[Conformed copy with
▇▇▇▇▇▇▇▇ ▇, ▇-▇, ▇-▇,
▇-▇, and K-4 Conformed
as Executed]
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TERM LOAN AGREEMENT
among
▇▇▇▇▇▇▇▇ COMMUNICATIONS, INC.,
▇▇▇▇▇▇▇▇ GRAPHICS, INC.,
VARIOUS FINANCIAL INSTITUTIONS
and
BANKERS TRUST COMPANY,
as ADMINISTRATIVE AGENT
----------------------------
Dated as of June 30, 1997
----------------------------
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TABLE OF CONTENTS
Page
SECTION 1. Amount and Terms of Credit............................... 1
1.01 The Commitments.............................................. 1
1.02 Notice of Borrowing.......................................... 1
1.03 Disbursement of Funds........................................ 2
1.04 Notes........................................................ 3
1.05 Pro Rata Borrowings.......................................... 3
1.06 Interest..................................................... 3
1.07 Interest Periods............................................. 4
1.08 Increased Costs, Illegality, etc............................. 5
1.09 Compensation................................................. 8
1.10 Change of Applicable Lending Office.......................... 8
1.11 Replacement of Banks......................................... 8
1.12 Conversions.................................................. 9
SECTION 2. Fees; Reductions of Commitment........................... 9
2.01 Fees......................................................... 9
SECTION 3. Prepayments; Payments; Taxes............................. 10
3.01 Mandatory and Voluntary Payment; Mandatory and Voluntary
Reduction of Commitments.................................. 10
3.02 Method and Place of Payment.................................. 11
3.03 Net Payments................................................. 11
SECTION 4. Conditions Precedent..................................... 15
4.01 Execution of Agreement; Notes................................ 15
4.02 No Default; Representations and Warranties................... 15
4.03 Opinions of Counsel.......................................... 16
4.04 Corporate Documents; Proceedings; etc........................ 16
4.05 Adverse Change, etc.......................................... 16
4.06 Litigation................................................... 17
4.07 Subsidiaries Guaranty........................................ 17
4.08 Existing Pledge Agreement Amendment.......................... 17
4.09 Existing Security Agreement Amendment........................ 18
4.10 Mortgage Amendments; etc..................................... 18
4.11 Canadian Debenture and Pledge Agreement...................... 18
4.12 Form of Collateral Assignments of Rights..................... 18
4.13 Lockbox, Blocked Account and Concentration Account
Agreements................................................ 19
4.14 Collateral Access Agreements................................. 19
4.15 Amendment to the Existing Credit Agreement................... 19
4.16 Solvency Certificate......................................... 19
4.17 Notice of Borrowing.......................................... 19
4.18 Fees, etc.................................................... 19
SECTION 5. Representations, Warranties and Agreements............... 19
5.01 Corporate Status............................................. 20
5.02 Corporate Power and Authority................................ 20
5.03 No Violation................................................. 20
5.04 Litigation................................................... 21
5.05 Use of Proceeds.............................................. 21
5.06 Governmental Approvals....................................... 21
5.07 Investment Company Act....................................... 21
5.08 Public Utility Holding Company Act........................... 21
5.09 True and Complete Disclosure................................. 21
5.10 Financial Condition; Financial Statements.................... 22
5.11 Locations of Offices, Records and Inventory.................. 22
5.12 Fictitious Business Names.................................... 23
5.13 Security Interests........................................... 23
5.14 Tax Returns and Payments..................................... 23
5.15 Compliance with ERISA........................................ 24
5.16 Subsidiaries................................................. 25
5.17 Patents, etc................................................. 25
5.18 Compliance with Statutes, etc................................ 26
5.19 Properties................................................... 27
5.20 Labor Relations; Collective Bargaining Agreements............ 27
5.21 Restrictions on Restricted Subsidiaries...................... 28
5.22 Material Contracts........................................... 28
5.23 Senior Indebtedness, etc..................................... 28
5.24 Existing Collateral Documents................................ 28
SECTION 6. Affirmative Covenants.................................... 29
6.01 Financial Information........................................ 29
6.02 Corporate Franchises......................................... 30
6.03 Compliance with Statutes, etc................................ 31
6.04 ERISA........................................................ 31
6.05 Good Repair.................................................. 33
6.06 Additional Security; Further Assurances; etc................. 33
6.07 Insurance.................................................... 34
6.08 Taxes........................................................ 34
6.09 Corporate Separateness....................................... 34
6.10 New Wholly-Owned Restricted Subsidiaries..................... 35
SECTION 7. Negative Covenants....................................... 35
7.01 Limitation on Indebtedness................................... 36
7.02 Limitation on Restricted Payments............................ 39
7.03 Limitation on Restrictions on Distributions from Restricted
Subsidiaries.............................................. 40
7.04 Limitation on Sales of Assets and Subsidiary Stock........... 42
7.05 Limitation on Affiliate Transactions......................... 43
7.06 Change of Control............................................ 44
7.07 Limitation on the Issuance of Preferred Stock of Restricted
Subsidiaries.............................................. 44
7.08 When Communications or Borrower May Merge or Transfer
Assets.................................................... 44
7.09 Ownership of Restricted Subsidiaries......................... 45
7.09 Further Instruments and Acts................................. 45
SECTION 8. Events of Default........................................ 45
8.01 Events of Default Defined.................................... 45
8.02 Acceleration................................................. 47
8.03 Other Remedies............................................... 48
SECTION 9. Definitions.............................................. 48
9.01 General Definitions.......................................... 48
9.02 Accounting Terms and Determinations.......................... 79
9.03 Other Defined Terms.......................................... 80
SECTION 10. The Agent............................................... 80
10.01 Appointment................................................. 80
10.02 Nature of Duties of Agent................................... 81
10.03 Lack of Reliance on Agent................................... 81
10.04 Certain Rights of the Agent................................. 82
10.05 Reliance by Agent........................................... 82
10.06 Indemnification of Agent.................................... 82
10.07 The Agent in Its Individual Capacity........................ 83
10.08 Holders of Notes............................................ 83
10.09 Successor Agent............................................. 83
10.10 Collateral Matters.......................................... 84
10.11 Actions with Respect to Defaults............................ 86
10.12 Delivery of Information..................................... 86
SECTION 11. Special Provisions Providing Lien Priorities; etc....... 86
11.01 Priorities With Respect to Collateral....................... 87
11.02 Priority on Distribution of Proceeds of Collateral.......... 88
11.03 Certain Dispositions of Collateral.......................... 89
11.04 Waiver of Set-Off........................................... 89
11.05 Right to Contest............................................ 90
11.06 Payment Invalidated......................................... 90
11.07 Right to Amend, etc......................................... 90
11.08 Creation of Future Obligations.............................. 91
11.09 Waiver of Liability For Actions Taken With Respect To Second
Priority Secured Obligations and Collateral.............. 91
11.10 Financing Issues............................................ 92
11.11 Effectiveness............................................... 92
11.12 Further Assurances.......................................... 92
11.13 Nature of the Obligations................................... 93
11.14 Benefits of this Section 11................................. 93
SECTION 12. Miscellaneous........................................... 93
12.01 Payment of Expenses; Indemnification; etc................... 93
12.02 Right of Setoff............................................. 94
12.03 Notices..................................................... 95
12.04 Benefit of Agreement; Assignments; Participations........... 95
12.05 No Waiver; Remedies Cumulative.............................. 98
12.06 Payments Pro Rata........................................... 99
12.07 Computations................................................ 99
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL............................................... 99
12.09 Counterparts................................................101
12.10 Effectiveness...............................................101
12.11 Headings Descriptive........................................101
12.12 Amendment or Waiver; etc....................................101
12.13 Survival....................................................102
12.14 Domicile of Loans...........................................103
12.15 Register....................................................103
12.16 Confidentiality.............................................103
12.17 Designated Senior Indebtedness..............................104
12.18 Limitation on Additional Amounts, etc.......................104
12.19 Maximum Rate................................................105
12.20 Post Closing Actions........................................106
SECTION 13. Parent Guaranty.........................................107
13.01 The Parent Guaranty.........................................107
13.02 Bankruptcy..................................................108
13.03 Nature of Liability.........................................108
13.04 Independent Obligation......................................108
13.05 Authorization...............................................108
13.06 Reliance....................................................109
13.07 Subordination...............................................110
13.08 Waiver......................................................110
13.09 Limitation on Enforcement...................................111
SCHEDULE I List of Banks
SCHEDULE II Governmental Approvals
SCHEDULE III Chief Executive Offices, Records Locations and Inventory
and Equipment Locations
SCHEDULE IV Fictitious Business Names
SCHEDULE V Tax Matters
SCHEDULE VI Subsidiaries
SCHEDULE VII Real Properties
SCHEDULE VIII Collective Bargaining Agreements
SCHEDULE IX Insurance
SCHEDULE X Existing Indebtedness
EXHIBIT A Form of Notice of Borrowing
EXHIBIT B Form of Note
EXHIBIT C Form of Section 3.03(e) Certificate
EXHIBIT D-1 Form of Opinion of Shearman & Sterling, special counsel
to the Credit Parties
EXHIBIT D-2 Form of Opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq., General
Counsel to Communications and the Borrower
EXHIBIT E Form of Officer's Certificate
EXHIBIT F Form of Solvency Certificate
EXHIBIT G Form of Subsidiaries Guaranty
EXHIBIT H-1 Existing Pledge Agreement
EXHIBIT H-2 Form of Existing Pledge Agreement Amendment
EXHIBIT I-1 Existing Security Agreement
EXHIBIT I-2 Form of Existing Security Agreement Amendment
EXHIBIT K-1 Existing Canadian Debenture
EXHIBIT K-2 Existing Canadian Pledge Agreement
EXHIBIT K-3 Form of Existing Canadian Debenture Amendment
EXHIBIT K-4 Form of Existing Canadian Pledge Agreement Amendment
EXHIBIT L Form of Collateral Assignment of Rights
EXHIBIT M-1 Form of Lockbox Agreement
EXHIBIT M-2 Form of Blocked Account Agreement
EXHIBIT M-3 Form of Concentration Account Agreement
EXHIBIT N Form of Collateral Access Agreement
EXHIBIT O Form of Compliance Certificate
EXHIBIT P Form of Assignment and Assumption Agreement
TERM LOAN AGREEMENT, dated as of June 30, 1997, among ▇▇▇▇▇▇▇▇
COMMUNICATIONS, INC., a Delaware corporation ("Communications" or the "Parent
Guarantor"), ▇▇▇▇▇▇▇▇ GRAPHICS, INC., a New York Corporation (the "Borrower"),
the financial institutions party hereto from time to time (the "Banks"), and
BANKERS TRUST COMPANY, as Administrative Agent (all capitalized terms used
herein and defined in Section 9 are used herein as therein defined).
W I T N E S S E T H :
-------------------
WHEREAS, the Borrower wishes to obtain a term loan facility to
prepay outstandings under the revolving credit facility pursuant to the
Existing Credit Agreement and thereby improve its liquidity; and
WHEREAS, subject to and upon the terms and conditions set forth
herein, the Banks are willing to make available to the Borrower the credit
facility provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 The Commitments. Subject to and upon the terms and
conditions set forth herein, each Bank severally agrees to make, on the
Closing Date, a term loan or term loans (each, a "Loan" and, collectively, the
"Loans") to the Borrower, which Loans shall (i) be denominated in Dollars,
(ii) at any time prior to the Syndication Date, be incurred and maintained as
a single Borrowing of Base Rate Loans (subject to mandatory conversion in
whole into a single Borrowing of Eurodollar Loans pursuant to Section 1.12),
(iii) at any time on and after the Syndication Date, be maintained as and/or
converted into a single Borrowing of Eurodollar Loans (subject to conversion,
in whole or in part, into Base Rate Loans pursuant to Section 1.08 or as
provided in last sentence of Section 1.07) and (iv) be made by each such Bank
in that initial aggregate principal amount as is equal to the Commitment of
such Bank on the Closing Date (before giving effect to any reductions thereto
on such date pursuant to Section 3.01(b)). Once repaid, Loans incurred
hereunder may not be reborrowed.
1.02 Notice of Borrowing. (a) When the Borrower desires to
incur the Loans hereunder, it shall give the Administrative Agent at its
Notice Office at least one Business Day's (or same day notice if acceptable to
the Administrative Agent) prior written notice (or telephonic notice promptly
confirmed in writing) of the Loans to be made hereunder, provided that any
such notice shall be deemed to have been given on a certain day only if given
before 11:00 A.M. (New York time) on such day. Such written notice or written
confirmation of telephonic notice (the "Notice of Borrowing"), except as
otherwise expressly provided in Section 1.08, shall be irrevocable and shall
be given by the Borrower in the form of Exhibit A, appropriately completed to
specify (i) the aggregate principal amount of the Loans to be incurred
pursuant to such Borrowing and (ii) the date of such Borrowing (which shall be
a Business Day). The Administrative Agent shall promptly give each Bank
notice of such proposed Borrowing, of such Bank's proportionate share thereof
and of the other matters required by the immediately preceding sentence to be
specified in the Notice of Borrowing.
(b) Without in any way limiting the obligation of the
Borrower to confirm in writing any telephonic notice permitted to be given
hereunder, the Administrative Agent may act without liability upon the basis
of such telephonic notice, believed by the Administrative Agent in good faith
to be from an Authorized Officer of the Borrower prior to receipt of written
confirmation. In each such case, the Borrower hereby waives the right to
dispute the Administrative Agent's record of the terms of such telephonic
notice.
1.03 Disbursement of Funds. No later than 12:00 Noon (New York
time) on the Closing Date, each Bank will make available its pro rata portion
(determined in accordance with Section 1.05) of the Loans to be made on such
date. All such amounts will be made available in Dollars and in immediately
available funds at the Payment Office of the Administrative Agent, and the
Administrative Agent will make available to the Borrower by depositing to its
account at the Payment Office the aggregate of the amounts so made available
by the Banks in the type of funds received. Unless the Administrative Agent
shall have been notified by any Bank prior to the Closing Date that such Bank
does not intend to make available to the Administrative Agent such Bank's
portion of the Loans to be made on such date, the Administrative Agent may
assume that such Bank has made such amount available to the Administrative
Agent on the Closing Date and the Administrative Agent may, in reliance upon
such assumption, make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the Administrative
Agent by such Bank, the Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Bank. If such Bank does not pay such
corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent shall promptly notify the Borrower and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent. The Administrative Agent shall also be entitled to recover on demand
from such Bank or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower until
the date such corresponding amount is recovered by the Administrative Agent,
at a rate per annum equal to (i) if recovered from such Bank, at the overnight
Federal Funds Rate and (ii) if recovered from the Borrower, the rate of
interest applicable to the Loans, as determined pursuant to Section 1.08.
Nothing in this Section 1.04 shall be deemed to relieve any Bank from its
obligation to make Loans hereunder or to prejudice any rights which the
Borrower may have against any Bank as a result of any failure by such Bank to
make Loans hereunder.
1.04 Notes. (a) The Borrower's obligation to pay the
principal of, and interest on, the Loans made by each Bank shall be evidenced
by a promissory note duly executed and delivered by the Borrower substantially
in the form of Exhibit B, with blanks appropriately completed in conformity
herewith (each, a "Note" and, collectively, the "Notes"). The Note issued to
each Bank shall (i) be executed by the Borrower, (ii) be payable to the order
of such Bank and be dated the Closing Date (or if issued thereafter, the date
of issuance), (iii) be in a stated principal amount equal to the principal
amount of the Loans made by such Bank and be payable in Dollars in the
outstanding principal amount of Loans evidenced thereby, (iv) mature on the
Final Maturity Date, (v) bear interest as provided in the appropriate clause
of Section 1.06 in respect of the Base Rate Loans and Eurodollar Loans, as the
case may be, evidenced thereby, (vi) be subject to voluntary and mandatory
prepayment as provided in Section 3.01 and (vii) be entitled to the benefits
of this Agreement and the other Credit Documents.
(b) Each Bank will note on its internal records the amount of
each Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the
outstanding principal amount of Loans evidenced thereby. Failure to make any
such notation or any error in such notation shall not affect the Borrower's
obligations in respect of such Loans.
1.05 Pro Rata Borrowings. All Loans made under this Agreement
shall be incurred from the Banks pro rata on the basis of their Commitments.
It is understood that no Bank shall be responsible for any default by any
other Bank of its obligation to make Loans hereunder and that each Bank shall
be obligated to make the Loans provided to be made by it hereunder, regardless
of the failure of any other Bank to make its Loans hereunder.
1.06 Interest. (a) The Borrower agrees to pay interest in
respect of the unpaid principal amount of each Base Rate Loan from the date
the proceeds thereof are made available to the Borrower until the maturity
thereof (whether by acceleration or otherwise) at a rate per annum which shall
be equal to the sum of the Applicable Margin plus the Base Rate, each as in
effect from time to time.
(b) The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Eurodollar Loan from the date the proceeds
thereof are made available to the Borrower until the maturity thereof (whether
by acceleration or otherwise) at a rate per annum which shall, during each
Interest Period applicable thereto, be equal to the sum of the Applicable
Margin (as in effect from time to time) plus the Eurodollar Rate for such
Interest Period.
(c) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and any other overdue amount payable
hereunder shall, in each case, bear interest at a rate per annum equal to the
greater of (x) 2% per annum in excess of the rate otherwise applicable to Base
Rate Loans from time to time and (y) the rate which is 2% in excess of the
rate borne by such Loans at the time of the payment default, in each case with
such interest to be payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be
payable (i) in respect of each Base Rate Loan, quarterly in arrears on each
Quarterly Payment Date, (ii) in respect of each Eurodollar Loan, on the last
day of each Interest Period applicable thereto and (iii) in respect of each
Loan, on any repayment or prepayment (on the amount repaid or prepaid), at
maturity (whether by acceleration or otherwise) and, after such maturity, on
demand.
(e) Upon each Interest Determination Date, the Administrative
Agent shall determine the Eurodollar Rate for the respective Interest Period
or Interest Periods to be applicable to Eurodollar Loans and shall promptly
notify the Borrower and the Banks thereof. Each such determination shall,
absent manifest error, be final and conclusive and binding on all parties
hereto.
1.07 Interest Periods. All Eurodollar Loans outstanding
hereunder at any time shall have a single interest period applicable thereto
at such time of three (3) months duration (each, an "Interest Period"),
provided that:
(i) the initial Interest Period for the Eurodollar Loans shall
commence on the Syndication Date and each Interest Period occurring
thereafter in respect of such Eurodollar Loans shall commence (x) on
the day on which the next preceding Interest Period applicable
thereto expires or (y) only in the circumstances provided in Section
1.08(d)(y) (where all Eurodollar Loans have theretofore been
converted into Base Rate Loans), on the Business Day specified in
Section 1.08(d)(y);
(ii) if any Interest Period for a Eurodollar Loan begins on a
day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period, such Interest
Period shall end on the last Business Day of such calendar month;
(iii) if any Interest Period for a Eurodollar Loan would
otherwise expire on a day which is not a Business Day, such Interest
Period shall expire on the next succeeding Business Day; provided,
however, that if any Interest Period for a Eurodollar Loan would
otherwise expire on a day which 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;
and
(iv) no Interest Period shall be selected which extends beyond
the Final Maturity Date.
If upon the expiration of an Interest Period, the Borrower is
not permitted by virtue of the application of clause (iv) above to elect a new
Interest Period to be applicable to a Borrowing of Eurodollar Loans as
provided above, the Borrower shall be deemed to have elected to convert such
Borrowing into a Borrowing of Base Rate Loans effective as of the expiration
date of such current Interest Period.
1.08 Increased Costs, Illegality, etc. (a) In the event that
any Bank shall have determined in good faith (which determination shall,
absent manifest error, be final and conclusive and binding upon all parties
hereto but, with respect to clause (i) below, may be made only by the
Administrative Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the date of this Agreement affecting the
interbank Eurodollar market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for
in the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loan because of (x) any change arising
after the date of this Agreement in any applicable law or
governmental rule, regulation, order, guideline or request (whether
or not having the force of law) or in the interpretation or
administration thereof and including the introduction of any new law
or governmental rule, regulation, order, guideline or request, such
as, for example, but not limited to: (A) a change in the basis of
taxation of payment to any Bank of the principal of or interest on
the Notes or any other amounts payable hereunder (except for changes
in the rate of tax on, or determined by reference to, the net income
or profits or franchise taxes based on net income of such Bank
pursuant to the laws of the jurisdiction in which it is organized or
in which its principal office or applicable lending office is located
or any subdivision hereof or therein) or (B) a change in official
reserve requirements (except to the extent included in the
computation of the Eurodollar Rate) or any special deposit,
assessment or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Bank (or its
applicable lending office) and/or (y) other circumstances since the
date of this Agreement affecting such Bank or the interbank
Eurodollar market or the position of such Bank in such market; or
(iii) at any time after the date of this Agreement, that the
making or continuance of any Eurodollar Loan has been made (x)
unlawful by any law or governmental rule, regulation or order, (y)
impossible by compliance by any Bank in good faith with any
governmental request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the date
of this Agreement which materially and adversely affects the
applicable interbank market;
then, and in any such event, such Bank (or the Administrative Agent, in the
case of clause (i) above) shall promptly give notice (by telephone promptly
confirmed in writing) to the Borrower and, except in the case of clause (i)
above, to the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each of the other Banks).
Thereafter (x) in the case of clause (i) above, on the last day of the then
current Interest Period, all Loans shall be automatically converted to Base
Rate Loans, until such time as the circumstances described in clause (i) shall
no longer be applicable, in which event Section 1.08(d) shall apply, (y) in
the case of clause (ii) above, the Borrower shall, subject to the provisions
of Section 12.18 (to the extent applicable), pay to such Bank, upon its
written request therefor, such additional amounts (in the form of an increased
rate of, or a different method of calculating, interest or otherwise as such
Bank in its sole discretion shall determine) as shall be required to
compensate such Bank for such increased costs or reductions in amounts
received or receivable hereunder (a written notice as to the additional amounts
owed to such Bank, showing in reasonable detail the basis for the calculation
thereof, submitted to the Borrower by such Bank shall, absent manifest error,
be final and conclusive and binding on all the parties hereto) and (z) in the
case of clause (iii) above, the Borrower shall take one of the actions
specified in Section 1.08(b) as promptly as possible and, in any event, within
the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.08(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.08(a)(iii) shall), upon at least three Business Days' written notice
to the Administrative Agent, require the affected Bank to convert such
Eurodollar Loan into a Base Rate Loan, until such time as the circumstances
described in Section 1.08(a)(ii) or (iii) shall no longer be applicable in
which event clause (d) below shall apply, provided that, if more than one Bank
is affected at any time, then all affected Banks must be treated the same
pursuant to this Section 1.08(b).
(c) If at any time after the date of this Agreement any Bank
determines that the introduction of or any change (which introduction or
change shall have occurred after the date of this Agreement) in any applicable
law or governmental rule, regulation, order, guideline, directive or request
(whether or not having the force of law) concerning capital adequacy, or any
change in interpretation or administration thereof by any governmental
authority, central bank or comparable agency, will have the effect of
increasing the amount of capital required or expected to be maintained by such
Bank or any corporation controlling such Bank based on the existence of such
Bank's Commitments hereunder or its obligations hereunder, then the Borrower
agrees to pay, subject to the provisions of Section 12.18 (to the extent
applicable), to such Bank, upon its written demand therefor, such additional
amounts as shall be required to compensate such Bank or such other corporation
for the increased cost to such Bank or such other corporation or the reduction
in the rate of return to such Bank or such other corporation as a result of
such increase of capital. In determining such additional amounts, each Bank
will act reasonably and in good faith and will use averaging and attribution
methods which are reasonable, provided that such Bank's determination of
compensation owing under this Section 1.08(c) shall, absent manifest error, be
final and conclusive and binding on all the parties hereto. Each Bank, upon
determining that any additional amounts will be payable pursuant to this
Section 1.08(c), will give prompt written notice thereof to the Borrower,
which notice shall show in reasonable detail the basis for calculation of such
additional amounts.
(d) In the event that any Base Rate Loan is outstanding at any
time and the relevant circumstances described in Section 1.08(a)(i), (ii)
and/or (iii), as the case may be, cease to be applicable, the respective
Bank(s) or the Administrative Agent (as applicable) shall give prompt notice
thereof to the Borrower and the Administrative Agent (as applicable) and (x)
if a Borrowing of Eurodollar Loans is outstanding at such time (from one or
more Banks which were not affected by such circumstances or as a result of the
application of following clause (y)), then on the last day of the Interest
Period then applicable thereto the Base Rate Loans of the respective affected
Bank or Banks to which the circumstances described above have ceased to be
applicable shall be converted back into (and thereafter shall form a part of)
the respective Borrowing of Eurodollar Loans (until such time, if any, as
Section 1.08(a) and (b) shall thereafter become applicable) and (y) if no
Eurodollar Loans remain outstanding at such time, then on the third Business
Day thereafter the Base Rate Loans of the respective Bank or Banks to which
the circumstances described above shall cease to be applicable shall be
converted into a Borrowing of Eurodollar Loans (with an Interest Period of
three months beginning on said third Business Day).
1.09 Compensation. The Borrower shall compensate each Bank,
upon its written request (which request shall set forth in reasonable detail
the basis for requesting such compensation), for all reasonable losses,
expenses and liabilities (including, without limitation, any loss, expense or
liability incurred by reason of the liquidation or reemployment of deposits or
other funds required by such Bank to fund its Eurodollar Loans, but excluding
loss of anticipated profits) which such Bank may sustain: (i) if any
repayment (including any repayment made pursuant to Section 3.01 or as a
result of an acceleration of the Loans pursuant to Section 8) occurs on a date
which is not the last day of an Interest Period with respect thereto; (ii) if
any prepayment of any of its Eurodollar Loans is not made on any date
specified in a notice of prepayment given by such Borrower; or (iii) as a
consequence of (x) any other default by such Borrower to repay its Loans when
required by the terms of this Agreement or any Note held by such Bank or (y)
any election made pursuant to Section 1.08(b).
1.10 Change of Applicable Lending Office. Each Bank agrees
that on the occurrence of any event giving rise to the operation of Section
1.08(a)(ii) or (iii), Section 1.08(c) or Section 3.03 with respect to such
Bank, it will, if requested by the Borrower, use reasonable efforts (subject
to overall policy considerations of such Bank) to designate another lending
office for any Loans affected by such event, provided that such designation is
made on such terms that such Bank and its lending office suffer no economic,
legal or regulatory disadvantage, with the object of avoiding the consequence
of the event giving rise to the operation of such Section. Nothing in this
Section 1.10 shall affect or postpone any of the obligations of the Borrower
or the right of any Bank provided in Sections 1.08 and 3.03.
1.11 Replacement of Banks. (x) Upon the occurrence of an
event giving rise to the operation of Section 1.08(a)(ii) or (iii), Section
1.08(c) or Section 3.03 with respect to any Bank which results in such Bank
charging to the Borrower increased costs in excess of those being generally
charged by the other Banks or (y) in the case of certain refusals by a Bank to
consent to certain proposed changes, waivers, discharges or terminations with
respect to this Agreement which have been approved by the Required Banks as
(and to the extent) provided in Section 12.12(b), the Borrower shall have the
right, if no Default under Section 8.01(1), (6) or (7) and no Event of Default
then exists (or, in the case of preceding clause (y), no Default under Section
8.01(1), (6) or (7) and no Event of Default will exist immediately after giving
effect to such replacement), to replace such Bank (the "Replaced Bank") with
one or more other Eligible Transferees (collectively, the "Replacement Bank")
and each of whom shall be required to be reasonably acceptable to the
Administrative Agent, provided that (i) at the time of any replacement
pursuant to this Section 1.11, the Replacement Bank shall enter into one or
more Assignment and Assumption Agreements pursuant to Section 12.04(b) (and
with all fees payable pursuant to said Section 12.04(b) to be paid by the
Replacement Bank) pursuant to which the Replacement Bank shall acquire all of
the outstanding Loans of the Replaced Bank and, in connection therewith, shall
pay to the Replaced Bank in respect thereof an amount equal to the principal
of, and all accrued interest on, all outstanding Loans of the Replaced Bank
and (ii) all obligations of the Borrower due and owing to the Replaced Bank at
such time (other than those specifically described in clause (i) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full to such Replaced Bank concurrently with
such replacement. Upon the execution of the respective Assignment and
Assumption Agreements, the payment of amounts referred to in clauses (i) and
(ii) above, recordation of the assignment on the Register by the
Administrative Agent pursuant to Section 12.15 and, if so requested by the
Replacement Bank, delivery to the Replacement Bank of the appropriate Note or
Notes executed by the Borrower, the Replacement Bank shall become a Bank
hereunder and the Replaced Bank shall cease to constitute a Bank hereunder,
except with respect to indemnification provisions under this Agreement
(including, without limitation, Sections 1.08, 1.09, 3.03, 10.06 and 12.01),
which shall survive as to such Replaced Bank. It is understood and agreed
that replacements pursuant to this Section 1.11 shall be effected by means of
assignments which otherwise meet the applicable requirements of Section
12.04(b).
1.12 Conversions. On the Syndication Date, the entire
outstanding principal amount of Loans made to the Borrower and then
outstanding shall be automatically converted into a single Borrowing of
Eurodollar Loans (with the first Interest Period applicable thereto to begin
on the Syndication Date).
SECTION 2. Fees; Reductions of Commitment.
2.01 Fees. (a) The Borrower shall pay to the Administrative
Agent, for its own account, such fees as have been previously agreed to in
writing by the Borrower and the Administrative Agent.
(b) In addition to any other fees payable pursuant to this
Agreement or any other agreement, if any Loans remain outstanding on either of
the 12 or 30 month anniversaries of the Closing Date, then on each such date
an additional cash fee shall be paid to each Bank (and retained by it for its
own account) in an amount equal to 1.0% of the aggregate principal amount of
the Loans of such Bank outstanding on the respective such date, and if any
Loans remain outstanding on any of the 6, 9, 18 or 24 month anniversaries of
the Closing Date, then additional cash fees shall be paid to each Bank on each
such date in an amount equal to 1/2 of 1% of the aggregate principal amount of
the Loans of such Bank outstanding on the respective such date (which fees
shall be retained by each Bank for its own account).
