, to
the extent agreed to by such law firm, with a letter from each such counsel
authorizing Lenders to rely upon such opinion to the same extent as though it
were addressed to Lenders.
P. Fees. Borrower shall have paid to Arranging Agent and Administrative
Agent, for distribution (as appropriate) to Arranging Agent, Administrative
Agent and Lenders, the fees payable on the Closing Date referred to in
subsection 2.3 and all other compensation, fees, costs and expenses (including
fees and expenses of counsel to Arranging Agent and Administrative Agent) and
payable hereunder or in connection herewith to Arranging Agent and
Administrative Agent on or prior to the Closing Date.
Q. Administrative Agreement. Administration Agent and Arranging Agent
shall have received duly executed copies of the Administrative Agreement, which
shall be in form and substance reasonably satisfactory to Arranging Agent and
Administrative Agent.
R. Representations and Warranties; Performance of Agreements. Holdings and
Borrower shall have delivered to Arranging Agent and Administrative Agent an
Officers' Certificate, in form and substance satisfactory to Arranging Agent and
Administrative Agent, to the effect that the representations and warranties in
Section 5 hereof are true and correct in all material respects on and as of the
Closing Date to the same extent as though made on and as of that date (or, to
the extent such representations and warranties specifically relate to an earlier
date, that such representations and warranties were true and correct in all
material respects on and as of such earlier date) and that each of Holdings and
Borrower shall have performed in all material respects all agreements and
satisfied all conditions which this Agreement provides shall be performed or
satisfied by it on or before the Closing Date except as otherwise disclosed to
and agreed to in writing by Arranging Agent, Administrative Agent and Requisite
Lenders.
S. Completion of Proceedings. All corporate and other proceedings taken or
to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by Administrative
Agent, acting on behalf of Lenders, or Arranging Agent and its counsel shall be
satisfactory in form and substance to Administrative Agent and Arranging Agent
and such counsel, and Administrative Agent, Arranging Agent and such counsel
shall have received all such counterpart originals or certified copies of such
documents as Administrative Agent or Arranging Agent may reasonably request.
Notwithstanding anything herein to the contrary, it is understood and
agreed that documents, certificates and other items set forth on Schedule 6.12
annexed hereto shall be delivered after the Closing Date in accordance with
subsection 6.12.
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Each Lender by delivering its signature page to this Agreement and funding
its AXEL Commitment on the Closing Date shall be deemed to have acknowledged
receipt of, and consented to and approved (as long as substantially in the form
delivered to Lenders including any changed pages thereto delivered to Lenders),
each Loan Document and each other document required to be approved by Requisite
Lenders or Lenders, as applicable.
4.2 Conditions to All Loans.
The obligations of Lenders to make Loans on each Funding Date are subject
to the following further conditions precedent:
A. Administrative Agent shall have received before that Funding Date, in
accordance with the provisions of subsection 2.1B, an originally executed Notice
of Borrowing, in each case signed by the chief executive officer, the president,
the chief financial officer or the treasurer of Borrower or by any executive
officer of Borrower designated by any of the above-described officers on behalf
of Borrower in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein and in the
other Loan Documents shall be true and correct in all material respects on
and as of that Funding Date to the same extent as though made on and as of
that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations
and warranties shall have been true and correct in all material respects
on and as of such earlier date;
(ii) No event shall have occurred and be continuing or would result
from the consummation of the borrowing contemplated by such Notice of
Borrowing that would constitute an Event of Default or a Potential Event
of Default;
(iii) Each Loan Party shall have performed in all material respects
all agreements and satisfied all conditions which this Agreement provides
shall be performed or satisfied by it on or before that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender from
making the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date shall not
violate any law including Regulation G, Regulation T, Regulation U or
Regulation X of the Board of Governors of the Federal Reserve System; and
(vi) There shall not be pending or, to the knowledge of Borrower,
threatened, any action, suit, proceeding, governmental investigation or
arbitration
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against or affecting Holdings or any of its Subsidiaries or any property
of Holdings or any of its Subsidiaries that has not been disclosed by
Borrower in writing pursuant to subsection 5.6 or 6.1(viii) prior to the
making of the last preceding Loans (or, in the case of the initial Loans,
prior to the execution of this Agreement), and there shall have occurred
no development not so disclosed in any such action, suit, proceeding,
governmental investigation or arbitration so disclosed, that, in either
event, in the opinion of Administrative Agent or of Requisite Lenders,
could reasonably be expected to have a Material Adverse Effect; and no
injunction or other restraining order shall have been issued and no
hearing to cause an injunction or other restraining order to be issued
shall be pending or noticed with respect to any action, suit or proceeding
seeking to enjoin or otherwise prevent the consummation of, or to recover
any damages or obtain relief as a result of, the transactions contemplated
by this Agreement or the making of Loans hereunder.
4.3 Conditions to Letters of Credit.
The issuance of any Letter of Credit hereunder (whether or not Issuing
Lender is obligated to issue such Letter of Credit) is subject to the following
conditions precedent:
A. On or before the date of issuance of the initial Letter of Credit
pursuant to this Agreement, the initial Loans shall have been made.
B. On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the
provisions of subsection 3.1B(i), an originally executed Notice of
Issuance of Letter of Credit, in each case signed by the chief executive
officer, the president, the chief financial officer or the treasurer of
Borrower or by any executive officer of Borrower designated by any of the
above-described officers on behalf of Borrower in a writing delivered to
Administrative Agent, together with all other information specified in
subsection 3.1B(i) and such other documents or information as Issuing
Lender may reasonably require in connection with the issuance of such
Letter of Credit.
C. On the date of issuance of such Letter of Credit, all conditions
precedent described in subsection 4.2B shall be satisfied to the same
extent as if the issuance of such Letter of Credit were the making of a
Loan and the date of issuance of such Letter of Credit were a Funding
Date.
SECTION 5.
REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make the
Loans, to induce Issuing Lender to issue Letters of Credit and to induce other
Lenders to purchase participations therein, Holdings and Borrower each represent
and warrant to each Lender,
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on the date of this Agreement, on each Funding Date and on the date of issuance
of each Letter of Credit, that the following statements are true, correct and
complete:
5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries.
A. Organization and Powers. Each Loan Party is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation as specified in Schedule 5.1 annexed hereto,
except, in the case of any Loan Party other than Holdings or Borrower, where
failure to be in good standing has not had and could not reasonably be expected
to have a Material Adverse Effect. Each Loan Party has all requisite corporate
power and authority to own and operate its properties, to carry on its business
as now conducted and as proposed to be conducted, to enter into the Loan
Documents and Related Agreements to which it is a party and to carry out the
transactions contemplated thereby.
B. Qualification and Good Standing. Each Loan Party is qualified to do
business and in good standing in every jurisdiction where its assets are located
and wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had and could not reasonably be expected to have a Material Adverse Effect.
C. Conduct of Business. Loan Parties are engaged only in the businesses
permitted to be engaged in pursuant to subsection 7.14.
D. Subsidiaries. All of the Subsidiaries of Holdings as of the Closing
Date are identified in Schedule 5.1 annexed hereto, as said Schedule 5.1 may be
supplemented from time to time pursuant to the provisions of subsection
6.1(xiv). The capital stock of each of the Subsidiaries of Holdings identified
in Schedule 5.1 annexed hereto (as so supplemented) is duly authorized, validly
issued, fully paid and nonassessable and none of such capital stock constitutes
Margin Stock. Schedule 5.1 annexed hereto (as so supplemented) correctly sets
forth the ownership interest of Borrower and each of its Subsidiaries in each of
the Subsidiaries of Borrower identified therein.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and performance of
the Loan Documents and the Related Agreements have been duly authorized by all
necessary corporate action on the part of each Loan Party that is a party
thereto.
B. No Conflict. The execution, delivery and performance by Loan Parties of
the Loan Documents and the Related Agreements to which they are parties and the
consummation of the transactions contemplated by the Loan Documents and such
Related Agreements do not and will not (i) violate any provision of (a) any law
or any governmental rule or regulation applicable to any Loan Party or any of
its Subsidiaries except for such violations which could not reasonably be
expected to have a Material Adverse Effect, (b)
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the Certificate or Articles of Incorporation or Bylaws of any Loan Party or any
of its Subsidiaries or (c) any order, judgment or decree of any court or other
agency of government binding on any Loan Party or any of its Subsidiaries, (ii)
conflict with, result in a breach of or constitute (with due notice or lapse of
time or both) a default under any Contractual Obligation of any Loan Party or
any of its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect, (iii) result in or require the creation or imposition of any
material Lien upon any of the properties or assets of any Loan Party or any of
its Subsidiaries (other than Permitted Encumbrances or any Liens created under
any of the Loan Documents in favor of Administrative Agent on behalf of
Lenders), or (iv) require any approval of stockholders or any approval or
consent of any Person under any Contractual Obligation of any Loan Party or any
of its Subsidiaries, except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to Lenders or
which could not reasonably be expected to have a Material Adverse Effect.
C. Governmental Consents. The execution, delivery and performance by Loan
Parties of the Loan Documents and the Related Agreements to which they are
parties and the consummation of the transactions contemplated by the Loan
Documents and such Related Agreements do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body except as provided in subsection 5.16B with respect to the Collateral
Documents and as set forth in subsection 4.1G and except to the extent the
absence thereof could not reasonably be expected to have a Material Adverse
Effect.
D. Binding Obligation. Each of the Loan Documents and Related Agreements
has been duly executed and delivered by each Loan Party that is a party thereto
and is the legally valid and binding obligation of such Loan Party, enforceable
against such Loan Party in accordance with its respective terms, subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium, other similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered in a proceeding
in equity or at law).
E. Valid Issuance of Holdings Common Stock, Holdings Preferred Stock and
Senior Subordinated Notes.
(i) Holdings Common Stock and Holdings Preferred Stock. The Holdings
Common Stock and Holdings Preferred Stock to be sold on or before the
Closing Date, when issued and delivered, will be duly and validly issued,
fully paid and non-assessable. The issuance and sale of such Holdings
Common Stock and Holdings Preferred Stock, upon such issuance and sale,
will either (a) have been registered or qualified under applicable federal
and state securities laws or (b) be exempt therefrom.
(ii) Senior Subordinated Notes. Borrower has the corporate power and
authority to issue the Senior Subordinated Notes. The Senior Subordinated
Notes
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when issued and paid for, will be the legally valid and binding
obligations of Borrower, enforceable against Borrower in accordance with
their respective terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, other similar laws
relating to or affecting creditors' rights generally and general equitable
principles (whether considered in a proceeding in equity or at law). The
subordination provisions of the Senior Subordinated Notes will be
enforceable against the holders thereof and the Loans and all other
monetary Obligations hereunder are and will be within the definition of
"Senior Indebtedness" included in such provisions. The Senior Subordinated
Notes, when issued and sold, will either (a) have been registered or
qualified under applicable federal and state securities laws or (b) be
exempt therefrom.
5.3 Financial Condition.
Borrower has heretofore delivered to Lenders, at Lenders' request, the
following financial statements and information: (i) the audited and restated
consolidated balance sheet of Holdings and its Subsidiaries as at December 31,
1995 and the related consolidated statements of income, stockholders' equity and
cash flows of Holdings and its Subsidiaries for the Fiscal Year then ended and
(ii) the unaudited consolidated balance sheet of Holdings and its Subsidiaries
as at March 31, 1996 and the related unaudited consolidated statements of
income, stockholders' equity and cash flows of Holdings and its Subsidiaries for
the three months then ended. All such statements were prepared in conformity
with GAAP and fairly present, in all material respects, the financial position
(on a consolidated basis) of the entities described in such financial statements
as at the respective dates thereof and the results of operations and cash flows
(on a consolidated basis) of the entities described therein for each of the
periods then ended, subject, in the case of any such unaudited financial
statements, to changes resulting from audit and normal year-end adjustments.
Except as set forth on Schedule 5.3, as of the Closing Date, Borrower does not
(and will not following the funding of the initial Loans) have any Contingent
Obligation, contingent liability or liability for taxes, long-term lease or
unusual forward or long-term commitment that is not reflected in the foregoing
financial statements or the notes thereto and which in any such case is material
in relation to the business, operations, properties, assets, condition
(financial or otherwise) or prospects of Borrower or any of its Subsidiaries.
5.4 No Material Adverse Change; No Restricted Junior Payments.
Except as set forth on Schedule 5.4, since December 31, 1995, no event or
change has occurred that has caused or evidences, either in any case or in the
aggregate, a Material Adverse Effect. Neither Holdings nor any of its
Subsidiaries has directly or indirectly declared, ordered, paid or made, or set
apart any sum or property for, any Restricted Junior Payment or agreed to do so
except as permitted by subsection 7.5.
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5.5 Title to Properties; Liens.
Loan Parties have (i) good, sufficient and legal title to (in the case of
fee interests in real property), (ii) valid leasehold interests in (in the case
of leasehold interests in real or personal property), or (iii) good title to (in
the case of all other personal property), all of their respective properties and
assets reflected in the financial statements referred to in subsection 5.3 or in
the most recent financial statements delivered pursuant to subsection 6.1, in
each case except for Permitted Encumbrances and assets disposed of since the
date of such financial statements in the ordinary course of business or as
otherwise permitted under subsection 7.7. Except as permitted by this Agreement,
all such properties and assets are free and clear of Liens.
5.6 Litigation; Adverse Facts.
Except as set forth in Schedule 5.6 annexed hereto, there are no actions,
suits, proceedings, arbitrations or governmental investigations (whether or not
purportedly on behalf of any Loan Party or any of its Subsidiaries) at law or in
equity, or before or by any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign (including any Environmental Claims) that are pending or, to the
knowledge of Holdings or Borrower, threatened against or affecting any Loan
Party or any of its Subsidiaries or any property of any Loan Party or any of its
Subsidiaries and that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. No Loan Party nor any of its
Subsidiaries (i) is in violation of any applicable laws (including Environmental
Laws) that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect, or (ii) is subject to or in default with
respect to any final judgments, writs, injunctions, decrees, rules or
regulations of any court or any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.
5.7 Payment of Taxes.
Except to the extent permitted by subsection 6.3, all income tax returns
and reports of Holdings and its Subsidiaries required to be filed by any of them
have been timely filed, and all taxes shown on such tax returns to be due and
payable and all assessments, fees and other governmental charges upon Holdings
and its Subsidiaries and upon their respective properties, assets, income,
businesses and franchises which are due and payable have been paid when due and
payable. No Loan Party knows of any proposed tax assessment against any Loan
Party or any of its Subsidiaries which is not being actively contested by such
Loan Party or such Subsidiary in good faith and by appropriate proceedings;
provided that such reserves or other appropriate provisions, if any, as shall be
required in conformity with GAAP shall have been made or provided therefor.
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5.8 Performance of Agreements; Materially Adverse Agreements; Material
Contracts.
A. No Loan Party nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, could not reasonably be expected to have a
Material Adverse Effect.
B. No Loan Party nor any of its Subsidiaries is a party to or is otherwise
subject to any agreements or instruments or any charter or other internal
restrictions which, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect.
C. Schedule 5.8 contains a true, correct and complete list of all the
Material Contracts in effect on the Closing Date. Except as described on
Schedule 5.8, all such Material Contracts are in full force and effect and no
material defaults currently exist thereunder.
5.9 Governmental Regulation.
No Loan Party nor any of its Subsidiaries is subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation (other than usury laws, Regulation X and
other similar laws) which may limit its ability to incur Indebtedness or which
may otherwise render all or any portion of the Obligations unenforceable.
5.10 Securities Activities.
A. No Loan Party nor any of its Subsidiaries is engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan, not more than 25%
of the value of the assets (either of Borrower only or of Borrower and its
Subsidiaries on a consolidated basis) subject to the provisions of subsection
7.2 or 7.7 or subject to any restriction contained in any agreement or
instrument, between Borrower and any Lender or any Affiliate of any Lender,
relating to Indebtedness and within the scope of subsection 8.2, will be Margin
Stock.
5.11 Employee Benefit Plans.
A. Each Loan Party and each of their respective ERISA Affiliates are in
material compliance with all applicable provisions and requirements of ERISA and
the regulations
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and published interpretations thereunder with respect to each Employee Benefit
Plan, and have performed all obligations under each Employee Benefit Plan which
could reasonably be expected to result in a material liability. Each Employee
Benefit Plan which is intended to qualify under Section 401(a) of the Internal
Revenue Code is so qualified.
B. No ERISA Event has occurred or is reasonably expected to occur.
C. Except to the extent required under Section 4980B of the Internal
Revenue Code or except as set forth in Schedule 5.11 annexed hereto, no Employee
Benefit Plan provides health or welfare benefits (through the purchase of
insurance or otherwise) for any retired or former employee of any Loan Party or
any of their respective ERISA Affiliates.
D. As of the most recent valuation date for any Pension Plan, the amount
of unfunded benefit liabilities (as defined in Section 4001(a)(18) of ERISA),
individually or in the aggregate for all Pension Plans (excluding for purposes
of such computation any Pension Plans with respect to which assets exceed
benefit liabilities), does not exceed $1,000,000.
E. As of the most recent valuation date for each Multiemployer Plan for
which the actuarial report is available, the potential liability of Loan Parties
and their respective ERISA Affiliates for a complete withdrawal from such
Multiemployer Plan (within the meaning of Section 4203 of ERISA), when
aggregated with such potential liability for a complete withdrawal from all
Multiemployer Plans, based on information available pursuant to Section 4221(e)
of ERISA, does not exceed $1,000,000.
5.12 Certain Fees.
Except to the extent included in Transaction Costs, no broker's or
finder's fee or commission will be payable by Holdings or any of its
Subsidiaries with respect to this Agreement or any of the transactions
contemplated hereby, and Holdings and Borrower hereby, jointly and severally,
indemnify Lenders against, and agrees that it will hold Lenders harmless from,
any claim, demand or liability for any such broker's or finder's fees alleged to
have been incurred in connection herewith or therewith and any expenses
(including reasonable fees, expenses and disbursements of counsel) arising in
connection with any such claim, demand or liability.
5.13 Environmental Protection.
Except as set forth in Schedule 5.13 annexed hereto,
(i) No Loan Party nor any of its Subsidiaries nor any of their
respective Facilities or operations are subject to any outstanding written
order, consent decree or settlement agreement with any Person relating to
(a) any Environmental Law, (b) any Environmental Claim, or (c) any
Hazardous Materials Activity;
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(ii) No Loan Party nor any of its Subsidiaries has received any
letter or request for information under Section 104 of the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. ss.
9604) or any comparable state law;
(iii) There are and, to Holdings' and Borrower's knowledge have
been, no conditions, occurrences, or Hazardous Materials Activities which
could reasonably be expected to form the basis of an Environmental Claim
against any Loan Party or any of its Subsidiaries that, individually or in
the aggregate, could reasonably be expected to have a Material Adverse
Effect;
(iv) Except as could not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect, (a) no Loan Party
nor any of its Subsidiaries nor, to Holdings' or Borrower's knowledge, any
predecessor of any Loan Party or any of its Subsidiaries has filed any
notice under any Environmental Law indicating past or present treatment of
Hazardous Materials at any Facility, and (b) no Loan Party's or any of its
Subsidiaries' operations involve the transportation, treatment, storage or
disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270 or
any state equivalent; and
(v) Compliance with all current or, to the best knowledge of each
Loan Party and its Subsidiaries, future requirements pursuant to or under
Environmental Laws could not, individually or in the aggregate, reasonably
be expected to give rise to a Material Adverse Effect.
Notwithstanding anything in this subsection 5.13 to the contrary, no event
or condition has occurred or is occurring with respect to any Loan Party
relating to any Environmental Law, any Release of Hazardous Materials, or any
Hazardous Materials Activity, including any matter disclosed on Schedule 5.13
annexed hereto, which individually or in the aggregate has had or could
reasonably be expected to have a Material Adverse Effect.
5.14 Employee Matters.
Except as set forth on Schedule 5.14 annexed hereto, no Loan Party nor any
of its Subsidiaries is party to any collective bargaining agreement and, to the
knowledge of Holdings and Borrower, no union representation question exists with
respect to the employees of any Loan Party or any of its Subsidiaries. There is
no strike, work stoppage, slow down, lockout or other labor dispute pending, or
to the knowledge of Holdings and Borrower, threatened, involving any Loan Party
or any of its Subsidiaries that singly or in the aggregate could reasonably be
expected to have a Material Adverse Effect.
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5.15 Solvency.
Each Loan Party is and, upon the incurrence of any Obligations by such
Loan Party on any date on which this representation is made, will be, Solvent.
5.16 Matters Relating to Collateral.
A. Creation, Perfection and Priority of Liens. The execution and delivery
of the Collateral Documents by Loan Parties, together with (i) the actions taken
on or prior to the date hereof pursuant to subsections 4.1I and 6.8 and (ii) the
delivery to Administrative Agent of any Pledged Collateral not delivered to
Administrative Agent at the time of execution and delivery of the applicable
Collateral Document (all of which Pledged Collateral has been so delivered) are
effective to create in favor of Administrative Agent for the benefit of Lenders,
as security for the respective Secured Obligations (as defined in the applicable
Collateral Document in respect of any Collateral), a valid and perfected First
Priority Lien on all of the Collateral, and all filings and other actions
necessary or desirable to perfect and maintain the perfection and First Priority
status of such Liens have been duly made or taken and remain in full force and
effect, other than the filing of any UCC financing statements delivered to
Administrative Agent for filing (but not yet filed) and the periodic filing of
UCC continuation statements in respect of UCC financing statements filed by or
on behalf of Administrative Agent.
B. Governmental Authorizations. No authorization, approval or other action
by, and no notice to or filing with, any governmental authority or regulatory
body is required for either (i) the pledge or grant by any Loan Party of the
Liens purported to be created in favor of Administrative Agent pursuant to any
of the Collateral Documents or (ii) the exercise by Administrative Agent of any
rights or remedies in respect of any Collateral (whether specifically granted or
created pursuant to any of the Collateral Documents or created or provided for
by applicable law), except for filings or recordings contemplated by subsection
5.16A and except as may be required, in connection with the disposition of any
Pledged Collateral, by laws generally affecting the offering and sale of
securities.
C. Absence of Third-Party Filings. Except such as may have been filed in
favor of Administrative Agent as contemplated by subsection 5.16A and in respect
of Liens permitted under subsection 7.2 hereof, following the filing of the UCC
termination statements delivered to Administrative Agent pursuant to subsection
4.1I(iii), no effective UCC financing statement, fixture filing or other
instrument similar in effect covering all or any part of the Collateral is on
file in any filing or recording office.
D. Margin Regulations. The pledge of the Pledged Collateral pursuant to
the Collateral Documents does not violate Regulation G, T, U or X of the Board
of Governors of the Federal Reserve System.
E. Information Regarding Collateral. All information supplied to
Administrative Agent by or on behalf of any Loan Party with respect to any of
the Collateral (in each case
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taken as a whole with respect to any particular Collateral) is accurate and
complete in all material respects.
5.17 Representations and Warranties in Acquisition Agreement.
Except to the extent otherwise set forth herein or in the Schedules
hereto, each of the representations and warranties in the Acquisition Agreement
is true and correct in all material respects as of the date hereof (or as of any
earlier date to which such representation and warranty specifically relates) and
will be true and correct in all material respects as of the Closing Date, or as
of such earlier date (as the case may be), in each case subject to the
qualifications set forth in the schedules to the Acquisition Agreement.
5.18 Disclosure.
No representation or warranty of any Loan Party contained in the
Confidential Information Memorandum or in any Loan Document or in any other
document, certificate or written statement furnished to Lenders by any Loan
Party for use in connection with the transactions contemplated by this Agreement
contains any untrue statement of a material fact or omits to state a material
fact (known to Holdings or Borrower, in the case of any document not furnished
by it) necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made. Any
projections and pro forma financial information contained in such materials are
based upon good faith estimates and assumptions believed by Holdings and
Borrower to be reasonable at the time made, it being recognized by Lenders that
such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections will
differ from the projected results. There are no facts known (or which should
upon the reasonable exercise of diligence be known) to Holdings or Borrower
(other than matters of a general economic nature) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
and that have not been disclosed herein or in such other documents, certificates
and statements furnished to Lenders for use in connection with the transactions
contemplated hereby.
SECTION 6.
AFFIRMATIVE COVENANTS
Each of Holdings and Borrower covenants and agrees that, so long as any of
the Commitments hereunder shall remain in effect and until payment in full of
all of the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, each of Holdings and Borrower shall perform, and shall cause each of
its Subsidiaries to perform, all covenants in this Section 6.
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6.1 Financial Statements and Other Reports.
Holdings will maintain, and cause each of its Subsidiaries to maintain, a
system of accounting established and administered in accordance with sound
business practices to permit preparation of financial statements in conformity
with GAAP. Borrower will deliver to Administrative Agent and Lenders:
(i) Quarterly Financials: as soon as available and in any event
within 45 days (or, in the case of the Fiscal Quarter ending September 30,
1996, 90 days) after the end of each Fiscal Quarter, (a) the consolidated
balance sheet of Holdings and its Subsidiaries as at the end of such
Fiscal Quarter and the related consolidated statements of income,
stockholders' equity and cash flows of Holdings and its Subsidiaries for
such Fiscal Quarter and for the period from the beginning of the then
current Fiscal Year to the end of such Fiscal Quarter and, commencing
March 31, 1997, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous Fiscal
Year and the corresponding figures from the Financial Plan for the current
Fiscal Year, all in reasonable detail and certified by the chief financial
officer of Holdings that they fairly present, in all material respects,
the financial condition of Holdings and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for the
periods indicated, subject to changes resulting from audit and normal
year-end adjustments, and (b) a narrative report describing the operations
of Holdings and its Subsidiaries in the form prepared for presentation to
senior management for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal
Quarter; provided that delivery of Borrower's Form 10-Q for such Fiscal
Quarter shall be deemed to satisfy the requirements of this clause (b);
(ii) Year-End Financials: as soon as available and in any event
within 90 days (or, in the case of the Fiscal Year ending December 31,
1996, 120 days) after the end of each Fiscal Year, (a) the consolidated
balance sheet of Holdings and its Subsidiaries as at the end of such
Fiscal Year and the related consolidated statements of income,
stockholders' equity and cash flows of Holdings and its Subsidiaries for
such Fiscal Year, setting forth in each case in comparative form the
corresponding figures for the previous Fiscal Year and the corresponding
figures from the Financial Plan for the Fiscal Year covered by such
financial statements, all in reasonable detail and certified by the chief
financial officer of Holdings that they fairly present, in all material
respects, the financial condition of Holdings and its Subsidiaries as at
the dates indicated and the results of their operations and their cash
flows for the periods indicated, (b) a narrative report describing the
operations of Holdings and its Subsidiaries in the form prepared for
presentation to senior management for such Fiscal Year; provided that
delivery of Borrower's Form 10-K for such Fiscal Year shall be deemed to
satisfy the requirements of this clause (b), and (c) in the case of such
consolidated financial statements, a report thereon of KPMG Peat Marwick
LLP or other independent certified public accountants of recognized
national standing selected by Holdings and satisfactory to Administrative
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Agent, which report shall be unqualified, shall express no doubts about
the ability of Holdings and its Subsidiaries to continue as a going
concern, and shall state that such consolidated financial statements
fairly present, in all material respects, the consolidated financial
position of Holdings and its Subsidiaries as at the dates indicated and
the results of their operations and their cash flows for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years (except as otherwise disclosed in such financial statements) and
that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with
generally accepted auditing standards;
(iii) Officers' and Compliance Certificates: together with each
delivery of financial statements of Holdings and its Subsidiaries pursuant
to subdivisions (i) and (ii) above, (a) an Officers' Certificate of
Holdings stating that the signers have reviewed the terms of this
Agreement and have made, or caused to be made under their supervision, a
review in reasonable detail of the transactions and condition of Holdings
and its Subsidiaries during the accounting period covered by such
financial statements and that such review has not disclosed the existence
during or at the end of such accounting period, and that the signers do
not have knowledge of the existence as at the date of such Officers'
Certificate, of any condition or event that constitutes an Event of
Default or Potential Event of Default, or, if any such condition or event
existed or exists, specifying the nature and period of existence thereof
and what action Holdings has taken, is taking and proposes to take with
respect thereto; and (b) a Compliance Certificate demonstrating in
reasonable detail compliance during and at the end of the applicable
accounting periods with the restrictions contained in Section 7, in each
case to the extent compliance with such restrictions is required to be
tested at the end of the applicable accounting period;
(iv) Reconciliation Statements: if, as a result of any change in
accounting principles and policies from those used in the preparation of
the audited financial statements referred to in subsection 5.3, the
consolidated financial statements of Holdings and its Subsidiaries
delivered pursuant to subdivisions (i), (ii) or (xi) of this subsection
6.1 will differ in any material respect from the consolidated financial
statements that would have been delivered pursuant to such subdivisions
had no such change in accounting principles and policies been made, then
(a) together with the first delivery of financial statements pursuant to
subdivision (i), (ii) or (xi) of this subsection 6.1 following such change
to the extent Borrower is required to prepare such pro forma financial
statements under the Securities Act or the Exchange Act or the rules and
regulations thereunder, consolidated financial statements of Holdings and
its Subsidiaries for (1) the current Fiscal Year to the effective date of
such change and (2) the two full Fiscal Years immediately preceding the
Fiscal Year in which such change is made, in each case prepared on a pro
forma basis as if such change had been in effect during such periods, and
(b) together with each delivery of financial statements pursuant to
subdivision (i), (ii) or (xi) of this subsection 6.1 following such
change, a written statement of the chief accounting officer or chief
financial officer of Holdings setting forth the material differences
(including any
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differences that would affect any calculations relating to the financial
covenants set forth in subsection 7.6) which would have resulted if such
financial statements had been prepared without giving effect to such
change;
(v) Accountants' Certification: concurrently with any delivery of
financial statements under subdivision (ii) above, a certificate of the
accounting firm opining on or certifying such statements on behalf of
Borrower (which certificate may be limited to accounting matters and may
disclaim responsibility for legal interpretations) certifying that no
Event of Default or Potential Event of Default has occurred or, if such an
Event of Default or Potential Event of Default has occurred, specifying
the nature and extent thereof and any corrective action taken or proposed
to be taken with respect thereto;
(vi) SEC Filings and Press Releases: promptly upon their becoming
available, copies of (a) all financial statements, reports, notices and
proxy statements sent or made available generally by Holdings to its
security holders or by any Subsidiary of Holdings to its security holders
other than Holdings or another Subsidiary of Holdings, (b) all regular and
periodic reports and all registration statements (other than on Form S-8
or a similar form) and prospectuses, if any, filed by Holdings or any of
its Subsidiaries with any securities exchange or with the Securities and
Exchange Commission, and (c) all press releases and other statements made
available generally by Holdings or any of its Subsidiaries to the public
concerning material developments in the business of Holdings or any of its
Subsidiaries;
(vii) Events of Default, etc.: promptly upon any officer of Holdings
or Borrower obtaining knowledge (a) of any condition or event that
constitutes an Event of Default or Potential Event of Default, or becoming
aware that any Lender has given any notice (other than to Administrative
Agent) or taken any other action with respect to a claimed Event of
Default or Potential Event of Default, (b) that any Person has given any
notice to Holdings or Borrower or any of its Subsidiaries or taken any
other action with respect to a claimed default or event or condition of
the type referred to in subsection 8.2, (c) at any time when neither
Holdings nor Borrower is required to file such reports, of any condition
or event that would be required to be disclosed in a current report filed
by Holdings or Borrower with the Securities and Exchange Commission on
Form 8-K (Items 1, 2, 4, 5 and 6 of such Form as in effect on the date
hereof) if Holdings or Borrower were required to file such reports under
the Exchange Act, or (d) of the occurrence of any event or change that has
caused or evidences, either in any case or in the aggregate, a Material
Adverse Effect, an Officers' Certificate specifying the nature and period
of existence of such condition, event or change, or specifying the notice
given or action taken by any such Person and the nature of such claimed
Event of Default, Potential Event of Default, default, event or condition,
and what action Holdings has taken, is taking and proposes to take with
respect thereto;
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(viii) Litigation or Other Proceedings: promptly upon any officer of
Holdings or Borrower obtaining knowledge of (a) the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Holdings or any of its Subsidiaries or
any property of Holdings or any of its Subsidiaries (collectively,
"Proceedings") not previously disclosed in writing by Holdings to Lenders
or (b) any material development in any Proceeding that, in any case:
(1) if adversely determined, has a reasonable possibility of
giving rise to a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the consummation of,
or to recover any damages or obtain relief as a result of, the
transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Holdings to enable Lenders and their counsel to
evaluate such matters;
(ix) ERISA Events: promptly upon becoming aware of the occurrence of
or forthcoming occurrence of any ERISA Event, a written notice specifying
the nature thereof, what action Holdings, any of its Subsidiaries or any
of their respective ERISA Affiliates has taken, is taking or proposes to
take with respect thereto and, when known, any action taken or threatened
by the Internal Revenue Service, the Department of Labor or the PBGC with
respect thereto;
(x) ERISA Notices: with reasonable promptness, copies of (a) if
requested by Administrative Agent each Schedule B (Actuarial Information)
to the annual report (Form 5500 Series) filed by Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates with the Internal
Revenue Service with respect to each Pension Plan; (b) all notices
received by Holdings, any of its Subsidiaries or any of their respective
ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA
Event; and (c) copies of such other documents or governmental reports or
filings relating to any Employee Benefit Plan as Administrative Agent
shall reasonably request;
(xi) Financial Plans: as soon as practicable and in any event no
later than 60 days after the beginning of each Fiscal Year, a consolidated
plan and financial forecast for such Fiscal Year (the "Financial Plan" for
such Fiscal Year), including (a) a forecasted consolidated balance sheet
and forecasted consolidated statements of income and cash flows of
Holdings and its Subsidiaries for each such Fiscal Year, together with an
explanation of the assumptions on which such forecasts are based, (b)
forecasted consolidated statements of income and cash flows of Holdings
and its Subsidiaries for each month of the first such Fiscal Year,
together with an explanation of the assumptions on which such forecasts
are based, and (c) such other information and projections as any Lender
may reasonably request;
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(xii) Insurance: as soon as practicable and in any event by the last
day of each Fiscal Year, a report in form and substance satisfactory to
Administrative Agent outlining all material insurance coverage maintained
as of the date of such report by Holdings and its Subsidiaries and all
material insurance coverage planned to be maintained by Holdings and its
Subsidiaries in the immediately succeeding Fiscal Year;
(xiii) Board of Directors: with reasonable promptness, written
notice of any change in the Board of Directors of Holdings or Borrower;
(xiv) New Subsidiaries: promptly upon any Person becoming a
Subsidiary of Holdings, a written notice setting forth with respect to
such Person (a) the date on which such Person became a Subsidiary of
Holdings and (b) all of the data required to be set forth in Schedule 5.1
annexed hereto with respect to all Subsidiaries of Holdings (it being
understood that such written notice shall be deemed to supplement Schedule
5.1 annexed hereto for all purposes of this Agreement);
(xv) Material Contracts: promptly, and in any event within ten
Business Days after any Material Contract of Holdings or any of its
Subsidiaries is terminated or amended in a manner that is materially
adverse to Holdings or such Subsidiary, as the case may be, or any new
Material Contract is entered into, a written statement describing such
event with copies of such material amendments or new contracts, and an
explanation of any actions being taken with respect thereto;
(xvi) Administrative Agreement: As promptly as practicable, and in
any event within ten Business Days prior to such termination, a written
notice of any pending termination of any Administrative Agreement;
(xvii) UCC Search Report: As promptly as practicable after the date
of delivery to Administrative Agent of any UCC financing statement
executed by any Loan Party pursuant to subsection 4.1I(iv) or 6.8A, copies
of completed UCC searches evidencing the proper filing, recording and
indexing of all such UCC financing statement and listing all other
effective financing statements that name such Loan Party as debtor,
together with copies of all such other financing statements not previously
delivered to Administrative Agent by or on behalf of Holdings or such Loan
Party; and
(xviii) Other Information: with reasonable promptness, such other
information and data with respect to Holdings or any of its Subsidiaries
as from time to time may be reasonably requested by any Lender.