SECTION 3. Prepayments; Payments; Taxes.
3.01 Mandatory and Voluntary Payment; Mandatory and Voluntary
Reduction of Commitments. (a) The Total Commitment (and the Commitment of
each Bank) shall terminate in its entirety on July 30, 1997 unless the Closing
Date has occurred on or before such date.
(b) In addition to any other mandatory commitment reductions
pursuant to this Section 3.01, the Total Commitment (and the commitment of
each Bank) shall terminate in its entirety on the Closing Date (after giving
effect to the making of Loans on such date).
(c) The Borrower shall have the right to prepay the Loans,
without premium or penalty, in whole or in part at any time and from time to
time on the following terms and conditions: (i) the Borrower shall give the
Administrative Agent prior to 12:00 Noon (New York City time) at least three
Business Days' prior written notice (or telephonic notice promptly confirmed
in writing) of its intent to prepay Loans and the amount of such prepayment,
which notice the Administrative Agent shall promptly transmit to each of the
Banks; (ii) each partial prepayment shall be in an aggregate principal amount
of at least $1,000,000; (iii) if any partial prepayment of then outstanding
Loans shall reduce the aggregate principal amount of outstanding Loans to an
amount less than $1,000,000, then all then outstanding Loans shall be required
to be repaid in full at such time; (iv) prepayments of Eurodollar Loans made
pursuant to this Section 3.01(c) on any date which is not the last day of an
Interest Period applicable thereto shall be accompanied by the payment of all
breakage and similar costs required to be paid as a result thereof pursuant to
Section 1.09; and (v) each prepayment in respect of any Loans shall be applied
pro rata among the Banks (based on the respective outstanding principal
amounts of their outstanding Loans).
(d) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 3.01, on each date after the Closing Date
upon which Communications receives any proceeds from any sale or issuance of
its equity, an amount equal to 50% of the cash proceeds of the respective sale
or issuance (net of all reasonable costs associated therewith, including,
without limitation, all due diligence costs and expenses paid for, or
reimbursed by, Communications, underwriting or similar fees discounts and
commissions, attorneys' fees and expenses paid for, or reimbursed by,
Communications and other direct costs associated therewith) shall be applied
as a mandatory repayment of principal of outstanding Loans in accordance with
the requirements of Section 3.01(e).
(e) Each mandatory repayment of Loans required by this Section
3.01 shall be applied pro rata to the then outstanding principal amount of the
Loans of the various Banks.
(f) In addition to the repayments specified above, (i) Excess
Proceeds Repayments shall be required to be made in accordance with, and to
the extent required by, Section 7.04 and (ii) repayments following the
occurrence of a Change of Control shall be required in accordance with the
provisions of Section 7.06. All repayments pursuant to this clause (i) shall,
except to the extent otherwise expressly provided in the second sentence of
Section 7.06, be applied in accordance with the provisions of Section 3.01(e).
3.02 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement or any Note
shall be made to the Administrative Agent for the account of the Bank or Banks
entitled thereto not later than 12:00 Noon (New York time) on the date when
due and shall be made in Dollars in immediately available funds at the Payment
Office of the Administrative Agent. The Administrative Agent will thereafter
cause to be distributed on the same day (if payment was actually received by
the Administrative Agent prior to 12:00 Noon (New York time) on such day) like
funds relating to the payment of principal, interest or fees ratably to the
Banks entitled thereto. Any payments under this Agreement which are made
later than 12:00 Noon (New York time) shall be deemed to have been made on the
next succeeding Business Day. Whenever any payment to be made hereunder or
under any Note shall be stated to be due on a day which is not a Business Day,
the due date thereof shall be extended to the next succeeding Business Day
and, with respect to payments of principal, interest shall be payable at the
applicable rate during such extension.
3.03 Net Payments. (a) Except as provided in Section
3.03(e), any and all payments by the Borrower (or any other Credit Party on
its behalf) hereunder, under the Loans or under the Guaranties to or for the
benefit of any Bank or the Administrative Agent shall be made free and clear
of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings and penalties, interests and all
other liabilities with respect thereto ("Taxes"), excluding, (i) in the case
of each such Bank or the Administrative Agent, taxes imposed on its net income
(including, without limitation, any taxes imposed on branch profits) and
franchise taxes (that are imposed on or computed by reference to net income)
imposed on it by the jurisdiction under the laws of which such Bank or the
Administrative Agent (as the case may be) is organized or any political
subdivision thereof, and (ii) in the case of each Bank, taxes imposed on its
net income (including, without limitation, any taxes imposed on branch
profits), and franchise taxes imposed on it, by the jurisdiction of such
Bank's Applicable Lending Office or any political subdivision thereof (all such
nonexcluded Taxes being hereinafter referred to as "Covered Taxes"). Except as
provided in Section 3.03(e), if the Borrower or any Credit Party shall be
required by law to deduct any Covered Taxes from or in respect of any sum
payable hereunder, under any Loan or under the Guaranties to or for the
benefit of any Bank or the Administrative Agent, (A) the sum payable shall be
increased as may be necessary so that after making all required deductions of
Covered Taxes (including deductions of Covered Taxes applicable to additional
sums payable under this Section 3.03) such Bank or the Administrative Agent,
as the case may be, receives an amount equal to the sum it would have received
had no such deductions been made, (B) the Borrower shall make such deductions
and (C) the Borrower shall pay the full amount so deducted to the relevant
taxation authority or other authority in accordance with applicable law. If
any amounts are payable in respect of Taxes pursuant to the preceding
sentence, the Borrower agrees to reimburse any Bank, or the Administrative
Agent, within thirty days of the date of the written request of such Bank or
the Administrative Agent, as the case may be, for taxes imposed on or measured
by the net income or profits of such Bank or the Administrative Agent pursuant
to the laws of the jurisdiction in which the principal office or Applicable
Lending Office of such Bank or the Administrative Agent is located or under
the laws of any political subdivision or taxing authority of any such
jurisdiction in which the principal office or Applicable Lending Office of
such Bank or the Administrative Agent is located and for any withholding of
income or similar taxes imposed by the United States as such Bank or the
Administrative Agent shall determine are payable by, or withheld from, such
Bank or the Administrative Agent in respect of such amounts so paid to or on
behalf of such Bank or the Administrative Agent pursuant to the preceding
sentence and in respect of any amounts paid to or on behalf of such Bank or
the Administrative Agent pursuant to this sentence ("Second Tier Taxes"). The
written request referred to in the preceding sentence shall certify and set
forth in reasonable detail the calculation of the payment and specify the type
of such Taxes. Any such certificate submitted in good faith to the Borrower
shall, absent manifest error, be final, conclusive and binding on all parties;
provided, however, that notwithstanding any of the foregoing with respect to
the above-referenced calculations, none of the Banks or the Administrative
Agent shall be obligated to provide any information with respect to its
assets, income or operations other than assets, income or operations solely
attributable to this Agreement, any Loan or any Guaranty.
(b) In addition, the Borrower agrees to pay any present or
future stamp, documentary, excise, privilege, intangible or similar levies
that arise at any time or from time to time (i) from any payment made under
any and all Credit Documents, (ii) from the transfer of the rights of any Bank
(other than a Defaulting Bank) under any Credit Documents to any transferee
pursuant to Section 1.11, or (iii) from the execution or delivery by the
Borrower of, or from the filing or recording or maintenance of, or otherwise
with respect to the exercise by the Administrative Agent or the Banks of their
rights (subject to the provisions of Section 3.03(a), excluding transfers
pursuant to Section 12.04) under, any and all Credit Documents (hereinafter
referred to as "Other Taxes").
(c) Except as provided in Section 3.03(e), the Borrower shall
indemnify, to the extent not previously withheld and paid to the relevant
taxation authority or other authority in accordance with applicable law, each
Bank and the Administrative Agent for the full amount of (i) Covered Taxes
imposed on or with respect to amounts payable hereunder, (ii) Other Taxes, and
(iii) any Second Tier Taxes (other than Covered Taxes imposed by any
jurisdiction on amounts payable under this Section 3.03) paid by such Bank or
the Administrative Agent, as the case may be, and any liability (including
penalties, interest and expenses) arising solely therefrom or with respect
thereto. Payment of this indemnification shall be made within 30 days from
the date such Bank or the Administrative Agent certifies and sets forth in
reasonable detail the calculation thereof as to the amount and type of such
Taxes. Any such certificate submitted by the Bank or Administrative Agent in
good faith to the Borrower shall, absent manifest error, be final, conclusive
and binding on all parties; provided, however, that notwithstanding any of the
foregoing with respect to the above-referenced calculations, none of the Banks
or the Administrative Agent shall be obligated to provide any information with
respect to its assets, income or operations other than assets, income or
operations solely attributable to this Agreement, any Loan or any Guaranty.
(d) Within 30 days after having received a receipt of Covered
Taxes or Other Taxes, the Borrower will furnish to the Administrative Agent
the original or a certified copy of a receipt evidencing payment thereof.
(e) Each Foreign Bank agrees to deliver to each of the
Borrower and the Administrative Agent on or prior to the Closing Date, or in
the case of a Foreign Bank that is an assignee or transferee of an interest
under this Agreement pursuant to Section 1.11 or 12.04 (unless the respective
Foreign Bank was already a Bank hereunder immediately prior to such assignment
or transfer), on or prior to the date of such assignment or transfer to such
Foreign Bank, (i) two accurate and complete original signed copies of Internal
Revenue Service Form 4224 or 1001 (or successor forms) certifying to such
Foreign Bank's entitlement to a complete exemption from United States
withholding tax with respect to payments to be made under any and all Credit
Documents or (ii) if the Foreign Bank is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 pursuant to clause (i) above with respect to any
payments of interest, (x) a certificate substantially in the form of Exhibit C
(any such certificate, a "Section 3.03(e) Certificate") and (y) two accurate
and complete original signed copies of Internal Revenue Service Form W-8 (or
successor form) certifying to such Foreign Bank's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under any and all Credit Documents. In addition, each
Foreign Bank agrees that from time to time after the Closing Date, when a
lapse in time or change in circumstances renders the previous certification
obsolete or inaccurate in any material respect, it will deliver to the
Borrower and the Administrative Agent two new accurate and complete original
signed copies of Internal Revenue Service Form 4224 or 1001, or Form W-8 and a
Section 3.03(e) Certificate, as the case may be, and such other forms and
statements as may be required in order to confirm or establish the entitlement
of such Foreign Bank to a continued exemption from or reduction in United
States withholding tax with respect to payments under any and all Credit
Documents or it shall immediately notify the Borrower and the Administrative
Agent of its inability to deliver any such Form or Certificate, in which case
such Foreign Bank shall not be required to deliver any such Form or Certificate
pursuant to this Section 3.03(e). Notwithstanding anything to the contrary
contained in Section 3.03(a) and (c), but subject to the immediately
succeeding sentence, (x) the Borrower shall be entitled, to the extent it is
required to do so by law, to deduct or withhold income or similar taxes
imposed by the United States (or any political subdivision or taxing authority
thereof or therein) from interest, fees or other amounts payable hereunder for
the account of any Foreign Bank for U.S. Federal income tax purposes to the
extent that such Foreign Bank has not provided to the Borrower Internal Revenue
Service Forms that establish a complete exemption from such deduction or
withholding and (y) the Borrower shall not be obligated pursuant to Section
3.03(a) and (c) hereof to indemnify or to gross-up payments to be made to a
Foreign Bank in respect of income or similar taxes imposed by the United
States if (I) such Foreign Bank has not provided to the Borrower the forms or
statements required to be provided to the Borrower pursuant to this Section
3.03(e) or (II) in the case of a payment, other than interest, to a Foreign
Bank described in clause (ii) above, to the extent that such forms or
statements do not establish a complete exemption from withholding of such
taxes. Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 3.03 and except as set forth in Section
12.04(b), the Borrower agrees to pay additional amounts and to indemnify each
Bank or the Administrative Agent in the manner set forth in Section 3.03(a)
and (c) (without regard to the identity of the jurisdiction requiring the
deduction or withholding) in respect of any amounts deducted or withheld by it
as described in the immediately preceding sentence as a result of any changes
after the Closing Date in any applicable law, treaty, governmental rule,
regulation, guideline or order, or in the interpretation thereof, relating to
the deducting or withholding of income or similar Taxes.
(f) If any Taxes for which the Borrower would be required to
make payment under this Section 3.03 are imposed, the Bank or the
Administrative Agent, as the case may be, shall use its reasonable best
efforts to avoid or reduce such Taxes by taking any appropriate action
(including, without limitation, assigning its rights hereunder to a related
entity or a different office) which would not in the sole opinion of such Bank
or Administrative Agent be otherwise disadvantageous to such Bank or
Administrative Agent, as the case may be.
(g) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 3.03 shall survive the payment in full of the
Obligations.
(h) If the Borrower pays any additional amount under this
Section 3.03 to a Bank and such Bank determines in its sole discretion that it
has actually received or realized in connection therewith any refund or any
reduction of, or credit against, its liabilities with respect to Taxes in or
with respect to the taxable year in which the additional amount is paid, such
Bank shall pay to the Borrower an amount that the Bank shall, in its sole
discretion, determine is equal to the net benefit, after tax, which was
obtained by the Bank in such year as a consequence of such refund, reduction
or credit.
(i) Notwithstanding any provision of this Agreement to the
contrary, Section 3.03 is the only provision of this Agreement that requires
the Borrower (or any Credit Party) to make any payment to a Bank, the
Administrative Agent or any of their successors and assigns, by reason of any
Tax imposed upon a Bank, the Administrative Agent or any of their successors
and assigns.
SECTION 4. Conditions Precedent. The obligation of each
Bank to make Loans on the Closing Date, is subject to the satisfaction of the
following conditions:
4.01 Execution of Agreement; Notes. On or prior to the
Closing Date (i) the Effective Date shall have occurred and (ii) there shall
have been delivered to the Administrative Agent for the account of each of the
Banks the appropriate Note executed by the Borrower, in each case in the
amount, maturity and as otherwise provided herein.
4.02 No Default; Representations and Warranties. On the
Closing Date and after giving effect to the Loans made on such date, (i) there
shall exist no Default or Event of Default and (ii) all representations and
warranties contained herein and in the other Credit Documents shall be true
and correct in all material respects with the same effect as though such
representations and warranties had been made on the Closing Date (it being
understood and agreed that any representation or warranty which by its terms
is made as of a specified date shall be required to be true and correct in all
material respects only as of such specified date).
4.03 Opinions of Counsel. On the Closing Date, the
Administrative Agent shall have received (i) from Shearman & Sterling, special
counsel to the Credit Parties, an opinion addressed to the Administrative
Agent, the Collateral Agent and each of the Banks and dated the Closing Date
in the form set forth as Exhibit D-1 and (ii) from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.,
General Counsel to Communications and the Borrower, an opinion addressed to
the Administrative Agent, the Collateral Agent and each of the Banks and dated
the Closing Date in the form set forth as Exhibit D-2. Without limiting the
foregoing, Shearman & Sterling's opinion as required pursuant to the
immediately preceding sentence shall contain an unqualified opinion, in form
satisfactory to the Administrative Agent, to the effect that all Loans and
related Obligations constitute "Senior Indebtedness" under, and as defined in,
the Senior Subordinated Notes Indenture.
4.04 Corporate Documents; Proceedings; etc. (a) On the
Closing Date, the Administrative Agent shall have received a certificate of
each Credit Party, dated the Closing Date, signed by an Authorized Officer of
such Credit Party, and attested to by the Secretary or any Assistant Secretary
of such Credit Party, in the form of Exhibit E with appropriate insertions,
together with copies of the certificate of incorporation (or equivalent
organizational document) and by-laws of such Credit Party and the resolutions
of such Credit Party referred to in such certificate, and the foregoing shall
be reasonably acceptable to the Administrative Agent.
(b) All corporate and legal proceedings and all instruments
and agreements in connection with the transactions contemplated by this
Agreement and the other Documents shall be reasonably satisfactory in form and
substance to the Administrative Agent and the Required Banks, and the
Administrative Agent shall have received all information and copies of all
documents and papers, including records of corporate proceedings, governmental
approvals, good standing certificates and bring-down telegrams or facsimiles,
if any, which the Administrative Agent reasonably may have requested in
connection therewith, such documents and papers where appropriate to be
certified by proper corporate or governmental authorities.
4.05 Adverse Change, etc. (a) On or prior to the Closing
Date, nothing shall have occurred (and neither the Administrative Agent nor
the Banks shall have become aware of any facts, conditions or other
information not previously known) which the Administrative Agent or the
Required Banks shall determine could reasonably be expected to have a material
adverse effect on the rights or remedies of the Administrative Agent or the
Banks, or on the ability of any Credit Party to perform its obligations to the
Administrative Agent and the Banks or which could reasonably be expected to
have a Material Adverse Effect.
(b) All necessary governmental (domestic and foreign) and
third party approvals and/or consents in connection with the making of the
Loans and the Transaction, the other transactions contemplated by the
Documents and otherwise referred to herein or therein shall have been obtained
and remain in effect, and all applicable waiting periods shall have expired
without any action being taken by any competent authority which restrains,
prevents, or imposes materially adverse conditions upon, the consummation of
the Transaction or the other transactions contemplated by the Documents or
otherwise referred to herein or therein. Additionally, there shall not exist
any judgment, order, injunction or other restraint issued or filed or a
hearing seeking injunctive relief or other restraint pending or notified
prohibiting or imposing materially adverse conditions upon the Transaction or
the other transactions contemplated by the Documents.
4.06 Litigation. On the Closing Date, no litigation by any
entity (private or governmental) shall be pending or threatened with respect
to this Agreement, any other Document or any documentation executed in
connection herewith or therewith or the transactions contemplated hereby or
thereby, or which the Administrative Agent or the Required Banks shall
determine could reasonably be expected to have a Material Adverse Effect.
4.07 Subsidiaries Guaranty. On the Closing Date, each of the
Wholly-Owned Restricted Subsidiaries of the Borrower, as well as any other
Restricted Subsidiary of the Borrower which has guaranteed outstandings
pursuant to the Existing Credit Agreement, shall have duly authorized,
executed and delivered a Subsidiaries Guaranty in the form of Exhibit G (as
modified, amended or supplemented from time to time in accordance with the
terms thereof and hereof, the "Subsidiaries Guaranty"), and the Subsidiaries
Guaranty shall be in full force and effect.
4.08 Existing Pledge Agreement Amendment. On the Closing
Date, the parties to the Existing Pledge Agreement shall have duly authorized,
executed and delivered an amendment thereto in the form of Exhibit H-2 (the
"Existing Pledge Agreement Amendment"), which amendment shall be in full force
and effect. Without limiting the foregoing, the consent of the requisite
lenders pursuant to the Existing Credit Agreement shall have been obtained to
the amendment of the Existing Pledge Agreement as required above.
4.09 Existing Security Agreement Amendment. On the Closing
Date, the parties thereto shall have duly authorized, executed and delivered
an amendment to the Existing Security Agreement in the form of Exhibit I-2
(the "Existing Security Agreement Amendment"), which amendment shall be in
full force and effect. Without limiting the foregoing, the consent of the
requisite lenders pursuant to the Existing Credit Agreement shall have been
obtained to the amendment of the Existing Security Agreement as required above.
4.10 Mortgage Amendments; etc. On or prior to the Closing
Date, the Collateral Agent shall have received:
(i) fully executed counterparts of amendments (the "Mortgage
Amendments"), in form and substance satisfactory to the
Administrative Agent and the Required Banks, to each of the
Existing Mortgages, together with evidence that counterparts of
each of the Mortgage Amendments have been delivered to the
title company insuring the Lien of the Existing Mortgages for
recording in all places to the extent necessary or desirable,
in the judgment of the Collateral Agent, effectively to
maintain a valid and enforceable first priority mortgage lien
(subject to Permitted Encumbrances relating thereto) on the
Existing Mortgaged Properties in favor of the Collateral Agent
(or such other trustee as may be required or desired under
local law) for the benefit of the Secured Creditors; and
(ii) endorsements reasonably satisfactory to the Collateral
Agent to each Existing Mortgage Policy assuring the Collateral
Agent that each Existing Mortgage is a valid and enforceable
first priority mortgage lien on the respective Existing
Mortgaged Properties, free and clear of all defects and
encumbrances except Permitted Encumbrances.
4.11 Canadian Debenture and Pledge Agreement. On the Closing
Date, the parties thereto shall have entered into amendments, in the form of
Exhibits K-3 and K-4 hereto, respectively, to the Existing Canadian Debenture
(the "Existing Canadian Debenture Amendment") and the Existing Canadian Pledge
Agreement (the "Existing Canadian Pledge Agreement Amendment"), and shall have
taken such actions in connection therewith (including making any required
filings under the PPSA of the relevant jurisdictions or otherwise) as may be
determined by the Collateral Agent to be necessary or desirable in connection
therewith.
4.12 Form of Collateral Assignments of Rights. On the Closing
Date, the form of the Collateral Assignment of Rights pursuant to the Existing
Credit Agreement shall be amended, so that all such Collateral Assignments of
Rights executed and delivered after the Closing Date shall be in the form of
Exhibit L hereto.
4.13 Lockbox, Blocked Account and Concentration Account
Agreements. On the Closing Date, all Lockbox Agreements, Blocked Account
Agreements and Concentration Account Agreements previously entered into with
respect to the Existing Credit Agreement (and which remain in effect on the
Closing Date) shall be modified so that same are in the forms of Exhibits ▇-▇,
▇-▇ ▇▇▇ ▇-▇, respectively, hereto.
4.14 Collateral Access Agreements. On the Closing Date, the
Borrower shall have caused all Existing Credit Agreement Collateral Access
Agreements to be replaced with Collateral Access Agreements in the form of
Exhibit N hereto.
4.15 Amendment to the Existing Credit Agreement. On or prior
to the Closing Date, the Existing Credit Agreement shall have been amended
pursuant to an amendment in form and substance satisfactory to the
Administrative Agent and the Required Banks. Without limiting the foregoing,
such amendment shall authorize the modifications to the Collateral Documents
previously delivered pursuant to the Existing Credit Agreement, as required by
preceding Section 4.08 through 4.14, inclusive.
4.16 Solvency Certificate. On the Closing Date, there shall
have been delivered to the Administrative Agent a solvency certificate in the
form of Exhibit F from the chief financial officer of the Borrower and dated
the Closing Date.
4.17 Notice of Borrowing. Prior to the making of any Loan on
the Closing Date, the Administrative Agent shall have received a Notice of
Borrowing meeting the requirements of Section 1.02(a).
4.18 Fees, etc. On the Closing Date, the Borrower shall have
paid to the Administrative Agent and each Bank all costs, fees and expenses
(including, without limitation, reasonable legal fees and expenses) payable to
the Administrative Agent and such Bank to the extent then due.
SECTION 5. Representations, Warranties and Agreements. To
induce the Banks to enter into this Agreement and to make Loans provided for
herein, each of Communications and the Borrower makes the following
representations, warranties and agreements, as to itself and as to each of its
Restricted Subsidiaries, with the Banks, all of which shall survive the
execution and delivery of this Agreement and the making of the Loans:
5.01 Corporate Status. Each Credit Party (i) is a duly
organized and validly existing corporation in good standing under the laws of
the jurisdiction of its organization and has the corporate power and authority
to own its property and assets and to transact the business in which it is
engaged and presently proposes to engage and (ii) has duly qualified and is
authorized to do business and is in good standing in all jurisdictions where
it is required to be so qualified except where the failure to be so qualified,
when aggregated with all other such failures, would not reasonably be expected
to have a Material Adverse Effect.
5.02 Corporate Power and Authority. Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and
performance of the Credit Documents to which it is a party. Each Credit Party
has duly executed and delivered each Credit Document to which it is a party
and each such Credit Document constitutes the legal, valid and binding
obligation of such Credit Party enforceable in accordance with its terms,
except that such enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws of general application
relating to or affecting the rights and remedies of creditors, (ii) federal
securities or other laws or regulations or public policy insofar as they may
restrict the enforceability of rights to indemnification and (iii) general
principles of equity (regardless of whether enforcement is sought in equity or
at law).
5.03 No Violation. Neither the execution, delivery and
performance by any Credit Party of the Credit Documents to which it is a party
nor compliance with the terms and provisions thereof, nor the consummation of
the transactions contemplated therein (i) will contravene any applicable
provision of any law, statute, rule, regulation, order, writ, injunction or
decree of any court or governmental instrumentality, (ii) will, after giving
effect to any waivers, conflict or be inconsistent with or result in any
breach of any of the terms, covenants, conditions or provisions of, or
constitute a default under, or (other than pursuant to the Collateral
Documents) result in the creation or imposition of (or the obligation to
create or impose) any Lien upon any of the property or assets of such Credit
Party or any of its Restricted Subsidiaries pursuant to the terms of any
indenture, mortgage, deed of trust, agreement or other instrument to which
such Credit Party or any of its Restricted Subsidiaries is a party or by which
it or any of its property or assets are bound or to which it may be subject
(including without limitation the Existing Credit Agreement and the Senior
Subordinated Notes Indenture) or (iii) will violate any provision of the
charter or By-Laws of Communications, the Borrower or any of the Borrower's
Restricted Subsidiaries, except, in the case of clauses (i) and (ii) any
immaterial contravention, conflict, inconsistency, breach or default (but not
under the Existing Credit Agreement or the Senior Subordinated Notes
Indenture) which is not reasonably likely to adversely affect any Bank or have
a Material Adverse Effect.
5.04 Litigation. There are no actions, suits or proceedings
pending or, to the best knowledge of the Borrower, threatened with respect to
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
that, after giving effect to expected insurance proceeds and indemnity
payments, are reasonably likely to have a Material Adverse Effect.
5.05 Use of Proceeds. (a) The proceeds of the Loans shall be
utilized (i) to pay certain fees and expenses owing in relation to this
Agreement and the extensions of credit hereunder and (ii) to repay outstanding
Revolving Loans under, and as defined in, the Existing Credit Agreement.
(b) No part of the proceeds of any Loan will be used to
purchase or carry any Margin Stock or to extend credit for the purpose of
purchasing or carrying any Margin Stock.
5.06 Governmental Approvals. Except as set forth on Schedule
II hereto and except for the filing of the Mortgage Amendments and the filing
of continuation statements as required under the Collateral Documents, no
order, consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority, or any subdivision thereof, is
required to authorize or is required in connection with (i) the execution,
delivery and performance by each Credit Party of any Credit Document or (ii)
the legality, validity, binding effect or enforceability of any Credit
Document as against each Credit Party thereto.
5.07 Investment Company Act. None of Communications, the
Borrower or any of the Borrower's Restricted Subsidiaries is an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.
5.08 Public Utility Holding Company Act. None of
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
is a "holding company," or a "subsidiary company" of a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company," within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.09 True and Complete Disclosure. As of the Closing Date,
there is no fact known to any Credit Party (other than matters of general
economic, political or social nature) which materially and adversely affects
the business, property, assets, liabilities, financial condition or prospects
of the Borrower and its Restricted Subsidiaries taken as a whole which has not
been disclosed herein or in such other documents, certificates and statements
furnished to the Banks for use in connection with the transactions
contemplated hereby.
5.10 Financial Condition; Financial Statements. (a) On and as
of the Closing Date on a pro forma basis after giving effect to the
Transaction and all Indebtedness incurred, and to be incurred, and Liens
created and to be created, by each Credit Party in connection with this
Agreement, (w) the value of the assets the Borrower, and of the Borrower and
its Restricted Subsidiaries on a consolidated basis, at a fair valuation,
would exceed the debts and liabilities, subordinated, contingent or otherwise,
of the Borrower, and of the Borrower and its Restricted Subsidiaries on a
consolidated basis, (x) the fair salable value of the property of the
Borrower, and of the Borrower and its Restricted Subsidiaries on a
consolidated basis, will be greater than the amount that will be required to
pay the probable liability of the Borrower, and of the Borrower and its
Restricted Subsidiaries on a consolidated basis, on their debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured, (y) the Borrower, and the Borrower
and its Restricted Subsidiaries on a consolidated basis, will be able to pay
their debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured, and (z) the Borrower, and
the Borrower and its Restricted Subsidiaries on a consolidated basis, will not
have unreasonably small capital with which to conduct the businesses in which
they are engaged as such businesses are now conducted and are proposed to be
conducted following the Closing Date.
(b) Communications has furnished to the Banks the following
financial statements, which have been prepared in accordance with GAAP
consistently applied throughout the periods involved: (i) Communications'
consolidated balance sheet as of, and consolidated statements of operations,
shareholders' equity and cash flows for the fiscal years ended, March 31, 1996
and March 31, 1997, in each case, audited by the Auditors, and accompanied by
an unqualified opinion thereof. After giving effect to the Transaction, since
March 31, 1997, there has occurred no Material Adverse Effect, and nothing has
occurred which is reasonably likely to result in a Material Adverse Effect.
5.11 Locations of Offices, Records and Inventory. The address
of the principal place of business and chief executive office of
Communications and the Borrower as of the date hereof and as of the Closing
Date is set forth on Schedule III. The books and records of the Borrower, and
all of its chattel paper and records of Accounts, are maintained exclusively
at the locations listed on Schedule III. As of the date hereof and as of the
Closing Date, there is no jurisdiction in which the Borrower has any chattel
paper, records of Account and Inventory (except for Inventory in transit)
other than those jurisdictions identified on Schedule III. Schedule III also
contains a complete list of the legal names and addresses of each facility or
warehouse at which Inventory is stored as of the date hereof and as of the
Closing Date. None of the receipts received by the Borrower from any
warehouseman states that the goods covered thereby are to be delivered to
bearer or to the order of a named person other than the Borrower or its
Restricted Subsidiaries or to a named person and such named person's assigns.