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6.2 Corporate Existence, etc.
Except as permitted under subsection 7.7, Holdings will, and will cause
each of its Subsidiaries to, at all times preserve and keep in full force and
effect (i) its corporate existence and (ii) all rights and franchises the loss
of which could reasonably be expected to have a Material Adverse Effect;
provided, however that neither Holdings nor any of its Subsidiaries shall be
required to preserve any such right or franchise if the Board of Directors of
Holdings or such Subsidiary shall determine that the preservation thereof is no
longer desirable in the conduct of the business of Holdings or such Subsidiary,
as the case may be, and that the loss thereof is not disadvantageous in any
material respect to Holdings, such Subsidiary or Lenders.
6.3 Payment of Taxes and Claims; Tax Consolidation.
A. Holdings will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty accrues thereon, and all claims (including claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a Lien upon any of its properties or
assets, prior to the time when any penalty or fine shall be incurred with
respect thereto; provided that no such charge or claim need be paid if it is
being contested in good faith by appropriate proceedings promptly instituted and
diligently conducted, so long as (i) such reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor and (ii) in the case of a charge or claim which has or may become
a Lien against any of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral to satisfy such charge
or claim.
B. Holdings will not, nor will it permit any of its Subsidiaries to, file
or consent to the filing of any consolidated income tax return with any Person
(other than Holdings or any of its Subsidiaries).
6.4 Maintenance of Properties; Insurance; Application of Net Insurance/
Condemnation Proceeds.
A. Maintenance of Properties. Holdings will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained in good repair, working
order and condition, ordinary wear and tear excepted, all properties used or
useful in the business of Holdings and its Subsidiaries (including all
Intellectual Property) that are material to Holdings and its Subsidiaries, taken
as a whole, and from time to time will make or cause to be made all appropriate
repairs, renewals and replacements thereof.
B. Insurance. Borrower will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities,
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losses or damage in respect of the assets, properties and businesses of Borrower
and its Subsidiaries as may customarily be carried or maintained under similar
circumstances by corporations of established reputation engaged in similar
businesses, in each case in such amounts (giving effect to self-insurance), with
such deductibles, covering such risks and otherwise on such terms and conditions
as shall be customary for corporations similarly situated in the industry.
Without limiting the generality of the foregoing, Borrower will maintain or
cause to be maintained replacement value casualty insurance on the Collateral
constituting tangible personal property under such policies of insurance, with
such insurance companies, in such amounts, with such deductibles, and covering
such risks as are at all times satisfactory to Administrative Agent in its
commercially reasonable judgment. Each such policy of insurance shall (i) name
Administrative Agent for the benefit of Lenders as an additional insured
thereunder as its interests may appear and (ii) in the case of each business
interruption and casualty insurance policy, contain a loss payable clause or
endorsement, satisfactory in form and substance to Administrative Agent, that
names Administrative Agent for the benefit of Lenders as the loss payee
thereunder for any covered loss in excess of $250,000 and provides for at least
30 days prior written notice to Administrative Agent of any modification or
cancellation of such policy.
C. Application of Net Insurance/Condemnation Proceeds.
(i) Business Interruption Insurance. Upon receipt by Borrower or any
of its Subsidiaries of any business interruption insurance proceeds
constituting Net Insurance/Condemnation Proceeds, (a) so long as no Event
of Default or Potential Event of Default shall have occurred and be
continuing, Borrower or such Subsidiary may retain and apply such Net
Insurance/Condemnation Proceeds for working capital purposes, and (b) if
an Event of Default or Potential Event of Default shall have occurred and
be continuing and Administrative Agent shall so request, Borrower shall
apply an amount equal to such Net Insurance/Condemnation Proceeds to
prepay the Loans (and/or the Revolving Loan Commitments shall be reduced)
as provided in subsection 2.4B(iii)(b);
(ii) Casualty Insurance/Condemnation Proceeds. Upon receipt by
Borrower or any of its Subsidiaries of any Net Insurance/Condemnation
Proceeds other than from business interruption insurance, (a) so long as
no Event of Default or Potential Event of Default shall have occurred and
be continuing, Borrower shall, or shall cause one or more of its
Subsidiaries to, promptly and diligently apply such Net
Insurance/Condemnation Proceeds to pay or reimburse the costs of
repairing, restoring or replacing the assets in respect of which such Net
Insurance/Condemnation Proceeds were received or, to the extent not so
applied, to prepay the Loans (and/or the Revolving Loan Commitments shall
be reduced) as provided in subsection 2.4B(iii)(b), and (b) if an Event of
Default or Potential Event of Default shall have occurred and be
continuing and Administrative Agent shall so request, Borrower shall apply
an amount equal to such Net Insurance/Condemnation Proceeds to prepay the
Loans (and/or the Revolving Loan Commitments shall be reduced) as provided
in subsection 2.4B(iii)(b).
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(iii) Net Insurance/Condemnation Proceeds Received by Administrative
Agent. Upon receipt by Administrative Agent of any Net
Insurance/Condemnation Proceeds as loss payee, (a) if and to the extent
Borrower would have been required to apply such Net Insurance/Condemnation
Proceeds (if it had received them directly) to prepay the Loans and/or
reduce the Revolving Loan Commitments, Administrative Agent shall, and
Borrower hereby authorizes Administrative Agent to, apply such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the Revolving
Loan Commitments shall be reduced) as provided in subsection 2.4B(iii)(b),
and (b) to the extent the foregoing clause (a) does not apply and, and
Borrower shall deliver written notice to Administrative Agent that it has
elected to apply such Net Insurance/Condemnation Proceeds to the costs of
repairing, restoring, or replacing the assets in respect of which such Net
Insurance/Condemnation Proceeds were received, Administrative Agent shall
deliver to Borrower and Borrower shall, or shall cause one or more of its
Subsidiaries to, promptly apply such Net Insurance/Condemnation Proceeds
to the costs of repairing, restoring or replacing the assets in respect of
which such Net Insurance/Condemnation Proceeds were received.
6.5 Inspection Rights.
Holdings shall, and shall cause each of its Subsidiaries to, permit any
authorized representatives designated by any Lender to visit and inspect the
headquarters of Holdings or Borrower, to inspect its and their financial and
accounting records, and to discuss its and their affairs, finances and accounts
with its and their officers and independent public accountants (provided that
Holdings or Borrower may, if it so chooses, be present at or participate in any
such discussion), all upon reasonable notice and at such reasonable times during
normal business hours and as often as may reasonably be requested.
6.6 Compliance with Laws, etc.
Holdings shall comply, and shall cause each of its Subsidiaries and all
other Persons occupying any Facilities to comply, with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority
(including all applicable current and future Environmental Laws and all laws,
rules, regulations and orders relating to prearranged funeral products and
services and the maintenance of trust accounts in respect thereof),
noncompliance with which could reasonably be expected to cause, individually or
in the aggregate, a Material Adverse Effect.
6.7 Environmental Review and Investigation, Disclosure, Etc.; Borrower's
Actions Regarding Hazardous Materials Activities, Environmental Claims and
Violations of Environmental Laws.
A. Environmental Review and Investigation. Borrower agrees that
Administrative Agent may, from time to time and in its reasonable discretion,
(i) retain, at Borrower's reasonable expense, an independent professional
consultant to review any environmental
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audits, investigations, analyses and reports relating to Hazardous Materials
prepared by or for Borrower and provided to Administrative Agent pursuant to
subsection 6.7B(i) and (ii) in the event (a) an Event of Default occurs as a
result of a breach of subsection 5.6 (to the extent relating to Environmental
Laws or Environmental Claims), 5.13, 6.6 (to the extent resulting from
noncompliance with Environmental Laws) or 6.7 and is continuing, or (b) the
Loans and all other Obligations shall (automatically or by declaration) have
become immediately due and payable pursuant to Section 8, conduct its own
investigation of reasonable scope and at reasonable expense; provided that,
Borrower shall only be obligated to use commercially reasonable efforts to
obtain permission for Administrative Agent's professional consultant to conduct
an investigation of any Facility which is the basis of such Event of Default or
such acceleration of the Loans and Obligations that is (x) no longer owned,
leased, operated or used by Borrower or any of its Subsidiaries, or (y)
currently used by Borrower (but not owned, leased, or operated by Borrower) and
with respect to which Borrower has no right or authority to permit
Administrative Agent's professional consultant to conduct an investigation
thereon. For purposes of conducting such a review and/or investigation,
Borrower, to the extent that it has the power and authority to do so, hereby
grants to Administrative Agent and its agents, employees, consultants and
contractors the right to enter into or onto any Facilities currently owned,
leased, operated or used by Borrower or any of its Subsidiaries and to perform
such tests on such property (including taking samples of soil, groundwater and
suspected asbestos-containing materials) as are reasonably necessary in
connection therewith. Any such investigation of any Facility shall be conducted,
unless otherwise agreed to by Borrower and Administrative Agent, during normal
business hours and, to the extent reasonably practicable, shall be conducted so
as not to interfere with the ongoing operations at such Facility or to cause any
damage or loss to any property at such Facility. To the extent reasonably
practicable, Administrative Agent shall restore any property damaged by such
investigation to its condition immediately prior to such investigation. Borrower
and Administrative Agent hereby acknowledge and agree that any report of any
investigation conducted at the request of Administrative Agent pursuant to this
subsection 6.7A will be obtained and shall be used by Administrative Agent and
Lenders for the purposes of Lenders' internal credit decisions, to monitor and
police the Loans and to protect Lenders' security interests, if any, created by
the Loan Documents. Administrative Agent agrees to deliver a copy of any such
report to Borrower with the understanding that Borrower acknowledges and agrees
that (1) it will indemnify and hold harmless Administrative Agent and each
Lender from any costs, losses or liabilities relating to Borrower's use of or
reliance on such report, (2) neither Administrative Agent nor any Lender makes
any representation or warranty with respect to such report, and (3) by
delivering such report to Borrower, neither Administrative Agent nor any Lender
is requiring or recommending the implementation of any suggestions or
recommendations contained in such report.
B. Environmental Disclosure. Borrower will deliver to Administrative Agent
and Lenders:
(i) Environmental Audits and Reports. As soon as practicable
following receipt thereof, copies of all material and non-privileged
environmental audits,
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investigations, analyses and reports of any kind or character, whether
prepared by personnel of Borrower or any of its Subsidiaries or by
independent consultants, governmental authorities or any other Persons,
with respect to environmental matters at any Facility which, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect or with respect to any Environmental Claims which,
individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect;
(ii) Notice of Certain Releases, Remedial Actions, Etc. Promptly
upon the occurrence thereof, written notice describing in reasonable
detail (a) any Release required to be reported to any federal, state or
local governmental or regulatory agency under any applicable Environmental
Laws that could reasonably be expected to have a Material Adverse Effect,
(b) any remedial action taken by Borrower or any other Person in response
to (1) any Hazardous Materials Activities the existence of which could
reasonably be expected to result in one or more Environmental Claims
having, individually or in the aggregate, a Material Adverse Effect, or
(2) any Environmental Claims that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, and (c)
Borrower's discovery of any occurrence or condition on any real property
adjoining or in the vicinity of any Facility that could cause such
Facility or any part thereof to be subject to any material restrictions on
the ownership, occupancy, transferability or use thereof under any
Environmental Laws which, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(iii) Written Communications Regarding Environmental Claims,
Releases, Etc. As soon as practicable following the sending or receipt
thereof by Borrower or any of its Subsidiaries, a copy of any and all
material and non-privileged written communications with respect to (a) any
Environmental Claims that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, (b) any Release
required to be reported to any federal, state or local governmental or
regulatory agency that could reasonably be expected to have a Material
Adverse Effect, and (c) any request for information from any governmental
agency that suggests such agency is investigating whether Borrower or any
of its Subsidiaries may be potentially responsible for any Hazardous
Materials Activity that could reasonably be expected to have a Material
Adverse Effect.
(iv) Notice of Certain Proposed Actions Having Environmental Impact.
Prompt written notice describing in reasonable detail (a) any proposed
acquisition of stock, assets, or property by Borrower or any of its
Subsidiaries that could reasonably be expected to (1) expose Borrower or
any of its Subsidiaries to, or result in, Environmental Claims that could
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect or (2) affect the ability of Borrower or any of
its Subsidiaries to maintain in full force and effect all Governmental
Authorizations required under any Environmental Laws for their respective
operations, except to the extent the failure to maintain such Governmental
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Authorizations could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect, and (b) any proposed action
to be taken by Borrower or any of its Subsidiaries to commence
manufacturing or other industrial operations or to modify current
operations in a manner that could reasonably be expected to subject
Borrower or any of its Subsidiaries to any additional obligations or
requirements under any Environmental Laws which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
(v) Other Information. With reasonable promptness, such other
material and non-privileged documents and information as from time to time
may be reasonably requested by Administrative Agent in relation to any
matters disclosed pursuant to this subsection 6.7.
C. Borrower's Actions Regarding Hazardous Materials Activities,
Environmental Claims and Violations of Environmental Laws.
(i) Remedial Actions Relating to Hazardous Materials Activities.
Borrower shall promptly undertake, and shall cause each of its
Subsidiaries promptly to undertake, any and all investigations, studies,
sampling, testing, abatement, cleanup, removal, remediation or other
response actions necessary to remove, remediate, clean up or ▇▇▇▇▇ any
Hazardous Materials Activity on, under or about any Facility that is in
violation of any Environmental Laws or that presents a risk of giving rise
to an Environmental Claim, in each case that could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect. In
the event Borrower or any of its Subsidiaries undertakes any such action
with respect to any Hazardous Materials, Borrower or such Subsidiary shall
conduct and complete such action in all material respects in compliance
with all applicable Environmental Laws and in accordance with the
policies, orders and directives of all relevant federal, state and local
governmental authorities except when, and only to the extent that,
Borrower's or such Subsidiary's liability with respect to such Hazardous
Materials Activity is being contested in good faith by Borrower or such
Subsidiary.