5.12 Fictitious Business Names. Except as set forth in
Schedule IV, no Credit Party has used any corporate or fictitious name since
August 1, 1990, other than the corporate name shown on its Governing Documents.
5.13 Security Interests. On and after the Closing Date, each
of the Collateral Documents create, as security for the Obligations, a valid
and enforceable perfected security interest in and Lien on all of the
Collateral, superior to and prior to the rights of all third persons and
subject to no other Liens, other than Liens Permitted by this Agreement and
under the Collateral Documents. At all times on or after the Closing Date,
the respective grantor under each Collateral Document shall have good and
marketable title to all the Collateral subject thereto free and clear of all
Liens other than Liens permitted under this Agreement. No filings or
recordings are required in order to perfect the security interests created
under any Collateral Document except for filings or recordings made as
required in connection with any such Collateral Document.
5.14 Tax Returns and Payments. Each of Communications, the
Borrower and each of their respective Subsidiaries has timely filed or caused
to be timely filed with the appropriate taxing authority, all material returns
and other material statements, forms and reports for taxes required to be
filed by or with respect to the income, properties or operations of
Communications, the Borrower and/or any of their respective Subsidiaries.
Such returns accurately reflect all liability for material taxes of
Communications, the Borrower and their respective Subsidiaries for the periods
covered thereby. Each of Communications, the Borrower and their respective
Subsidiaries has paid all material taxes payable by it other than taxes which
are not yet due and payable, and other than those contested in good faith and
for which adequate reserves have been established in accordance with generally
accepted accounting principles. Except as provided in Schedule V, there is no
material action, suit, proceeding, investigation, audit, or claim now pending
or, to the knowledge of Communications or the Borrower, threatened by any
authority regarding any taxes relating to Communications, the Borrower or any
of their respective Subsidiaries. Except as provided in Schedule V, as of the
Closing Date, none of Communications, the Borrower or any of their respective
Subsidiaries has entered into an agreement or waiver or been requested to
enter into an agreement or waiver extending any statute of limitations
relating to the payment or collection of material taxes of Communications, the
Borrower or any of their respective Subsidiaries, or is aware of any
circumstances that would cause the taxable years or other taxable periods of
Communications, the Borrower or any of their respective Subsidiaries not to be
subject to the normally applicable statute of limitations. None of
Communications, the Borrower or any of their respective Subsidiaries have
provided, with respect to themselves or property held by them, any consent
under Section 341 of the Code. None of Communications, the Borrower or any of
their respective Subsidiaries has incurred, or will incur, any material tax
liability with respect to the Transaction and the other transactions
contemplated hereby.
5.15 Compliance with ERISA. Except to the extent that all
events and obligations described in the following clauses of this Section 5.15
and then in existence would not, in the aggregate, be reasonably likely to
have a Material Adverse Effect; (i) each Plan (other than a Multiemployer
Plan) is in substantial compliance with ERISA and the Code; to the knowledge
of Communications, the Borrower, any Subsidiary of Communications, or any
ERISA Affiliate, each Multiemployer Plan is in substantial compliance with
ERISA and the Code; no Reportable Event has occurred with respect to a Plan
(other than a Multiemployer Plan); no Multiemployer Plan is insolvent (as
defined in Section 4245 of ERISA) or in reorganization (as defined in Section
4241 of ERISA); no Plan (other than a Multiemployer Plan) has an Unfunded
Current Liability; no Plan (other than a Multiemployer Plan) has an
accumulated or waived funding deficiency or has applied for an extension of
any amortization period within the meaning of Section 412 of the Code or
Section 302 of ERISA; all contributions required to be made with respect to a
Plan and a Foreign Pension Plan have been timely made; neither Communications
nor the Borrower nor any Subsidiary of Communications nor any ERISA Affiliate
has incurred any liability which as of the date hereof has not been fully
satisfied, to or on account of a Plan pursuant to Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section
401(a)(29), 4971, 4975 or 4980 of the Code or expects to incur any liability
under any of the foregoing Sections with respect to any Plan; no proceedings
have been instituted to terminate or appoint a trustee to administer any Plan;
no condition exists which presents a material risk to Communications, the
Borrower or any Subsidiary of Communications or any ERISA Affiliate of
incurring a liability to or on account of a Plan pursuant to the foregoing
provisions of ERISA and the Code; using actuarial assumptions and computation
methods consistent with Part 1 of subtitle E of Title IV of ERISA, there would
be no liabilities of Communications, the Borrower, any Subsidiaries and any
ERISA Affiliates to all Plans which are multiemployer plans (as defined in
Section 4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom,
as of the close of the most recent fiscal year of each such Plan ended prior
to the Closing Date, which would result in a Material Adverse Effect; no lien
imposed under the Code or ERISA on the assets of Communications or any
Subsidiary of Communications or any ERISA Affiliate exists or is likely to
arise on account of any Plan; and Communications and its Subsidiaries do not
maintain or contribute to any employee welfare benefit plan (as defined in
Section 3(1) of ERISA) which provides benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA) or any
employee pension benefit plan (as defined in Section 3(2) of ERISA) the
obligations with respect to which could reasonably be expected to have a
Material Adverse Effect. With respect to Plans that are Multiemployer Plans the
representations and warranties in this Section 5.15, other than any made with
respect to liability under Section 4201 or 4204 of ERISA, are made to the
knowledge of the Borrower.
(ii) Each Foreign Pension Plan has been maintained in
substantial compliance with its terms and with the requirements of any and all
applicable laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities. Neither Communications, nor the Borrower nor any of their
Subsidiaries has incurred any obligation in connection with the termination of
or withdrawal from any Foreign Pension Plan. No Foreign Pension Plan has any
unfunded liabilities, either on a "going concern" or on a "winding up" basis
and determined in accordance with all applicable laws and actuarial practices
and using actuarial assumptions and methods that are reasonable in the
circumstances. No event has occurred or will occur and no condition exists or
will exist with respect to any Foreign Pension Plan that has resulted or could
reasonably be expected to result in any Foreign Pension Plan having its
registration revoked or being wound up (in whole or in part) or refused for
the purposes of any applicable pension benefits or tax laws or being placed
under the administration of any relevant pension benefits regulatory authority
or being required to pay any taxes or penalties under any applicable pension
benefits or tax laws.
5.16 Subsidiaries. Schedule VI hereto lists each Subsidiary
of the Borrower, and the direct and indirect ownership interest of the
Borrower therein, in each case existing on the Closing Date. Communications
is the record and beneficial owner of 100% of the capital stock of the
Borrower. On the Closing Date, the only material asset of Communications is
the capital stock of the Borrower owned by it, and on such date Communications
owns no other capital stock of any other Person.
5.17 Patents, etc. Communications and each of its Restricted
Subsidiaries have obtained all material patents, trademarks, servicemarks,
trade names, copyrights, licenses and other rights, free from burdensome
restrictions, that are necessary for the operation of their respective
businesses as presently conducted and as proposed to be conducted except where
a failure to do so could not reasonably be expected to have a Material Adverse
Effect.
5.18 Compliance with Statutes, etc. (a) Each of
Communications, the Borrower and the Borrower's Restricted Subsidiaries is in
compliance with all applicable statutes, regulations and orders of, and all
applicable restrictions imposed by, all governmental bodies, domestic or
foreign, in respect of the conduct of its business and the ownership of its
property, except such noncompliances as are not likely to, in the aggregate,
have a Material Adverse Effect.
(b) Except as set forth in the Offering Memorandum, each of
Communications, the Borrower and the Borrower's Restricted Subsidiaries is in
compliance with all applicable Environmental Laws governing its business for
which failure to comply is likely to have a Material Adverse Effect, and none
of Communications, the Borrower or any of the Borrower's Restricted
Subsidiaries is liable for any material penalties, fines or forfeitures for
failure to comply with any of the foregoing in the manner set forth above.
All licenses, permits, registrations or approvals required for the business
of Communications, the Borrower and each of the Borrower's Restricted
Subsidiaries, as conducted as of the Closing Date, under any Environmental Law
have been secured and each of Communications, the Borrower and the Borrower's
Restricted Subsidiaries is in material compliance therewith, except such
licenses, permits, registrations or approvals the failure to secure or to
comply therewith is not likely to have a Material Adverse Effect. None of
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
is in any respect in noncompliance with, breach of or default under any
applicable writ, order, judgment, injunction, or decree to which any of
Communications, the Borrower or such Restricted Subsidiary is a party or which
would affect the ability of Communications, the Borrower or such Restricted
Subsidiary to operate its business or other Real Property and no event has
occurred and is continuing which, with the passage of time or the giving of
notice or both, would be reasonably likely to constitute noncompliance, breach
of or default thereunder, except in each such case, such noncompliances,
breaches or defaults as are not likely to, in the aggregate, have a Material
Adverse Effect. Except as set forth in the Offering Memorandum delivered to
the Administrative Agent, there are as of the Closing Date no Environmental
Claims pending or, to the best knowledge of the Borrower, threatened, which
(a) question the validity, term or entitlement of Communications, the Borrower
or any of the Borrower's Restricted Subsidiaries for any permit, license,
order or registration required for the operation of any facility which
Communications, the Borrower or any of the Borrower's Restricted Subsidiaries
currently operates and (b) wherein an unfavorable decision, ruling or finding
would be reasonably likely to have a Material Adverse Effect. To the best
knowledge of the Borrower, there are no facts, circumstances, conditions or
occurrences on any Real Property of Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries or on any property adjoining or adjacent to
any such Real Property, that are reasonably expected (i) to form the basis of
an Environmental Claim against Communications, the Borrower any of the
Borrower's Restricted Subsidiaries or any Real Property of Communications, the
Borrower or any of the Borrower's Restricted Subsidiaries, or (ii) to cause
such Real Property to be subject to any restrictions on the ownership,
occupancy, use or transferability of such Real Property under any
Environmental Law, except in each such case, such Environmental Claims or
restrictions that individually or in the aggregate are not likely to have a
Material Adverse Effect.
(c) Except as set forth in the Offering Memorandum, Hazardous
Materials have not at any time been (i) generated, used, treated or stored on,
or transported to or from, by Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries, any Real Property of Communications, the
Borrower or any of the Borrower's Restricted Subsidiaries, except Hazardous
Materials generated, used, treated or stored on, or transported to or from,
any Real Property of Communications, the Borrower or any of the Borrower's
Restricted Subsidiaries in the ordinary course of business and in compliance
with Environmental Laws ("Permitted Materials") or (ii) released or disposed
of (not including the sale of Inventory) on any such Real Property in
violation of any Environmental Laws or in any quantity or amount which would
require any clean-up, removal, treatment or remediation, in each case where
such occurrence or event is likely to have a Material Adverse Effect.
5.19 Properties. Communications and each of its Restricted
Subsidiaries has good title to all material properties owned by it free and
clear of all Liens, other than as permitted by this Agreement. Schedule VII
contains a true and complete list of each Real Property owned, if any, and
each Real Property leased by Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries on the Closing Date and the type of
interest therein held by Communications, the Borrower or the respective such
Restricted Subsidiary.
5.20 Labor Relations; Collective Bargaining Agreements. (a)
Set forth on Schedule VIII hereto is a list (including dates of termination)
of all collective bargaining or similar agreements between or applicable to
the Borrower or any of its Restricted Subsidiaries and any union, labor
organization or other bargaining agent in respect of the employees of the
Borrower and/or any of its Restricted Subsidiaries on the Closing Date.
(b) Neither the Borrower nor any of its Restricted
Subsidiaries is engaged in any unfair labor practice that is reasonably likely
to have a Material Adverse Effect. There is (i) no significant unfair labor
practice complaint pending against Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries or, to the best knowledge of the Borrower,
threatened against any of them, before the National Labor Relations Board, and
no significant grievance or significant arbitration proceeding arising out of
or under any collective bargaining agreement is pending on the Closing Date
against Communications, the Borrower or any of the Borrower's Restricted
Subsidiaries or, to the best knowledge of the Borrower, threatened against any
of them, (ii) no significant strike, labor dispute, slowdown or stoppage is
pending against Communications, the Borrower or any of the Borrower's
Restricted Subsidiaries or, to the best knowledge of the Borrower, threatened
against Communications, the Borrower or any of the Borrower's Restricted
Subsidiaries, except (with respect to any matter specified in clause (i) and
(ii) above, either individually or in the aggregate) such as is not reasonably
likely to have a Material Adverse Effect.
5.21 Restrictions on Restricted Subsidiaries. Except for
restrictions contained in the Credit Documents, the Existing Credit Agreement
Documents, the Senior Subordinated Note Documents and in agreements with
respect to the Existing Indebtedness, as of the Closing Date there are no
contractual or consensual restrictions on the Borrower or any of its
Wholly-Owned Restricted Subsidiaries which prohibit or otherwise restrict (i)
the transfer of cash or other assets (x) between the Borrower and any of its
Wholly-Owned Restricted Subsidiaries or (y) between any Restricted
Subsidiaries of the Borrower or (ii) the ability of the Borrower or any of its
Wholly-Owned Restricted Subsidiaries to grant security interests to the Banks
in the Collateral.
5.22 Material Contracts. Neither the Borrower nor any of its
Restricted Subsidiaries is in breach of or in default under any Material
Contract.
5.23 Senior Indebtedness, etc. All Obligations pursuant to
this Agreement constitute "Senior Indebtedness" under, and as defined in, and
for all purposes of, the Senior Subordinated Notes Indenture. The Borrower
and its Restricted Subsidiaries have not more than $1.0 million of outstanding
Indebtedness under Section 4.03(b)(xiv) of the Senior Subordinated Notes
Indenture (other than Indebtedness pursuant to this Agreement). $24.0 million
of Indebtedness pursuant to this Agreement is permitted under Section
4.03(b)(xiv) of the Senior Subordinated Notes Indenture and $1.0 million of
Indebtedness pursuant to this Agreement is permitted under Section 4.03(b)(i)
of the Senior Subordinated Notes Indenture.
5.24 Existing Collateral Documents. True and correct copies,
as same are in effect on the Closing Date but before giving effect to the
amendments thereto required pursuant to Section 4 hereof, of each of (i) the
Existing Pledge Agreement is set forth as Exhibit H-1, (ii) the Existing
Security Agreement is set forth as Exhibit I-1, (iii) the Existing Canadian
Debenture is set forth as Exhibit K-1 and (iv) the Existing Canadian Pledge
Agreement is set forth as Exhibit K-2.
SECTION 6. Affirmative Covenants. Communications and the
Borrower hereby covenant and agree that on the Closing Date and thereafter,
for so long as this Agreement is in effect and until the Total Commitments
have terminated, no Notes are outstanding and the Loans, together with
interest, Fees, Expenses and all other Obligations (other than any indemnities
described in Section 12.01 hereof which are not then due and payable) incurred
hereunder, are paid in full:
6.01 Financial Information. Communications and the Borrower
shall furnish to, or cause to be furnished to, the Banks the following
information within the following time periods:
(a) as soon as available and in any event within 90 days after
the end of each fiscal year of Communications or the Borrower, as the
case may be, (i) audited Financial Statements as of the close of the
fiscal year and for the fiscal year, together with a comparison to
the Financial Statements for the prior year, in each case accompanied
by (A) report thereon of the Auditors unqualified as to scope, which
report shall state that such consolidated financial statements fairly
present the consolidated financial position of Communications or the
Borrower, as the case may be, and each of its consolidated
Subsidiaries as at the date indicated and the results of their
operations and cash flow for the periods indicated in conformity with
GAAP (except as otherwise stated therein) and that the examination by
the Auditors has been made in accordance with generally accepted
auditing standards and (B) a written statement signed by the Auditors
stating that in the course of the regular audit of the business of
Communications and the Borrower, which audit was conducted by the
Auditors in accordance with generally accepted auditing standards,
the Auditors have not obtained any knowledge of the existence of any
Default or Event of Default under any provision of Sections 7.01 and
7.02 of this Agreement, or, if such Auditors shall have obtained from
such examination any such knowledge, they shall disclose in such
written statement the existence of the Default or Event of Default
and the nature thereof, it being understood that such Auditors shall
not be required hereunder to perform any special audit procedures and
shall have no liability, directly or indirectly, to anyone for
failure to obtain knowledge of any such Default or Event of Default
and (ii) a compliance certificate substantially in the form of
Exhibit O along with a schedule in form reasonably satisfactory to
the Administrative Agent of the calculations used in determining, as
of the end of such fiscal year, whether the Borrower was in
compliance with the covenants set forth in Section 7 of this
Agreement for such year. To the extent that Communications' or the
Borrower's, as the case may be, annual report on Form 10-K contains
any of the foregoing items, the Banks will accept such Form 10-K in
lieu of such items required to be furnished by Communications or the
Borrower, as the case may be;
(b) as soon as available and in any event within 45 days after
the end of each fiscal quarter of Communications or the Borrower, as
the case may be, (except the last fiscal quarter of any fiscal year),
(i) Financial Statements as at the end of such period and for the
fiscal year to date, together with a comparison to the Financial
Statements for the same periods in the prior year, all in reasonable
detail and duly certified (subject to the addition of footnotes and
audit and normal year-end adjustments) by the chief executive
officer, chief financial officer or vice president - corporate
controller of Communications or the Borrower, as the case may be, as
having been prepared substantially in accordance with GAAP and (ii) a
compliance certificate substantially in the form of Exhibit O along
with a schedule in form reasonably satisfactory to the Administrative
Agent of the calculations used in determining, as of the end of such
fiscal quarter, whether the Borrower was in compliance with the
covenants set forth in Section 7 of this Agreement for such quarter.
To the extent that Communications' or the Borrower's, as the case may
be, quarterly report on Form 10-Q contains any of the foregoing
items, the Banks will accept such Form 10-Q in lieu of such items
required to be furnished by Communications or the Borrower, as the
case may be;
(c) promptly and in any event within five Business Days after
becoming aware of the occurrence of a Default or Event of Default, a
certificate of the chief executive officer or chief financial officer
of the Borrower specifying the nature thereof and the Borrower's
proposed response thereto, each in reasonable detail; and
(d) promptly upon the earlier of the mailing or filing
thereof, copies of all ▇▇-▇▇, ▇▇-▇▇, ▇-▇▇, proxy statements, annual
reports, quarterly reports, registration statements and any other
filings or other communications made by the either of the Borrower or
Communications to holders of its publicly traded securities, to the
holders of its Senior Subordinated Notes or the Securities Exchange
Commission from time to time pursuant to the Securities Exchange Act
of 1934, as amended, or the Securities Act of 1933, as amended.
6.02 Corporate Franchises. Communications will, and will
cause each of its Restricted Subsidiaries to, do or cause to be done, all
things necessary to preserve and keep in full force and effect its existence,
material rights and authority to do business, provided that any transaction
permitted by Section 7 will not constitute a breach of this Section 6.02 and
provided further that Communications shall not be required to preserve, with
respect to itself, any material right or authority to do business and with
respect to any of its Restricted Subsidiaries, any such existence, material
right or authority to do business if Communications shall reasonably determine
that such preservation is no longer desirable in the ordinary course of
business, and the loss thereof shall not be reasonably likely to have a
Material Adverse Effect.
6.03 Compliance with Statutes, etc. Communications and the
Borrower will, and will cause each of their respective Restricted Subsidiaries
to, comply with all applicable statutes, regulations and orders of, and all
applicable restrictions imposed by, all governmental bodies, domestic or
foreign, in respect of the conduct of its business and the ownership of its
property (including applicable Environmental Laws) other than those the
non-compliance with which (individually or in the aggregate) would not have
a Material Adverse Effect. Neither Communications nor any of its Restricted
Subsidiaries will generate, use, treat, store, release or dispose of, or
permit the generation, use, treatment, storage, release or disposal of
Hazardous Materials on any of its Real Property, or transport or permit the
transportation of Hazardous Materials to or from any such Real Property,
except for quantities used or stored at such Real Properties in material
compliance with all applicable Environmental Laws and required in connection
with the normal operation, use and maintenance of such Real Property or the
operation of the business of the Borrower and its Restricted Subsidiaries. If
required to do so under any applicable Environmental Law, the Borrower agrees
to undertake, and agrees to cause each of its Restricted Subsidiaries to
undertake, any cleanup, removal, remedial or other action necessary to remove
and clean up any Hazardous Materials from any Real Property in accordance with
the requirements of all such applicable Environmental Laws and in accordance
with orders and directives of all governmental authorities; provided that
neither Communications nor any of its Restricted Subsidiaries shall be
required to take any such action where same is being contested by appropriate
legal proceedings in good faith by Communications or such Restricted
Subsidiary.
6.04 ERISA. As soon as possible and, in any event, within
fifteen (15) days after Communications, the Borrower or any of the Borrower's
Subsidiaries or any ERISA Affiliate knows or has reason to know of the
occurrence of any of the following events relating to a Plan, the Borrower
will deliver to each of the Banks a certificate of the chief financial officer
of the Borrower setting forth details as to such occurrence and the action, if
any, that Communications, the Borrower, such Subsidiary or such ERISA
Affiliate is required or proposes to take, together with any notices required
to be given to or filed with or by Communications, the Borrower, such
Subsidiary, the ERISA Affiliate, the PBGC, a Plan participant or the Plan
administrator with respect thereto: that a Reportable Event has occurred
(other than with respect to a Plan which is a Multiemployer Plan) which could
reasonably be expected to result in material liability of Communications, the
Borrower, any of the Borrower's Subsidiaries or any ERISA Affiliate; that,
with respect to a Plan, an accumulated funding deficiency has been incurred or
an application will be or has been made to the Secretary of the Treasury for a
waiver or modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code or Section 302 of ERISA with respect to a Plan; that a
contribution required to be made to a Plan or Foreign Pension Plan by
Communications, the Borrower, any of the Borrower's Subsidiaries or any ERISA
Affiliate has not been timely made; that a Plan has been or is reasonably
expected to be terminated; that a Plan that is a Multiemployer Plan has been
or is reasonably expected to be reorganized, partitioned or declared insolvent
under Title IV of ERISA; that a Plan, which is not a Multiemployer Plan, has
an Unfunded Current Liability giving rise to a lien under ERISA or the Code;
that proceedings may be or have been instituted to terminate a Plan; that a
proceeding has been instituted pursuant to Section 515 of ERISA to collect a
delinquent contribution of Communications, the Borrower, any of the Borrower's
Subsidiaries or any ERISA Affiliate to a Plan; or that Communications, the
Borrower, any Subsidiary or any ERISA Affiliate will or is reasonably expected
to incur any material liability (including any contingent or secondary
liability) to or on account of the termination of or withdrawal from a Plan
under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409 or 502(i) or 502(l) of ERISA; or that Communications, the Borrower
or any Subsidiary may incur any material liability pursuant to any employee
welfare benefit plan (as defined in Section 3(1) of ERISA) that provides
benefits to retired employees or other former employees (other than as
required by Section 601 of ERISA) or any employee pension benefit plan (as
defined in Section 3(2) of ERISA) as a result of the adoption or amendment of
any such plan. Upon the request of the Administrative Agent, Communications
will deliver to each of the Banks a complete copy of the annual report (Form
5500) of each Plan required to be filed with the Internal Revenue Service. In
addition to any certificates or notices delivered to the Banks pursuant to the
first sentence hereof, copies of any material notices received by
Communications, the Borrower, any Subsidiary of Communications or the Borrower
or any ERISA Affiliate with respect to any Plan or Foreign Pension Plan shall
be delivered to the Banks no later than 15 Business Days after the date such
notice has been received by Communications, the Borrower or such Subsidiary or
the ERISA Affiliate, as applicable.
6.05 Good Repair. The Borrower will, and will cause each of
its Restricted Subsidiaries to, ensure that its material properties and
equipment used or useful in its business in whomsoever's possession they may
be, are kept in good repair, working order and condition, normal wear and tear
excepted, provided that violations of the foregoing provisions of this Section
6.05 shall not constitute a breach of this covenant unless such violations,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
6.06 Additional Security; Further Assurances; etc. (a) If at
any time Communications, the Borrower or any of their respective Restricted
Subsidiaries grant a security interest in any of their assets or properties to
support extensions of credit pursuant to the Existing Credit Agreement (as
same is in effect from time to time), then Communications and the Borrower
will, or will cause the respective Restricted Subsidiary to, provide for the
granting of a security interest in such assets or properties to secure the
Obligations pursuant to this Agreement, on substantially the same basis as is
provided in the Collateral Documents as in effect on the Closing Date (after
giving effect to the amendments required pursuant to Section 4). All such
security interests shall be granted pursuant to documentation (the "Additional
Security Documents") in a form which secures the Obligations under this
Agreement on a second-priority basis in accordance with the provisions of
Section 11 hereof.
(b) Communications and the Borrower shall, and shall cause
each of their respective Restricted Subsidiaries to, defend the Collateral
against all claims and demands of all Persons (other than the Secured
Creditors) at any time claiming the same or any interest therein.
Communications and the Borrower shall, and shall cause their respective
Restricted Subsidiaries to, comply with the requirements of all state and
federal laws in order to grant to the Secured Creditors valid and perfected
first priority security interests in the Collateral, subject only to Liens
permitted by this Agreement and the priorities contained in Section 11 hereof
and in the Security Documents. The Collateral Agent is hereby authorized by
Communications and the Borrower to file any UCC financing statements covering
the Collateral whether or not the signature of Communications or the Borrower
appears thereon. Communications and the Borrower shall do whatever the
Collateral Agent may reasonably request, from time to time, to effect the
purposes of this Agreement and the other Credit Documents, including without
limitation, filing notices of liens, UCC financing statements and amendments,
renewals and continuations thereof; cooperating with the Collateral Agent's
representatives; keeping stock records; obtaining waivers from landlords and
mortgagees and from warehousemen and their landlords and mortgagees (provided
that Communications or the Borrower, as the case may be, shall not be required
to pay any consideration (other than de minimis amounts) or incur any material
obligation or relinquish any material right in connection with any such
waiver); and, paying claims which might, if unpaid, become a Lien on the
Collateral other than a Permitted Lien. Furthermore, the Borrower shall cause
to be delivered to the Collateral Agent such opinions of counsel, title
insurance and other related documents as may be reasonably requested by the
Collateral Agent to assure itself that this Section 6.08 has been complied
with.
(c) Each of Communications and the Borrower agrees that each
action required by this Section 6.06 shall be completed as soon as possible,
but in no event later than 60 days after such action is requested to be taken
by the Collateral Agent.
6.07 Insurance. Schedule IX hereto sets forth a true and
complete listing of all insurance maintained by the Borrower and each of its
Restricted Subsidiaries as of the Closing Date. The Borrower agrees to
maintain, and to cause each of its Restricted Subsidiaries to maintain, public
liability insurance, third party property damage insurance and replacement
value (or such higher coverage as the Borrower may obtain) insurance on the
Collateral under such policies of insurance, with such insurance companies, in
such amounts, covering such risks and with such deductibles or self-insured
retentions as are in accordance with normal industry practice for similarly
situated businesses.
6.08 Taxes. Communications and the Borrower will, and will
cause each of their respective Subsidiaries to, pay and discharge all material
income and other material taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits, or upon any properties
belonging to it, or payable by it pursuant to the Tax Sharing Agreements,
prior to the date on which penalties or interest attach thereto; provided,
that neither Communications nor any of its Subsidiaries shall be required to
pay any such tax, assessment, charge or levy which is being contested in good
faith and by proper proceedings if it has maintained adequate reserves (in the
good faith judgment of the management of such Person) with respect thereto in
accordance with GAAP. In no event shall the Borrower and its Subsidiaries
make payments with respect to Federal income taxes computed on a consolidated,
combined or unitary basis which exceed the relevant amounts required to be
paid by them pursuant to the Tax Sharing Agreement as furnished to the
Administrative Agent prior to the Closing Date.
6.09 Corporate Separateness. Communications shall take, and
shall cause each of its Restricted Subsidiaries and Unrestricted Subsidiaries
to take, all actions as are necessary to keep the operations of
Communications, the Borrower and the Borrower's Restricted Subsidiaries
separate and apart from those of any Unrestricted Subsidiaries, including,
without limitation, ensuring that all customary formalities regarding their
respective corporate existence, including holding regular board of directors'
and shareholders' meetings and maintenance of corporate offices and records,
are followed. None of Communications, the Borrower nor any of the Borrower's
Restricted Subsidiaries shall make any payment to a creditor of any
Unrestricted Subsidiary in respect of any liability of any Unrestricted
Subsidiary. All financial statements provided to creditors shall clearly
evidence the corporate separateness of Communications, the Borrower and the
Borrower's Restricted Subsidiaries from any Unrestricted Subsidiaries, and
Communications, the Borrower and the Borrower's Restricted Subsidiaries shall
maintain their own respective payroll (if any) and separate books of account
and bank accounts from Unrestricted Subsidiaries. Each Unrestricted
Subsidiary shall pay its respective liabilities, including all administrative
expenses, from its own separate assets, and assets of Communications, the
Borrower and the Borrower's Restricted Subsidiaries shall at all times be
separately identified and segregated from the assets of Unrestricted
Subsidiaries. Finally, none of Communications, the Borrower nor any of the
Borrower's Restricted Subsidiaries nor any Unrestricted Subsidiaries shall
take any action, or conduct its affairs in a manner which is likely to result
in the corporate existence of any Unrestricted Subsidiary being ignored, or in
the assets and liabilities of any Unrestricted Subsidiary being substantively
consolidated with those of Communications, the Borrower or any of the
Borrower's Restricted Subsidiaries in a bankruptcy, reorganization or other
insolvency proceeding.