(ii) Actions with Respect to Environmental Claims and Violations of
Environmental Laws. Borrower shall promptly take, and shall cause each of
its Subsidiaries promptly to take, any and all actions necessary to (i)
cure any material violation of applicable Environmental Laws by Borrower
or its Subsidiaries where failure to do so could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and (ii)
make an appropriate response to any Environmental Claim against Borrower
or any of its Subsidiaries and discharge any obligations it may have to
any Person thereunder where failure to do so could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect.
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6.8 Execution of Subsidiary Guaranty and Personal Property Collateral
Documents by Certain Subsidiaries and Future Subsidiaries.
A. Execution of Subsidiary Guaranty and Personal Property Collateral
Documents. In the event that any Person becomes a Subsidiary of Borrower after
the date hereof, Borrower will promptly notify Administrative Agent of that fact
and cause such Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty if such Subsidiary is a domestic
Subsidiary, the Subsidiary Pledge Agreement and the Subsidiary Security
Agreement and to take all such further actions and execute all such further
documents and instruments (including actions, documents and instruments
comparable to those described in subsection 4.1I) as may be necessary or, in the
opinion of Administrative Agent, desirable to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and perfected First Priority Lien on
all of the personal assets of such Subsidiary described in the applicable forms
of Collateral Documents.
B. Subsidiary Charter Documents, Legal Opinions, Etc. Borrower shall
deliver to Administrative Agent, together with such Loan Documents, (i)
certified copies of such Subsidiary's Certificate or Articles of Incorporation,
together with a good standing certificate from the Secretary of State of the
jurisdiction of its incorporation and each other state in which such Person is
qualified as a foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each to be dated a recent date prior to their
delivery to Administrative Agent, (ii) a copy of such Subsidiary's Bylaws,
certified by its corporate secretary or an assistant secretary as of a recent
date prior to their delivery to Administrative Agent, (iii) a certificate
executed by the secretary or an assistant secretary of such Subsidiary as to (a)
the fact that the attached resolutions of the Board of Directors of such
Subsidiary approving and authorizing the execution, delivery and performance of
such Loan Documents are in full force and effect and have not been modified or
amended and (b) the incumbency and signatures of the officers of such Subsidiary
executing such Loan Documents, and (iv) a favorable opinion of counsel to such
Subsidiary, in form and substance satisfactory to Administrative Agent and its
counsel, as to (a) the due organization and good standing of such Subsidiary,
(b) the due authorization, execution and delivery by such Subsidiary of such
Loan Documents, (c) the enforceability of such Loan Documents against such
Subsidiary, (d) such other matters (including matters relating to the creation
and perfection of Liens in any Collateral pursuant to such Loan Documents) as
Administrative Agent may reasonably request, all of the foregoing to be
satisfactory in form and substance to Administrative Agent and its counsel.
6.9 Interest Rate Protection.
Within 45 days after the Closing Date, Borrower shall obtain and maintain
in effect one or more Interest Rate Agreements with respect to the Loans, in an
aggregate notional principal amount of not less than $45,000,000, which Interest
Rate Agreements shall have the effect of establishing a fixed interest rate or
capping the interest rate in a manner
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satisfactory to Administrative Agent and Arranging Agent with respect to such
notional principal amount, each such Interest Rate Agreement to be in form and
substance satisfactory to Administrative Agent and with a term of not less than
two years after the Closing Date.
6.10 Future Capital Contributions.
Upon receipt by Holdings of any Cash proceeds (any such proceeds net of
underwriting discounts and commissions and other reasonable costs and expenses
associated therewith, including reasonable legal fees and expenses) from the
issuance of any equity Securities of Holdings or any other contributions to the
capital of Holdings, Holdings shall contribute such net Cash proceeds to
Borrower as a contribution to capital (provided that if Holdings receives any
capital stock of Borrower as a result of such contribution it shall be common
stock) to be used by Borrower in accordance with subsection 2.4B(iii)(e).
6.11 Delivery of Certain Pledged Shares.
As of the date of this Agreement, the capital stock of the Subsidiaries
set forth on Schedule 6.11 annexed hereto is pledged to secure certain Remaining
Existing Indebtedness (the "Encumbered Subsidiary Shares"). Within 10 Business
Days after the repayment or defeasance of any Remaining Existing Indebtedness
secured by any Encumbered Subsidiary Shares, Borrower shall, or Borrower shall
cause the appropriate Loan Party, to deliver to Administrative Agent, a Pledge
Amendment (as defined in the Borrower Pledge Agreement or Subsidiary Pledge
Agreement, as applicable) pursuant to which such Loan Party shall pledge such
Encumbered Subsidiary Shares to Administrative Agent, for the benefit of
Lenders, pursuant to the terms of the Borrower Pledge Agreement or Subsidiary
Pledge Agreement, as applicable, together with certificates (which certificates
shall be accompanied by irrevocable undated stock powers, duly endorsed in blank
and otherwise in form and substance satisfactory to Administrative Agent)
representing such Encumbered Subsidiary Stock.
6.12 Post Closing Deliveries.
Borrower shall cause (i) any actions set forth on Schedule 6.12 annexed
hereto to be taken and (ii) each document, certificate or other item set forth
on Schedule 6.12 to be delivered, in each case within the time period specified
on Schedule 6.12 and in form and substance reasonably satisfactory to
Administrative Agent and Arranging Agent.
SECTION 7.
NEGATIVE COVENANTS
Each of Holdings and Borrower covenants and agrees that, so long as any of
the Commitments hereunder shall remain in effect and until payment in full of
all of the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless
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Requisite Lenders shall otherwise give prior written consent, each of Holdings
and Borrower shall perform, and shall cause each of its Subsidiaries to perform,
all covenants in this Section 7.
7.1 Indebtedness.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:
(i) Borrower may become and remain liable with respect to the
Obligations;
(ii) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations permitted by subsection 7.4 and, upon
any matured obligations actually arising pursuant thereto, the
Indebtedness corresponding to the Contingent Obligations so extinguished;
(iii) Borrower or a Subsidiary of Borrower may become and remain
liable with respect to Indebtedness that represents the assumption by
Borrower or such Subsidiary of Indebtedness of a Wholly Owned Subsidiary
in connection with the permitted merger of such Wholly Owned Subsidiary
with or into the Person assuming such Indebtedness or in connection with
the permitted purchase of all or substantially all the assets of such
Wholly Owned Subsidiary by Borrower or a Subsidiary of Borrower; provided
that such Indebtedness was not incurred pursuant to subsection 7.1(v);
(iv) Borrower and its Subsidiaries may become and remain liable with
respect to Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn
against insufficient funds in the ordinary course of business, provided
that such Indebtedness is extinguished within two Business Days of its
incurrence;
(v) a Subsidiary of Borrower acquired after the date hereof in a
Permitted Acquisition may remain liable with respect to Indebtedness of
such Subsidiary incurred prior to such Permitted Acquisition, and a
Subsidiary of Borrower formed after the date hereof for the purpose of
acquiring assets (whether by merger, consolidation or otherwise) in a
Permitted Acquisition may become and remain liable with respect to
Indebtedness assumed in such Permitted Acquisition, which Indebtedness in
each case exists at the time of such Permitted Acquisition and was not
created in contemplation of such Permitted Acquisition; provided that the
aggregate principal amount of Indebtedness with respect to which
Subsidiaries of Borrower may become and remain liable pursuant to this
subsection 7.1(v) with maturities, amortization payments or other required
payments of principal prior to August 1, 2003 shall not exceed at any time
$5,000,000;
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(vi) Borrower and its Subsidiaries may become and remain liable with
respect to Indebtedness in respect of Capital Leases and purchase money
Indebtedness, in each case which is incurred in respect of Consolidated
Adjusted Capital Expenditures permitted by subsection 7.8; provided that
any such purchase money Indebtedness or Indebtedness in respect of Capital
Leases is incurred by Borrower or any of its Subsidiaries prior to or
within 270 days after the applicable Consolidated Adjusted Capital
Expenditure;
(vii) Borrower and its Subsidiaries may become and remain liable
with respect to Indebtedness under Capital Leases of automobiles to be
used by employees and directors of Borrower and its Subsidiaries entered
into in the ordinary course of business;
(viii) Borrower may become and remain liable with respect to
Indebtedness to any of its Wholly Owned Subsidiaries, and any domestic
Wholly Owned Subsidiary of Borrower may become and remain liable with
respect to Indebtedness to Borrower or any other domestic Wholly Owned
Subsidiary of Borrower; provided that (a) all such intercompany
Indebtedness shall be evidenced by Intercompany Notes which shall be
pledged to Administrative Agent to secure the Obligations, (b) all such
intercompany Indebtedness shall be subordinated in right of payment to the
payment in full of the Obligations pursuant to the terms of the applicable
Intercompany Notes, and (c) any payment by any Subsidiary of Borrower
under any guaranty of the Obligations shall result in a pro tanto
reduction of the amount of any intercompany Indebtedness owed by such
Subsidiary to Borrower or to any of its Subsidiaries for whose benefit
such payment is made;
(ix) Borrower and its Subsidiaries, as applicable, may remain liable
with respect to Indebtedness described in Schedule 7.1 annexed hereto;
provided, however, that all Remaining Existing Indebtedness reflected on
such Schedule in excess of $1,000,000 shall have been repaid in full and
Holdings and its Subsidiaries shall have delivered to Administrative Agent
release letters or other evidence satisfactory to Administrative Agent
from the holders of the Remaining Existing Indebtedness releasing all of
their claims, in each case on or prior to January 31, 1997;
(x) Borrower may become and remain liable with respect to
Indebtedness evidenced by the Senior Subordinated Notes and any
refinancing Indebtedness in respect thereof; provided that the
subordination provisions, maturity, amortization, interest rates, events
of default, covenants and all other terms and conditions of such
refinancing Indebtedness are at least as favorable to Lenders and to
Borrower and its Subsidiaries as the Senior Subordinated Notes; and
provided, further that no Potential Event of Default or Event of Default
shall have occurred and be continuing at the time of any such refinancing;
and
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(xi) Borrower and its Subsidiaries may become and remain liable with
respect to other Indebtedness in an aggregate principal amount not to
exceed $5,000,000 at any time outstanding.
7.2 Liens and Related Matters.
A. Prohibition on Liens. Holdings shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Holdings or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the Uniform Commercial Code of any State or under any similar
recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Liens described in Schedule 7.2A annexed hereto; provided,
however, that all Liens securing Remaining Existing Indebtedness shall
have been released and Holdings and its Subsidiaries shall have delivered
to Administrative Agent all documents or instruments reasonably requested
by Administrative Agent to release such Liens on or prior to January 31,
1997.
(iv) Liens securing Indebtedness permitted pursuant to subsection
7.1(xi) provided that such Liens relate solely to the assets financed with
such Indebtedness;
(v) any Lien securing Indebtedness permitted by subsection 7.1(v)
existing on any property or asset which is the subject of a Permitted
Acquisition; provided that (i) such Lien was not created in contemplation
of or in connection with such Permitted Acquisition and (ii) such Lien
does not apply to any other property or asset of Borrower or any of its
Subsidiaries; and provided, further, that the aggregate principal amount
of Indebtedness secured by such Liens shall not exceed $5,000,000 at any
time;
(vi) purchase money security interests in real property,
improvements thereto or equipment hereafter acquired (or, in the case of
improvements, constructed) by Borrower or any of its Subsidiaries
(including the interests of vendors and lessors under conditional sale and
title retention agreements), provided that (a) such security interests
secure Indebtedness permitted by Section 7.1(vi), (b) such security
interests are created, and the Indebtedness secured thereby is incurred,
within 270 days after such acquisition (or construction), (c) the
Indebtedness secured thereby does not exceed 100% of the cost of such real
property, improvements or equipment at the time of such acquisition (or
construction), and (d) such security
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interests do not encumber any other property or assets of Borrower or any
Subsidiary (other than accessions to such real property, improvements or
equipment and provided that individual financings of equipment provided by
a single lender may be cross-collateralized to other financings of
equipment provided solely by such lender);
(vii) the replacement, extension or renewal of any Lien permitted by
clause (v) or (vi) above, provided that such replacement, extension or
renewal Lien shall not encumber any property other than the property that
was subject to such Lien prior to such replacement, extension or renewal;
and provided, further, that the Indebtedness and other obligations secured
by such replacement, extension or renewal Lien are permitted by subsection
7.1; and
(viii) Liens arising by operation of law pursuant to Section 107(1)
of the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. ss. 9607(1), or pursuant to analogous state law, (a) for
costs or damages which are not yet due (by virtue of a written demand of
payment by a governmental authority), or (b) which are being actively
contested in good faith by appropriate proceedings, or (c) on property
that Borrower and its Subsidiaries have determined to abandon if the sole
recourse for such costs or damages is to such property; provided, however,
that the liability of Holdings and its Subsidiaries with respect to the
matters giving rise to all Liens described in this subsection 7.2A(viii)
shall not, in the reasonable estimation of Borrower, exceed $1,000,000.
B. Equitable Lien in Favor of Lenders. If Holdings or any of its
Subsidiaries shall create or assume any Lien upon any of its properties or
assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, it shall make or cause to be made effective
provision whereby the Obligations will be secured by such Lien equally and
ratably with any and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured; provided that, notwithstanding the foregoing,
this covenant shall not be construed as a consent by Requisite Lenders to the
creation or assumption of any such Lien not permitted by the provisions of
subsection 7.2A.
C. No Further Negative Pledges. Except with respect to specific property
encumbered to secure payment of particular Indebtedness or to be sold pursuant
to an executed agreement with respect to an Asset Sale, neither Holdings nor any
of its Subsidiaries shall enter into any agreement (other than the Senior
Subordinated Note Indenture) prohibiting the creation or assumption of any Lien
upon any of its properties or assets, whether now owned or hereafter acquired.
D. No Restrictions on Subsidiary Distributions to Borrower or Other
Subsidiaries. Except as provided herein and in the Senior Subordinated Note
Indenture or as set forth on Schedule 7.2D, Borrower will not, and will not
permit any of its Subsidiaries to, create or otherwise cause or suffer to exist
or become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Borrower or any
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other Subsidiary of Borrower, (ii) repay or prepay any Indebtedness owed by such
Subsidiary to Borrower or any other Subsidiary of Borrower, (iii) make loans or
advances to Borrower or any other Subsidiary of Borrower, or (iv) transfer any
of its property or assets to Borrower or any other Subsidiary of Borrower,
except encumbrances or restrictions contained in agreements relating to
Indebtedness of Subsidiaries acquired after the date hereof in a Permitted
Acquisition; provided that such Indebtedness is permitted pursuant to subsection
7.1(v) and such encumbrances or restrictions relate solely to the property or
assets of such Subsidiary.
7.3 Investments; Joint Ventures.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, including any
Joint Venture, except:
(i) Borrower and its Subsidiaries may make and own Investments in
Cash and Cash Equivalents;
(ii) Borrower and its Subsidiaries may make and own Investments in
Persons that are, at the time of such Investments, domestic Subsidiaries
of Borrower;
(iii) Borrower and its Subsidiaries may make intercompany loans to
the extent permitted under subsection 7.1(viii);
(iv) Borrower and its Subsidiaries may continue to own the
Investments owned by them and described in Schedule 7.3 annexed hereto;
(v) Holdings may continue to own the Investment owned by it as of
the Closing Date in Borrower;
(vi) Borrower may make and own Investments which constitute
Permitted Acquisitions permitted under subsection 7.7(v);
(vii) Borrower and its Subsidiaries may make and own other
Investments in an aggregate amount not to exceed at any time $1,000,000;
(viii) Borrower and its Subsidiaries may make and own Investments
arising out of the receipt by Borrower or any of its Subsidiaries of
non-cash consideration for any sale of assets permitted under subsection
7.7; provided that such consideration (if the stated amount or value
thereof is in excess of $200,000) is pledged upon receipt to
Administrative Agent;
(ix) Borrower and its Subsidiaries may make loans and advances to
employees of Borrower or its Subsidiaries not to exceed $1,500,000 in the
aggregate at any time outstanding; and
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(x) Borrower and its Subsidiaries may make and own Investments in
respect of (a) accounts receivable arising and trade credit granted in the
ordinary course of business and any securities received in satisfaction or
partial satisfaction thereof from financially troubled account debtors to
the extent reasonably necessary in order to prevent or limit loss and (b)
prepayments and other credits to suppliers made in the ordinary course of
business consistent with the past practices of Borrower and its
Subsidiaries.
7.4 Contingent Obligations.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or become or remain liable with respect to any
Contingent Obligation, except:
(i) Holdings and any Subsidiaries of Borrower may become and remain
liable with respect to Contingent Obligations in respect of the Holdings
Guaranty and the Subsidiary Guaranty, respectively;
(ii) Borrower may become and remain liable with respect to
Contingent Obligations in respect of Letters of Credit, and Borrower and
its Subsidiaries may become and remain liable with respect to Contingent
Obligations in respect of other Commercial Letters of Credit and Standby
Letters of Credit in an aggregate amount not to exceed at any time
$5,000,000;
(iii) Borrower may become and remain liable with respect to
Contingent Obligations under Hedge Agreements;
(iv) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of customary indemnification
and purchase price adjustment obligations incurred in connection with
Asset Sales or other sales of assets;
(v) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations in respect of any Indebtedness of
Borrower or any of its Subsidiaries permitted by subsection 7.1 (other
than subsection 7.1(v));
(vi) Borrower and its Subsidiaries, as applicable, may remain liable
with respect to Contingent Obligations described in Schedule 7.4 annexed
hereto; and
(vii) Borrower and its Subsidiaries may become and remain liable
with respect to other Contingent Obligations; provided that the maximum
aggregate liability, contingent or otherwise, of Borrower and its
Subsidiaries in respect of all such Contingent Obligations shall at no
time exceed $1,000,000.
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7.5 Restricted Junior Payments.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, declare, order, pay, make or set apart any sum for any
Restricted Junior Payment; provided that
(i) Borrower may make regularly scheduled payments of interest in
respect of the Senior Subordinated Notes in accordance with the terms of,
and only to the extent required by, and subject to the subordination
provisions contained in, the Senior Subordinated Note Indenture;
(ii) so long as no Event of Default or Potential Event of Default
shall have occurred and be continuing or shall be caused thereby, Borrower
may make Restricted Junior Payments to Holdings (a) to the extent
necessary to permit Holdings to pay general administrative costs and
expenses then due and payable in the ordinary course of business of
Holdings and (b) to the extent necessary to permit Holdings to discharge
the consolidated tax liabilities of Holdings and its Subsidiaries, in each
case so long as Holdings applies the amount of any such Restricted Junior
Payment for such purpose;
(iii) Borrower may make the Borrower Distribution; and
(iv) Borrower may make Restricted Junior Payments to enable Holdings
to satisfy liabilities assumed by Borrower in the Reorganization to the
extent that such liabilities are then due and payable and to the extent
Holdings applies the proceeds of such Restricted Junior Payments, upon
receipt, to the satisfaction of such liabilities.
7.6 Financial Covenants.
A. Minimum Interest Coverage Ratio. Holdings and Borrower shall not permit
the ratio of (i) Consolidated Adjusted EBITDA to (ii) Consolidated Cash Interest
Expense for any four-Fiscal Quarter period ending during any of the periods set
forth below to be less than the correlative ratio indicated:
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======================================================
Minimum
Interest Coverage
Period Ratio
======================================================
03/31/97 through 09/30/97 1.10:1.00
------------------------------------------------------
10/01/97 through 03/31/98 1.15:1.00
------------------------------------------------------
04/01/98 through 03/31/99 1.30:1.00
------------------------------------------------------
04/01/99 through 03/31/00 1.40:1.00
------------------------------------------------------
04/01/00 through 03/31/01 1.50:1.00
------------------------------------------------------
04/01/01 and thereafter 1.60:1.00
======================================================
B. Minimum Fixed Charge Coverage Ratio. Holdings and Borrower shall not
permit the ratio of (i) Consolidated Adjusted EBITDA to (ii) Consolidated Fixed
Charges for any four-Fiscal Quarter period ending during any of the periods set
forth below to be less than the correlative ratio indicated:
=======================================================
Minimum
Period Fixed Charge
Coverage Ratio
=======================================================
03/31/97 through 09/30/97 1.00:1.00
-------------------------------------------------------
10/01/97 through 09/30/98 1.10:1.00
-------------------------------------------------------
10/01/98 through 09/30/99 1.20:1.00
-------------------------------------------------------
10/01/99 through 09/30/00 1.25:1.00
-------------------------------------------------------
10/01/00 through 09/30/01 1.15:1.00
-------------------------------------------------------
10/01/01 and thereafter 1.00:1.00
=======================================================
C. Maximum Total Senior Debt Leverage Ratio. Holdings and Borrower shall
not permit the ratio of (i) Total Senior Debt as of the last day of any Fiscal
Quarter to (ii) Consolidated Adjusted EBITDA for the four-Fiscal Quarter period
then ended, during any of the periods set forth below to exceed the correlative
ratio indicated:
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=======================================================
Maximum Total
Period Senior Debt
Leverage Ratio
=======================================================
03/31/97 through 09/30/97 4.50:1.00
-------------------------------------------------------
10/01/97 through 09/30/98 4.00:1.00
-------------------------------------------------------
10/01/98 through 09/30/99 3.60:1.00
-------------------------------------------------------
10/01/99 through 09/30/00 3.30:1.00
-------------------------------------------------------
10/01/00 through 09/30/01 3.00:1.00
-------------------------------------------------------
10/01/01 and thereafter 2.75:1.00
=======================================================
D. Minimum Cumulative Consolidated Adjusted EBITDA. Holdings and Borrower
shall not permit Cumulative Consolidated Adjusted EBITDA as at any of the dates
set forth below to be less than the correlative amount indicated:
=======================================================
Minimum
Date Cumulative Consolidated
Adjusted EBITDA
=======================================================
09/30/98 $25,000,000
-------------------------------------------------------
09/30/99 $50,000,000
-------------------------------------------------------
09/30/00 $80,000,000
-------------------------------------------------------
09/30/01 $110,000,000
-------------------------------------------------------
09/30/02 $140,000,000
-------------------------------------------------------
09/30/03 $170,000,000
-------------------------------------------------------
09/30/04 $200,000,000
=======================================================
E. Certain Calculations.
(i) With respect to calculations of Consolidated Adjusted EBITDA and
Consolidated Cash Interest Expense for any four-Fiscal Quarter period
including the Closing Date, such calculations shall be made on a pro forma
basis assuming, in each case, that the Closing Date, the Acquisition, the
issuance and sale of the Holdings Common Stock and the Holdings Preferred
Stock, and the related borrowings by Borrower pursuant to this Agreement
and the Senior Subordinated Note Indenture all occurred on the first day
of the applicable four-Fiscal Quarter period and assuming further, for
purposes of calculation of the pro forma interest accrued on
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Loans during any such periods prior to the Closing Date, that all Loans
outstanding were Eurodollar Rate Loans and that the applicable reference
interest rates were the average effective Adjusted Eurodollar Rates on the
Loans for the period from the Closing Date through the date of
determination, all such calculations to be in form and substance
satisfactory to Arranging Agent and Administrative Agent.
(ii) With respect to calculations of Consolidated Adjusted EBITDA
(other than for purposes of calculating Consolidated Excess Cash Flow) and
Consolidated Cash Interest Expense for any four-Fiscal Quarter period
during which any Permitted Acquisition was consummated, such calculations
shall be made on a pro forma basis assuming, in each case, that such
Permitted Acquisition was consummated on the first day of the applicable
four-Fiscal Quarter period. All such calculations shall be in form and
substance satisfactory to Arranging Agent and Administrative Agent.
(iii) With respect to calculations of Consolidated Adjusted EBITDA
(other than for purposes of calculating Consolidated Excess Cash Flow) for
any four-Fiscal Quarter Period including the Closing Date, such
calculations shall give effect to the Pro Forma EBITDA Adjustment.
F. Borrower's Right to Cure.
(i) Financial Performance Covenants. In the event that Holdings and
Borrower fail to comply with the requirements of any Financial Performance
Covenant, until the expiration of the 10th day subsequent to the date the
Compliance Certificate calculating such Financial Performance Covenant is
required to be delivered pursuant to subsection 6.1(iv), Holdings shall
have the right to issue Permitted Cure Securities for Cash or otherwise
receive Cash contributions to the capital of Holdings and to contribute
any such Cash to the capital of Borrower (collectively, the "Cure Right"),
and upon the receipt by Borrower of such Cash pursuant to the exercise by
Holdings of such Cure Right such Financial Performance Covenant shall be
recalculated giving effect to the following pro forma adjustments:
"Consolidated Adjusted EBITDA" shall be increased, solely for
the purpose of measuring the Financial Performance Covenants and not
for any other purpose under this Agreement, by an amount equal to
the Cure Amount.
If, after giving effect to the foregoing recalculations, Holdings
and Borrower shall then be in compliance with the requirements of all
Financial Performance Covenants, Holdings and Borrower shall be deemed to
have satisfied the requirements of the Financial Performance Covenants as
of the relevant date of determination with the same effect as though there
had been no failure to comply therewith at such date, and the applicable
breach or default of the Financial Performance Covenants which had
occurred shall be deemed cured for all purposes of this Agreement.
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(ii) Limitation on Exercise of Cure Right. Notwithstanding anything
herein to the contrary, (a) in no event shall Holdings be entitled to
exercise the Cure Right in more than three consecutive Fiscal Quarters,
and (b) in any ten Fiscal Quarter period, there must be a period of at
least four consecutive Fiscal Quarters during which Holdings has not
exercised its Cure Right.
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions.
Holdings shall not, and shall not permit any of its Subsidiaries to, alter
the corporate, capital or legal structure of Holdings or any of its
Subsidiaries, or enter into any transaction of merger or consolidation, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person, or make any Business Acquisition, except:
(i) any Subsidiary of Borrower (other than a Subsidiary which has
become liable for Indebtedness permitted under subsection 7.1(v)) may be
merged with or into Borrower or any Wholly Owned Subsidiary Guarantor, or
be liquidated, wound up or dissolved, or all or any part of its business,
property or assets may be conveyed, sold, leased, transferred or otherwise
disposed of, in one transaction or a series of transactions, to Borrower
or any Wholly Owned Subsidiary Guarantor; provided that, in the case of
such a merger, Borrower or such Wholly Owned Subsidiary Guarantor shall be
the continuing or surviving corporation;
(ii) Borrower and its Subsidiaries may dispose of obsolete, worn out
or surplus property in the ordinary course of business;
(iii) Borrower and its Subsidiaries may sell or otherwise dispose of
assets in transactions that do not constitute Asset Sales; provided that
the consideration received for such assets shall be in an amount at least
equal to the fair market value thereof as determined by Borrower in good
faith;
(iv) subject to subsection 7.11, Borrower and its Subsidiaries may
make Asset Sales of assets having a fair market value not in excess of
$5,000,000 in any Fiscal Year or $15,000,000 in the aggregate; provided
that (a) the consideration received for such assets shall be in an amount
at least equal to the fair market value thereof as determined by Borrower
in good faith; (b) at least 85% of the consideration received shall be
Cash, Cash Equivalents or the assumption of Indebtedness; and (c) the
proceeds of such Asset Sales shall be applied as required by subsection
2.4B(iii)(a);
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(v) so long as no Potential Event of Default or Event of Default
shall have occurred and be continuing or would result therefrom and
Borrower delivers an Officers' Certificate to Administrative Agent and
Lenders, in form and substance reasonably satisfactory to Administrative
Agent, confirming that it will be in compliance, on a pro forma basis
after giving effect to such Permitted Acquisition as if it had occurred at
the beginning of the period specified in the applicable covenant, with all
covenants set forth in subsection 7.6 hereof, Borrower and its
Subsidiaries may make Permitted Acquisitions in an amount not to exceed in
the aggregate $5,000,000 (the "Permitted Acquisition Amount") in any
Fiscal Year; provided that Borrower and it Subsidiaries may make Permitted
Acquisitions in excess of the Permitted Acquisition Amount in any Fiscal
Year to the extent the amount of such Permitted Acquisition does not
exceed the Available Excess Consolidated Capital Expenditure Amount at the
time of such Permitted Acquisition;
(vi) Holdings may make the Acquisition on the Closing Date and
Holdings and Company may consummate the transactions contemplated by the
Reorganization; and
(vii) Borrower and its Subsidiaries may discount or otherwise
transfer defaulted receivables in connection with the collection thereof
in the ordinary course of business.
7.8 Consolidated Adjusted Capital Expenditures.
Holdings shall not, and shall not permit its Subsidiaries to, make or
incur Consolidated Adjusted Capital Expenditures in any period indicated below
in an aggregate amount in excess of the corresponding amount (the "Maximum
Consolidated Capital Expenditures Amount") set forth below opposite such period;
provided that the Maximum Consolidated Capital Expenditures Amount for any
period shall be increased by an amount equal to 100% of the excess, if any, of
the Maximum Consolidated Capital Expenditures Amount for the previous period set
forth in the table below (as adjusted in accordance with this proviso) over the
actual amount of Consolidated Adjusted Capital Expenditures for such previous
period; and provided further that Borrower and its Subsidiaries may make
Consolidated Adjusted Capital Expenditures in excess of the Maximum Consolidated
Capital Expenditures Amount for any period set forth below to the extent the
Consolidated Adjusted Capital Expenditure does not exceed the Available Excess
Consolidated Capital Expenditure Amount at the time of such expenditure:
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==============================================================
Maximum Consolidated
Period Capital Expenditures
Amount
==============================================================
Closing Date through 12/31/97 $7,500,000
--------------------------------------------------------------
Fiscal Year ending 12/31/98 $4,000,000
--------------------------------------------------------------
Fiscal Year ending 12/31/99 $4,000,000
--------------------------------------------------------------
Fiscal Year ending 12/31/00 $4,000,000
--------------------------------------------------------------
Each Fiscal Year thereafter $4,500,000
==============================================================
7.9 Sales and Lease-Backs.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, become or remain liable as lessee or as a guarantor or
other surety with respect to any Operating Lease of any property (whether real,
personal or mixed), whether now owned or hereafter acquired, (i) which Borrower
or any of its Subsidiaries has sold or transferred or is to sell or transfer to
any other Person (other than Borrower or any of its Subsidiaries) or (ii) which
Borrower or any of its Subsidiaries intends to use for substantially the same
purpose as any other property which has been or is to be sold or transferred by
Borrower or any of its Subsidiaries to any Person (other than Borrower or any of
its Subsidiaries) in connection with such lease; provided, however, that
Borrower and its Subsidiaries may become and remain liable with respect to
Operating Leases so long as the product of (a) eight times (b) consolidated
annual rental payments thereunder shall not exceed $500,000 at any time.
7.10 Transactions with Shareholders and Affiliates.
Holdings shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction (including
the purchase, sale, lease or exchange of any property or the rendering of any
service) with any holder of 5% or more of any class of equity Securities of
Holdings or with any Affiliate of Holdings or of any such holder, on terms that
are less favorable to Holdings or that Subsidiary, as the case may be, than
those that might be obtained at the time from Persons who are not such a holder
or Affiliate; provided that the foregoing restriction shall not apply to (i) any
transaction between Holdings and any of its Wholly Owned Subsidiaries or between
any of its Wholly Owned Subsidiaries (ii) the transactions contemplated by the
Administrative Agreement, (iii) reasonable and customary fees paid to members of
the Boards of Directors of Holdings and its Subsidiaries or (iv) so long as no
Event of Default or Potential Event of Default has occurred and is continuing or
would be caused thereby, payment of Management Fees.
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7.11 Disposal of Subsidiary Stock.
Except as permitted pursuant to subsection 7.7(i), (iii) or (iv), neither
Holdings nor any of its Subsidiaries shall:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity
Securities of any of its Subsidiaries, except to qualify directors or
funeral directors if required by applicable law; or
(ii) permit any of its Subsidiaries directly or indirectly to sell,
assign, pledge or otherwise encumber or dispose of any shares of capital
stock or other equity Securities of any of its Subsidiaries (including
such Subsidiary), except to Borrower, another domestic Wholly Owned
Subsidiary of Borrower, or to qualify directors or funeral directors if
required by applicable law.
7.12 Conduct of Business.
(i) From and after the Closing Date, Borrower shall not, and shall
not permit any of its Subsidiaries to, engage in any business other than
(i) the businesses engaged in by Borrower and its Subsidiaries on the
Closing Date and similar or related businesses and (ii) such other lines
of business as may be consented to by Requisite Lenders.
(ii) Holdings shall engage in no business and have no assets or
liabilities other than (a) owning the stock of Borrower, (b) the
performance of its obligations under the Loan Documents, (c) liabilities
associated with the maintenance of its corporate existence and with
respect to consolidated tax liabilities of Holdings and its Subsidiaries,
(d) the receipt of Cash dividends or Cash distributions from Borrower in
accordance with the provisions of subsection 7.5, (e) the activities
related to the maintenance of Permitted Cure Securities and (f) any
residual liabilities relating to liabilities existing on the Closing Date
and assumed by the Borrower in the Reorganization.
7.13 Amendments or Waivers of Certain Related Agreements; Designation of
"Senior Indebtedness".