6.10 New Wholly-Owned Restricted Subsidiaries; Additional
Subsidiary Guarantors. To the extent (x) the Borrower creates or acquires any
Wholly-Owned Restricted Subsidiary after the Effective Date in accordance with
the other provisions of this Agreement or (y) any Restricted Subsidiary of
Communications or the Borrower directly or indirectly guarantees any
extensions of credit pursuant to the Existing Credit Agreement, then in either
such case, each such Restricted Subsidiary shall be required to become a party
to the Subsidiaries Guaranty by executing a counterpart thereof or enter into
an amendment thereto satisfactory to the Administrative Agent and, if
requested by the Administrative Agent or the Required Banks, shall be required
to enter into the Collateral Documents entered into by the entities which were
Subsidiary Guarantors on the Closing Date, in each case by entering into
counterparts thereof or amendments thereto, in form and substance reasonably
satisfactory to the extent requested by the Administrative Agent and the
Collateral Agent. In connection with the foregoing to the extent requested by
the Administrative Agent or the Collateral Agent, the Company shall be
required to cause to be delivered such relevant documentation (including
opinions of counsel) of the type described in Section 4 as the respective
Restricted Subsidiary would have had delivered if it were a Credit Party on
the Closing Date.
SECTION 7. Negative Covenants. Communications and the
Borrower hereby covenant and agree that, as of the Closing Date, and
thereafter, for so long as this Agreement is in effect and until the Total
Commitments have terminated, no notes are outstanding and the Loans, together
with interest, Fees, Expenses and all other Obligations (other than any
indemnities described in Section 12.01 hereof which are not then due and
payable) incurred hereunder are paid in full:
7.01 Limitation on Indebtedness. (a) Communications and the
Borrower shall not, and shall not permit any of their Restricted Subsidiaries
to, Incur any Indebtedness.
(b) Notwithstanding Section 7.01(a), the Borrower and its
Restricted Subsidiaries may Incur any or all of the following Indebtedness:
(i) Indebtedness of the Borrower Incurred pursuant to the
Existing Credit Agreement (including related Guarantees and security
agreements; provided that such security agreements shall only be
permitted if all Obligations pursuant to this Agreement are secured
thereby on substantially the same basis provided in the Collateral
Documents as in effect on the Closing Date after giving effect to the
amendments required pursuant to Section 4) in an aggregate principal
amount outstanding at any time not to exceed the greater of (x) the
sum of (i) 90% of the consolidated book value of the accounts
receivable of the Borrower and its Restricted Subsidiaries and (ii)
60% of the consolidated book value of the inventory of the Borrower
and its Restricted Subsidiaries, in each case as determined at the
time of the respective Incurrence in accordance with GAAP and (y)
$75,000,000, in each case less the sum of (x) any amount of
Indebtedness outstanding pursuant to this Section 7.01(b)(i)
permanently repaid as described in Section 7.04 hereof and (y) the
amount of any Indebtedness (other than pursuant to this Agreement)
outstanding on the Closing Date pursuant to Section 4.03(b)(xiv) of
the Senior Subordinated Notes Indenture, to the extent the
Indebtedness described in this clause (y) remains outstanding on the
date of any determination pursuant to this clause (i);
(ii) Indebtedness of the Borrower (and any Guarantee or Liens
with respect thereto; provided that such Liens shall only be
permitted if all Obligations pursuant to this Agreement are secured
thereby on substantially the same basis provided in the Collateral
Documents as in effect on the Closing Date after giving effect to the
amendments required pursuant to Section 4) originally Incurred
pursuant to the term loan provisions of the Existing Credit Agreement
in an aggregate principal amount outstanding at any time not to
exceed (A) $44,800,000 less (B) the aggregate sum of all principal
payments actually made from time to time after the Closing Date under
the Existing Credit Agreement and any amount of Indebtedness
outstanding pursuant to this Section 7.01(b)(ii) permanently repaid
as described in Section 7.04 hereof;
(iii) Indebtedness owed to and held by the Borrower or a
Wholly-Owned Restricted Subsidiary of the Borrower; provided,
however, that any subsequent issuance or transfer of any Capital
Stock which results in any such Wholly-Owned Restricted Subsidiary of
the Borrower ceasing to be a Wholly-Owned Restricted Subsidiary of
the Borrower or any subsequent transfer of such Indebtedness (other
than to the Borrower or another Wholly-Owned Restricted Subsidiary of
the Borrower) shall be deemed, in each case, to constitute the
Incurrence of such Indebtedness;
(iv) the Senior Subordinated Notes may remain outstanding in an
aggregate principal amount not to exceed $185,000,000;
(v) Indebtedness outstanding on the Closing Date after giving
effect to the Transaction (other than Indebtedness outstanding
pursuant to the Existing Credit Agreement or otherwise described in
clause (i), (ii), (iii) or (iv) above);
(vi) Guarantees by the Borrower or a Subsidiary Guarantor of
Indebtedness of a Subsidiary Guarantor otherwise permitted to be
Incurred by the Subsidiary Guarantor (other than Indebtedness
permitted by clause (x) below) or Guarantees by a Subsidiary
Guarantor of Senior Indebtedness of the Borrower permitted to be
Incurred by the Borrower under this Indenture;
(vii) Refinancing Indebtedness in respect of Indebtedness
Incurred pursuant to clause (iv) or (v) above (excluding Indebtedness
outstanding on the Closing Date pursuant to Section 4.03(b)(xiv) of
the Senior Subordinated Notes Indenture) or clause (ix) and (x)
below; provided, however, that Refinancing Indebtedness the proceeds
of which are used to Refinance the Senior Subordinated Notes or any
other Indebtedness that is subordinated in right of payment to
Obligations pursuant to this Agreement shall only be permitted under
this clause (vii) if such Refinancing Indebtedness, by its terms or
by the terms of any agreement or instrument pursuant to which such
Refinancing Indebtedness is Incurred or is outstanding, is expressly
made subordinate in right of payment to the Obligations pursuant to
this Agreement at least to the extent that the Indebtedness to be
Refinanced is subordinated to such Obligations; provided further,
however, that Refinancing Indebtedness the proceeds of which are used
to Refinance Indebtedness Incurred pursuant to clause (x) below shall
only be permitted under this clause (vii) if such Refinancing
Indebtedness is Incurred by the Borrower or the Restricted Subsidiary
that originally Incurred the Indebtedness pursuant to clause (x)
below;
(viii) Indebtedness (A) in respect of performance, surety or
appeal bonds provided in the ordinary course of business or (B)
arising from agreements providing for indemnification, adjustment of
purchase price or similar obligations, or from Guarantees or letters
of credit, surety bonds or performance bonds securing any obligations
of the Borrower or any of its Restricted Subsidiaries pursuant to
such agreements, in any case Incurred in connection with the
acquisition or disposition of any business, assets or Restricted
Subsidiary (other than Guarantees of Indebtedness or other obligations
Incurred by any Person acquiring all or any portion of such business,
assets or Restricted Subsidiary for the purpose of financing such
acquisition), in a principal amount not to exceed the gross proceeds
actually received by the Borrower or any Restricted Subsidiary in
connection with such disposition;
(ix) Indebtedness, in an aggregate principal amount
outstanding at any time not to exceed $2.0 million, Incurred by the
Borrower in connection with the purchase, redemption, acquisition,
cancellation or other retirement for value of shares of Capital Stock
of the Borrower, any of its Restricted Subsidiaries or
Communications, options on any such shares or related stock
appreciation rights or similar securities (including phantom equity
rights) held by employees, former employees, directors or former
directors of Communications, the Borrower or its Restricted
Subsidiaries (or their estates or beneficiaries under their estates),
upon death, disability, retirement, termination of employment or
pursuant to any agreement under which such shares of stock or related
rights were issued; provided, however, that (A) such Indebtedness,
by its terms or by the terms of any agreement or instrument pursuant
to which such Indebtedness is Incurred, is expressly made subordinate
in right of payment to all Obligations under this Agreement and (B)
such Indebtedness, by its terms or by the terms of any agreement or
instrument pursuant to which such Indebtedness is Incurred, provides
that no payments of principal of such Indebtedness, including by way
of sinking fund, mandatory redemption or otherwise (including
defeasance), may be made by the Borrower at any time while any of the
Loans are outstanding;
(x) Indebtedness of any Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted
Subsidiary was acquired by the Borrower (other than Indebtedness
Incurred as consideration in, or to provide all or any portion of the
funds or credit support utilized to consummate, the transaction or
series of related transactions pursuant to which such Restricted
Subsidiary became a Restricted Subsidiary or was acquired by the
Borrower), so long as the aggregate principal amount of all
Indebtedness Incurred in any fiscal year pursuant to clauses (x),
(xi), (xii) and (xiii) of this Section 7.01 does not exceed
$25,000,000;
(xi) Capital Lease Obligations, so long as the aggregate
principal amount of all Indebtedness Incurred in any fiscal year
pursuant to clauses (x), (xi), (xii) and (xiii) of this Section 7.01
does not exceed $25,000,000;
(xii) Indebtedness constituting purchase money obligations for
property acquired in the ordinary course of business or other similar
financing transactions, so long as the aggregate principal amount of
all Indebtedness Incurred in any fiscal year pursuant to clauses (x),
(xi), (xii) and (xiii) of this Section 7.01 does not exceed
$25,000,000;
(xiii) Indebtedness Incurred to finance Capital Expenditures or
the acquisition of Additional Assets in any fiscal year in an
aggregate principal amount not to exceed 6% of the Borrower's
consolidated net sales for the immediately preceding fiscal year and
Refinancing Indebtedness in respect thereof, so long as the aggregate
principal amount of all Indebtedness Incurred in any fiscal year
pursuant to clauses (x), (xi), (xii) and (xiii) of this Section 7.01
does not exceed $25,000,000; and
(xiv) Indebtedness Incurred pursuant to this Agreement.
(c) The Borrower shall not Incur any Indebtedness pursuant to
Section 7.01(b) if such Indebtedness is subordinate in right of payment to any
Senior Indebtedness unless such Indebtedness is expressly subordinated (at
least to the same extent) in right of payment to all Obligations pursuant to
this Agreement. In addition, the Borrower shall not Incur any Secured
Indebtedness pursuant to Sections 7.01 (b)(i) and (ii) unless
contemporaneously therewith effective provision is made to secure the
Obligations pursuant to this Agreement equally and ratably with such Secured
Indebtedness for so long as such Secured Indebtedness is secured by a Lien;
provided that, to the extent Indebtedness pursuant to the Existing Credit
Agreement or any obligations pursuant to Interest Rate Agreements (as defined
in the Collateral Documents) are secured by Liens, the Obligations pursuant to
this Agreement shall be secured on the basis provided in Section 11 hereof and
in accordance with the priorities (as to Collateral) established pursuant to
the amendments to the Collateral Documents entered into in accordance with the
requirements of Section 4.
(d) On and after the Closing Date, the Borrower and its
Restricted Subsidiaries shall not Incur any Indebtedness under Section
4.03(b)(xiv) of the Senior Subordinated Notes Indenture (other than (x)
Indebtedness Incurred pursuant to this Agreement and (y) at any time after the
repayment of Loans hereunder, such other Indebtedness in an aggregate
principal amount not to exceed at any time outstanding the aggregate principal
amount of all such repayments made since the Closing Date).
7.02 Limitation on Restricted Payments. (a) Communications
and the Borrower shall not, and shall not permit any of their Restricted
Subsidiaries to, directly or indirectly, to make any Restricted Payment.
(b) The provisions of Section 7.02(a) shall not prohibit:
(i) any purchase or redemption of Subordinated Obligations made
by exchange for, or out of the proceeds of the substantially
concurrent sale of, indebtedness of the Borrower which is permitted
to be Incurred pursuant to Section 7.01(b)(vii);
(ii) the repurchase (or dividends to Communications for the
repurchase) of shares of, or options to purchase shares of, Capital
Stock of the Borrower or any of its Restricted Subsidiaries or of
Communications from employees, former employees, directors or former
directors of Communications, the Borrower or any of its Restricted
Subsidiaries (or permitted transferees of such employees, former
employees, directors or former directors), pursuant to the terms of
the agreements (including employment agreements) or plans (or
amendments thereto) approved by the Board of Directors under which
such persons purchase or sell, or are granted the option to purchase
or sell, shares of such stock; provided, however, that the aggregate
amount of all such repurchases or dividends after the Closing Date
shall not exceed $2.0 million;
(iii) any payments pursuant to any tax-sharing agreement between
the Borrower and any other Person with which the Borrower is required
or permitted to file a consolidated tax return or with which the
Borrower is or could be part of a consolidated group for tax purposes;
(iv) payments to Communications necessary for Communications to
pay corporate overhead expenses, not to exceed $250,000 in any fiscal
year;
(v) payments to Communications sufficient to permit
Communications to pay for the registration of its securities with the
SEC (including all reasonable professional fees and expenses); and
(vi) Investments in Unrestricted Subsidiaries made in exchange
for Capital Stock (other than Disqualified Stock) of Communications.
7.03 Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Borrower shall not, and shall not permit any of
its Restricted Subsidiaries to, create or otherwise cause or permit to exist
or become effective any consensual encumbrance or restriction on the ability
of any Restricted Subsidiary of the Borrower (a) to pay dividends or make any
other distributions on its Capital Stock owned by, or pay any Indebtedness
owed to, the Borrower, (b) to make any loans or advances to the Borrower or
(c) transfer any of its property or assets to the Borrower, except:
(i) any encumbrance or restriction pursuant to the Existing
Credit Agreement or any other agreement in effect at or entered into
on the date of this Agreement and any extensions, refinancings,
renewals or replacements of any such agreement; provided, however,
that the encumbrances and restrictions in any such extension,
refinancing, renewal or replacement are no less favorable in any
material respect to the Banks than those encumbrances or restrictions
being extended, refinanced, renewed or replaced;
(ii) any encumbrance or restriction with respect to a Restricted
Subsidiary of the Borrower pursuant to an agreement relating to any
Indebtedness Incurred by such Restricted Subsidiary on or prior to
the date on which such Restricted Subsidiary was acquired by the
Borrower (other than Indebtedness Incurred as consideration in, or to
provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions
pursuant to which such Restricted Subsidiary became a Restricted
Subsidiary of, or was acquired by, the Borrower) and outstanding on
such date;
(iii) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness Incurred pursuant to an
agreement referred to in clause (ii) above or contained in any
amendment to an agreement referred to in clause (ii) above; provided,
however, that the encumbrances and restrictions with respect to such
Restricted Subsidiary contained in any such refinancing agreement or
amendment are no less favorable in any material respect to the Banks
than encumbrances and restrictions with respect to such Restricted
Subsidiary contained in the agreements referred to in clause (ii)
above;
(iv) any encumbrance or restriction consisting of customary
nonassignment provisions in leases governing leasehold interests to
the extent such provisions restrict the transfer of the lease or the
property leased thereunder;
(v) in the case of clause (c) above, restrictions contained in
security agreements or mortgages securing Indebtedness of a
Restricted Subsidiary of the Borrower to the extent such restrictions
restrict the transfer of the property subject to such security
agreements or mortgages;
(vi) any restriction with respect to a Restricted Subsidiary of
the Borrower imposed pursuant to an agreement entered into for the
sale or disposition of all or substantially all the Capital Stock or
assets of such Restricted Subsidiary pending the closing of such sale
or disposition;
(vii) encumbrances and restrictions contained in any
Indebtedness or any agreement relating to any Indebtedness of the
Borrower or a Restricted Subsidiary of the Borrower permitted
pursuant to Section 7.01; provided, however, that either (A) such
encumbrances and restrictions are no more restrictive than the
encumbrances and restrictions imposed by the Existing Credit
Agreement or (B) each Restricted Subsidiary subject to any such
encumbrances or restrictions after the Closing Date shall Guarantee
the Loans on a senior basis; pursuant to the Subsidiaries Guaranty;
and
(viii) any encumbrance or restriction existing under or by reason
of applicable law.
Nothing contained in this Section 7.03 shall prevent the
Borrower or any Restricted Subsidiary of the Borrower from restricting the
sale or other disposition of property or assets of the Borrower or any
Restricted Subsidiary of the Borrower that secure Indebtedness of the Borrower
or any of its Restricted Subsidiaries.
7.04 Limitation on Sales of Assets and Subsidiary Stock. (a)
In addition to any mandatory repayments required pursuant to Section 3.01, in
the event and to the extent that the Net Available Cash received by the
Borrower or any of its Restricted Subsidiaries from one or more Asset
Dispositions occurring on or after the Issue Date in any period of 12
consecutive months ended after the Closing Date exceeds 10% of Adjusted
Consolidated Assets as of the beginning of such 12-month period, then the
Borrower shall (i) within 12 months after the date such Net Available Cash so
received exceeds such 10% of Adjusted Consolidated Assets and to the extent
the Borrower elects (or is required by the terms of any Indebtedness) (A)
apply an amount equal to or less than such excess Net Available Cash to
permanently repay (and in the case of any repayment of revolving loans or
similar obligations, to permanently reduce the correlating commitments) Senior
Indebtedness of the Borrower or (B) invest an amount, equal to or less than
the difference between such excess Net Available Cash and the amount so
applied pursuant to clause (A) (or enter into a definitive agreement
committing to so invest within 12 months after the date of such agreement), in
Additional Assets and (ii) apply an amount equal to the difference between
such excess Net Available Cash and the amount applied pursuant to clause (i)
as provided in the following paragraphs of this Section 7.06. The amount of
such excess Net Available Cash required to be applied pursuant to clause (ii)
of the preceding sentence shall constitute "Excess Proceeds."
(b) If, as of the first day of any calendar month, the
aggregate amount of Excess Proceeds totals at least $5 million, the Borrower
must, not later than the fifteenth Business Day of such month, apply an amount
equal to such Excess Proceeds to prepay principal of outstanding Loans (the
"Excess Proceeds Repayment"). Each repayment pursuant to the preceding
sentence shall be accompanied by the payment of all accrued but unpaid
interest on the principal amount of Loans so repaid.
7.05 Limitation on Affiliate Transactions. (a) The Borrower
shall not, and shall not permit any of its Restricted Subsidiaries to, enter
into, renew or extend any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate
of the Borrower (an "Affiliate Transaction") unless the terms thereof (1) are
no less favorable to the Borrower or such Restricted Subsidiary (or, in the
case of an Affiliate Transaction between the Borrower and a Restricted
Subsidiary, are no less favorable to the Borrower or are, in the good faith
determination of the Board of Directors, in the best interests of the
Borrower) than those which could be obtained at the time of such transaction
in arm's-length dealings with a Person who is not such an Affiliate and (2) if
such Affiliate Transaction involves an amount in excess of $2.5 million, the
terms thereof are set forth in writing and either (A) have been approved by a
majority of the disinterested members of the Board of Directors or (B) for
which the Borrower or such Restricted Subsidiary delivers to the
Administrative Agent a written opinion of a nationally recognized investment
banking firm stating that the transaction is fair to the Borrower or such
Restricted Subsidiary from a financial point of view.
(b) The provisions of Section 7.05(a) shall not prohibit (i)
any Restricted Payment permitted to be paid pursuant to Section 7.02, (ii) any
issuance of securities, or other payments, awards or grants in cash,
securities or otherwise pursuant to, or the funding of, employment
arrangements, stock options and stock ownership plans approved by the Board of
Directors, (iii) the grant of stock options or similar rights to employees and
directors of the Borrower pursuant to plans approved by the Board of
Directors, (iv) loans or advances to employees in the ordinary course of
business in accordance with the past practices of the Borrower or its
Restricted Subsidiaries; (v) the payment of reasonable fees to directors of
the Borrower and its Restricted Subsidiaries who are not employees of the
Borrower or its Restricted Subsidiaries; (vi) any payments or other
transactions pursuant to any tax-sharing agreement between the Borrower and
any other Person with which the Borrower is required or permitted to file a
consolidated tax return or with which the Borrower is or could be part of a
consolidated group for tax purposes; (vii) any Affiliate Transaction between
the Borrower and a Wholly-Owned Restricted Subsidiary or between Wholly-Owned
Restricted Subsidiaries; (viii) the Transaction; (ix) any employment or other
agreement providing for compensation between the Borrower or any of its
Restricted Subsidiaries and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ that is
approved, in good faith, by the Board of Directors; (x) the payment of fees to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated or its Affiliates for financial, advisory,
consulting or investment banking services that the Board of Directors of the
Borrower deems to be advisable or appropriate for the Borrower or any
Restricted Subsidiary to obtain (and including the payment to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Co. Incorporated or its Affiliates of any underwriting discounts or
commissions or placement agency fees in connection with the issuance and sale
of any securities by the Borrower or any Restricted Subsidiary of the
Borrower), so long as the amount of such fees is no greater than the amount of
fees which would be payable for such services in arm's-length dealings with a
Person who is not an Affiliate; or (xi) sales of Capital Stock of
Communications or the Borrower to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated or its
Affiliates.
7.06 Change of Control. On the 15th day following the
occurrence of any Change of Control, the Borrower shall repay in full 100% of
the outstanding principal amount of all Loans, together with all accrued and
unpaid interest thereon to the date of such repayment. Notwithstanding
anything to the contrary contained in the immediately preceding sentence, the
Borrower shall not be required to repay the outstanding Loans of any Bank
which agrees in writing, prior to the 15th day following the occurrence of the
respective Change of Control, that such Bank waives its right to receive such
repayment. It is understood and agreed that no Bank shall be obligated to
grant any such waiver under any circumstances, and the granting thereof shall
be in the sole discretion of the respective Bank.
7.07 Limitation on the Issuance of Preferred Stock of
Restricted Subsidiaries. The Borrower shall not sell or otherwise dispose of
any shares of Preferred Stock of any Restricted Subsidiary of the Borrower,
and shall not permit any Restricted Subsidiary of the Borrower, directly or
indirectly, to issue, sell or otherwise dispose of any shares of its Preferred
Stock, except, in each case, (i) to the Borrower or a Wholly-Owned Restricted
Subsidiary of the Borrower or (ii) if, immediately after giving effect to such
issuance, sale or other disposition, such Restricted Subsidiary would no
longer constitute a Restricted Subsidiary of the Borrower (and none of
Communications, the Borrower nor any of their respective Subsidiaries shall
retain any equity interest therein).
7.08 When Communications or Borrower May Merge or Transfer
Assets. After the Closing Date, neither Communications nor the Borrower shall
consolidate with or merge with or into, or convey, transfer or lease all or
substantially all its assets to, any Person.
7.09 Ownership of Restricted Subsidiaries. Communications
will not at any time directly own equity interests in any Subsidiary other
than the Borrower.
7.09 Further Instruments and Acts. Upon request of the
Administrative Agent, Communications and the Borrower will execute and deliver
such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this
Agreement and the other Credit Documents.
SECTION 8. Events of Default. An "Event of Default" occurs
if:
8.01 Events of Default Defined.
(1) the Borrower defaults in any payment of interest on any
Loan, or any other amount (other than principal of Loans owing
pursuant to this Agreement or any other Credit Document, when the
same becomes due and payable, and such default continues for a period
of 30 days;
(2) the Borrower defaults in the payment of the principal of
any Loan or Note when the same becomes due and payable at its Stated
Maturity, as a result of any mandatory repayment under Section 3.01,
7.04 or 7.06, upon declaration or otherwise;
(3) the Borrower fails to comply with Section 7.08;
(4) the Borrower fails to comply with Section 7.01, 7.02,
7.03, 7.05, 7.06 and 7.07 and such failure continues for 30 days
after the notice specified below;
(5) Communications or the Borrower fails to comply with any
of its agreements in this Agreement or any other Credit Document
(other than those referred to in (1), (2), (3) or (4) above) and such
failure continues for 45 days after the notice specified below;
(6) Indebtedness of Communications, the Borrower or any
Significant Subsidiary is not paid within any applicable grace period
after final maturity thereof or becomes, or is declared by the
holders thereof to be, immediately and unconditionally due and
payable because of a default, the total amount of such Indebtedness
unpaid or becoming or declared to be due and payable exceeds
$10,000,000 or its foreign currency equivalent and such failure
continues (or such payment shall not have been waived or extended or
such Indebtedness shall continue to be due and payable) for 30 days
after the notice specified below;
(7) Communications, the Borrower or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a Custodian of it or
for any substantial part of its property; or
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against Communications, the Borrower
or any Significant Subsidiary in an involuntary case;
(B) appoints a Custodian of Communications, the Borrower
or any Significant Subsidiary or for any substantial part of
its property; or
(C) orders the winding up or liquidation of
Communications, the Borrower or any Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order
or decree remains unstayed and in effect for 60 days;
(9) any judgment or decree for the payment of money in excess of
$10,000,000 (provided that the amount of such money judgment or
decree shall be calculated net of any insurance coverage that the
Borrower has determined in good faith is available in whole or in
part with respect to such money judgment or decree) is entered
against Communications, the Borrower or any Significant Subsidiary
and is not discharged and there is a period of 60 days following the
entry of such judgment or decree during which such judgment or decree
is not discharged, waived or the execution thereof stayed and, in each
case, such default continues for 10 days after the notice specified
below;
(10) any Collateral Document shall cease to be in full force and
effect, or shall cease to give the Collateral Agent on behalf of the
Secured Creditors the Liens, rights, powers and privileges purported
to be created thereby in favor of the Collateral Agent, or any Credit
Party shall default in any material respect in the due performance or
observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any such Collateral Document and
such failure shall continue for 30 days after the notice specified
below; or
(11) any Guaranty or provision thereof shall cease to be in full
force or effect as to the relevant Guarantor, or any Guarantor or
Person acting by or on behalf of such Guarantor shall deny or
disaffirm such Guarantor's obligations under the relevant Guaranty,
or any Guarantor shall default in the due performance or observance
of any material term, covenant or agreement on its part to be
performed or observed pursuant to any Guaranty.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or
involuntary or is effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body.
A Default under clause (4), (5), (6), (9) or (10) of this
Section is not an Event of Default until the Administrative Agent or Banks
holding at least 25% in principal amount of the outstanding Loans notify the
Borrower of the Default and the Borrower does not cure such Default within the
time specified after receipt of such Notice. Such Notice must specify the
Default, demand that it be remedied and state that such notice is a "Notice of
Default".
The Borrower shall deliver to the Administrative Agent, within 5
Business Days after the occurrence thereof, written notice in the form of an
Officers' Certificate of any event which with the giving of notice and the
lapse of time would become an Event of Default under clause (4), (5), (6), (9)
or (10) of this Section, its status and what action the Borrower is taking or
proposes to take with respect thereto.
8.02 Acceleration. If an Event of Default (other than an
Event of Default specified in Section 8.01(7) or (8) with respect to the
Borrower) occurs and is continuing, the Administrative Agent shall, upon the
written request of the holders of at least a majority of the outstanding
principal amount of Loans, by written notice to the Borrower, declare the
principal amount of and accrued interest on all the Loans as of the date of
such declaration to be due and payable. Upon such a declaration, such
principal and interest shall be due and payable immediately. If an Event of
Default specified in Section 8.01(7) or (8) with respect to the Borrower
occurs, the principal of and interest on all the Loans shall ipso facto become
and be immediately due and payable without any declaration or other act on the
part of the Administrative Agent or any Bank. The holders of a majority in
principal amount of the outstanding Loans by notice to the Administrative
Agent may rescind an acceleration and its consequences if the rescission would
not conflict with any judgment or decree and if all existing Events of Default
have been cured or waived except nonpayment of principal or interest that has
become due solely because of acceleration. No such rescission shall affect any
subsequent Default or impair any right consequent thereto.
8.03 Other Remedies. If an Event of Default occurs and is
continuing, the Administrative Agent and the Banks may, subject to the
provisions of Section 11, pursue any available remedy to collect the payment
of principal of or interest on the Loans or to enforce the performance of any
provision of the Notes, this Agreement or any other Credit Document.
The Administrative Agent may maintain a proceeding even if it
does not possess any of the Notes or does not produce any of them in the
proceeding. A delay or omission by the Administrative Agent or any Bank in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative.
SECTION 9. Definitions.
9.01 General Definitions. As used herein, the following terms
shall have the meanings herein specified (to be equally applicable to both the
singular and plural forms of the terms defined):
"Accounts" of any Person shall mean all of such Person's rights
to payment for goods sold or leased or services performed by such Person,
whether presently existing or hereafter arising, including, without
limitation, rights evidenced by accounts, instruments, notes, drafts,
documents, chattel paper, and all other forms of obligations owing to such
Person arising out of the sale of goods or the rendition of services by such
Person, whether or not earned by performance, and any and all credit
insurance, letters of credit, guaranties and other security therefor, as well
as all merchandise returned to or reclaimed by such Person, and such Person's
books and records (except minute books) relating to any of the foregoing.
"Additional Security Documents" shall have the meaning provided
in Section 6.06(a).
"Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) in a Related Business; or (iii) Capital Stock
constituting a minority interest in any Person that at such time is a
Restricted Subsidiary of the Borrower; provided, however, that any such
Restricted Subsidiary described in clauses (ii) or (iii) above is primarily
engaged in a Related Business.
"Adjusted Certificate of Deposit Rate" shall mean, on any day,
the sum (rounded to the nearest 1/100 of 1%) of (1) the rate obtained by
dividing (x) the most recent weekly average dealer offering rate for
negotiable certificates of deposit with a three-month maturity in the
secondary market as published in the most recent Federal Reserve System
publication entitled "Select Interest Rates," published weekly on Form H.15 as
of the date hereof, or if such publication or a substitute containing the
foregoing rate information shall not be published by the Federal Reserve
System for any week, the weekly average offering rate determined by the
Administrative Agent on the basis of quotations for such certificates received
by it from three certificate of deposit dealers in New York of recognized
standing or, if such quotations are unavailable, then on the basis of other
sources reasonably selected by the Administrative Agent, by (y) a percentage
equal to 100% minus the stated maximum rate of all reserve requirements as
specified in Regulation D applicable on such day to a three-month certificate
of deposit of a member bank of the Federal Reserve System in excess of
$100,000 (including, without limitation, any marginal, emergency,
supplemental, special or other reserves), plus (2) the then daily net annual
assessment rate as estimated by the Administrative Agent for determining the
current annual assessment payable by the Administrative Agent to the Federal
Deposit Insurance Corporation for insuring three-month certificates of deposit.
"Adjusted Consolidated Assets" means at any time the total
amount of assets of the Borrower and its consolidated Restricted Subsidiaries
(less applicable depreciation, amortization and other valuation reserves),
after deducting therefrom all current liabilities of the Borrower and its
consolidated Restricted Subsidiaries (excluding intercompany items), all as
set forth on the consolidated balance sheet of the Borrower and its
consolidated Restricted Subsidiaries as of the end of the most recent fiscal
quarter ended at least 45 days prior to the date of determination.