A. Amendments or Waivers of Certain Related Agreements. Neither Holdings
nor any of its Subsidiaries shall agree to any material amendment to, request
any material waiver of (other than a waiver for which no fee is paid and no
other concessions or consideration are granted by Holdings or Borrower), or
waive any of their respective rights under, any of the Related Agreements (other
than any amendment or waiver described in the next succeeding sentence) without
in each case obtaining the prior written consent of Administrative Agent and
Requisite Lenders (and giving notice to Arranging Agent) to such amendment,
request or waiver. Notwithstanding the foregoing, Holdings and its Subsidiaries
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may agree to amend or waive any provisions of the Related Agreements (i) to cure
any ambiguity, to correct or supplement any provision therein which may be
defective or inconsistent with any other provision therein, or (ii) to comply
with the Trust Indenture Act of 1939, as amended, or (iii) to make modifications
of a technical or clarifying nature or which are no less favorable to the
Lenders, in the reasonable opinion of Administrative Agent and Requisite
Lenders, than the provisions of the Related Agreements as in effect on the
Closing (for the purposes of this subsection 7.13, any amendment, modification
or change which would extend the maturity or reduce the amount of any payment of
principal on the Senior Subordinated Notes or which would reduce the rate or
extend the date for payment of interest thereon, provided that no fee is payable
in connection therewith, shall be deemed to be an amendment, modification or
change that is no less favorable to the Lenders).
B. Designation of "Senior Indebtedness". Borrower shall not designate any
Indebtedness as "Designated Senior Indebtedness" (as defined in the Senior
Subordinated Note Indenture) for purposes of the Senior Subordinated Note
Indenture without the prior written consent of Requisite Lenders.
7.14 Fiscal Year
Holdings shall not change its Fiscal Year-end from December 31.
SECTION 8.
EVENTS OF DEFAULT
If any of the following conditions or events ("Events of Default") shall
occur:
8.1 Failure to Make Payments When Due.
Failure by Borrower to pay any installment of principal of any Loan when
due, whether at stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; failure by Borrower to pay
when due any amount payable to Issuing Lender in reimbursement of any drawing
under a Letter of Credit; or failure by Borrower to pay any interest on any Loan
or any fee or any other amount due under this Agreement within five days after
the date due; or
8.2 Default in Other Agreements.
(i) Failure of Holdings or any of its Subsidiaries to pay when due any
principal of or interest on or any other amount payable in respect of one or
more items of Indebtedness (other than Indebtedness referred to in subsection
8.1) or Contingent Obligations in an individual principal amount of $1,000,000
or more or with an aggregate principal amount of $2,000,000 or more, in each
case beyond the end of any grace period provided therefor; or (ii) breach or
default by Holdings or any of its Subsidiaries with respect to any other
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material term of (a) one or more items of Indebtedness or Contingent Obligations
in the individual or aggregate principal amounts referred to in clause (i) above
or (b) any loan agreement, mortgage, indenture or other agreement relating to
such item(s) of Indebtedness or Contingent Obligation(s), if the effect of such
breach or default is to cause, or to permit the holder or holders of that
Indebtedness or Contingent Obligation(s) (or a trustee on behalf of such holder
or holders) to cause, that Indebtedness or Contingent Obligation(s) to become or
be declared due and payable prior to its stated maturity or the stated maturity
of any underlying obligation, as the case may be (upon the giving or receiving
of notice, lapse of time, both, or otherwise); or
8.3 Breach of Certain Covenants.
Failure of Holdings or its Subsidiaries to perform or comply with any term
or condition contained in subsection 2.5 or 6.2 or Section 7 of this Agreement;
or
8.4 Breach of Warranty.
Any representation, warranty, certification or other statement made by any
Loan Party or any of its Subsidiaries in any Loan Document or in any statement
or certificate at any time given by any Loan Party or any of its Subsidiaries in
writing pursuant hereto or thereto or in connection herewith or therewith shall
be false in any material respect on the date as of which made; or
8.5 Other Defaults Under Loan Documents.
Any Loan Party shall default in the performance of or compliance with any
term contained in this Agreement or any of the other Loan Documents, other than
any such term referred to in any other subsection of this Section 8, and such
default shall not have been remedied or waived within 30 days after the earlier
of (i) an officer of Borrower or such Loan Party becoming aware of such default
or (ii) receipt by Borrower and such Loan Party of notice from Administrative
Agent or any Lender of such default; or
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having jurisdiction in the premises shall enter a decree or
order for relief in respect of Holdings or any of its Subsidiaries in an
involuntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, which decree
or order is not stayed; or any other similar relief shall be granted under any
applicable federal or state law; or (ii) an involuntary case shall be commenced
against Holdings or any of its Subsidiaries under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Holdings or any of its Subsidiaries, or
over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim
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receiver, trustee or other custodian of Holdings or any of its Subsidiaries for
all or a substantial part of its property; or a warrant of attachment, execution
or similar process shall have been issued against any substantial part of the
property of Holdings or any of its Subsidiaries, and any such event described in
this clause (ii) shall continue for 60 days unless dismissed, bonded or
discharged; or
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Holdings or any of its Subsidiaries shall have an order for relief
entered with respect to it or commence a voluntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, or shall consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial
part of its property; or Holdings or any of its Subsidiaries shall make any
assignment for the benefit of creditors; or (ii) Holdings or any of its
Subsidiaries shall be unable, or shall fail generally, or shall admit in writing
its inability, to pay its debts as such debts become due; or the Board of
Directors of Holdings or any of its Subsidiaries (or any committee thereof)
shall adopt any resolution or otherwise authorize any action to approve any of
the actions referred to in clause (i) above or this clause (ii); or
8.8 Judgments and Attachments.
Any money judgment, writ or warrant of attachment or similar process
involving in the aggregate at any time an amount in excess of $2,000,000 (in
either case not adequately covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Holdings or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 60 days (or in any event later than five days prior to the date of any
proposed sale thereunder); or
8.9 Dissolution.
Any order, judgment or decree shall be entered against Holdings or any of
its Subsidiaries decreeing the dissolution or split up of Holdings or that
Subsidiary and such order shall remain undischarged or unstayed for a period in
excess of 30 days; or
8.10 Employee Benefit Plans.
There shall occur one or more ERISA Events which individually or in the
aggregate results in or might reasonably be expected to result in liability of
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates in
excess of $1,000,000 during the term of this Agreement; or there shall exist an
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which
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assets exceed benefit liabilities), which exceeds $1,000,000, and the minimum
funding standards of Section 412 of the Internal Revenue Code (whether or not
waived in accordance with Section 412(d) of the Internal Revenue Code) have not
been met with respect to any Pension Plan; or
8.11 Change in Control.
(i) The Blackstone Investors and ▇▇▇▇▇▇ Group and its Affiliates,
collectively, or ▇▇▇▇▇▇ Group and its Affiliates, individually, shall cease to
beneficially own and control 95% of the issued and outstanding shares of capital
stock of Holdings entitled (without regard to the occurrence of any contingency)
to vote for the election of members of the Board of Directors of Borrower; (ii)
Holdings shall cease to own 100% of the outstanding capital stock of Borrower;
or (iii) a "Change of Control" under the Senior Subordinated Note Indenture
shall occur; or
8.12 Invalidity of Guaranties; Failure of Security; Repudiation of Obligations.
At any time after the execution and delivery thereof, (i) any Guaranty for
any reason, other than the satisfaction in full of all Obligations, shall cease
to be in full force and effect (other than in accordance with its terms) or
shall be declared to be null and void, (ii) any Collateral Document shall cease
to be in full force and effect (other than by reason of a release of Collateral
thereunder in accordance with the terms hereof or thereof, the satisfaction in
full of the Obligations or any other termination of such Collateral Document in
accordance with the terms hereof or thereof) or shall be declared null and void,
or Administrative Agent shall not have or shall cease to have a valid and
perfected First Priority Lien in any Collateral purported to be covered thereby,
in each case for any reason other than the failure of Administrative Agent or
any Lender to take any action within its control, or (iii) any Loan Party shall
contest the validity or enforceability of any Loan Document in writing or deny
in writing that it has any further liability, including with respect to future
advances by Lenders, under any Loan Document to which it is a party; or
8.13 Subordinated Indebtedness.
Borrower shall fail to comply with the subordination provisions contained
in the Senior Subordinated Note Indenture or any other agreement governing any
other Subordinated Indebtedness;
THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7 with respect to Borrower, each of (a) the unpaid principal amount of and
accrued interest on the Loans, (b) an amount equal to the maximum amount that
may at any time be drawn under all Letters of Credit then outstanding (whether
or not any beneficiary under any such Letter of Credit shall have presented, or
shall be entitled at such time to present, the drafts or other documents or
certificates required to draw under such Letter of Credit), and (c) all other
Obligations shall automatically become immediately due and payable, without
presentment, demand, protest or other requirements of any kind, all of which are
hereby
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expressly waived by Borrower, and the obligation of each Lender to make any
Loan, the obligation of Administrative Agent to issue any Letter of Credit and
the right of any Lender to issue any Letter of Credit hereunder shall thereupon
terminate, and (ii) upon the occurrence and during the continuation of any other
Event of Default, Administrative Agent shall, upon the written request or with
the written consent of Requisite Lenders, by written notice to Borrower, declare
all or any portion of the amounts described in clauses (a) through (c) above to
be, and the same shall forthwith become, immediately due and payable, and the
obligation of each Lender to make any Loan, the obligation of Administrative
Agent to issue any Letter of Credit and the right of any Lender to issue any
Letter of Credit hereunder shall thereupon terminate; provided that the
foregoing shall not affect in any way the obligations of Lenders under
subsection 3.3C(i) or the obligations of Lenders to purchase participations in
any unpaid Swing Line Loans as provided in subsection 2.1A(iii).
Any amounts described in clause (b) above, when received by Administrative
Agent, shall be held by Administrative Agent pursuant to the terms of the
Collateral Account Agreement and shall be applied as therein provided.
Notwithstanding anything contained in the second preceding paragraph, if
at any time within 60 days after an acceleration of the Loans pursuant to clause
(ii) of such paragraph Borrower shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 10.6, then Requisite Lenders, by written notice to
Borrower, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not intended,
directly or indirectly, to benefit Borrower, and such provisions shall not at
any time be construed so as to grant Borrower the right to require Lenders to
rescind or annul any acceleration hereunder or to preclude Administrative Agent
or Lenders from exercising any of the rights or remedies available to them under
any of the Loan Documents, even if the conditions set forth in this paragraph
are met.
SECTION 9.
AGENTS
9.1 Appointment.
A. Appointment of Agents. ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. is hereby appointed
Syndication Agent and Arranging Agent hereunder, and each Lender hereby
authorizes Arranging Agent and Syndication Agent to act as its agent in
accordance with the terms of
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this Agreement and the other Loan Documents. Scotiabank is hereby appointed
Administrative Agent hereunder and under the other Loan Documents and each
Lender hereby authorizes Administrative Agent to act as its agent in accordance
with the terms of this Agreement and the other Loan Documents. Each Agent hereby
agrees to act upon the express conditions contained in this Agreement and the
other Loan Documents, as applicable. The provisions of this Section 9 are solely
for the benefit of Agents and Lenders and Borrower shall have no rights as a
third party beneficiary of any of the provisions thereof. In performing its
functions and duties under this Agreement, each Agent shall act solely as an
agent of Lenders and does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency or trust with or for Borrower or
any of its Subsidiaries. Each of Arranging Agent and Syndication Agent, without
consent of or notice to any party hereto, may assign any and all of its rights
or obligations hereunder to any of its Affiliates. As of the Closing Date, all
obligations of Arranging Agent and Syndication Agent hereunder shall terminate.
B. Appointment of Supplemental Collateral Agents. It is the purpose of
this Agreement and the other Loan Documents that there shall be no violation of
any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as agent or trustee in such
jurisdiction. It is recognized that in case of litigation under this Agreement
or any of the other Loan Documents, and in particular in case of the enforcement
of any of the Loan Documents, or in case Administrative Agent deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the rights, powers or remedies granted herein or in any of the other Loan
Documents or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that Administrative Agent appoint an
additional individual or institution as a separate trustee, co-trustee,
collateral agent or collateral co-agent (any such additional individual or
institution being referred to herein individually as a "Supplemental Collateral
Agent" and collectively as "Supplemental Collateral Agents").
In the event that Administrative Agent appoints a Supplemental Collateral
Agent with respect to any Collateral, (i) each and every right, power, privilege
or duty expressed or intended by this Agreement or any of the other Loan
Documents to be exercised by or vested in or conveyed to Administrative Agent
with respect to such Collateral shall be exercisable by and vest in such
Supplemental Collateral Agent to the extent, and only to the extent, necessary
to enable such Supplemental Collateral Agent to exercise such rights, powers and
privileges with respect to such Collateral and to perform such duties with
respect to such Collateral, and every covenant and obligation contained in the
Loan Documents and necessary to the exercise or performance thereof by such
Supplemental Collateral Agent shall run to and be enforceable by either Agent or
such Supplemental Collateral Agent, and (ii) the provisions of this Section 9
and of subsections 10.2 and 10.3 that refer to Administrative Agent shall inure
to the benefit of such Supplemental Collateral Agent and all references therein
to Administrative Agent shall be deemed to be references to Administrative Agent
and/or such Supplemental Collateral Agent, as the context may require.
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Should any instrument in writing from Borrower or any other Loan Party be
required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Borrower shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent. In case any Supplemental Collateral Agent,
or a successor thereto, shall die, become incapable of acting, resign or be
removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
9.2 Powers and Duties; General Immunity.
▇. ▇▇▇▇▇▇; Duties Specified. Each Lender irrevocably authorizes each Agent
to take such action on such Lender's behalf and to exercise such powers, rights
and remedies hereunder and under the other Loan Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. Each
Agent shall have only those duties and responsibilities that are expressly
specified in this Agreement and the other Loan Documents. Each Agent may
exercise such powers, rights and remedies and perform such duties by or through
its agents or employees. No Agent shall have, by reason of this Agreement or any
of the other Loan Documents, a fiduciary relationship in respect of any Lender;
and nothing in this Agreement or any of the other Loan Documents, expressed or
implied, is intended to or shall be so construed as to impose upon any Agent any
obligations in respect of this Agreement or any of the other Loan Documents
except as expressly set forth herein or therein.
B. No Responsibility for Certain Matters. No Agent shall be responsible to
any Lender for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any other
Loan Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by any of Agent to Lenders or by or on behalf of
Borrower to any Agent or any Lender in connection with the Loan Documents and
the transactions contemplated thereby or for the financial condition or business
affairs of Borrower or any other Person liable for the payment of any
Obligations, nor shall any Agent be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions, covenants
or agreements contained in any of the Loan Documents or as to the use of the
proceeds of the Loans or as to the existence or possible existence of any Event
of Default or Potential Event of Default. Anything contained in this Agreement
to the contrary notwithstanding, Administrative Agent shall not have any
liability arising from confirmations of the amount of outstanding Loans or the
Letter of Credit Usage or the component amounts thereof.
C. Exculpatory Provisions. None of Agents nor any of their respective
officers, partners, directors, employees or agents shall be liable to Lenders
for any action taken or
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omitted by any Agent under or in connection with any of the Loan Documents
except to the extent caused by such Agent's gross negligence or willful
misconduct. Each Agent shall be entitled to refrain from any act or the taking
of any action (including the failure to take an action) in connection with this
Agreement or any of the other Loan Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required to give such instructions
under subsection 10.6) and, upon receipt of such instructions from Requisite
Lenders (or such other Lenders, as the case may be), such Agent shall be
entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions.
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Borrower and its Subsidiaries), accountants,
experts and other professional advisors selected by it; and (ii) no Lender shall
have any right of action whatsoever against any Agent as a result of such Agent
acting or (where so instructed) refraining from acting under this Agreement or
any of the other Loan Documents in accordance with the instructions of Requisite
Lenders (or such other Lenders as may be required to give such instructions
under subsection 10.6).
D. Agent Entitled to Act as Lender. The agency hereby created shall in no
way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans and the Letters of Credit, each
Agent shall have the same rights and powers hereunder as any other Lender and
may exercise the same as though it were not performing the duties and functions
delegated to it hereunder, and the term "Lender" or "Lenders" or any similar
term shall, unless the context clearly otherwise indicates, include each Agent
in its individual capacity. Any Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Borrower or any of its Affiliates as
if it were not performing the duties specified herein, and may accept fees and
other consideration from Borrower for services in connection with this Agreement
and otherwise without having to account for the same to Lenders.
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness.
Each Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Borrower and its
Subsidiaries in connection with the making of the Loans and the issuance of
Letters of Credit hereunder and that it has made and shall continue to make its
own appraisal of the creditworthiness of Borrower and its Subsidiaries. No Agent
shall not have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of Lenders
or to provide any Lender with any credit or other information with
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respect thereto, whether coming into its possession before the making of the
Loans or at any time or times thereafter, and no Agent shall not have any
responsibility with respect to the accuracy of or the completeness of any
information provided to Lenders.
9.4 Right to Indemnity.
Each Lender, in proportion to its Pro Rata Share, severally agrees to
indemnify Administrative Agent, to the extent that Administrative Agent shall
not have been reimbursed by Borrower, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and disbursements) or disbursements of any kind
or nature whatsoever which may be imposed on, incurred by or asserted against
Administrative Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Loan Documents or otherwise in its
capacity as Administrative Agent in any way relating to or arising out of this
Agreement or the other Loan Documents; provided that no Lender shall be liable
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from such
Agent's gross negligence or willful misconduct.