"Administrative Agent" shall mean Bankers Trust Company in its
capacity as Administrative Agent for the Banks hereunder, and shall include any
successor thereto as Administrative Agent, appointed as such pursuant to
Section 10.09.
"Affiliate", of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this
definition, "control", when used with respect to any Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing. For purposes of Section 7, "Affiliate", shall also mean any
beneficial owner of shares representing 10% or more of the total voting power
of the Voting Stock (on a fully diluted basis) of Communications or the
Borrower or of rights or warrants to purchase such stock (whether or not
currently exercisable) and any Person who would be an Affiliate of any such
beneficial owner pursuant to the first sentence hereof.
"Affiliate Transaction" shall have the meaning provided in
Section 7.05.
"Agreement" shall mean this Term Loan Agreement as same may be
supplemented, modified or amended from time to time in accordance with the
provisions hereof.
"Applicable Lending Office" shall mean, with respect to each
Bank, such Bank's Eurodollar Lending Office in the case of a Eurodollar Rate
Loan, and such Bank's Domestic Lending Office in the case of a Base Rate Loan.
"Applicable Margin" shall mean a percentage per annum which
shall initially equal (x) in the case of Eurodollar Loans, 4.0% and (y) in the
case of Base Rate Loans, 3.0%, provided that the Applicable Margins for each
type of loan shall increase on each three-month anniversary of the Closing
Date in accordance with the table set forth below:
Applicable Margin Applicable Margin for
Month Anniversary for Eurodollar Loans Base Rate Loans
----------------- -------------------- ---------------------
0 4.0% 3.0%
3 4.25% 3.25%
6 4.5% 3.5%
9 5.0% 4.0%
12 5.5% 4.5%
15 6.0% 5.0%
18 6.5% 5.5%
21 7.0% 6.0%
24 7.5% 6.5%
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Borrower or any Restricted Subsidiary, including any disposition by means
of a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of (i) any shares of Capital
Stock of a Restricted Subsidiary (other than directors' qualifying shares) or
(ii) any assets of the Borrower or any Restricted Subsidiary outside the
ordinary course of business of the Borrower or such Restricted Subsidiary
(other than (y) a disposition by a Restricted Subsidiary to the Borrower or by
the Borrower or a Restricted Subsidiary to a Wholly-Owned Restricted
Subsidiary and (z) for purposes of Section 7.04 only, a Restricted Payment
permitted by Section 7.02); provided, however, that for purposes of Section
7.04 only, the term "Asset Disposition" shall not include any disposition of
assets if such disposition is governed by Section 7.08.
"Assignment and Assumption Agreement" shall mean an assignment
and assumption agreement entered into by an assigning Bank and an assignee Bank
in accordance with Section 12.04, substantially in the form of Exhibit P.
"Auditors" shall mean a nationally-recognized firm of
independent public accountants selected by Communications or the Borrower and
reasonably satisfactory to the Administrative Agent. For purposes of this
Agreement, Communications' current firm of independent public accountants,
Ernst & Young, shall be deemed to be satisfactory to the Administrative Agent.
"Authorized Officer" of any Credit Party shall mean any of the
President, the Chief Financial Officer, the Treasurer, any Assistant
Treasurer, any Vice-President, the Secretary or any Assistant Secretary of
such Credit Party or any other officer of such Credit Party which is
designated in writing to the Administrative Agent by any of the foregoing
officers of such Credit Party as being authorized to give such notices under
this Agreement.
"Average Life" means, as of the date of determination, with
respect to any Indebtedness, the guotient obtained by dividing (i) the sum of
the products of numbers of years from the date of determination to the dates
of each successive scheduled principal payment of such Indebtedness multiplied
by the amount of such payment by (ii) the sum of all such payments.
"Bankruptcy Law" shall mean ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, or any
similar Federal or state law for the relief of debtors.
"Banks" is defined to mean the lenders who are from time to time
parties to this Agreement.
"Base Rate" shall mean the higher of (x) 1/2 of 1% in excess of
the Federal Reserve reported certificate of deposit rate and (y) the rate that
BTCo announces from time to time as its prime lending rate, as in effect from
time to time.
"Base Rate" at any time shall mean the highest of (i) 1/2 of 1%
in excess of the Adjusted Certificate of Deposit Rate, (ii) 1/2 of 1% in
excess of the overnight Federal Funds Rate and (iii) the Prime Lending Rate.
"Base Rate Loan" shall mean each Loan converted into such
pursuant to Section 1.08, until such time (if any) as converted back into a
Eurodollar Loan in accordance with the requirements of Section 1.08(d).
"Blocked Account Agreements" shall mean all blocked account
agreements executed and delivered pursuant to the Existing Credit Agreement,
until such time as same are replaced by blocked account agreements in the form
of Exhibit M-2 hereto, and any blocked account agreements at any time entered
into in the form of Exhibit M-2 hereto.
"Board of Directors" means the Board of Directors of the
Borrower or any committee thereof duly authorized to act on behalf of such
Board.
"Borrower" shall have the meaning provided in the first
paragraph of this Agreement.
"BTCC" shall mean BT Commercial Corporation, in its individual
capacity.
"BTCo" shall mean Bankers Trust Company in its individual
capacity.
"Business Day" shall mean (i) for all purposes other than as
covered by clause (ii) below, any day except Saturday, Sunday and any day
which shall be in New York City a legal holiday or a day on which banking
institutions are authorized or required by law or other government action to
close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day
which is a Business Day described in clause (i) above and which is also a day
for trading by and between banks in Dollars in the New York interbank
Eurodollar market.
"Canadian Debenture" shall mean the Existing Canadian Debenture,
as same may be modified, amended or supplemented from time to time in
accordance with the terms thereof and hereof, including pursuant to the
Existing Canadian Debenture Amendment.
"Canadian Pledge Agreement" shall mean the Existing Canadian
Pledge Agreement, as same may be modified, amended or supplemented from time
to time in accordance with the terms thereof and hereof, including pursuant to
the Existing Canadian Pledge Agreement Amendment.
"Capital Expenditures" means expenditures (whether paid in cash
or accrued as liabilities and including Capital Lease Obligations) of the
Borrower and its Restricted Subsidiaries relating to the acquisition of
equipment used or useful in the business of the Borrower or any Restricted
Subsidiary or in a Related Business.
"Capital Lease Obligations" means an obligation that is
required to be classified and accounted for as a capitalized lease for
financial reporting purposes in accordance with GAAP, and the amount of
Indebtedness represented by such obligation shall be the capitalized amount of
such obligation determined in accordance with GAAP; and the Stated Maturity
thereof shall be the date of the last payment of rent of any other amount due
under such lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Change of Control" means such time as (i) a "person" or "group"
(within the meaning of Sections 13(d) and 14(d) of the Exchange Act), other
than the Permitted Holders and their respective Affiliates, becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of (A)
more than forty percent (40%) of the total voting power of the then
outstanding Voting Stock of the Borrower or Communications and (B) more than
the total voting power of the then outstanding Voting Stock of the Borrower or
Communications, as the case may be, beneficially owned by the Permitted
Holders and their respective Affiliates, treating the Permitted Holders and
their respective Affiliates as a "group"; or (ii) during any period of two
consecutive calendar years, individuals who at the beginning of such period
constituted the Board of Directors of (A) the Borrower (together with any new
directors whose election by the Borrower's Board of Directors or whose
nomination for election by the Borrower's Board of Directors or whose
nomination for election by the Borrower's shareholders was approved by a vote
of at least two thirds of the directors then still in office who either were
directors at the beginning of such period or whose election or nomination for
election was previously so approved) or (B) Communications (together with any
new directors whose election by Communications' Board of Directors or whose
nomination for election by Communications' shareholders was approved by a vote
of at least two-thirds of the directors then still in office who either were
directors at the beginning of such period or whose election or nomination for
election was previously so approved), in either case, cease for any reason to
constitute a majority of the directors of the Borrower or Communications, as
the case may be, then in office; or (iii) (A) the Borrower or Communications
consolidates with or merges into any other Person or conveys, transfers or
leases all or substantially all its assets to any Person or (B) any Person
mergers into the Borrower or Communications, in either event pursuant to a
transaction in which any Voting Stock of the Borrower or Communications, as the
case may be, outstanding immediately prior to the effectiveness thereof is
reclassified or changed into or exchanged for cash, securities or other
property; provided, however, that any consolidation, conveyance, transfer or
lease (x) between the Borrower and any of its Restricted Subsidiaries, between
Communications and the Borrower or between Restricted Subsidiaries of the
Borrower (including the reincorporation of the Borrower or Communications in
another jurisdiction) or (y) for the purpose of creating a public holding
company for the Borrower or Communications in another jurisdiction or (z) for
the purpose of creating a public holding company for the Borrower or
Communications in which all holders of the capital stock of the Borrower or
Communications, as the case may be, would be entitled to receive (other than
cash in lieu of fractional shares) solely capital stock of the holding company
in amounts proportionate to their holdings of such capital stock of the
Borrower or Communications immediately prior to such transaction, shall be
excluded from the operation of this clause (iii) or (iv) Communications shall
at any time cease to own 100% of the capital stock of the Borrower.
"Closing Date" shall mean the date of the extension of Loans
hereunder, which shall occur on or after the Effective Date and on or prior to
July 31, 1997.
"Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.
"Collateral" shall mean all of the Collateral as defined in
each of the Collateral Documents.
"Collateral Access Agreements" shall mean any landlord waivers,
mortgagee waivers, bailee letters or any similar acknowledgement agreements of
any warehousemen or processor in possession of Inventory, in each case
substantially in the form of Exhibit N hereto (or prior to obtaining any such
agreement, in the form previously attached as Exhibit N to the Existing Credit
Agreement), in each case with such changes thereto as are reasonably
acceptable to the Administrative Agent.
"Collateral Agent" shall mean BTCC acting as collateral agent
pursuant to the Collateral Documents.
"Collateral Assignments of Rights" shall mean each collateral
assignment of rights executed and delivered in substantially the form of
Exhibit L hereto (or, if executed and delivered prior to the Closing Date, in
the form of Exhibit L to the Existing Credit Agreement).
"Collateral Documents" shall mean all contracts, instruments and
other documents now or hereafter executed and delivered in connection with this
Agreement, pursuant to which liens and security interests were or are granted
to the Collateral Agent in the Collateral for the benefit of the Secured
Creditors (including the Banks), including, without limitation, the Pledge
Agreement, the Security Agreement, each Mortgage, the Canadian Debenture, the
Canadian Pledge Agreement and, after the execution and delivery thereof, each
Additional Security Document.
"Commitment" shall mean, for each Bank, the amount set forth
opposite such Bank's name in Schedule I, as the same may be (x) reduced from
time to time pursuant to Section 3.01 or (y) adjusted from time to time as a
result of assignments to or from such Bank pursuant to Section 1.11 or
12.04(b).
"Communications" means ▇▇▇▇▇▇▇▇ Communications, Inc., a Delaware
corporation, and its successors.
"Concentration Account Agreements" shall mean each concentration
account agreement executed and delivered pursuant to the Existing Credit
Agreement, until such time as same are replaced by concentration account
agreements in the form of Exhibit M-3 hereto, and any concentration account
agreement at any time entered into in the form of Exhibit M-3 hereto.
"Covered Taxes" shall have the meaning provided such term in
Section 3.03(a).
"Credit Documents" shall mean, collectively, this Agreement, the
Notes, the Subsidiaries Guaranty and each of the Collateral Documents, as the
same may be modified, amended, extended, restated or supplemented from time to
time.
"Credit Parties" shall mean, collectively, Communications, the
Borrower and the Subsidiary Guarantors.
"Custodian" shall mean any receiver, trustee, assignee,
liquidator, custodian or similar official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Disposition" means the sale, assignment, transfer, lease,
conveyance or other disposition by Communications, the Borrower or their
respective Restricted Subsidiaries of any Collateral, including, without
limitation an involuntary disposition as a result of a casualty or
condemnation.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock which by its terms or upon the happening of any event (i)
matures or is mandatorily redeemable pursuant to a sinking fund obligation or
otherwise, (ii) is convertible or exchangeable for Indebtedness or
Disqualified Stock or (iii) is redeemable at the option of the holder thereof,
in whole or in part, in each case on or prior to the first anniversary of the
Stated Maturity of the Senior Subordinated Notes (as in effect on the Closing
Date); provided, however, that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders thereof the right
to require such Person to repurchase or redeem such Capital Stock upon the
occurrence of any "asset sale" or "change of control", occurring prior to the
first anniversary of the Stated Maturity of the Senior Subordinated Notes (as
in effect on the Closing Date) shall not constitute Disqualified Stock if the
"asset sale" or "change of control" provisions applicable to such Capital
Stock are no more favorable to the holders of such Capital Stock than the
provisions contained in Section 4.06 and Section 4.08 of the Senior
Subordinated Notes Indenture (as in effect on the Closing Date) and such
Capital Stock specifically provides that such Person will not repurchase or
redeem any such Capital Stock pursuant to such provision prior to such
Person's repayment of all Loans as are required to be repaid pursuant to
Section 7.04 and Section 7.06.
"Documents" shall mean all Credit Documents and all Existing
Credit Agreement Documents.
"Dollars" and the sign "$" shall each mean freely transferable
lawful money of the United States.
"Domestic Lending Office" shall mean, with respect to any Bank,
the office of such Bank specified as its "Domestic Lending Office" opposite
its name on Schedule I, as such Schedule may be amended from time to time.
"Effective Date" shall have the meaning provided in Section
12.10.
"Eligible Transferee" shall mean and include a commercial bank,
financial institution, any fund that invests in bank loans and any other
"accredited investor" (as defined in Regulation D of the Securities Act).
"Environmental Law" shall mean any applicable Federal, state,
provincial, foreign or local statute, law, rule, regulation, ordinance, code,
guide, policy and rule of common law now or hereafter in effect and in each
case as amended, and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment,
relating to the environment, health, safety or Hazardous Materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, as
amended, 33 U.S.C. Section 1251 et seq.; the Toxic Substances Control Act, 15
U.S.C. Section 2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et
seq.; the Safe Drinking Water Act, 42 U.S.C. Section 300F et seq.; the Oil
Pollution Act of 1990, 33 U.S.C Section 2701 et seq. and any applicable
state, provincial and local or foreign counterparts, or equivalents or similar
statutes.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigations (other than internal
reports prepared by the Borrower or any of its Restricted Subsidiaries solely
in the ordinary course of such Person's business or as required in connection
with a financing transaction and not in response to any third party action or
request of any kind) or proceedings relating in any way to any Environmental
Law or any permit issued, or any approval given, under any such Environmental
Law (hereafter, "Claims"), including, without limitation, (a) any and all
Claims by governmental or regulatory authorities for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to any
Environmental Law, and (b) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation, specific
performance or injunctive relief resulting from Hazardous Materials arising
from alleged injury or threat of injury to health, safety or the environment.
"Equipment" means all of the Borrower's present and hereafter
acquired machinery, equipment, furniture, furnishings, fixtures, motor
vehicles, tools, parts, dies, jigs, goods, and any and all attachments,
accessories, accessions, replacements, substitutions, additions, and
improvements thereto, wherever located (but shall exclude any such attachment,
accessories, accessions, replacements, substitutions, additions and
improvements which accrue to lessors with respect to any equipment leased by
the Borrower or subject to a prior lien as permitted hereunder).
"Equipment Acquisition Loans" shall mean all Equipment
Acquisition Loans under, and as defined in, the Existing Credit Agreement.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to ERISA are to ERISA, as in
effect at the date of this Agreement and any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section
3(9) of ERISA) which together with Communications, the Borrower or any
Restricted Subsidiary of Communications or the Borrower would be deemed to be
a "single employer" within the meaning of Section 414(b) or (c) of the Code,
and for the purpose of any specific provision of this Agreement which
expressly refers to Section 302 of ERISA or Section 412, 4971 or 4977 of the
Code, within the meaning of Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Lending Office" shall mean, with respect to any
Bank, the office of such Bank specified as its "Eurodollar Lending Office"
opposite its name on Schedule I, as such Schedule may be amended from time to
time (or, if no such office is specified, its Domestic Lending Office), or
such other office or Affiliate of such Bank as such Bank may from time to time
specify to the Borrower and the Administrative Agent.
"Eurodollar Loan" shall mean each Loan outstanding at any time
hereunder, except during such time (and then only to the extent) as the
respective such Loan is required to be maintained as a Base Rate Loan in
accordance with the provisions of Section 1.08.
"Eurodollar Rate" shall mean (a) the offered quotation to
first-class banks in the New York interbank Eurodollar market by BTCo for
Dollar deposits of amounts in immediately available funds comparable to the
outstanding principal amount of the Eurodollar Loan of BTCo with maturities
comparable to the Interest Period applicable to such Eurodollar Loan
commencing two Business Days thereafter as of 10:00 A.M. (New York time) on
the date which is two Business Days prior to the commencement of such Interest
Period, divided (and rounded off to the nearest 1/16 of 1%) by (b) a
percentage equal to 100% minus the then stated maximum rate of all reserve
requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves required by applicable law) applicable
to any member bank of the Federal Reserve System in respect of Eurocurrency
funding or liabilities as defined in Regulation D (or any successor category
of liabilities under Regulation D).
"Event of Default" has the meaning provided in Section 8.
"Excess Proceeds" shall have the meaning provided in Section
7.04.
"Excess Proceeds Repayment" shall have the meaning provided in
Section 7.04.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing Canadian Debenture" shall mean the Canadian Debenture
under, and as defined in, the Existing Credit Agreement, as same is in effect
immediately prior to the occurrence of the Closing Date and immediately before
giving effect to the Existing Canadian Debenture Amendment.
"Existing Canadian Debenture Amendment" shall have the meaning
provided in Section 4.11.
"Existing Canadian Pledge Agreement" shall mean the Canadian
Pledge Agreement under, and as defined in, the Existing Credit Agreement, as
same is in effect immediately prior to the occurrence of the Closing Date and
immediately before giving effect to the Existing Canadian Pledge Agreement
Amendment.
"Existing Canadian Pledge Agreement Amendment" shall have the
meaning provided in Section 4.11.
"Existing Credit Agreement" is defined to mean the Credit
Agreement, dated as of August 15, 1995, among Communications, the Borrower,
the lenders party thereto and the Existing Credit Agreement Agent, together
with the related documents thereto (including any Guarantees and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented, replaced or otherwise
modified from time to time, including any agreement extending the maturity of,
refinancing or otherwise restructuring (including, but not limited to, the
inclusion of additional borrowers or guarantors thereunder that are Restricted
Subsidiaries of Communications or the Borrower and whose obligations are
guaranteed by Communications or the Borrower thereunder) all or a portion of
the Indebtedness under such agreement or any successor agreement.
"Existing Credit Agreement Agent" shall mean BTCC, as Agent
pursuant to the Existing Credit Agreement, and any successor thereto.
"Existing Credit Agreement Collateral Access Agreements" shall
mean all Collateral Access Agreements entered into pursuant to, and as
required by, the Existing Credit Agreement.
"Existing Credit Agreement Credit Parties" shall mean each of
the Credit Parties under, and as defined in, the Existing Credit Agreement.
"Existing Credit Agreement Documents" shall mean all Credit
Documents under, and as defined in, the Existing Credit Agreement.
"Existing Credit Agreement Obligations" shall mean all
Obligations under, and as defined, in the Existing Credit Agreement (in any
event including all principal of, and interest on, all loans pursuant to the
Existing Credit Agreement, all amounts owing in respect of unpaid drawings
under letters of credit issued thereunder, and all interest, fees and other
amounts owing pursuant to the Existing Credit Agreement).
"Existing Credit Agreement Required Lenders" shall mean the
Required Lenders under, and as defined in, the Existing Credit Agreement.
"Existing Credit Agreement Termination Date" shall mean that
date upon which all commitments pursuant to the Existing Credit Agreement have
terminated, no letter of credit or promissory note remains outstanding
thereunder and all loans and letter of credit obligations, together with
interest, fees, expenses and other obligations pursuant to the Existing Credit
Agreement (other than any indemnities described therein which are not then due
and payable) are paid in full.
"Existing Indebtedness" shall mean all Indebtedness of the
Borrower and its Restricted Subsidiaries outstanding prior to, and to remain
outstanding on and after, the Closing Date, and set forth on Schedule X,
without giving effect to extensions or renewals thereto, except as expressly
provided therein.
"Existing Mortgage Policies" shall mean each mortgage insurance
policy issued with respect to an Existing Mortgage under the Existing Credit
Agreement.
"Existing Mortgaged Property" shall mean all Real Property of
the Borrower and its Restricted Subsidiaries listed as such on Schedule VII
(which shall include all Real Property subject to any Existing Mortgage).
"Existing Mortgages" shall mean all Mortgages under, and as
defined in, the Existing Credit Agreement, granted by the Existing Credit
Agreement Credit Parties pursuant to the Existing Credit Agreement and which
have not been released by the lenders thereunder prior to the Closing Date.
"Existing Pledge Agreement" shall mean the Pledge Agreement
under, and as defined in, the Existing Credit Agreement, as same is in effect
immediately prior to the occurrence of the Closing Date and immediately before
giving effect to the Existing Pledge Agreement Amendment.
"Existing Pledge Agreement Amendment" shall have the meaning
provided in Section 4.08.
"Existing Security Agreement" shall mean the Security Agreement
under, and as defined in, the Existing Credit Agreement, as same is in effect
immediately prior to the occurrence of the Closing Date and immediately before
giving effect to the Existing Security Agreement Amendment.
"Existing Security Agreement Amendment" shall have the meaning
provided in Section 4.09.
"Expenses" shall mean all present and future expenses incurred
by or on behalf of the Administrative Agent in connection with this Agreement,
any other Credit Document or otherwise in its capacity as Administrative Agent
under this Agreement, whether incurred heretofore or hereafter.
"Federal Funds Rate" shall mean 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 the Administrative Agent from three
Federal Funds brokers of recognized standing selected by the Administrative
Agent.
"Fees" shall mean all fees payable pursuant to, or referenced
in, Section 2.01.
"Final Maturity Date" shall mean March 31, 2001.
"Financial Statements" shall mean the consolidated and, if
requested by the Administrative Agent, consolidating balance sheet and
statement of operations and statement of cash flows and statements of changes
in shareholders' equity of each of (x) Communications and (y) the Borrower,
for the period specified prepared in accordance with GAAP and consistent with
prior practices; provided however, that so long as Communications owns all the
capital stock of the Borrower, owns no other significant assets and owns no
capital stock of any other Subsidiary, separate financial statements for the
Borrower shall not be required to be furnished pursuant to Sections 6.01(a)
and (b).
"First Priority Secured Obligations" shall mean all Existing
Credit Agreement Obligations and all Secured Interest Rate Protection
Obligations, in each case secured pursuant to the Collateral Documents.
"Foreign Bank" shall mean any Bank organized under the laws of a
jurisdiction outside of the United States.
"Foreign Pension Plan" means any plan, fund (including, without
limitation, any superannuation fund) or other similar program or arrangement
established or maintained outside the United States of America by
Communications, the Borrower or any one or more of their Restricted
Subsidiaries primarily for the benefit of employees of Communications, the
Borrower or such Restricted Subsidiaries residing outside the United States of
America, which plan, fund or other similar program provides, or results in,
retirement income, a deferral of income in contemplation of retirement or
payments to be made upon any termination of employment, and which plan is not
subject to ERISA or the Code.
"GAAP" shall mean generally accepted accounting principles in
the United States as in effect from time to time subject to Section 9.02.
"Governing Documents" shall mean, as to any Person, the
certificate or articles of incorporation and by-laws or other organizational
or governing documents of such Person.
"Governmental Authority" shall mean any nation or government,
any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness or other
financial obligation of any other Person and any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other financial obligation of such other Person (whether arising by virtue of
partnership arrangements, or by agreements to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for the purpose of
assuring in any other manner the obligee of such Indebtedness or other
financial obligation of the payment thereof or to protect such obligee against
loss in respect thereof (in whole or in part); provided, however, that the
term "Guarantee" shall not include endorsements for collection or deposit in
the ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning. The term "Guarantor" shall mean any Person Guaranteeing
any Indebtedness or financial obligation.
"Guaranty" shall mean the Parent Guaranty and the Subsidiaries
Guaranty.
"Hazardous Materials" shall mean (a) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation, transformers or other equipment
that contained dielectric fluid containing levels of polychlorinated
biphenyls, and radon gas; (b) any chemicals, materials or substances defined
as or included in the definition of "hazardous substances," "hazardous waste,"
"hazardous materials," "extremely hazardous waste," "restricted hazardous
waste," "toxic substances," "toxic pollutants," "contaminants," or
"pollutants," or words of similar import, under any Environmental Law; and (c)
any other chemical, material or substance, exposure to which is prohibited,
limited or regulated by any governmental authority.
"Highest Lawful Rate" shall mean, at any given time during which
any Obligations shall be outstanding hereunder, the maximum nonusurious
interest rate, if any, that at any time or from time to time may be contracted
for, taken, reserved, charged or received on the Obligations owing under this
Agreement, under the laws of the State of New York (or the law of any other
jurisdiction whose laws may be mandatorily applicable notwithstanding other
provisions of this Agreement and the other Credit Documents), or under
applicable federal laws which may presently or hereafter be in effect and
which allow a higher maximum nonusurious interest rate than under New York (or
such other jurisdiction's) law, in any case after taking into account, to the
extent permitted by applicable law, any and all relevant payments or charges
under this Agreement and any other Credit Documents executed in connection
herewith, and any available exemptions, exceptions and exclusions.
"Holder" means the Person in whose name a Security is
registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise
become liable for; provided, however, that any Indebtedness or Capital Stock
of a Person existing at the time such Person becomes a Restricted Subsidiary
of the Borrower (whether by merger, consolidation, acquisition or otherwise)
shall be deemed to be Incurred by such Restricted Subsidiary at the time it
becomes a Restricted Subsidiary. The term "Incurrence" when used as a noun
shall have a correlative meaning.
"Indebtedness" of any Person means, without duplication:
(i) the principal of and premium (if any) in respect of (A)
indebtedness of such Person for money borrowed and (B) indebtedness
evidenced by notes, debentures, bonds or other similar instruments
for the payment of which such Person is responsible or liable (other
than Interest Rate Protection Agreements);
(ii) all Capital Lease Obligations of such Person;
(iii) all obligations of such Person issued or assumed as the
deferred purchase price of property which purchase price is due more
than six months after the date of placing such property in service or
taking delivery and title thereto, all conditional sale obligations
of such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable arising in
the ordinary course of business);
(iv) all obligations of such Person for the reimbursement of any
obligor on any letter of credit, banker's acceptance or similar
credit transaction (other than obligations with respect to letters of
credit securing obligations (other than obligations described in
clauses (i) through (iii) above) entered into in the ordinary course
of business of such Person to the extent such letters of credit are
not drawn upon or, if and to the extent drawn upon, such drawing is
reimbursed no later than the third Business Day following receipt by
such Person of a demand for reimbursement following payment on the
letter of credit);
(v) the amount of all obligations of such Person with respect to
the redemption, repayment or other repurchase of any Disqualified
Stock, and in respect of a Restricted Subsidiary, all obligations of
such Restricted Subsidiary with respect to the redemption, repayment
or other repurchase of any Preferred Stock (but excluding, in each
case, any accrued dividends);
(vi) all obligations of the type referred to in clauses (i)
through (v) of other Persons and all dividends of other Persons for
the payment of which, in either case, such Person is responsible or
liable, directly or indirectly, as obligor, Guarantor or otherwise,
including by means of any Guarantee; and
(vii) all obligations of the type referred to in clauses (i)
through (vi) of other Persons secured by any Lien on any property or
asset of such Person (whether or not such obligation is assumed by
such Person), the amount of such obligation being deemed to be the
lesser of the fair market value of such property or assets (as
determined by the Board of Directors) or the amount of the obligation
so secured.
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and,
with respect to contingent obligations, the maximum liability upon the
occurrence of the contingency giving rise to the obligation; provided,
however, (i) that the amount outstanding at any time of any Indebtedness
Incurred with original issue discount is the face amount of such Indebtedness
less the remaining unamortized portion of the original issue discount of such
Indebtedness at such time as determined in conformity with GAAP and (ii) that
Indebtedness shall not include (A) any liability for Federal, state, local or
other taxes, (B) any obligations under Interest Rate Protection Agreements or
Raw Material Hedge Agreements or (C) any liability arising from the honoring
by a bank or other financial institution of a check, draft or similar
instrument inadvertently drawn against insufficient funds in the ordinary
course of business.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section
1.07.
"Interest Rate Protection Agreement" means any interest rate or
currency swap agreement, interest rate cap agreement or other financial
agreement or arrangement designed to protect the Borrower or any Restricted
Subsidiary against fluctuations in interest rates or currency values.
"Inventory" of any Person shall mean all of the inventory owned
by such Person, including without limitation: (i) all raw materials, work in
process, parts, components, assemblies, supplies and materials used or
consumed in such Person's business; (ii) all goods, wares and merchandise,
finished or unfinished, held for sale or lease or leased or furnished or to be
furnished under contracts of service; and (iii) all goods returned or
repossessed by such Person.
"Investment" in any Person means any direct or indirect
advance, loan (other than advances to customers in the ordinary course of
business that are recorded as accounts receivable) or other extension of
credit (including by way of Guarantee or similar arrangement) or capital
contribution to (by means of any transfer of cash or other property to others
or any payment for property or services of the account or use of others), or
any purchase or acquisition of Capital Stock, Indebtedness or other similar
instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary," the definition of "Restricted Payment," and Section
7.02 (i) "Investment" shall include the portion (proportionate to the
Borrower's equity interest in such Subsidiary) of the fair market value of the
net assets of any Restricted Subsidiary of the Borrower at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a redesignation of such Subsidiary as a Restricted
Subsidiary, the Borrower shall be deemed to continue to have a permanent
"Investment" in such Subsidiary at the time of such redesignation equal to the
amount (if positive) equal to (x) the Borrower's "Investment" in such
Subsidiary at the time of such redesignation less (y) the portion
(proportionate to the Borrower's equity interest in such Subsidiary) of the
fair market value of the net assets of such Subsidiary at the time of such
redesignation; and (ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of Directors.
"Issue Date" means the date on which the Senior Subordinated
Notes were originally issued.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or
other title retention agreement or lease in the nature thereof).
"Loan" shall have the meaning provided in Section 1.01.
"Lockbox Agreements" shall mean all lockbox agreements executed
and delivered pursuant to the Existing Credit Agreement, until such time as
same are replaced by lockbox agreements in the form of Exhibit M-1 hereto, and
any lockbox agreements at any time entered into in the form of Exhibit M-1
hereto.
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Adverse Effect" shall mean a material adverse effect
on (i) the business, prospects, operations, results of operations, assets,
liabilities or financial condition of the Borrower or of Communications and
its Restricted Subsidiaries taken as a whole, (ii) any Credit Party's ability
to perform its material obligations under the Credit Documents to which it is
a party, or (iii) the material rights and remedies of the Administrative
Agent, the Collateral Agent or the Banks under any Credit Document.
"Material Contract" shall mean any contract or other arrangement
(other than the Credit Documents), whether written or oral, to which the
Borrower or its Restricted Subsidiaries is a party as to which the breach,
nonperformance, cancellation or failure to renew by any party thereto may be
reasonably expected to have a Material Adverse Effect.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its
successors.
"Mortgage Amendments" shall have the meaning provided in Section
4.10.
"Mortgages" shall mean all Existing Mortgages, as modified by
the Mortgage Amendments or as same may be further modified, amended or
supplemented from time to time in the future in accordance with the terms
thereof and hereof, as well as any additional mortgages granted by any of the
Credit Parties after the Closing Date.
"MSCP Entities" means, collectively, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital
Partners III, L.P., a Delaware limited partnership, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Capital
Investors, L.P., a Delaware limited partnership, and MSCP III 892 Investors,
L.P., a Delaware limited partnership.
"MSLEF" means The ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Leveraged Equity Fund II,
L.P., a Delaware limited partnership.
"Multiemployer Plan" shall mean a "multiemployer plan" as
defined in Section 4001(a)(3) of ERISA.
"Net Available Cash" from an Asset Disposition means cash
payments received therefrom (including any cash payments received by way of
deferred payment of principal (but not interest) pursuant to a note or
installment receivable or otherwise including upon release to the Borrower or
a Restricted Subsidiary from any reserve established by the Borrower or such
Restricted Subsidiary against any liabilities associated with such Asset
Disposition, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring person of
Indebtedness or other obligations relating to such properties or assets or
received in any other noncash form) in each case net of all legal, title and
recording tax expenses, commissions and other fees and expenses incurred, and
all Federal, state, provincial, foreign and local taxes required to be accrued
as a liability under GAAP, as a consequence of such Asset Disposition (without
regard to the consolidated results of operations of the Borrower and its
Restricted Subsidiaries, taken as whole), and in each case net of all payments
made on any Indebtedness which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon or other security
agreement of any kind with respect to such assets, or which must by its terms,
or in order to obtain a necessary consent to such Asset Disposition, or by
applicable law be repaid out of the proceeds from such Asset Disposition, and,
until released to the Borrower or a Restricted Subsidiary, net of appropriate
amounts to be provided by the Borrower or any Restricted Subsidiary of the
Borrower as a reserve against any liabilities associated with such Asset
Disposition, including pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Disposition, all as
determined in accordance with GAAP, and net of all distributions and other
payments required to be made to minority interest holders in Restricted
Subsidiaries or joint ventures as a result of such Asset Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"Note" shall have the meaning provided in Section 1.04(a).
"Notice of Borrowing" shall have the meaning provided in Section
1.02(a).
"Notice Office" shall mean the office of the Administrative
Agent located at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇
▇▇▇▇▇▇▇, or such other office as the Administrative Agent may hereafter
designate in writing as such to the other parties hereto.
"Obligations" shall mean, without duplication, the unpaid
principal of and interest on (including interest accruing on or after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to Communications, the Borrower or
any Restricted Subsidiary of the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) the
Notes, the Fees, the Expenses and all other obligations and liabilities of
Communications, the Borrower or any Restricted Subsidiary of the Borrower to
the Administrative Agent, the Collateral Agent or the Banks, whether direct or
indirect, absolute or contingent, due or to become due, whether now existing
or hereafter incurred, which may arise under, out of, or in connection with,
this Agreement, the Notes, any other Credit Document or any other document
made, delivered or given in connection herewith or therewith.
"Offering Memorandum" shall mean the Offering Memorandum, dated
August 10, 1995, issued in connection with the private placement of the Senior
Subordinated Notes.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Treasurer or the Secretary of the Borrower.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal counsel
who is acceptable to the Administrative Agent. The counsel may be an employee
of or counsel to the Borrower or the Administrative Agent.
"Other Taxes" shall have the meaning given such term in Section
3.03(b).
"Parent Guarantor" shall have the meaning provided in the first
paragraph of this Agreement.
"Parent Guaranty" shall mean the Guaranty provided by
Communications pursuant to Section 13.
"Payment Office" shall mean the office of the Administrative
Agent located at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ABA Number:
▇▇▇▇▇▇▇▇▇, Account Name: BTCo Investor Cash A/C, Account Number: 000355784,
Reference: ▇▇▇▇▇▇▇▇ Graphics, Inc., Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, or such other
office as the Administrative Agent may hereafter designate in writing as such
to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA and any Person succeeding to the
functions thereof.
"Permitted Encumbrances" shall mean, with respect to any
Mortgage, the Permitted Encumbrances related thereto as described in the
respective Mortgage Policy relating thereto.
"Permitted Holders" means, collectively, MSLEF and the MSCP
Entities.
"Permitted Investment" means (i) an Investment in the Borrower
or in a Restricted Subsidiary or a Person which will, upon the making of such
Investment, become a Restricted Subsidiary; provided, however, that the
primary business of such Restricted Subsidiary or such Person is a Related
Business; (ii) an Investment by the Borrower or any Restricted Subsidiary in
another Person if as a result of such Investment such other Person is merged
or consolidated with or into, or transfers or conveys all or substantially all
its assets to, the Borrower or a Restricted Subsidiary; provided, however,
that such Person's primary business is a Related Business; (iii) a Temporary
Cash Investment; (iv) receivables owing to the Borrower or any Restricted
Subsidiary, if created or acquired in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms; provided,
however, that such trade terms may include such concessionary trade terms as
the Borrower or any such Restricted Subsidiary deems reasonable under the
circumstances; (v) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as expenses
for accounting purposes and that are made in the ordinary course of business;
(vi) loans or advances to employees made in the ordinary course of business in
accordance with past practices of the Borrower or of its Restricted
Subsidiaries; (vii) stock, obligations or securities received in settlement of
debts created in the ordinary course of business and owing to the Borrower or
any Restricted Subsidiary or in satisfaction of judgments, (viii) Interest
Rate Protection Agreements and Raw Material Hedge Agreements and (ix)
Investments at any time not exceeding $2 million (valued at the fair market
value at the time any such Investment was made).
"Permitted Materials" shall have the meaning given to such term
in Section 5.18.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof or any other entity.
"Plan" shall mean any multiemployer or single-employer plan as
defined in Section 4001 of ERISA, which (i) is maintained or contributed to by
(or to which there is an obligation to contribute of), or (ii) at any time
during the five year period preceding (A) in the case of any Loan, the date of
the making of such Loan or (B) in the case of any event or condition described
in Section 6.04, the date thereof, was maintained or contributed to by (or to
which there is or was an obligation to contribute to), Communications, the
Borrower, a Restricted Subsidiary of Communications or the Borrower or an
ERISA Affiliate.
"Pledge Agreement" shall mean the Existing Pledge Agreement, as
same may be modified, amended or supplemented from time to time in accordance
with the terms thereof and hereof, including pursuant to the Existing Pledge
Agreement Amendment.
"PPSA" shall mean the Personal Property Security Act (Ontario).
"Preferred Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution
of assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Prime Lending Rate" shall mean the rate which BTCo announces
from time to time as its prime lending rate, the Prime Lending Rate to change
when and as such prime lending rate changes. The Prime Lending Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. BTCo may make commercial loans or other
loans at rates of interest at, above or below the Prime Lending Rate.
"Proceeds" shall mean all proceeds of any Collateral.
"Quarterly Payment Date" shall mean the last Business Day of
each January, April, July and October occurring after the Closing Date.
"Raw Material Hedge Agreement" means an agreement designed to
hedge against fluctuations in the cost of raw materials entered into by the
Borrower or its Subsidiaries in the ordinary course of business in connection
with their business operations.
"Real Property" of any Person shall mean all of the right,
title and interest of such Person in and to land, improvements and fixtures,
including leaseholds.
"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
Indebtedness in exchange, substitution or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances
any Indebtedness of the Borrower or any Restricted Subsidiary of the Borrower
existing on the Closing Date or Incurred in compliance with this Agreement,
including Indebtedness that Refinances Refinancing Indebtedness; provided,
however, that (i) such Refinancing Indebtedness has a Stated Maturity no
earlier than the Stated Maturity of the Indebtedness being Refinanced, (ii)
such Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of
the Indebtedness being Refinanced and (iii) such Refinancing Indebtedness has
an aggregate principal amount (or if Incurred with original issue discount, an
aggregate issue price) that is equal to or less than the aggregate principal
amount (or if Incurred with original issue discount, the aggregate accreted
value) then outstanding or committed (plus fees, accrued interest and
expenses, including any premium and defeasance costs) under the Indebtedness
being Refinanced; provided further, however, that Refinancing Indebtedness
shall not include Indebtedness of a Restricted Subsidiary of the Borrower that
Refinances Indebtedness of the Borrower.
"Register" shall have the meaning provided in Section 12.15.
"Regulation D" shall mean Regulation D of the Board of Governors
of the Federal Reserve System as from time to time in effect and any successor
to all or a portion thereof establishing reserve requirements.
"Regulation U" shall mean Regulation U of the Board of Governors
of the Federal Reserve System as from time to time in effect and any successor
thereto.
"Related Business" means as of any date the businesses of the
Borrower and its Subsidiaries as conducted on the Closing Date and any business
related, ancillary or complementary thereto.
"Remedial Actions" means any claim, proceeding or action to
foreclose upon, take possession or control of, sell, lease or otherwise
dispose of, or in any other manner realize, take steps to realize or seek to
realize upon, the whole or any part of any Collateral, whether pursuant to the
UCC, by foreclosure, by setoff, by self-help repossession, by notification to
account debtors, by deed in lieu of foreclosure, by exercise of power of sale,
by judicial action or otherwise, or the exercise of any other remedies with
respect to any Collateral available under any of the Collateral Documents, or
under applicable law.
"Replaced Bank" shall have the meaning provided in Section 1.11.
"Replacement Bank" shall have the meaning provided in Section
1.11.
"Reportable Event" shall mean any of the events described in
Section 4043 of ERISA with respect to a Plan as to which the 30-day notice
requirement has not been waived by the PBGC.
"Required Banks" shall mean, collectively, Banks the sum of
whose outstanding Loans (or, if prior to the Closing Date, Commitments)
represent an amount greater than 50% of the sum of all outstanding Loans (or,
if prior to the Closing Date, the Commitments); provided that until the first
date on or after the Closing Date upon which BTCo and its Affiliates own less
than a majority of the outstanding principal amount of Loans, the Required
Banks shall be required to include (if there are any Banks other than BTCo and
its Affiliates) at least one Bank which is not BTCo or an Affiliate thereof.
"Required Secured Creditors" shall mean, with respect to any
Collateral Document, the Required Lenders as defined therein.
"Restricted Payment" with respect to any Person means (i) the
declaration or payment of any dividends or any other distributions of any sort
in respect of its Capital Stock (including any payment in connection with any
merger or consolidation involving such Person) or similar payment to the
direct or indirect holders of its Capital Stock (other than dividends or
distributions payable solely in its Capital Stock (other than Disqualified
Stock) or options, warrants or other rights to acquire its Capital Stock
(other than Disqualified Stock) and dividends or distributions payable solely
to the Borrower or a Restricted Subsidiary, and other than pro rata dividends
or other distributions made by a Subsidiary of the Borrower that is not a
Wholly-Owned Subsidiary to minority stockholders (or owners of an equivalent
interest in the case of a Subsidiary that is an entity other than a
corporation)), (ii) the purchase, redemption or other acquisition or
retirement for value of any Capital Stock of the Borrower held by any Person
or of any Capital Stock of a Subsidiary of the Borrower held by any Affiliate
of the Borrower (other than a Restricted Subsidiary), including the exercise
of any option to exchange any Capital Stock (other than into Capital Stock of
the Borrower that is not Disqualified Stock), (iii) the purchase, repurchase,
redemption, defeasance or other acquisition or retirement for value, prior to
scheduled maturity, scheduled repayment or scheduled sinking fund payment of
any Subordinated Obligations (other than the purchase, repurchase or other
acquisition of Subordinated Obligations purchased in anticipation of
satisfying a sinking fund obligation, principal installment or final maturity,
in each case due within one year of the date of acquisition) or (iv) the
making of any Investment, other than a Permitted Investment, in any Person.
"Restricted Subsidiary" means any Subsidiary of the Borrower
that is not an Unrestricted Subsidiary.
"S&P" means Standard & Poor's Ratings Group and its successors.
"SEC" means the Securities and Exchange Commission.
"Section 3.03(e) Certificate" shall have the meaning provided in
Section 3.03(e).
"Second Priority Secured Obligations" shall mean all Obligations
under, or with respect to, this Agreement.
"Second Tier Taxes" shall have the meaning provided in Section
3.03(a).
"Secured Creditors" shall have the meaning provided in the
various Collateral Documents (after giving effect to the amendments thereto
required pursuant to Section 4), and in any event shall include (x) the
lenders from time to time party to the Existing Credit Agreement, (y) various
lenders entering into Interest Rate Agreements as more fully provided in the
various Collateral Documents and (z) the Banks pursuant to this Agreement.
"Secured Indebtedness" means any Indebtedness of the Borrower or
any of its Restricted Subsidiaries secured by a Lien.
"Secured Interest Rate Protection Obligations" shall mean all
obligations relating to Interest Rate Protection Agreements secured pursuant
to the Collateral Documents in accordance with the terms thereof.
"Secured Obligations" shall mean all obligations secured in
accordance with the provisions of the various Collateral Documents, in any
event including all Existing Credit Agreement Obligations, all Obligations
pursuant to this Agreement and all Secured Interest Rate Protection
Obligations.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" shall mean the Existing Security
Agreement, as same may be modified, amended or supplemented from time to time
in accordance with the terms thereof and hereof, including pursuant to the
Existing Security Agreement Amendment.
"Senior Indebtedness" of any Person means all obligations of
such Person which would constitute Senior Indebtedness under, and as defined
in, the Senior Subordinated Notes Indenture as in effect on the Closing Date,
or which constitutes Senior Indebtedness under, and as defined in, the
documentation governing any Indebtedness which Refinances (or successively
Refinances) such Indebtedness and is incurred pursuant to the provisions of
Section 7.01(b)(vii).
"Senior Subordinated Note Documents" shall mean and include each
of the documents and other agreements entered into (including, without
limitation, the Senior Subordinated Notes and the Senior Subordinated Notes
Indenture) relating to the issuance by the Borrower of the Senior Subordinated
Notes, as in effect on the Closing Date and as the same may be entered into,
modified, supplemented or amended from time to time to the extent permitted
pursuant to the terms hereof and thereof.
"Senior Subordinated Notes Indenture" shall mean the Indenture,
dated as of August 15, 1995, entered into by and between the Borrower and
NationsBank of Georgia, National Association, as trustee thereunder, as in
effect on the Closing Date and as the same may be modified, amended or
supplemented from time to time to the extent permitted in accordance with the
terms hereof and thereof.
"Senior Subordinated Notes" shall mean the Borrower's 12-3/4%
Senior Subordinated Notes due 2005, as in effect on the Closing Date and as the
same may be modified, supplemented or amended from time to time to the extent
permitted pursuant to the terms hereof and thereof.
"Shareholders' Agreement" shall have the meaning assigned that
term in the Existing Credit Agreement, as same is in effect on the Closing
Date.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "Significant Subsidiary" of the Borrower within the meaning of Rule
1-02 under Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any Indebtedness, the
date specified in such security or other relevant documentation as the fixed
date on which the final payment of principal of such Indebtedness is due and
payable, including pursuant to any mandatory redemption provision (but
excluding any provision providing for the repurchase of such security at the
option of the holder thereof upon the happening of any contingency unless such
contingency has occurred).
"Subordinated Obligation" means the Senior Subordinated Notes,
any Indebtedness which Refinances same, and any other Indebtedness of the
Borrower (whether outstanding on the Issue Date or thereafter incurred) which
is subordinate or junior in right of payment to the Loans pursuant to a
written agreement to that effect.
"Subsidiaries Guaranty" shall have the meaning provided in
Section 4.07.
"Subsidiary" shall mean as to any Person, a corporation,
partnership or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers
of such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through
one or more intermediaries, or both, by such Person. Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Credit Agreement shall refer to a Subsidiary or Subsidiaries of Communications
or the Borrower, as appropriate.
"Subsidiary Guarantor" shall mean, at any time, any Restricted
Subsidiary of the Borrower which has theretofore executed and delivered the
Subsidiaries Guaranty or a counterpart thereof.
"Syndication Date" shall mean the earlier of (x) the date which
is 30 days after the Closing Date and (y) the date occurring three Business
Days after the date upon which the Administrative Agent determined in its sole
discretion (and notifies the Borrower) that the primary syndication (and the
resulting addition of institutions as Banks pursuant to Section 12.04) has
been completed, notice of which shall be promptly given to the Borrower.
"Tax Sharing Agreements" shall have the meaning assigned that
term in the Existing Credit Agreement, as same is in effect on the Closing
Date.
"Taxes" shall have the meaning provided in Section 3.03.
"Temporary Cash Investments" means any of the following: (i) any
investment in direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any agency
thereof, (ii) investments in time deposit accounts, certificates of deposit
and money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States, and which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $50,000,000 (or the
foreign currency equivalent thereof) and has outstanding debt which is rated
"A" (or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund sponsored by a registered broker
dealer or mutual fund distributor, (iii) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in
clause (i) above entered into with a bank meeting the qualifications described
in clause (ii) above, (iv) investments in commercial paper, maturing not more
than 90 days after the date of acquisition, issued by a corporation (other
than an Affiliate of the Borrower) organized and in existence under the laws
of the United States of America or any foreign country recognized by the
United States of America with a rating at the time as of which any investment
therein is made of "P-1" (or higher) according to ▇▇▇▇▇'▇ or "A-1" (or higher)
according to S&P, and (v) investments in securities with maturities of six
months or less from the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least "A" by
S&P or "A" by ▇▇▇▇▇'▇.
"Total Commitments" shall mean, at any time, the sum of the
Commitments of each of the Banks at such time.
"Transaction" shall mean the entering into of this Agreement
and the incurrence of Loans hereunder, the utilization of the proceeds hereof
as contemplated by Section 5.05 and the taking of the other actions specified
in Section 4 of this Agreement.
"Unfunded Current Liability" of any Plan shall mean the amount,
if any, by which the actuarial present value of the accumulated plan benefits
under the Plan as of the close of its most recent plan year, exceeds the fair
market value of the assets allocable thereto, each determined in accordance
with Statement of Financial Accounting Standards No. 35, based upon the
actuarial assumptions used by the Plan's actuary in the most recent annual
valuation of the Plan.
"Uniform Commercial Code" means the New York Uniform Commercial
Code as in effect from time to time.
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Borrower that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors in the manner provided below and (ii) any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors may
designate any Subsidiary (including any newly acquired or newly formed
Subsidiary) of the Borrower to be an Unrestricted Subsidiary unless such
Subsidiary owns any Capital Stock or Indebtedness of, or holds any Lien on any
property of, the Borrower or any Restricted Subsidiary of the Borrower that is
not a Subsidiary of the Subsidiary to be so designated; provided, however,
that either (A) the Subsidiary to be so designated has total assets of $1,000
or less or (B) if such Subsidiary has assets greater than $1,000, such
designation would be permitted as a Permitted Investment pursuant to clause
(ix) of the definition thereof. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that
immediately after giving effect to such designation (x) the Borrower could
Incur $1.00 of additional Indebtedness under Section 4.03(a) of the Senior
Subordinated Notes Indenture as same is in effect on the Closing Date (and
without giving effect to any modifications, supplements or amendments thereto,
or terminations or waivers thereof) and (y) no Default or Event of Default
shall have occurred and be continuing. Any such designation by the Board of
Directors shall be evidenced by the Borrower to the Administrative Agent by
promptly filing with the Administrative Agent a copy of the board resolution
giving effect to such designation and an officers' certificate certifying that
such designation complied with the foregoing provisions.
"Voting Stock" of a Person means all classes of Capital Stock
or other interests (including partnership interests) of such Person then
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees
thereof.
"Wholly-Owned Restricted Subsidiary" shall mean, as to any
Person, (i) any corporation 100% of whose capital stock (other than director's
qualifying shares) is at the time owned by such Person and/or one or more
Wholly-Owned Restricted Subsidiaries of such Person and (ii) any partnership,
association, joint venture or other entity in which such Person and/or one or
more Wholly-Owned Restricted Subsidiaries of such Person has a 100% equity
interest at such time. Unless the context otherwise requires, each reference
to a Wholly-Owned Restricted Subsidiary shall be to a Wholly-Owned Restricted
Subsidiary of the Borrower.
9.02 Accounting Terms and Determinations. Unless otherwise
defined or specified herein all accounting terms used in this Agreement shall
be construed in accordance with GAAP, applied on a basis consistent in all
material respects with the Financial Statements delivered to the
Administrative Agent on or before the Closing Date. All accounting
determinations for purposes of determining compliance with the covenants
contained in Section 7, and all defined terms as used in said Section 7, shall
be made consistent with practices in effect as of the Closing Date and, if
applicable, in accordance with GAAP as in effect on the Closing Date (or, if
the Administrative Agent shall have given its prior written approval thereto,
such determinations may be made by the Borrower in accordance with GAAP as in
effect on the date for which the determinations of such compliance shall be
made), and applied on a basis consistent in all material respects with the
audited Financial Statements delivered to the Administrative Agent on or
before the Closing Date, except as otherwise previously disclosed to the
Administrative Agent. The Financial Statements required to be delivered
hereunder from and after the Closing Date, and all financial records, shall be
maintained in accordance with GAAP. If GAAP shall change from the basis used
in preparing the audited Financial Statements delivered to the Administrative
Agent on or before the Closing Date, the certificates required to be delivered
pursuant to Section 6.01 demonstrating compliance with the covenants contained
herein shall include (except as otherwise provided above) at the election of
the Borrower or upon the request of the Required Banks, calculations setting
forth the adjustments necessary to demonstrate how the Borrower is in
compliance with the financial covenants based upon GAAP as in effect on the
Closing Date.
9.03 Other Defined Terms. Terms not otherwise defined herein
which are defined in the UCC as in effect in the State of New York shall have
the meanings given them in such UCC. The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and references to Article, Section, Schedule, Exhibit and like
references are references to this Agreement unless otherwise specified.
SECTION 10. The Agent.
10.01 Appointment. (a) Each Bank hereby designates (x) BTCo
as Administrative Agent and (y) BTCC as Collateral Agent (for purposes of this
Section 10, the term "Agent" shall include BTCo as Administrative Agent
pursuant to this Agreement and BTCC as Collateral Agent under the Collateral
Documents) to act as herein specified. Each Bank hereby irrevocably
authorizes, and each holder of any Note shall be deemed irrevocably to
authorize, the Agent to take such action on its behalf under the provisions of
this Agreement and the Notes and any other instruments and agreements referred
to herein and to exercise such powers and to perform such duties hereunder and
thereunder as are specifically delegated to or required of the Agent by the
terms hereof and thereof and such other powers as are reasonably incidental
thereto. Subject to the provisions of Section 11, the Collateral Agent shall
hold all Collateral and the Administrative Agent shall hold all payments of
principal, interest, Fees, charges and Expenses received pursuant to this
Agreement or any other Credit Document for the benefit of the Banks to be
distributed as provided herein. The Agent may perform any of its duties
hereunder by or through its agents or employees.
(b) The provisions of this Section 10 are solely for the
benefit of the Agent and the Banks, and neither Communications nor any of its
Subsidiaries shall have any rights as a third party beneficiary of any of the
provisions hereof (other than Sections 10.09 and 10.10(c)). In performing its
functions and duties under this Agreement, the Agent shall act solely as agent
of the Banks and does not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for
Communications or any of its Subsidiaries.
10.02 Nature of Duties of Agent. The Agent shall have no
duties or responsibilities except those expressly set forth in this Agreement
and the other Credit Documents. Neither the Agent nor any of its officers,
directors, employees or agents shall be liable for any action taken or omitted
by it as such hereunder or in connection herewith, unless caused by its or
their gross negligence or willful misconduct. The duties of the Agent shall
be mechanical and administrative in nature; the Agent shall not have by reason
of this Agreement or the other Credit Documents a fiduciary relationship in
respect of any Bank; and nothing in this Agreement or the other Credit
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon the Agent any obligations in respect of this Agreement or the
other Credit Documents except as expressly set forth herein or therein.
10.03 Lack of Reliance on Agent. (a) Independently and
without reliance upon the Agent, each Bank, to the extent it deems
appropriate, has made and shall continue to make (i) its own independent
investigation of the financial or other condition and affairs of the Borrower
and its Subsidiaries in connection with the taking or not taking of any action
in connection herewith and (ii) its own appraisal of the creditworthiness of
the Borrower and its Subsidiaries, and, except as expressly provided in this
Agreement, the Agent shall not have any duty or responsibility, either
initially or on a continuing basis, to provide any Bank with any credit or
other information with respect thereto, whether coming into its possession
before the making of the Loans or at any time or times thereafter.
(b) The Agent shall not be responsible to any Bank for any
recitals, statements, information, representations or warranties herein or in
any document, certificate or other writing delivered in connection herewith or
for the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Agreement or the Notes or the
financial or other condition of the Borrower or any of its Subsidiaries. The
Agent shall not be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of
this Agreement or the Notes, or the financial condition of the Borrower or any
of its Subsidiaries, or the existence or possible existence of any Default or
Event of Default.
10.04 Certain Rights of the Agent. The Agent shall have the
right to request instructions from the Required Banks at any time. If the
Agent requests instructions from the Required Banks with respect to any act or
action (including the failure to act) in connection with this Agreement, the
Agent shall be entitled to refrain from such act or taking such action unless
and until the Agent shall have received instructions from the Required Banks,
and the Agent shall not incur liability to any Person by reason of so
refraining. Without limiting the foregoing, no Bank shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Banks.
10.05 Reliance by Agent. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or telecopier message,
cablegram, radiogram, order or other documentary, teletransmission or
telephone message believed by it to be genuine and correct and to have been
signed, sent or made by the proper person. The Agent may consult with legal
counsel (including counsel for the Borrower with respect to matters concerning
the Borrower and its Subsidiaries), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken by it in good faith in accordance with the advice of such counsel,
accountants or experts.
10.06 Indemnification of Agent. To the extent the Agent is not
reimbursed and indemnified by the Borrower or, in the case of the Collateral
Agent, the other Secured Creditors, each Bank will reimburse and indemnify the
Agent, in proportion to the Banks' respective "percentages" as used in
determining the Required Banks, 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 (including all Expenses) which may be imposed on,
incurred by or asserted against the Agent in performing its duties hereunder,
in any way relating to or arising out of this Agreement or the other Credit
Documents; provided that no Bank shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct. The agreements contained in this Section
shall survive any termination of this Agreement and the other Credit Documents
and the payment in full of the Obligations.
10.07 The Agent in Its Individual Capacity. With respect to
its obligation to lend under this Agreement, the Loans made by it and the
Notes issued to it, the Agent shall have the same rights and powers hereunder
as any other Bank or holder of a Note or participation interests and may
exercise the same as though it was not performing the duties specified herein;
and the terms "Banks," "Required Banks," "holders of Notes," or any similar
terms shall, unless the context clearly otherwise indicates, include the Agent
in its individual capacity. The Agent may accept deposits from, lend money
to, acquire equity interests in, and generally engage in any kind of banking,
trust, financial advisory or other business with Communications or any
Affiliate of Communications as if it were not performing the duties specified
herein, and may accept fees and other consideration from Communications for
services in connection with this Agreement and otherwise without having to
account for the same to the Banks. Without limiting the foregoing, the Banks
acknowledge that BTCC is the agent pursuant to the Existing Credit Agreement.
10.08 Holders of Notes. The Agent may deem and treat the
payee of any Note as the owner thereof for all purposes hereof unless and
until a written notice of the assignment or transfer thereof shall have been
filed with the Agent. Any request, authority or consent of any Person who, at
the time of making such request or giving such authority or consent, is the
holder of any Note, shall be conclusive and binding on any subsequent holder,
transferee or assignee of such Note or of any Note or Notes issued in exchange
therefor.
10.09 Successor Agent. (a) The Agent may, upon five (5)
Business Days' notice to the Banks and the Borrower, resign at any time
(effective upon the appointment of a successor Agent (including the Banks
acting as such pursuant to following clause (c)) pursuant to the provisions of
this Section 10.09) by giving written notice thereof to the Banks and the
Borrower. Upon any such resignation, the Required Banks shall have the right,
upon five (5) days' notice and approval by the Borrower (which approval shall
not be unreasonably withheld), to appoint a successor Agent. If no successor
Agent (i) shall have been so appointed by the Required Banks, and (ii) shall
have accepted such appointment, within fifteen (15) days after the retiring
Agent's giving of notice of resignation, then, upon five (5) days' notice, the
retiring Agent may, on behalf of the Banks, appoint a successor Agent.