9.5 Successor Administrative Agent and Swing Line Lender.
A. Successor Administrative Agent. Administrative Agent may resign at any
time by giving 30 days' prior written notice thereof to Lenders and Borrower.
Upon any such notice of resignation, Requisite Lenders with Borrower's consent
(which may not be unreasonably withheld or delayed) shall have the right, upon
five Business Days' notice to Borrower, to appoint a successor Administrative
Agent. Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent and the retiring Administrative
Agent shall be discharged from its duties and obligations under this Agreement.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement.
B. Successor Swing Line Lender. Any resignation or removal of
Administrative Agent pursuant to subsection 9.5A shall also constitute the
resignation or removal of Scotiabank or its successor as Swing Line Lender, and
any successor Administrative Agent appointed pursuant to subsection 9.5A shall,
upon its acceptance of such appointment, become the successor Swing Line Lender
for all purposes hereunder. In such event (i) Borrower shall prepay any
outstanding Swing Line Loans made by the retiring or removed Administrative
Agent in its capacity as Swing Line Lender, (ii) upon such prepayment, the
retiring or removed Administrative Agent and Swing Line Lender shall surrender
the Swing Line Note held by it to Borrower for cancellation, and (iii) Borrower
shall issue a new Swing Line Note to the successor Administrative Agent and
Swing Line
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Lender substantially in the form of Exhibit VI annexed hereto, in the principal
amount of the Swing Line Loan Commitment then in effect and with other
appropriate insertions.
9.6 Collateral Documents and Guaranties.
Each Lender hereby further authorizes Administrative Agent, on behalf of
and for the benefit of Lenders, to enter into each Collateral Document as
secured party and to be the agent for and representative of Lenders under each
Guaranty, and each Lender agrees to be bound by the terms of each Collateral
Document and Guaranty; provided that Administrative Agent shall not (i) enter
into or consent to any material amendment, modification, termination or waiver
of any provision contained in any Collateral Document or Guaranty or (ii)
release any Collateral (except as otherwise expressly permitted or required
pursuant to the terms of this Agreement or the applicable Collateral Document),
in each case without the prior consent of Requisite Lenders (or, if required
pursuant to subsection 10.6, all Lenders); provided further, however, that,
without further written consent or authorization from Lenders, Administrative
Agent may execute any documents or instruments necessary to (a) release any Lien
encumbering any item of Collateral that is the subject of an Asset Sale or other
sale or disposition of assets permitted by this Agreement or to which Requisite
Lenders have otherwise consented in accordance with the provisions of this
subsection 9.6 or (b) release any Subsidiary Guarantor from the Subsidiary
Guaranty if all of the capital stock of such Subsidiary Guarantor is sold to any
Person (other than an Affiliate of Borrower) pursuant to an Asset Sale or other
disposition permitted hereunder or to which Requisite Lenders have otherwise
consented. In the event Collateral is sold in such an Asset Sale or other
transaction, Administrative Agent may, without further consent or authorization
from Lenders, release the Liens granted under the Collateral Documents on the
Collateral that is the subject of such Asset Sale or other transaction
concurrently with the consummation of such Asset Sale or other transaction;
provided that Administrative Agent shall have received (i) reasonable, and in
any event not less than 30 days', prior written notice of such Asset Sale or
such other transaction from Borrower; (ii) an Officers' Certificate (1)
certifying that no Event of Default or Potential Event of Default shall have
occurred and be continuing as of the date of such release of Collateral, (2)
setting forth a detailed description of the Collateral subject to such Asset
Sale or other transaction, and (3) certifying such Asset Sale or other
transaction is permitted under this Agreement and that all conditions precedent
to such Asset Sale or other transaction under this Agreement have been met; and
(iii) evidence satisfactory to it that Administrative Agent shall have received
all Net Cash Proceeds of such Asset Sale or other transaction, if any, required
to be applied to repay Secured Obligations under this Agreement. Upon payment in
full of all of the Obligations and termination of the Commitments,
Administrative Agent shall release the Liens on such Collateral granted pursuant
to the Collateral Documents. Upon any release of Collateral pursuant to the
foregoing, Administrative Agent shall, at Borrower's expense, execute and
deliver such documents (without recourse or representation or warranty) as
reasonably requested to evidence such release. Anything contained in any of the
Loan Documents to the contrary notwithstanding, Borrower, Administrative Agent
and each Lender hereby agree that (1) no Lender shall have any right
individually to realize upon any of the Collateral under any Collateral Document
or to enforce any Guaranty, it
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being understood and agreed that all powers, rights and remedies under the
Collateral Documents and the Guaranties may be exercised solely by
Administrative Agent for the benefit of Lenders in accordance with the terms
thereof, and (2) in the event of a foreclosure by Administrative Agent on any of
the Collateral pursuant to a public or private sale, Administrative Agent or any
Lender may be the purchaser of any or all of such Collateral at any such sale
and Administrative Agent, as agent for and representative of Lenders (but not
any Lender or Lenders in its or their respective individual capacities unless
Requisite Lenders shall otherwise agree in writing) shall be entitled, for the
purpose of bidding and making settlement or payment of the purchase price for
all or any portion of the Collateral sold at any such public sale, to use and
apply any of the Obligations as a credit on account of the purchase price for
any collateral payable by Administrative Agent at such sale.
SECTION 10.
MISCELLANEOUS
10.1 Assignments and Participations in Loans and Letters of Credit.
A. General. Subject to subsection 10.1B, each Lender shall have the right
at any time to (i) sell, assign or transfer to any Eligible Assignee, or (ii)
sell participations to any Person in, all or any part of its Commitments or any
Loan or Loans made by it or its Letters of Credit or participations therein or
any other interest herein or in any other Obligations owed to it; provided that
no such sale, assignment, transfer or participation shall require Borrower to
file a registration statement with the Securities and Exchange Commission or
apply to qualify such sale, assignment, transfer or participation under the
securities laws of any state; provided, further that no such sale, assignment or
transfer described in clause (i) above shall be effective unless and until an
Assignment Agreement effecting such sale, assignment or transfer shall have been
accepted by Administrative Agent and recorded in the Register as provided in
subsection 10.1B(ii); provided, further that no such sale, assignment, transfer
or participation of any Letter of Credit or any participation therein may be
made separately from a sale, assignment, transfer or participation of a
corresponding interest in the Revolving Loan Commitment and the Revolving Loans
of the Lender effecting such sale, assignment, transfer or participation; and
provided, further that, anything contained herein to the contrary
notwithstanding, the Swing Line Loan Commitment and the Swing Line Loans of
Swing Line Lender may not be sold, assigned or transferred as described in
clause (i) above to any Person other than a successor Administrative Agent and
Swing Line Lender to the extent contemplated by subsection 9.5. Except as
otherwise provided in this subsection 10.1, no Lender shall, as between Borrower
and such Lender, be relieved of any of its obligations hereunder as a result of
any sale, assignment or transfer of, or any granting of participations in, all
or any part of its Commitments or the Loans, the Letters of Credit or
participations therein, or the other Obligations owed to such Lender.
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B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan, Letter
of Credit or participation therein, or other Obligation may (a) be
assigned in any amount to another Lender, or to an Affiliate of the
assigning Lender or another Lender, with the giving of notice to Borrower
and Administrative Agent or (b) be assigned in an aggregate amount of not
less than $5,000,000 (or such lesser amount as shall constitute the
aggregate amount of the Commitments, Loans, Letters of Credit and
participations therein, and other Obligations of the assigning Lender) to
any other Eligible Assignee with the consent of Borrower and, in the case
of assignments by Lenders other than ▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit Partners L.P.,
Administrative Agent (which consent of Borrower and Administrative Agent
shall not be unreasonably withheld or delayed). To the extent of any such
assignment in accordance with either clause (a) or (b) above, the
assigning Lender shall be relieved of its obligations with respect to its
Commitments, Loans, Letters of Credit or participations therein, or other
Obligations or the portion thereof so assigned. The parties to each such
assignment shall execute and deliver to Administrative Agent, for its
acceptance and recording in the Register, an Assignment Agreement,
together with a processing and recordation fee of $3,000 and such forms,
certificates or other evidence, if any, with respect to United States
federal income tax withholding matters as the assignee under such
Assignment Agreement may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a). Upon such execution, delivery,
acceptance and recordation, from and after the effective date specified in
such Assignment Agreement, (1) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment Agreement, shall have the
rights and obligations of a Lender hereunder and (2) the assigning Lender
thereunder shall, to the extent that rights and obligations hereunder have
been assigned by it pursuant to such Assignment Agreement, relinquish its
rights (other than any rights which survive the termination of this
Agreement under subsection 10.9B) and be released from its obligations
under this Agreement (and, in the case of an Assignment Agreement covering
all or the remaining portion of an assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a party
hereto; provided that, anything contained in any of the Loan Documents to
the contrary notwithstanding, if such Lender is Issuing Lender with
respect to any outstanding Letters of Credit such Lender shall continue to
have all rights and obligations of Issuing Lender with respect to such
Letters of Credit until the cancellation or expiration of such Letters of
Credit and the reimbursement of any amounts drawn thereunder). The
Commitments hereunder shall be modified to reflect the Commitment of such
assignee and any remaining Commitment of such assigning Lender and, if any
such assignment occurs after the issuance of the Notes hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or as
promptly thereafter as practicable, surrender its applicable Notes to
Administrative Agent for cancellation, and thereupon new Notes shall be
issued to the assignee and/or to the assigning Lender, substantially in
the form of Exhibit IV or Exhibit V annexed hereto, as the
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case may be, with appropriate insertions, to reflect the new Commitments
and/or outstanding AXELs of the assignee and/or the assigning Lender.
(ii) Acceptance by Administrative Agent; Recordation in Register.
Upon its receipt of an Assignment Agreement executed by an assigning
Lender and an assignee representing that it is an Eligible Assignee,
together with the processing and recordation fee referred to in subsection
10.1B(i) and any forms, certificates or other evidence with respect to
United States federal income tax withholding matters that such assignee
may be required to deliver to Administrative Agent pursuant to subsection
2.7B(iii)(a), Administrative Agent shall, if Administrative Agent and
Borrower have consented to the assignment evidenced thereby (in each case
to the extent such consent is required pursuant to subsection 10.1B(i)),
(a) accept such Assignment Agreement by executing a counterpart thereof as
provided therein (which acceptance shall evidence any required consent of
Administrative Agent to such assignment), (b) record the information
contained therein in the Register, and (c) give prompt notice thereof to
Borrower. Administrative Agent shall maintain a copy of each Assignment
Agreement delivered to and accepted by it as provided in this subsection
10.1B(ii).
C. Participations. The holder of any participation, other than an
Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit to take any action hereunder except action
directly affecting (i) the extension of the scheduled final maturity date of any
Loan allocated to such participation or (ii) a reduction of the principal amount
of or the rate of interest payable on any Loan allocated to such participation,
and all amounts payable by Borrower hereunder (including amounts payable to such
Lender pursuant to subsections 2.6D, 2.7 and 3.6) shall be determined as if such
Lender had not sold such participation. Borrower and each Lender hereby
acknowledge and agree that, solely for purposes of subsections 10.4 and 10.5,
(a) any participation will give rise to a direct obligation of Borrower to the
participant and (b) the participant shall be considered to be a "Lender".
D. Assignments to Federal Reserve Banks. In addition to the assignments
and participations permitted under the foregoing provisions of this subsection
10.1, any Lender may assign and pledge all or any portion of its Loans, the
other Obligations owed to such Lender, and its Notes to any Federal Reserve Bank
as collateral security pursuant to Regulation A of the Board of Governors of the
Federal Reserve System and any operating circular issued by such Federal Reserve
Bank; provided that (i) no Lender shall, as between Borrower and such Lender, be
relieved of any of its obligations hereunder as a result of any such assignment
and pledge and (ii) in no event shall such Federal Reserve Bank be considered to
be a "Lender" or be entitled to require the assigning Lender to take or omit to
take any action hereunder.
E. Information. Each Lender may furnish any information concerning
Borrower and its Subsidiaries in the possession of that Lender from time to time
to assignees and participants (including prospective assignees and
participants), subject to subsection 10.19.
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F. Representations of Lenders. Each Lender listed on the signature pages
hereof hereby represents and warrants (i) that it is an Eligible Assignee
described in clause (i) of the definition thereof; (ii) that it has experience
and expertise in the making of loans such as the Loans; and (iii) that it will
make its Loans for its own account in the ordinary course of its business and in
accordance with all applicable laws). Each Lender that becomes a party hereto
pursuant to an Assignment Agreement shall be deemed to agree that the
representations and warranties of such Lender contained in Section 2(c) of such
Assignment Agreement are incorporated herein by this reference.
10.2 Expenses.
Whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to pay promptly (i) all the actual and reasonable costs and
expenses of Administrative Agent and Arranging Agent in connection with the
preparation of the Loan Documents and any consents, amendments, waivers or other
modifications thereto; (ii) all the costs of furnishing all opinions by counsel
for Borrower (including any opinions requested by Lenders as to any legal
matters arising hereunder) and of Borrower's performance of and compliance with
all agreements and conditions on its part to be performed or complied with under
this Agreement and the other Loan Documents including with respect to confirming
compliance with environmental, insurance and solvency requirements; (iii) the
reasonable fees, expenses and disbursements of counsel to Arranging Agent and
counsel to Administrative Agent in connection with the negotiation, preparation,
execution and administration of the Loan Documents and any consents, amendments,
waivers or other modifications thereto and any other documents or matters
requested by Borrower; (iv) all the actual costs and reasonable expenses of
creating and perfecting Liens in favor of Administrative Agent on behalf of
Lenders pursuant to any Collateral Document, including filing and recording
fees, expenses and taxes, stamp or documentary taxes, search fees, and
reasonable fees, expenses and disbursements of counsel to Arranging Agent and
counsel to Administrative Agent and of counsel providing any opinions that
Arranging Agent, Administrative Agent or Requisite Lenders may request in
respect of the Collateral Documents or the Liens created pursuant thereto; (v)
all the actual costs and reasonable expenses (including the reasonable fees,
expenses and disbursements of any auditors, accountants, appraisers,
environmental consultants or any other consultants, advisors and agents employed
or retained by Administrative Agent and its counsel) in connection with the
valuation (upon the occurrence and during the continuance of an Event of
Default), custody or preservation of any of the Collateral; (vi) all other
actual and reasonable costs and expenses incurred by Syndication Agent,
Arranging Agent or Administrative Agent in connection with the syndication of
the Commitments and the negotiation, preparation and execution of the Loan
Documents and any consents, amendments, waivers or other modifications thereto
and the transactions contemplated thereby; and (vii) after the occurrence and
during the continuance of an Event of Default, all costs and expenses, including
reasonable attorneys' fees and costs of settlement, incurred by Arranging Agent,
Administrative Agent and Lenders in enforcing any Obligations of or in
collecting any payments due from any Loan Party hereunder or under the other
Loan Documents by reason of such Event of Default (including in connection with
the sale of, collection from,
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or other realization upon any of the Collateral or the enforcement of the
Guaranties) or in connection with any refinancing or restructuring of the credit
arrangements provided under this Agreement in the nature of a "work-out" or
pursuant to any insolvency or bankruptcy proceedings.
10.3 Indemnity.
In addition to the payment of expenses pursuant to subsection 10.2,
whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to indemnify, pay and hold harmless Agents and Lenders, and the
officers, partners, directors, trustees, employees, agents and affiliates of any
of Agents and Lenders (collectively called the "Indemnitees"), from and against
any and all Indemnified Liabilities (as hereinafter defined); provided that
Borrower shall not have any obligation to any Indemnitee hereunder with respect
to any Indemnified Liabilities to the extent such Indemnified Liabilities arise
solely from the gross negligence, willful misconduct or bad faith of that
Indemnitee.