(b) Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation
hereunder as Agent, the provisions of this Article 10 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.
(c) In the event that no successor Agent is appointed pursuant
to clause (a) above, the Agent's resignation shall become effective forty days
after notice of such resignation is given to the Borrower and the Banks, and
the Required Banks shall perform the duties of the Agent until a successor
Agent is appointed as provided herein.
10.10 Collateral Matters. (a) Each Bank authorizes and
directs the Collateral Agent to enter into the Collateral Documents for the
benefit of the Banks. Each Bank hereby agrees, and each holder of any Note by
the acceptance thereof will be deemed to agree, that, except as otherwise set
forth herein, any action taken by the Required Banks in accordance with the
provisions of this Agreement, or by the Required Secured Creditors under the
Collateral Documents, and the exercise by the Required Banks or Required
Secured Creditors, as the case may be, of the powers set forth herein or
therein, together with such other powers as are reasonably incidental thereto,
shall be authorized and binding upon all of the Banks. The Collateral Agent
is hereby authorized on behalf of all of the Banks, without the necessity of
any notice to or further consent from any Bank, to take any action with
respect to any Collateral or Collateral Documents which may be necessary to
perfect and maintain perfected the security interest in and liens upon the
Collateral granted pursuant to the Collateral Documents.
(b) The Banks hereby authorize the Collateral Agent, at its
option and in its discretion, upon the direction of the Agent to release any
Lien granted to or held by the Collateral Agent upon any Collateral (i) upon
termination of the Commitments and payment and satisfaction of all of the
Obligations at any time arising under or in respect of this Agreement or the
Credit Documents or the transactions contemplated hereby or thereby, (ii)
constituting property being sold or disposed of upon receipt of the proceeds
of such sale by the Collateral Agent if the Borrower certifies to the
Collateral Agent that the sale or disposition is made in compliance with this
Agreement and the Existing Credit Agreement (and the Agent may rely
conclusively on any such certificate, without further inquiry) or (iii) if
approved, authorized or ratified in writing by the Required Banks or Required
Secured Creditors, as the case may be, unless such release is required to be
approved by all of the Banks hereunder. Upon request by the Agent at any time,
the Banks will confirm in writing the Collateral Agent's authority to release
particular types or items of Collateral pursuant to this Section 10.10.
(c) Upon any sale and transfer of Collateral which is expressly
permitted pursuant to the terms of this Agreement and the Existing Credit
Agreement, or consented to in writing by the Required Banks or Required Secured
Creditors, as the case may be, or all of the Banks, as applicable, and upon at
least five (5) Business Days' prior written request by the Borrower, the
Collateral Agent shall (and is hereby irrevocably authorized by the Banks to)
execute such documents as may be necessary to evidence the release of the
Liens granted to the Collateral Agent for the benefit of the Banks herein or
pursuant hereto upon the Collateral that was sold or transferred; provided
that (i) the Collateral Agent shall not be required to execute any such
document on terms which, in the Collateral Agent's opinion, would expose the
Collateral Agent to liability or create any obligation or entail any
consequence other than the release of such Liens without recourse,
representation or warranty and (ii) such release shall not in any manner
discharge, affect or impair the Obligations or any Liens upon (or obligations
of the Borrower or any of its Subsidiaries in respect of) all interests
retained by the Borrower or any of its Subsidiaries, including, without
limitation, the proceeds of the sale, all of which shall continue to
constitute part of the Collateral. In the event of any sale or transfer of
Collateral, or any foreclosure with respect to any of the Collateral, the
Collateral Agent shall be authorized to deduct all of the Expenses reasonably
incurred by the Collateral Agent from the proceeds of any such sale, transfer
or foreclosure.
(d) The Collateral Agent shall have no obligation whatsoever
to the Banks or to any other Person to assure that the Collateral exists or is
owned by the Borrower or any of its Subsidiaries or is cared for, protected or
insured or that the Liens granted to the Collateral Agent herein or pursuant
hereto have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to
exercise or to continue exercising at all or in any manner or under any duty
of care, disclosure or fidelity any of the rights, authorities and powers
granted or available to the Collateral Agent in this Section 10.10 or in any
of the Collateral Documents, it being understood and agreed that in respect of
the Collateral, or any act, omission or event related thereto, the Collateral
Agent may act in any manner it may deem appropriate, in its sole discretion,
given the Collateral Agent's own interest in the Collateral as one of the
Banks and that the Collateral Agent shall have no duty or liability whatsoever
to the Banks, except for its gross negligence or willful misconduct.
(e) It is acknowledged and agreed by all the Banks that (i) the
priorities with respect to the Collateral are as set forth in the Collateral
Documents and are expressly subject to the provisions of Section 11 hereof and
(ii) to the extent the provisions of the Collateral Documents are inconsistent
with any of the provisions of this Section 10, the provisions of the
respective Collateral Document shall prevail.
10.11 Actions with Respect to Defaults. In addition to the
Agent's right to take actions on its own accord as permitted under this
Agreement, the Agent may take such action with respect to an Event of Default
as shall be directed by the Required Banks or, in the case of any Collateral
Document, the Required Secured Creditors; provided that until the Agent shall
have received such directions, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Event of Default as it shall deem advisable and in the best interests of the
Banks or, in the case of Collateral Documents, the Secured Creditors (or the
lenders pursuant to the Existing Credit Agreement).
10.12 Delivery of Information. The Agent shall not be
required to deliver to any Bank originals or copies of any documents,
instruments, notices, communications or other information received by the
Agent from Communications, the Borrower, any Subsidiary, the Required Banks,
any Bank or any other Person under or in connection with this Agreement or any
other Credit Document except (i) as specifically provided in this Agreement or
any other Credit Document and (ii) as specifically requested from time to time
in writing by any Bank with respect to a specific document, instrument, notice
or other written communication received by and in the possession of such Agent
at the time of receipt of such request and then only in accordance with such
specific request.
SECTION 11. Special Provisions Providing Lien Priorities;
etc. To induce the lenders pursuant to the Existing Credit Agreement to enter
into the amendments thereto and to the related Collateral Documents as
required by Section 4 hereof, and thereby permit the extensions of credit
pursuant to this Agreement and the securing of the Obligations pursuant to
this Agreement pursuant to the Collateral Documents (on a second priority
basis as more fully provided below), the following agreements are made by the
Banks (and their successors and assigns) for the benefit of the other Secured
Creditors (including without limitation the lenders pursuant to the Existing
Credit Agreement) under, and as defined in, the various Collateral Documents.
11.01 Priorities With Respect to Collateral. The Banks
acknowledge and agree that all Secured Obligations shall be secured pursuant
to the Collateral Documents in accordance with the terms thereof; provided
that, notwithstanding anything to the contrary contained in this Agreement or
any other Credit Document, as between the First Priority Secured Obligations
and Second Priority Secured Obligations, the following priorities with respect
to the Collateral shall apply:
(i) the First Priority Secured Obligations shall be
entitled to a first priority security interest in all
Collateral, superior and prior to the rights of the holders of
the Second Priority Secured Obligations with respect thereto,
which rights of the holders of Second Priority Obligations to
any and all Collateral shall be subject to the prior interests
of the holders of the First Priority Secured Obligations under
the Collateral Documents; and
(ii) the holders of the Second Priority Secured
Obligations, for themselves and their successors and assigns,
hereby acknowledge and agree for the benefit of the First
Priority Secured Creditors that they shall not be entitled to
receive, in respect of the Second Priority Secured Obligations
held by them, any of the proceeds of any Collateral following
the occurrence of an Event of Default or received as a result
of the enforcement of rights pursuant to the Collateral
Documents until all First Priority Secured Obligations have been
indefeasibly paid in full in cash or cash equivalents. The
Banks (for themselves and their successors and assigns) hereby
agree that, unless the Credit Agreement Termination Date (as
defined in the Security Agreement as amended on the Closing
Date pursuant to Section 4) has occurred and no First Priority
Secured Obligations are outstanding, they shall have no rights
to institute foreclosure or other enforcement rights under the
Collateral Documents or any other Credit Document or otherwise,
but shall only be entitled to share in the proceeds of the
Collateral as realized and following the indefeasible payment
in full in cash or cash equivalents of all First Priority
Secured Obligations. The foregoing provisions shall not
affect, or impair, the right of the Banks to accelerate the
maturity of any Loans pursuant to Section 8 hereof or to
institute legal proceedings (not including enforcement actions
with respect to the Collateral) to collect amounts due pursuant
to this Agreement.
(iii) Until all First Priority Secured Obligations have
been indefeasibly paid in full in cash or cash equivalents,
each holder of the Second Priority Secured Obligations hereby
agrees (x) not to exercise, with respect to the Second Priority
Secured Obligations, any right of setoff or counterclaim with
respect to the Collateral or any Proceeds thereof, (y) that all
Proceeds of Collateral shall be paid to the Collateral Agent
for application to the First Priority Secured Obligations and
(z) that any Proceeds of Collateral received by any holder of
the Second Priority Secured Obligations in its capacity as such
shall be segregated and held in trust and paid over to the
Collateral Agent for the benefit of the holders of all Secured
Obligations (in accordance with the priorities set forth above)
in the same form as received, with any necessary endorsements.
(iv) The holders of the Second Priority Secured
Obligations acknowledge and agree that Collateral (or Liens
thereon pursuant to the Collateral Documents) may be released
from the security interests created pursuant to the Collateral
Documents in accordance with the requirements of the respective
Collateral Documents and, except as expressly required thereby,
no consent of the holders of the Second Priority Secured
Obligations shall be required in connection therewith.
The foregoing provisions shall be effective at all times during
the term of this Agreement, and notwithstanding (without limitation):
(i) the initiation of any bankruptcy, moratorium, reorganization or
other insolvency proceeding with respect to Communications, the
Borrower or any of their Subsidiaries; (ii) the priorities which
would otherwise result under the terms of the respective Collateral
Documents or under applicable law; (iii) the taking of possession of
any Collateral by any Bank; or (iv) any other matter whatsoever; and
shall continue in full force and effect until all Secured Obligations
have been repaid in full.
11.02 Priority on Distribution of Proceeds of Collateral. In
the event of:
(a) any distribution of any Collateral upon any
bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding
involving the readjustment of the obligations and indebtedness
of Communications, the Borrower or any of their Subsidiaries,
or the application of any Collateral to the payment thereof;
(b) any distribution of the Collateral upon the
liquidation or dissolution of Communications, the Borrower or
any of their Subsidiaries, or the winding up of the assets or
business of Communications, the Borrower or any of their
Subsidiaries;
(c) any realization by any of the Secured Creditors or
the Collateral Agent with respect to the Liens pursuant to the
Credit Documents whether through a Remedial Action or
otherwise; or
(d) any Disposition of any Collateral, to the extent
that any part of the proceeds of such disposition are required
to be applied to any of the Secured Obligations or held by the
Collateral Agent in accordance with the provisions of any of
the Collateral Documents;
then, in any such event, as between the Secured Creditors all of the
Collateral and any Proceeds thereof so distributed, applied or
realized upon shall be distributed or paid to (or retained by) the
Collateral Agent for application first, to the Collateral Agent to
pay the Collateral Agent's fees, expenses and indemnities provided
for in this Agreement, the Existing Credit Agreement and in the
Collateral Documents, second, to the First Priority Secured
Obligations and third, after the indefeasible payment in full in cash
or cash equivalents of all First Priority Secured Obligations, the
remaining amount of such Proceeds shall be distributed or paid to (or
retained by) the Collateral Agent for application to the Second
Priority Secured Obligations then due and payable.
11.03 Certain Dispositions of Collateral. Notwithstanding
anything to the contrary contained above, to the extent Collateral is sold in
accordance with the requirements of Section 8.1 of the Existing Credit
Agreement and relevant provisions of this Agreement (and is not sold as a
result of any Remedial Action pursuant to a Security Document) at a time when
no Default or Event of Default exists pursuant to Section 8.01(7) and (8), the
proceeds thereof shall be applied in accordance with the requirements of this
Agreement and the Existing Credit Agreement.
11.04 Waiver of Set-Off. Notwithstanding anything to the
contrary contained elsewhere in this Agreement or any other Credit Document,
at all times prior to the Existing Credit Agreement Termination Date, and
unless the Existing Credit Agreement Required Lenders otherwise expressly
consent, the Banks shall have no right and hereby waive any right to set-off
(whether pursuant to Section 12.02, applicable law or otherwise) any amounts
owed to it by Communications, the Borrower or any Guarantor against or on
account of any of the Obligations.
11.05 Right to Contest. Each holder of Obligations and each
Bank agrees for itself, and its successors and assigns, not to contest or
support any other Person in contesting, in any proceeding, including without
limitation, any bankruptcy, insolvency or liquidation proceeding, the
priority, validity or enforceability of the Liens held by the Collateral Agent
or the Secured Creditors in the Collateral or the priority, validity or
enforceability of the Secured Obligations, or the provisions of this Section
11. Notwithstanding anything to the contrary contained in the immediately
preceding sentence, the Banks shall be entitled to assert the provisions of
the Collateral Documents (subject to the provisions of this Section 11) in
accordance with the terms thereof.
11.06 Payment Invalidated. In the event that any of the First
Priority Secured Obligations shall be paid in full and subsequently, for
whatever reason (including, but not limited to, an order or judgment for
disgorgement of a preference under Title 11 of the United Stated Code, or any
similar law, or the settlement of any claim in respect thereof), formerly paid
or satisfied First Priority Secured Obligations become unpaid or unsatisfied,
the terms and conditions of this Section 11 shall be fully applicable thereto
until all such First Priority Secured Obligations are again paid in full.
11.07 Right to Amend, etc. As between the Banks and the other
Secured Creditors, it is agreed that the Secured Creditors (excluding the
Banks in their capacities as such) may at any time and from time to time, in
their sole discretion, and without any obligation to give any notice or
receive any consent from any Bank in its capacity as such, change the manner,
place or terms of payment, or change or extend the time of payment of, or
renew, alter, refinance, increase or add to the First Priority Secured
Obligations (subject, in the case of an increase in outstanding Indebtedness
constituting Secured Obligations, to compliance to the relevant provisions of
Section 7.01 hereof), or obtain, release, or dispose of any Collateral
therefor, or amend or supplement in any manner the Existing Credit Agreement,
the Collateral Documents or any other agreements or instruments evidencing,
securing or relating to the First Priority Secured Obligations, and the
provisions of this Section 11 shall continue in full force and effect with
respect to all such First Priority Secured Obligations; provided, however,
that the actions of the Secured Creditors in effecting any amendments, waivers
or modifications of the Collateral Documents shall be required to be taken in
compliance with the relevant provisions regarding amendments contained in the
respective Collateral Document.
11.08 Creation of Future Obligations. All of the First
Priority Secured Obligations shall be deemed to have been funded by the
Secured Creditors in reliance upon the agreements contained in this Section
11, and each Bank expressly waives notice of acceptance of the agreements set
forth herein, notice of reliance thereon and any other agreements and notice
of the creation of any First Priority Secured Obligations after the date
hereof, and agrees that the Secured Creditors shall be entitled to rely upon
the agreements set forth herein at all times in creating First Priority
Secured Obligations. It is expressly agreed that, subject to the provisions
of Section 7.01, additional extensions of credit may be made pursuant to the
Existing Credit Agreement or Interest Rate Protection Agreements (including
but not limited to refinancings permitted pursuant to Section 7.01), and that
such additional obligations may be designated as First Priority Secured
Obligations (and shall be entitled to the priorities with respect to the
Collateral as are provided in this Section 11), and that, except to the extent
the Incurrence of any Indebtedness would violate Section 7.01, no further
consent of the Banks shall be required in connection therewith and that the
provisions of this Section 11 shall be fully applicable to the obligations so
created in the future. The Banks hereby authorize the Collateral Agent to
amend the Security Documents as necessary or desirable to effect the foregoing
agreements.
11.09 Waiver of Liability For Actions Taken With Respect To
Second Priority Secured Obligations and Collateral. (a) Neither the
Administrative Agent, the Existing Credit Agent, the Collateral Agent nor any
Secured Creditor shall have any liability to the holder of any Second Priority
Secured Obligations (in its capacity as such), and each Bank (in its capacity
as such), on behalf of itself and its successors and assigns, hereby waives to
the extent permitted by applicable law any claim, right, action or cause of
action which it may now or hereafter have against the Administrative Agent,
the Existing Credit Agreement Agent, the Collateral Agent or any other Secured
Creditor (including, without limitation, any and all claims, rights, actions
or causes of action that any Bank may otherwise have against the
Administrative Agent, the Collateral Agent or any other Secured Creditor under
Section 9-207, 9-504 and 9-507 of the UCC) arising out of, any and all actions
which the Administrative Agent, the Collateral Agent or any other Secured
Creditor, in good faith, takes or omits to take with respect to the Secured
Obligations, any obligor with respect to the Secured Obligations or any
Collateral, including, without limitation, actions with respect to: the
creation, perfection or continuation of Liens with respect to any Collateral;
any Remedial Action or Disposition of any Collateral; the release of any
Collateral; the custody, valuation, protection, preservation, use or
depreciation of any Collateral; the realizing upon or failure to realize upon
any Collateral; or the collection of the Obligations. To the extent that any
of the foregoing waivers is not permitted by applicable law, it is agreed that
the applicable standard by which any non-waivable rights, duties or claims are
to be measured shall be that neither the Administrative Agent, the Existing
Credit Agreement Agent, the Collateral Agent nor any other Secured Creditor
shall have any liability or responsibility to any holder of any Second
Priority Secured Obligations, for any actions or omissions other than actions
or omissions constituting gross negligence or wilful misconduct as finally
determined by a court of competent jurisdiction.
11.10 Financing Issues. If Communications, the Borrower or
any of their Restricted Subsidiaries shall be subject to a bankruptcy,
insolvency, liquidation or similar proceeding (including as a result of the
commencement of a case under the Bankruptcy Code) and the Administrative
Agent, the Existing Credit Agreement Agent, the Collateral Agent, the Secured
Creditors or any of them shall desire to permit the usage of cash collateral
or to provide financing to Communications, the Borrower or any of their
respective Restricted Subsidiaries under Section 363 or Section 364 of the
Bankruptcy Code, then: each of the holders of the Second Priority Secured
Obligations agrees that (i) notice received two Business Days' prior to the
entry of an order approving such usage of cash collateral and five Business
Days' prior to the entry of an order approving such financing shall be adequate
notice; and (ii) provided it receives a Lien in any property arising or
acquired after the commencement of such proceeding which may be substituted
for the Collateral subject to such usage under Section 363 of the Bankruptcy
Code or which secures such financing under Section 364 of the Bankruptcy Code
(which Lien shall be subordinated to any Lien in such property held by the
Administrative Agent, the Collateral Agent, or the Secured Creditors, as the
case may be, on terms substantially the same as the terms set forth in this
Section 11), it will raise no objection to such usage or financing on the
grounds that its junior Lien position with respect to any Collateral is not
adequately protected.
11.11 Effectiveness. The provisions in this Section 11 shall
be effective both before and after the commencement of a bankruptcy,
insolvency, liquidation or similar proceeding. All references in this
Agreement to Communications, the Borrower or any of their respective
Subsidiaries shall include such entity as debtor in possession or any receiver
or trustee for such entity.
11.12 Further Assurances. Each of the holders of the
Obligations agrees to take such further action and shall execute and deliver
to the Administrative Agent, the Existing Credit Agreement Agent, the
Collateral Agent and the Secured Creditors such additional documents and
instruments (in recordable form, if requested) as the Administrative Agent,
the Existing Credit Agreement Agent, the Collateral Agent or the Secured
Creditors may reasonably request to effectuate the terms of and agreements
contemplated by this Section 11.
11.13 Obligations as Designated Senior Indebtedness under
Senior Subordinated Notes Indenture. (a) The parties hereto expressly
acknowledge and agree that the Obligations constitute Indebtedness (as defined
in the Senior Subordinated Notes Indenture) of (and with full recourse, as a
general claim, to and against) the Borrower and the various Guarantors (by
virtue of the Guaranties), which (i) is senior and superior in right of
payment to the respective obligations of the Borrower and the Guarantors under
the Senior Subordinated Notes, the Guaranties thereof contained in the Senior
Subordianted Note Documents and the Senior Subordinated Note Documents, (ii)
is not subordinate in right of payment to any other Indebtedness (as defined
in the Senior Subordinated Notes Indenture) of the Borrower or any Guarantor
and (iii) is, therefore "Senior Indebtedness" (as defined in the Senior
Subordinated Notes Indenture) of the Borrower and such Guarantors,
respectively. The parties hereto further acknowledge and agree that, at any
time when all Indebtedness under the Existing Credit Agreement has been repaid
in full, the Obligations constitute Designated Senior Indebtedness (as defined
in the Senior Subordinated Notes Indenture) of the Borrower and the
Guarantors.
(b) The parties hereto further acknowledge and agree that,
without limiting the effect of the preceding sentence (including, without
limitation, the seniority and superiority of the Obligations in right of
payment), the priorities with respect to the Collateral and the Proceeds
thereof shall be governed by the provisions of this Section 11, and the
provisions of Section 11.13(a) shall in no event limit or modify the
agreements contained in Sections 11.01 through 11.12, or the provisions of the
Collateral Documents.
11.14 Benefits of this Section 11. It is acknowledged and
agreed that the provisions of this Section 11 are agreed to in order to induce
the Existing Credit Agreement Required Lenders to enter into the amendments to
the Existing Credit Agreement and Collateral Documents as contemplated by
Section 4, and that the provisions of this Section 11 may be directly enforced
by the various Secured Creditors and the Collateral Agent or Existing Credit
Agreement Agent on their behalf. In no event shall any of the provisions of
this Section 11 be supplemented, modified or waived except in a written
agreement executed by the Existing Credit Agreement Agent (with the prior
written consent of the Existing Credit Agreement Required Lenders).
SECTION 12. Miscellaneous.
12.01 Payment of Expenses; Indemnification; etc. The Borrower
agrees that it shall: (i) whether or not the transactions herein contemplated
are consummated, pay all reasonable out-of-pocket costs and expenses of the
Administrative Agent (including, without limitation, the reasonable fees and
disbursements of White & Case and the Administrative Agent's local counsel and
consultants) in connection with the preparation, execution and delivery of this
Agreement and the other Credit Documents and the documents and instruments
referred to herein and therein and any amendment, waiver or consent relating
hereto or thereto, of the Administrative Agent in connection with its
syndication efforts with respect to this Agreement and of the Administrative
Agent and, after the occurrence of an Event of Default, each of the Banks in
connection with the enforcement of this Agreement and the other Credit
Documents and the documents and instruments referred to herein and therein
(including, without limitation, the fees and disbursements of counsel for the
Administrative Agent); (ii) pay and hold each of the Banks harmless from and
against any and all present and future stamp, excise and other similar
documentary taxes with respect to the foregoing matters and save each of the
Banks harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent attributable to
such Bank) to pay such taxes; and (iii) indemnify the Administrative Agent and
each Bank, and each of their respective officers, directors, employees,
representatives and agents from and hold each of them harmless against any and
all liabilities, obligations (including removal or remedial actions), losses,
damages, penalties, claims, actions, judgments, suits, costs, expenses and
disbursements (including reasonable attorneys' and consultants' fees and
disbursements) incurred by, imposed on or assessed against any of them as a
result of, or arising out of, or in any way related to, or by reason of, (a)
any investigation, litigation or other proceeding (whether or not the
Administrative Agent or any Bank is a party thereto) related to the entering
into and/or performance of this Agreement or any other Credit Document or the
use of the proceeds of any Loans hereunder or the consummation of any
transactions contemplated herein or in any other Credit Document or the
exercise of any of their rights or remedies provided herein or in the other
Credit Documents, or (b) the actual or alleged presence of Hazardous Materials
in the air, surface water or groundwater or on the surface or subsurface of
any Real Property owned or at any time operated by the Borrower or any of its
Subsidiaries, the generation, storage, transportation, handling or disposal of
Hazardous Materials at any location, whether or not owned or operated by the
Borrower or any of its Subsidiaries, the non-compliance of any Real Property
with foreign, federal, state and local laws, regulations, and ordinances
(including applicable permits thereunder) applicable to any Real Property, or
any Environmental Claim asserted against the Borrower, any of its Subsidiaries
or any Real Property owned or at any time operated by the Borrower or any of
its Subsidiaries, including, in each case, without limitation, the reasonable
fees and disbursements of counsel and other consultants incurred in connection
with any such investigation, litigation or other proceeding (but excluding any
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified). To the extent that the undertaking to indemnify, pay or hold
harmless the Administrative Agent or any Bank set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, the Borrower shall make the maximum contribution to the payment and
satisfaction of each of the indemnified liabilities which is permissible under
applicable law.
12.02 Right of Setoff. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, upon the occurrence of an Event of Default,
each Bank is hereby authorized (to the extent not prohibited by applicable
law) at any time or from time to time, without presentment, demand, protest or
other notice of any kind to the Borrower or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and apply
any and all deposits (general or special) and any other Indebtedness at any
time held or owing by such Bank (including, without limitation, by branches
and agencies of such Bank wherever located) to or for the credit or the
account of any Credit Party against and on account of the Obligations and
liabilities of such Credit Party to such Bank under this Agreement or under
any of the other Credit Documents, including, without limitation, all
interests in Obligations purchased by such Bank pursuant to Section 12.06(b),
and all other claims of any nature or description arising out of or connected
with this Agreement or any other Credit Document, irrespective of whether or
not such Bank shall have made any demand hereunder and although said
Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
12.03 Notices. Except as otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit
Party, at the address specified opposite its signature below or in the other
relevant Credit Documents; if to any Bank, at its address specified on
Schedule II; and if to the Administrative Agent, at its Notice Office; or, as
to any Credit Party or the Administrative Agent, at such other address as
shall be designated by such party in a written notice to the other parties
hereto and, as to each Bank, at such other address as shall be designated by
such Bank in a written notice to the Borrower and the Administrative Agent.
All such notices and communications shall, when mailed, telegraphed, telexed,
telecopied, or cabled or sent by overnight courier, be effective (x) three
Business Days after deposited in the mails, (y) one Business Day after
delivered to the telegraph company, cable company or a recognized overnight
courier, as the case may be, or (z) when sent by telex or telecopier, except
that notices and communications to the Administrative Agent shall not be
effective until received by the Administrative Agent.
12.04 Benefit of Agreement; Assignments; Participations. (a)
This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the parties hereto;
provided, however, the Borrower may not assign or transfer any of its rights,
obligations or interest hereunder or under any other Credit Document without
the prior written consent of the Banks and, provided further, that, although
any Bank may transfer, assign or grant participations in its rights hereunder,
such Bank shall remain a "Bank" for all purposes hereunder (and may not
transfer or assign all or any portion of its obligations hereunder except as
provided in Sections 1.11 and 12.04(b)) and the transferee, assignee or
participant, as the case may be, shall not constitute a "Bank" hereunder and,
provided further, that no Bank shall transfer or grant any participation under
which the participant shall have rights to approve any amendment to or waiver
of this Agreement or any other Credit Document except to the extent such
amendment or waiver would (i) extend the final scheduled maturity of any Loan
or Note in which such participant is participating, or reduce the rate or
extend the time of payment of interest or Fees thereon (except in connection
with a waiver of applicability of any post-default increase in interest rates)
or reduce the principal amount thereof, or increase the amount of the
participant's participation over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default or of a mandatory
repayment of Loans shall not constitute a change in the terms of such
participation, (ii) consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement or (iii) release all
or substantially all of the Collateral under all of the Collateral Documents
(except as expressly provided in the Credit Documents) supporting the Loans
hereunder in which such participant is participating. In the case of any such
participation, the participant shall (x) not have any rights under this
Agreement or any of the other Credit Documents (the participant's rights
against such Bank in respect of such participation to be those set forth in
the agreement executed by such Bank in favor of the participant relating
thereto) and all amounts payable by the Borrower hereunder shall be determined
as if such Bank had not sold such participation and (y) if such participant is
not a bank, represent that either (i) no part of its acquisition of its
participation is made out of assets of any employee benefit plan, or (ii) after
consultation, in good faith, with the Borrower and provision by the Borrower of
such information as may be reasonably requested by the participant, the
acquisition and holding of such participation does not constitute a non-exempt
prohibited transaction under Section 406 of ERISA and Section 4975 of the
Code, or (iii) such participation is an "insurance company general account,"
as such term is defined in the Department of Labor Prohibited Transaction
Class Exemption 95-60 (issued July 12, 1995) ("PTCE 95-60"), and, as of the
date of the transfer there is no "employee benefit plan" with respect to which
the aggregate amount of such general account's reserves and liabilities for
the contracts held by or on behalf of such "employee benefit plan" and all
other "employee benefit plans" maintained by the same employer (and affiliates
thereof as defined in Section V(a)(1) of PTCE 95-60) or by the same employee
organization (in each case determined in accordance with the provisions of
PTCE 95-60) exceeds 10% of the total reserves and liabilities of such general
account (as determined under PTCE 95-60) (exclusive of separate account
liabilities) plus surplus as set forth in the National Association of Insurance
Commissioners Annual Statement filed with the state of domicile of the
participant. As used in this Section 12.04(a), the term "employee benefit
plan" shall have the meaning assigned to it in Title I of ERISA and shall also
include a "plan" as defined in Section 4975(e)(1) of the Code.