As used herein, "Indemnified Liabilities" means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties, actions, judgments, suits, claims (including Environmental Claims),
costs (including the costs of any investigation, study, sampling, testing,
abatement, cleanup, removal, remediation or other response action necessary to
remove, remediate, clean up or ▇▇▇▇▇ any Hazardous Materials Activity), expenses
and disbursements of any kind or nature whatsoever (including the reasonable
fees and disbursements of counsel for Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened by
any Person, whether or not any such Indemnitee shall be designated as a party or
a potential party thereto, and any fees or expenses incurred by Indemnitees in
enforcing this indemnity), whether direct, indirect or consequential and whether
based on any federal, state or foreign laws, statutes, rules or regulations
(including securities and commercial laws, statutes, rules or regulations and
Environmental Laws), on common law or equitable cause or on contract or
otherwise, that may be imposed on, incurred by, or asserted against any such
Indemnitee, in any manner relating to or arising out of (i) this Agreement or
the other Loan Documents or the Related Agreements or the transactions
contemplated hereby or thereby (including Lenders' agreement to make the Loans
hereunder or the use or intended use of the proceeds thereof or the issuance of
Letters of Credit hereunder or the use or intended use of any thereof, or any
enforcement of any of the Loan Documents (including any sale of, collection
from, or other realization upon any of the Collateral or the enforcement of the
Guaranties)), (ii) the statements contained in the commitment letter delivered
by any Lender to Borrower with respect thereto, or (iii) any Environmental Claim
or any Hazardous Materials Activity relating to or arising from, directly or
indirectly, any past or present activity, operation, land ownership, or practice
of Borrower or any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and hold
harmless set forth in this subsection 10.3 may be unenforceable in whole or in
part because they are violative of any law or public policy, Borrower shall
contribute the maximum portion that
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it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them.
10.4 Set-Off; Security Interest in Deposit Accounts.
In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence of any
Event of Default each Lender is hereby authorized by Borrower at any time or
from time to time, without notice to Borrower or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other Indebtedness at any time held or owing by that Lender to
or for the credit or the account of Borrower against and on account of the
obligations and liabilities of Borrower to that Lender under this Agreement, the
Letters of Credit and participations therein and the other Loan Documents,
including all claims of any nature or description arising out of or connected
with this Agreement, the Letters of Credit and participations therein or any
other Loan Document, irrespective of whether or not (i) that Lender shall have
made any demand hereunder or (ii) the principal of or the interest on the Loans
or any amounts in respect of the Letters of Credit or any other amounts due
hereunder shall have become due and payable pursuant to Section 8 and although
said obligations and liabilities, or any of them, may be contingent or
unmatured.
10.5 Ratable Sharing.
Lenders hereby agree among themselves that if any of them shall, whether
by voluntary payment (other than a voluntary prepayment of Loans made and
applied in accordance with the terms of this Agreement), by realization upon
security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as Cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) which is greater than the proportion received by
any other Lender in respect of the Aggregate Amounts Due to such other Lender,
then the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such payment to purchase participations (which it shall
be deemed to have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
Amounts Due shall be shared by all Lenders in proportion to the Aggregate
Amounts Due to them; provided that if all or part of such proportionately
greater payment received by such purchasing Lender is thereafter recovered from
such Lender upon the bankruptcy or reorganization of Borrower or otherwise,
those purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to such purchasing Lender
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ratably to the extent of such recovery, but without interest. Borrower expressly
consents to the foregoing arrangement and agrees that any holder of a
participation so purchased may exercise any and all rights of banker's lien,
set-off or counterclaim with respect to any and all monies owing by Borrower to
that holder with respect thereto as fully as if that holder were owed the amount
of the participation held by that holder.
10.6 Amendments and Waivers.
A. No amendment, modification, termination or waiver of any provision of
this Agreement or of the Notes, and no consent to any departure by Borrower
therefrom, shall in any event be effective without the written concurrence of
Requisite Lenders; provided that any such amendment, modification, termination,
waiver or consent which: increases the amount of any of the Commitments or
reduces the principal amount of any of the Loans; increases the maximum amount
of Letters of Credit; changes in any manner the definition of "Class" or the
definition of "Pro Rata Share" or the definition of "Requisite Class Lenders" or
the definition of "Requisite Lenders"; changes in any manner any provision of
this Agreement which, by its terms, expressly requires the approval or
concurrence of all Lenders; postpones the scheduled final maturity date; changes
any interim scheduled amortization payments on the AXELs; postpones the date on
which any interest or any fees are payable; decreases the interest rate borne by
any of the Loans (other than any waiver of any increase in the interest rate
applicable to any of the Loans pursuant to subsection 2.2E) or the amount of any
fees payable hereunder; increases the maximum duration of Interest Periods
permitted hereunder; reduces the amount or postpones the due date of any amount
payable in respect of, or increases the maximum term hereunder of, any Letter of
Credit; changes in any manner the obligations of Lenders relating to the
purchase of participations in Letters of Credit; releases any Lien granted in
favor of Administrative Agent with respect to substantially all of the
Collateral; releases Holdings from its obligations under the Holdings Guaranty
or releases any Subsidiary Guarantor from its obligations under the Subsidiary
Guaranty, in each case other than in accordance with the terms of the Loan
Documents; or changes in any manner the provisions contained in subsection 8.1
or this subsection 10.6 shall be effective only if evidenced by a writing signed
by or on behalf of each Lender affected thereby. In addition, (i) any amendment,
modification, termination or waiver of any of the provisions contained in
Section 4 shall be effective only if evidenced by a writing signed by or on
behalf of Administrative Agent and Requisite Lenders, (ii) no amendment,
modification, termination or waiver of any provision of any Note shall be
effective without the written concurrence of the Lender which is the holder of
that Note, (iii) no amendment, modification, termination or waiver of any
provision of subsection 2.1A(iii) or of any other provision of this Agreement
relating to the Swing Line Loan Commitment or the Swing Line Loans shall be
effective without the written concurrence of Swing Line Lender, (iv) no
amendment, modification, termination or waiver of any provision of Section 9 or
of any other provision of this Agreement which, by its terms, expressly requires
the approval or concurrence of any Agent shall be effective without the written
concurrence of such Agent and (v) no amendment, modification, termination or
waiver of any provision disproportionately and adversely affecting the
obligation of any Loan Party to make payments to the holders of any Class shall
be effective without the written
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concurrence of the applicable Requisite Class Lenders of such Class.
Administrative Agent may, but shall have no obligation to, with the concurrence
of any Lender, execute amendments, modifications, waivers or consents on behalf
of that Lender. Any waiver or consent shall be effective only in the specific
instance and for the specific purpose for which it was given. No notice to or
demand on Borrower in any case shall entitle Borrower to any other or further
notice or demand in similar or other circumstances. Any amendment, modification,
termination, waiver or consent effected in accordance with this subsection 10.6
shall be binding upon each Lender at the time outstanding, each future Lender
and, if signed by Borrower, on Borrower.
B. If, in connection with any proposed change, waiver, discharge or
termination to any of the provision of this Agreement as contemplated by the
proviso in the first sentence of subsection 10.6A, the consent of Requisite
Lenders is obtained but consent of one or more of such other Lenders whose
consent is required is not obtained, then Borrower may, so long as all
non-consenting Lenders are so treated, elect to terminate such Lender as a party
to this Agreement; provided that, concurrently with such termination, (i)
Borrower shall pay that Lender all principal, interest and fees and other
amounts owed to such Lender through such date of termination, (ii) another
financial institution satisfactory to Borrower and Administrative Agent (or if
Administrative Agent is also the Lender to be terminated, the successor
Administrative Agent) shall agree, as of such date, to become a Lender for all
purposes under this Agreement (whether by assignment or amendment) and to assume
all obligations of the Lender to be terminated as of such date, and (iii) all
documents and supporting materials necessary, in the judgment of Administrative
Agent (or if Administrative Agent is also the Lender to be terminated, the
successor Administrative Agent), to evidence the substitution of such Lender
shall have been received and approved by Administrative Agent as of such date.
10.7 Independence of Covenants.
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of an Event
of Default or Potential Event of Default if such action is taken or condition
exists.
10.8 Notices.
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served or sent by telefacsimile or United States mail or
courier service and shall be deemed to have been given when delivered in person
or by courier service or upon receipt if sent by telefacsimile or by the United
States mail with postage prepaid and properly addressed. For the purposes
hereof, the address of each party hereto shall be as set forth under such
party's name on the signature pages hereof or (i) as to Borrower and
Administrative Agent, such other address as shall be designated by such Person
in a written notice delivered to the
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other parties hereto and (ii) as to each other party, such other address as
shall be designated by such party in a written notice delivered to
Administrative Agent and Borrower.
10.9 Survival of Representations, Warranties and Agreements.
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the
contrary, the agreements of Borrower set forth in subsections 2.6D, 2.7, 3.5A,
3.6, 10.2, 10.3 and 10.4 and the agreements of Lenders set forth in subsections
9.2C, 9.4 and 10.5 shall survive the payment of the Loans, the cancellation or
expiration of the Letters of Credit and the reimbursement of any amounts drawn
thereunder, and the termination of this Agreement.
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Administrative Agent or any Lender in
the exercise of any power, right or privilege hereunder or under any other Loan
Document shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 Marshalling; Payments Set Aside.
Neither Administrative Agent nor any Lender shall be under any obligation
to marshal any assets in favor of Borrower or any other party or against or in
payment of any or all of the Obligations. To the extent that Borrower makes a
payment or payments to Administrative Agent or Lenders (or to Administrative
Agent for the benefit of Lenders), or Administrative Agent or Lenders enforce
any security interests or exercise their rights of setoff, and such payment or
payments or the proceeds of such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, any other state or federal law, common law or any equitable
cause, then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement or setoff had
not occurred.
10.12 Severability.
In case any provision in or obligation under this Agreement or the Notes
shall be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability
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of the remaining provisions or obligations, or of such provision or obligation
in any other jurisdiction, shall not in any way be affected or impaired thereby.
10.13 Obligations Several; Independent Nature of Lenders' Rights.
The obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitments of any other Lender hereunder.
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out of this Agreement and it shall not be necessary for any other
Lender to be joined as an additional party in any proceeding for such purpose.
10.14 Headings.
Section and subsection headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose or be given any substantive effect.
10.15 Applicable Law.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES.
10.16 Successors and Assigns.
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of Lenders (it being understood that
Lenders' rights of assignment are subject to subsection 10.1). Neither Holdings
nor Borrower's rights or obligations hereunder nor any interest therein may be
assigned or delegated by Holdings or Borrower without the prior written consent
of all Lenders.
10.17 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST HOLDINGS OR BORROWER ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇. BY EXECUTING AND
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DELIVERING THIS AGREEMENT, EACH OF HOLDINGS AND HOLDINGS OR BORROWER, FOR ITSELF
AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I) ACCEPTS GENERALLY AND
UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO HOLDINGS OR BORROWER AT ITS ADDRESS
PROVIDED IN ACCORDANCE WITH SUBSECTION 10.8; (IV) AGREES THAT SERVICE AS
PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION
OVER HOLDINGS OR BORROWER IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND
OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; (V) AGREES
THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO BRING PROCEEDINGS AGAINST HOLDINGS OR BORROWER IN THE COURTS OF ANY
OTHER JURISDICTION; AND (VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE
FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402
OR OTHERWISE.
10.18 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver
is intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each party hereto acknowledges that this waiver is a material
inducement to enter into a business relationship, that each has already relied
on this waiver in entering into this Agreement, and that each will continue to
rely on this waiver in their related future dealings. Each party hereto further
warrants and represents that it has reviewed this waiver with its legal counsel
and that it knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
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10.19 Confidentiality.
Each Lender shall hold all non-public information obtained pursuant to the
requirements of this Agreement which has been identified as confidential by
Borrower in accordance with such Lender's customary procedures for handling
confidential information of this nature and in accordance with prudent lending
or investing practices, it being understood and agreed by Borrower that in any
event a Lender shall be permitted to disclose such information (a) to Affiliates
of such Lender or disclosures reasonably required by any bona fide assignee,
transferee or participant in connection with the contemplated assignment or
transfer by such Lender of its Loan or any participations therein, (b) to such
of its respective officers, directors, employees, agents, affiliates and
representatives as need to know such information, (c) to the extent requested by
any regulatory authority, (d) to the extent otherwise required by applicable
laws and regulations or by any subpoena or similar legal process or disclosures
required by the National Association of Insurance Commissioners, (e) in
connection with any suit, action or proceeding relating to the enforcement of
its rights hereunder or under the other Loan Documents or (f) to the extent such
information (i) publicly available other than as a result of a breach of this
Section 10.19 or (ii) becomes available to an Agent or any Lender on a
nonconfidential basis from a source other than Borrower.
10.20 Maximum Amount.
A. It is the intention of Borrower and Lenders to conform strictly to the
usury and similar laws relating to interest from time to time in force, and all
agreements between Borrower, Administrative Agent and Lenders, whether now
existing or hereafter arising and whether oral or written, are hereby expressly
limited so that in no contingency or event whatsoever, whether by acceleration
of maturity hereof or otherwise, shall the amount paid or agreed to be paid in
the aggregate to Lenders or to Administrative Agent on behalf of Lenders as
interest hereunder or under the other Loan Documents or in any other security
agreement given to secure the Obligations, or in any other document evidencing,
securing or pertaining to the Indebtedness evidenced hereby or thereby, exceed
the maximum amount permissible under applicable usury or such other laws (the
"Maximum Amount"). If under any circumstances whatsoever fulfillment of any
provision hereof, or of any of the other Loan Documents, at the time performance
of such provision shall be due, shall involve exceeding the Maximum Amount,
then, ipso facto, the obligation to be fulfilled shall be reduced to the Maximum
Amount. For the purposes of calculating the actual amount of interest paid
and/or payable hereunder in respect of laws pertaining to usury or such other
laws, all sums paid or agreed to be paid to Lenders for the use, forbearance or
detention of the Indebtedness of Borrower evidenced hereby, outstanding from
time to time shall, to the extent permitted by applicable law, be amortized, pro
rated, allocated and spread from the date of disbursement of the proceeds of the
Loans until payment in full of all of such Indebtedness, so that the actual rate
of interest on account of such Indebtedness is uniform throughout the term
hereof. The terms and provisions of this subsection shall control and supersede
every other provision of all agreements between Borrower, Administrative Agent
and Lenders.
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B. If under any circumstances Lenders shall receive an amount which would
exceed the Maximum Amount, such amount shall be deemed a payment in reduction of
the principal amount of the Loans and shall be treated as a voluntary prepayment
under subsection 2.4B(i), and shall be so applied in accordance with subsection
2.4B(iv) hereof, or if such amount exceeds the unpaid balance of the Loans and
any other Indebtedness of Borrower in favor of Lenders, the excess shall be
deemed to have been a payment made by mistake and shall be refunded to Borrower.
10.21 Counterparts; Effectiveness.
This Agreement and any amendments, waivers, consents or supplements hereto
or in connection herewith may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Borrower and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWER:
PRIME SUCCESSION ACQUISITION CORP.
(to be renamed Prime Succession, Inc.)
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
President
Notice Address:
prior to the earlier of October 31, 1996 or notice
from Borrower:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officers
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
after October 31, 1996:
Olympic Corporate Center
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to each of the following:
The Blackstone Group
31st Floor
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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The ▇▇▇▇▇▇ Group Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
GUARANTOR:
PRIME SUCCESSION, INC.
(to be renamed Prime Succession Holdings, Inc.)
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
President
Notice Address:
prior to the earlier of October 31, 1996 or notice
from Borrower:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
after October 31, 1996:
Olympic Corporate Center
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy to each of the following:
The Blackstone Group
31st Floor
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
The ▇▇▇▇▇▇ Group Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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AGENTS AND LENDERS:
▇▇▇▇▇▇▇, SACHS & CO.,
as Syndication Agent and as Arranging Agent
/s/ ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
--------------------------------------------
Notice Address:
▇▇▇▇▇▇▇, Sachs & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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THE BANK OF NOVA SCOTIA,
individually and as Administrative Agent
By: /s/ M.D. ▇▇▇▇▇
--------------------------------
Name: M.D. ▇▇▇▇▇
Title: Agent
Notice Address:
The Bank of Nova Scotia
Atlanta Agency
Suite 2700
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
The Bank of Nova Scotia
Chicago Representative Office
Suite 3700
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇ CREDIT PARTNERS L.P.
By: /s/ ▇▇ ▇▇▇▇▇
------------------------------
Authorized Signatory
Notice Address:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit Partners L.P.
c/o Goldman, Sachs & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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KEYPORT LIFE INSURANCE COMPANY
By: /s/ ▇▇▇▇▇▇ T.H. Yin
-------------------------------
Title: Assistant Vice President
- Investment
Notice Address:
Chancellor Senior Secured Management, Inc.
1166 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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MEDICAL LIABILITY MUTUAL INSURANCE
COMPANY
By: /s/ K. ▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
Title: Vice President and
Controller
Notice Address:
Chancellor Senior Secured Management, Inc.
1166 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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PRIME INCOME TRUST
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
Notice Address:
Prime Income Trust
c/o ▇▇▇▇ ▇▇▇▇▇▇ InterCapital
2 World Trade Center - 72nd Floor
New York, New York 10048
Attention: April Chrysostomas
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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NEW YORK LIFE INSURANCE COMPANY
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
Notice Address:
New York Life Insurance Company
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Investment Department
Private Finance Group
Room 206
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
New York Life Insurance Company
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Office of General Counsel
Investment Section, Room 10SB
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING RATE
FUND, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: AUTHORIZED SIGNATORY
Notice Address:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Senior Floating Rate Fund, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ - ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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