(b) Notwithstanding the foregoing, any Bank (or any Bank
together with one or more other Banks) may (x) assign all or a portion of its
outstanding Obligations hereunder to (i) its parent company and/or any
affiliate of such Bank which is at least 50% owned by such Bank or its parent
company or to one or more Banks or (ii) in the case of any Bank that is a fund
that invests in bank loans, any other fund that invests in bank loans and is
managed by the same investment advisor of such Bank or by an Affiliate of such
investment advisor or (y) assign all, or if less than all, a portion equal to
at least $1,000,000 in the aggregate for the assigning Bank or assigning
Banks, of such outstanding Obligations hereunder to one or more Eligible
Transferees, each of which assignees shall become a party to this Agreement as
a Bank by execution of an Assignment and Assumption Agreement; provided that
(i) at such time Schedule I shall be deemed modified to reflect the
outstanding Loans of such new Bank and of the existing Banks, (ii) new Notes
will be issued, at the Borrower's expense, to such new Bank and to the
assigning Bank upon the request of such new Bank or assigning Bank, such new
Notes to be in conformity with the requirements of Section 1.04 (with
appropriate modifications) to the extent needed to reflect the revised
outstanding Loans, (iii) the Administrative Agent shall receive at the time of
each such assignment, from the assigning or assignee Bank, the payment of a
non-refundable assignment fee of $3,500 and (iv) if such Eligible Transferee
is not a bank, represent that either (i) no part of its acquisition of its
Loans is made out of assets of any employee benefit plan, or (ii) after
consultation, in good faith, with the Borrower and provision by the Borrower
of such information as may be reasonably requested by such Eligible
Transferee, the acquisition and holding of such Loans does not constitute a
non-exempt prohibited transaction under Section 406 of ERISA and Section 4975
of the Code, or (iii) such assignment is an "insurance company general
account," as such term is defined in the Department of Labor Prohibited
Transaction Class Exemption 95-60 (issued July 12, 1995) ("PTCE 95-60"), and,
as of the date of the assignment, there is no "employee benefit plan" with
respect to which the aggregate amount of such general account's reserves and
liabilities for the contracts held by or on behalf of such "employee benefit
plan" and all other "employee benefit plans" maintained by the same employer
(and affiliates thereof as defined in Section V(a)(1) of PTCE 95-60) or by the
same employee organization (in each case determined in accordance with the
provisions of PTCE 95-60) exceeds 10% of the total reserves and liabilities of
such general account (as determined under PTCE 95-60) (exclusive of separate
account liabilities) plus surplus as set forth in the National Association of
Insurance Commissioners Annual Statement filed with the state of domicile of
such Eligible Transferee; provided further, that such transfer or assignment
will not be effective until recorded by the Administrative Agent on the
Register pursuant to Section 12.15. As used in this Section 12.04(b), the
term "employee benefit plan" shall have the meaning assigned to it in Title I
of ERISA and shall also include a "plan" as defined in Section 4975(e)(1) of
the Code. To the extent of any assignment pursuant to this Section 12.04(b),
the assigning Bank shall be relieved of its obligations hereunder with respect
to its assigned Loans. At the time of each assignment pursuant to this
Section 12.04 (b) to a Person which is not already a Bank hereunder and which
is not a United States person (as such term is defined in Section 7701(a)(30)
of the Code) for Federal income tax purposes, the respective assignee Bank
shall, to the extent legally entitled to do so, provide to the Borrower the
forms described in Section 3.03(e). To the extent that an assignment of all or
any portion of a Bank's outstanding Obligations pursuant to Section 1.11 or
this Section 12.04(b) would, at the time of such assignment, result in
increased costs (including, without limitation, amounts described in Section
3.03) from those being charged by the respective assigning Bank prior to such
assignment, then the Borrower shall not be obligated to pay such increased
costs (although the Borrower shall be obligated to pay any other increased
costs of the type described above resulting from changes after the date of the
respective assignment).
(c) Nothing in this Agreement shall prevent or prohibit any
Bank from pledging its Loans and Notes hereunder to a Federal Reserve Bank in
support of borrowings made by such Bank from such Federal Reserve Bank and,
with the consent of the Administrative Agent, any Bank which is a fund may
pledge all or any portion of its Notes or Loans to its trustee in support of
its obligations to its trustee. No pledge pursuant to this clause (c) shall
release the transferor Bank from any of its obligations hereunder.
12.05 No Waiver; Remedies Cumulative. No failure or delay on
the part of the Administrative Agent, the Collateral Agent or any Bank in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit
Party and the Administrative Agent, the Collateral Agent or any Bank shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder or thereunder. The rights, powers and
remedies herein or in any other Credit Document expressly provided are
cumulative and not exclusive of any rights, powers or remedies which the
Administrative Agent, the Collateral Agent or any Bank would otherwise have.
No notice to or demand on any Credit Party in any case shall entitle any
Credit Party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Administrative Agent,
the Collateral Agent or any Bank to any other or further action in any
circumstances without notice or demand.
12.06 Payments Pro Rata. (a) Except as otherwise provided in
this Agreement, the Administrative Agent agrees that promptly after its
receipt of each payment from or on behalf of the Borrower in respect of any
Obligations hereunder, it shall distribute such payment to the Banks (other
than any Bank that has consented in writing to waive its pro rata share of any
such payment) pro rata based upon their respective shares, if any, of the
Obligations with respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security,
by the exercise of the right of setoff or banker's lien, by counterclaim or
cross action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or
interest on, the Loans, of a sum which with respect to the related sum or sums
received by other Banks is in a greater proportion than the total of such
Obligation then owed and due to such Bank bears to the total of such
Obligation then owed and due to all of the Banks immediately prior to such
receipt, then such Bank receiving such excess payment shall purchase for cash
without recourse or warranty from the other Banks an interest in the
Obligations of the respective Credit Party to such Banks in such amount as
shall result in a proportional participation by all the Banks in such amount;
provided that if all or any portion of such excess amount is thereafter
recovered from such Bank, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
12.07 Computations. All computations of interest and Fees
hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring
in the period for which such interest or Fees are payable.
12.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER
OF JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS (EXCEPT, IN
THE CASE OF OTHER CREDIT DOCUMENTS, AS SPECIFICALLY OTHERWISE PROVIDED
THEREIN) AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER HEREBY
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. THE BORROWER
HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL
JURISDICTION OVER THE BORROWER, AND AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL
ACTION PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENTS
BROUGHT IN ANY OF THE AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL
JURISDICTION OVER THE BORROWER. THE BORROWER FURTHER IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH
ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS SET FORTH
OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER
SUCH MAILING. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH
SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER
CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT, ANY BANK OR
THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN
ANY OTHER JURISDICTION.
(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE
AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN
CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT
ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
12.09 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument. A set of counterparts executed by all the parties hereto shall be
lodged with the Borrower and the Administrative Agent.
12.10 Effectiveness. This Agreement shall become effective on
the date (the "Effective Date") on which the Borrower, the Administrative
Agent and each of the Banks shall have signed a counterpart hereof (whether
the same or different counterparts) and shall have delivered the same to the
Administrative Agent at its Notice Office or, in the case of the Banks, shall
have given to the Administrative Agent telephonic (confirmed in writing),
written or telex notice (actually received) at such office that the same has
been signed and mailed to it. The Administrative Agent shall give the
Borrower and each Bank prompt written notice of the occurrence of the
Effective Date.
12.11 Headings Descriptive. The headings of the several
sections and subsections of this Agreement are inserted for convenience only
and shall not in any way affect the meaning or construction of any provision
of this Agreement.
12.12 Amendment or Waiver; etc. (a) Neither this Agreement
nor any other Credit Document nor any terms hereof or thereof may be changed,
waived, discharged or terminated unless such change, waiver, discharge or
termination is in writing signed by the respective Credit Parties party
thereto and the Required Banks, provided that (A) the various Collateral
Documents may be amended in accordance with the relevant provisions thereof
governing amendments (which shall be consistent with the Collateral Documents
as amended pursuant to the amendments required pursuant to Section 4 hereof)
and (B) except as provided in proceeding clause (A), no such change, waiver,
discharge or termination shall, without the consent of each Bank (other than a
Defaulting Bank) with Obligations being directly modified, (i) extend the
final scheduled maturity of any Loan or Note, or reduce the rate or extend the
time of payment of interest or Fees thereon, or reduce the principal amount
thereof (except to the extent repaid in cash), (ii) release all or
substantially all of the Collateral (except as expressly provided in the
Collateral Documents) under all the Collateral Documents, (iii) amend, modify
or waive any provision of this Section 12.12 (except for technical amendments
with respect to additional extensions of credit pursuant to this Agreement
which afford the protections set forth in the proviso below to such additional
extensions of credit), (iv) reduce the percentage specified in the definition
of Required Banks (it being understood that, with the consent of the Required
Banks, additional extensions of credit pursuant to this Agreement may be
included in the determination of the Required Banks on substantially the same
basis as the extensions of Loans are included on the Effective Date) or (vi)
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement; provided further, that no such change,
waiver, discharge or termination shall (x) increase the Commitment of any Bank
over the amount thereof then in effect without the consent of such Bank (it
being understood that waivers or modifications of conditions precedent,
covenants, Defaults or Events of Default shall not constitute an increase of
the Commitment of any Bank), (y) without the consent of the Administrative
Agent, amend, modify or waive any provision of Section 10 or any other
provision as same relates to the rights or obligations of the Administrative
Agent, (x) without the consent of the Collateral Agent, amend, modify or waive
any provision relating to the rights or obligations of the Collateral Agent.
(b) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement as
contemplated by clauses (i) through (vi), inclusive, of the first proviso to
Section 12.12(a), the consent of the Required Banks is obtained but the
consent of one or more of such other Banks whose consent is required is not
obtained, then the Borrower shall have the right, so long as all
non-consenting Banks whose individual consent is required are treated as
described below, to replace each such non-consenting Bank or Banks with one or
more Replacement Banks pursuant to Section 1.11 so long as at the time of such
replacement, each such Replacement Bank consents to the proposed change,
waiver, discharge or termination, provided further, that in any event the
Borrower shall not have the right to replace a Bank, or repay its Loans solely
as a result of the exercise of such Bank's rights (and the withholding of any
required consent by such Bank) pursuant to the second proviso to Section
12.12(a).
12.13 Survival. All indemnities set forth herein including,
without limitation, in Sections 1.08, 3.03, 10.06 and 12.01 shall survive the
execution, delivery and termination of this Agreement and the Notes and the
making and repayment of the Obligations.
12.14 Domicile of Loans. Each Bank may transfer and carry its
Loans at, to or for the account of any office, Subsidiary or Affiliate of such
Bank. Notwithstanding anything to the contrary contained herein, to the
extent that a transfer of Loans pursuant to this Section 12.14 would, at the
time of such transfer, result in increased costs under Section 1.08, 1.09 or
3.03 in excess of those being charged by the respective Bank prior to such
transfer, then the Borrower shall not be obligated to pay such excess
increased costs (although the Borrower, in accordance with and pursuant to the
other provisions of this Agreement, shall be obligated to pay the costs which
would apply in the absence of such designation and any subsequent increased
costs of the type described above resulting from changes after the date of the
respective transfer).
12.15 Register. The Borrower hereby designates the
Administrative Agent to serve as the Borrower's agent, solely for purposes of
this Section 12.15, to maintain a register (the "Register") on which it will
record the Loans made by each of the Banks and each repayment in respect of
the principal amount of the Loans of each Bank. Failure to make any such
recordation, or any error in such recordation shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Bank, the transfer
of the rights to the principal of, and interest on, any Loan shall not be
effective until such transfer is recorded on the Register maintained by the
Administrative Agent with respect to ownership of such Loans and prior to such
recordation all amounts owing to the transferor with respect to such Loans
shall remain owing to the transferor. The registration of assignment or
transfer of all or part of any Loans shall be recorded by the Administrative
Agent on the Register only upon the acceptance by the Administrative Agent of
a properly executed and delivered Assignment and Assumption Agreement pursuant
to Section 12.04(b). Coincident with the delivery of such an Assignment and
Assumption Agreement to the Administrative Agent for acceptance and
registration of assignment or transfer of all or part of a Loan, or as soon
thereafter as practicable, the assigning or transferor Bank shall surrender
the Note evidencing such Loan, and thereupon one or more new Notes in the same
aggregate principal amount shall be issued to the assigning or transferor Bank
and/or the new Bank. The Borrower agrees to indemnify the Administrative
Agent from and against any and all losses, claims, damages and liabilities of
whatsoever nature which may be imposed on, asserted against or incurred by the
Administrative Agent in performing its duties under this Section 12.15.
12.16 Confidentiality. (a) Subject to the provisions of
clause (b) of this Section 12.16, each Bank agrees that it will use its
reasonable efforts not to disclose without the prior consent of the Borrower
(other than to its employees, auditors, advisors or counsel or to another Bank
if the Bank or such Bank's holding or parent company in its sole discretion
determines that any such party should have access to such information,
provided such Persons shall be subject to the provisions of this Section 12.16
to the same extent as such Bank) any information with respect to
Communications, the Borrower or any of their respective Subsidiaries which is
now or in the future furnished pursuant to this Agreement or any other Credit
Document and which is designated by the Borrower to the Banks in writing as
confidential, provided that any Bank may disclose any such information (a) as
has become generally available to the public, (b) as may be required or
appropriate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdiction over
such Bank or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or similar organizations (whether in the United States or
elsewhere) or their successors, (c) as may be required or appropriate in
respect to any summons or subpoena or in connection with any litigation, (d)
in order to comply with any law, order, regulation or ruling applicable to
such Bank, (e) to the Administrative Agent or the Collateral Agent or any
other Bank or Secured Creditor and (f) to any prospective or actual transferee
or participant in connection with any contemplated transfer or participation
of any of the Notes or Loans or any interest therein by such Bank, provided,
that such prospective transferee shall be subject to the provisions of this
Section 12.16(a).
(b) The Borrower hereby acknowledges and agrees that each Bank
may share with any of its affiliates any information related to
Communications, the Borrower or any of their respective Restricted
Subsidiaries (including, without limitation, any nonpublic customer
information regarding the creditworthiness of Communications, the Borrower and
their respective Restricted Subsidiaries, provided such Persons shall be
subject to the provisions of this Section 12.16 to the same extent as such
Bank).
12.17 Designated Senior Indebtedness. The Borrower hereby
irrevocably agrees that, at any time when all Indebtedness under the Existing
Credit Agreement has been repaid in full, the Indebtedness outstanding
hereunder shall constitute Designated Senior Indebtedness under, and as
defined in, the Senior Subordinated Notes Indenture at all times when the
principal amount of outstanding Loans are at least equal to $25 million.
12.18 Limitation on Additional Amounts, etc. Notwithstanding
anything to the contrary contained in Section 1.08 or 1.09 of this Agreement,
unless a Bank gives notice to the respective Borrower that it is obligated to
pay an amount under the respective Section within one year after the later of
(x) the date the Bank incurs the respective increased costs, loss, expense or
liability, reduction in amounts received or receivable or reduction in return
on capital or (y) the date such Bank has actual knowledge of its incurrence of
the respective increased costs, loss, expense or liability, reductions in
amounts received or receivable or reduction in return on capital, then such
Bank shall only be entitled to be compensated for such amount by such Borrower
pursuant to said Section 1.08 or 1.09, as the case may be, to the extent the
costs, loss, expense or liability, reduction in amounts received or receivable
or reduction in return on capital are incurred or suffered on or after the
date which occurs one year prior to such Bank giving notice to such Borrower
that it is obligated to pay the respective amounts pursuant to said Section
1.08 and 1.09, as the case may be. This Section 12.18 shall have no
applicability to any Section of this Agreement other than said Sections 1.08
and 1.09.
12.19 Maximum Rate. Notwithstanding anything to the contrary
contained elsewhere in this Agreement or in any other Credit Document, the
Borrower, the Administrative Agent and the Banks hereby agree that all
agreements among them under this Agreement and the other Credit Documents,
whether now existing or hereafter arising and whether written or oral, are
expressly limited so that in no contingency or event whatsoever shall the
amount paid, or agreed to be paid, to the Administrative Agent or any Bank for
the use, forbearance, or detention of the money loaned to the Borrower and
evidenced hereby or thereby or for the performance or payment of any covenant
or obligation contained herein or therein, exceed the Highest Lawful Rate. If
due to any circumstance whatsoever, fulfillment of any provisions of this
Agreement or any of the other Credit Documents at the time performance of such
provision shall be due shall exceed the Highest Lawful Rate, then,
automatically, the obligation to be fulfilled shall be modified or reduced to
the extent necessary to limit such interest to the Highest Lawful Rate, and if
from any such circumstance any Bank should ever receive anything of value
deemed interest by applicable law which would exceed the Highest Lawful Rate,
such excessive interest shall be applied to the reduction of the principal
amount then outstanding hereunder or on account of any other then outstanding
Obligations and not to the payment of interest, or if such excessive interest
exceeds the principal unpaid balance then outstanding hereunder and such other
then outstanding Obligations, such excess shall be refunded to the Borrower.
All sums paid or agreed to be paid to the Administrative Agent or any Bank for
the use, forbearance, or detention of the Obligations and other Indebtedness
of the Borrower to the Administrative Agent or any Bank shall, to the extent
permitted by applicable law, be amortized, prorated, allocated and spread
throughout the full term of such Indebtedness until payment in full so that
the actual rate of interest on account of all such Indebtedness does not
exceed the Highest Lawful Rate throughout the entire term of such
Indebtedness. The terms and provisions of this Section 12.19 shall control
every other provision of this Agreement and all agreements among the Borrower,
the Administrative Agent and the Banks.
12.20 Post-Closing Actions. Notwithstanding anything to the
contrary contained in this Agreement or the other Credit Documents, the parties
hereto acknowledge and agree that:
(a) The Borrower was not required to satisfy the
conditions precedent set forth in Section 4.13 (other than with respect to
Concentration Account Agreements, which shall be delivered on the Closing
Date) and 4.14 on the Closing Date. Not later than the 90th day after the
Closing Date, the Borrower shall have:
(i) delivered fully executed amendments to all existing Lockbox
Agreements as otherwise required by Section 4.13, it being understood
that if the Borrower is unable to obtain any such amendment to an
existing Lockbox Agreement, the Borrower shall, by such 90th day,
have entered into a new Lockbox Agreement with a financial
institution satisfactory to the Collateral Agent in the form of
Exhibit M-1 hereto; and
(ii) used its best efforts to replace all Existing Credit
Agreement Collateral Access Agreements with Collateral Access
Agreements in accordance with the provisions of Section 4.14, it
being understood and agreed that if the Borrower is unable to replace
any such Existing Credit Agreement Collateral Access Agreement with a
Collateral Access Agreement after using its best efforts to do so, no
Default or Event of Default shall arise under this Agreement as a
result of any such failure.
In connection with the foregoing, the Borrower shall (i) to the extent
requested by the Collateral Agent on the Closing Date, deliver to the
Collateral Agent local counsel opinions in form and substance satisfactory to
the Collateral Agent prior to the 90th day following the Closing Date and (ii)
deliver to the Administrative Agent within 5 days following the Closing Date
Annexes II through X, inclusive, to this Agreement, which Annexes shall be
reasonably satisfactory to the Administrative Agent and the Required Banks.
All provisions of this Credit Agreement and the other Credit
Documents (including, without limitation, all conditions precedent,
representations, warranties, covenants and other agreements herein and
therein) shall be deemed modified to the extent necessary to effect the
foregoing (and to permit the taking of the actions described above within the
time periods, required above, rather than as otherwise provided in the Credit
Documents); provided, that (x) to the extent any representation and warranty
would not be true because the foregoing actions were not taken on the Closing
Date, the respective representation and warranty shall be required to be true
and correct in all material respects at the time the respective action is
taken (or was required to be taken) in accordance with the foregoing
provisions of Section 12.20 and (y) all representations and warranties
relating to the Collateral Documents shall be required to be true immediately
after the actions required to be taken by Section 12.20 have been taken (or
were required to be taken). The acceptance of the benefits of the Loans shall
constitute a representation, warranty and covenant by the Borrower to each of
the Banks that the actions required pursuant to this Section 12.20 will be, or
have been, taken within the relevant time periods referred to in this Section
12.20 and that, at such time, all representations and warranties contained in
this Credit Agreement and the other Credit Documents shall then be true and
correct without any modification pursuant to this Section 12.20, the parties
hereto acknowledge and agree that the failure to take any of the actions
required above, within the relevant time periods required above, shall give
rise to an immediate Event of Default pursuant to this Agreement.
SECTION 13. Parent Guaranty.
13.01 The Parent Guaranty. In order to induce the Banks to
enter into this Agreement and to extend credit hereunder and in recognition of
the direct benefits to be received by the Parent Guarantor from the proceeds
of the Loans and the issuance of the Letters of Credit, the Parent Guarantor
hereby agrees with the Banks as follows: the Parent Guarantor hereby
unconditionally and irrevocably guarantees as primary obligor and not merely
as surety the full and prompt payment when due, whether upon maturity, by
acceleration or otherwise, of any and all indebtedness of the Borrower to the
Banks hereunder. If any or all of the indebtedness of the Borrower to the
Banks becomes due and payable hereunder, the Parent Guarantor unconditionally
promises to pay such indebtedness to the Banks, or order, on demand, together
with any and all reasonable expenses which may be incurred by (x) the
Administrative Agent in connection with the preparation, execution and
delivery of this Agreement and the other Credit Documents and the documents and
instruments referred to herein and therein and any amendment, waiver or consent
relating hereto or thereto, in connection with its syndication efforts with
respect to this Agreement, or (y) the Administrative Agent or the Banks in
collecting any of the indebtedness. The word "indebtedness" is used in this
Section 13 in its most comprehensive sense and means any and all advances,
debts, obligations and liabilities of the Borrower arising in connection with
this Agreement, in each case, heretofore, now, or hereafter made, incurred or
created, whether voluntarily or involuntarily, absolute or contingent,
liquidated or unliquidated, determined or undetermined, whether or not such
indebtedness is from time to time reduced, or extinguished and thereafter
increased or incurred, whether the Borrower may be liable individually or
jointly with others, whether or not recovery upon such indebtedness may be or
hereafter become barred by any statute of limitations, and whether or not such
indebtedness may be or hereafter become otherwise unenforceable.
13.02 Bankruptcy. Additionally, the Parent Guarantor
unconditionally and irrevocably guarantees the payment of any and all
indebtedness of the Borrower to the Banks whether or not due or payable by the
Borrower upon the occurrence in respect of the Borrower of any of the events
specified in Section 8.01(7) or (8), and unconditionally and irrevocably
promises to pay such indebtedness to the Banks, or order, on demand, in lawful
money of the United States.
13.03 Nature of Liability. The liability of the Parent
Guarantor hereunder is exclusive and independent of any security for or other
guaranty of the indebtedness of the Borrower whether executed by the Parent
Guarantor, any other guarantor or by any other party, and the liability of the
Parent Guarantor hereunder shall not be affected or impaired by (a) any
direction as to application of payment by the Borrower or by any other party,
or (b) any other continuing or other guaranty, undertaking or maximum
liability of a guarantor or of any other party as to the indebtedness of the
Borrower, or (c) any payment on or in reduction of any such other guaranty or
undertaking, or (d) any dissolution, termination or increase, decrease or
change in personnel by the Borrower, or (e) any payment made to the
Administrative Agent or the Banks on the indebtedness which such Administrative
Agent or such Bank repays the Borrower pursuant to court order in any
bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and the Parent Guarantor waives any right to the deferral or
modification of its obligations hereunder by reason of any such proceeding.
13.04 Independent Obligation. The obligations of the Parent
Guarantor hereunder are independent of the obligations of any other guarantor
or the Borrower, and a separate action or actions may be brought and
prosecuted against the Parent Guarantor whether or not action is brought
against any other guarantor or the Borrower and whether or not any other
guarantor or the Borrower be joined in any such action or actions. The Parent
Guarantor waives, to the fullest extent permitted by law, the benefit of any
statute of limitations affecting its liability hereunder or the enforcement
thereof. Any payment by the Borrower or other circumstance which operates to
toll any statute of limitations as to the Borrower shall, to the fullest
extent permitted by law, operate to toll the statute of limitations as to the
Parent Guarantor.
13.05 Authorization. The Parent Guarantor authorizes the
Administrative Agent and the Banks without notice or demand (except as shall be
required by applicable statute and cannot be waived), and without affecting or
impairing its liability hereunder, from time to time to:
(a) subject to the agreement of the Borrower, change the
manner, place or terms of payment of, and/or change or extend the
time of payment of, renew, increase, accelerate or alter, any of the
indebtedness (including any increase or decrease in the rate of
interest thereon), any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the Parent Guaranty
herein made shall apply to the indebtedness as so changed, extended,
renewed or altered;
(b) take and hold security for the payment of the indebtedness
and sell, exchange, release, surrender, realize upon or otherwise
deal with in any manner and in any order any property by whomsoever
at any time pledged or mortgaged to secure, or howsoever securing,
the indebtedness or any liabilities (including any of those
hereunder) incurred directly or indirectly in respect thereof or
hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers,
guarantors, the Borrower or other obligors;
(e) settle or compromise any of the indebtedness, any security
therefor or any liability (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and may
subordinate the payment of all or any part thereof to the payment of
any liability (whether due or not) of the Borrower to its creditors
other than the Banks;
(f) apply any sums by whomsoever paid or howsoever realized to
any liability or liabilities of the Borrower to the Banks regardless
of what liability or liabilities of the Parent Guarantor or the
Borrower remain unpaid; and/or
(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement or any of the instruments or agreements
referred to herein, or otherwise, with the agreement of the Borrower,
amend, modify or supplement this Agreement or any of such other
instruments or agreements.
13.06 Reliance. It is not necessary for the Administrative
Agent or the Banks to inquire into the capacity or powers of the Borrower or
its Subsidiaries or the officers, directors, partners or agent acting or
purporting to act on its behalf, and any indebtedness made or created in
reliance upon the professed exercise of such powers shall be guaranteed
hereunder.
13.07 Subordination. Any indebtedness of the Borrower now or
hereafter owing to the Parent Guarantor is hereby subordinated in right of
payment to the indebtedness of the Borrower owing to the Administrative Agent
and the Banks; provided that payment may be made by the Borrower on any such
indebtedness owing to the Parent Guarantor so long as the same is not
prohibited by this Agreement; and provided further, that if the Administrative
Agent so requests at a time when an Event of Default exists, all such
indebtedness of the Borrower to the Parent Guarantor shall be collected,
enforced and received by the Parent Guarantor as trustee for the Banks and be
paid over to the Banks on account of the indebtedness of the Borrower to the
Banks, but without affecting or impairing in any manner the liability of the
Parent Guarantor under the other provisions of this Parent Guaranty. Prior to
the transfer by the Parent Guarantor of any note or negotiable instrument
evidencing any indebtedness of the Borrower to the Parent Guarantor, the
Parent Guarantor shall ▇▇▇▇ such note or negotiable instrument with a legend
that the same is subject to this subordination.
13.08 Waiver. (a) The Parent Guarantor waives any right
(except as shall be required by applicable statute and cannot be waived) to
require the Administrative Agent or the Banks to (i) proceed against the
Borrower, any other guarantor or any other party, (ii) proceed against or
exhaust any security held from the Borrower, any other guarantor or any other
party or (iii) pursue any other remedy in the Administrative Agent's or the
Banks' power whatsoever. The Parent Guarantor waives any defense based on or
arising out of any defense of the Borrower, any other guarantor or any other
party other than payment in full of the indebtedness, including, without
limitation, any defense based on or arising out of the disability of the
Borrower, any other guarantor or any other party, or the unenforceability of
the indebtedness or any part thereof from any cause, or the cessation from any
cause of the liability of the Borrower other than payment in full of the
indebtedness. The Administrative Agent and the Banks may, at their election,
foreclose on any security held by the Administrative Agent, the Collateral
Agent or the Banks by one or more judicial or nonjudicial sales, whether or
not every aspect of any such sale is commercially reasonable (to the extent
such sale is permitted by applicable law), or exercise any other right or
remedy the Administrative Agent and the Banks may have against the Borrower or
any other party, or any security, without affecting or impairing in any way
the liability of the Parent Guarantor hereunder except to the extent the
indebtedness has been paid. The Parent Guarantor waives, to the fullest
extent permitted by law, any defense arising out of any such election by the
Administrative Agent and the Banks, even though such election operates to
impair or extinguish any right of reimbursement or subrogation or other right
or remedy of the Parent Guarantor against any Borrower or any other party or
any security.
(b) The Parent Guarantor waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notices of protest, notices of dishonor, notices of acceptance
of this Parent Guaranty, and notices of the existence, creation or incurring
of new or additional indebtedness. The Parent Guarantor assumes all
responsibility for being and keeping itself informed of the Borrower's
financial condition and assets, and of all other circumstances bearing upon
the risk of nonpayment of the indebtedness and the nature, scope and extent of
the risks which the Parent Guarantor assumes and incurs hereunder, and agrees
that the Administrative Agent and the Banks shall have no duty to advise the
Parent Guarantor of information known to them regarding such circumstances or
risks.
13.09 Limitation on Enforcement. The Banks agree that this
Parent Guaranty may be enforced only by the action of the Administrative Agent
or the Collateral Agent, in each case acting upon the instructions of the
Required Banks and that no Bank shall have any right individually to seek to
enforce or to enforce this Parent Guaranty, it being understood and agreed
that such rights and remedies may be exercised by the Administrative Agent for
the benefit of the Banks upon the terms of this Agreement. The Banks further
agree that this Parent Guaranty may not be enforced against any Affiliate,
director, officer, employee or stockholder of the Parent Guarantor.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their proper and duly authorized
officers as of the date set forth above.
▇▇▇▇▇▇▇▇ COMMUNICATIONS, INC.,
a Delaware corporation
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Chief Financial Officer
▇▇▇▇▇▇▇▇ GRAPHICS, INC.,
a New York corporation
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Chief Finanical Officer
ADMINISTRATIVE AGENT:
BANKERS TRUST COMPANY, as
Administrative Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
COLLATERAL AGENT:
BT COMMERCIAL CORPORATION,
As Collateral Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
SCHEDULE I
----------
LIST OF BANKS
-------------
Bank Commitment
---- ----------
Bankers Trust $25,000,000
Company
----------
$25,000,000
SCHEDULE II
-----------
GOVERNMENTAL APPROVALS
----------------------
SCHEDULE III
------------
CHIEF EXECUTIVE OFFICES, RECORDS LOCATIONS AND INVENTORY
--------------------------------------------------------
AND EQUIPMENT LOCATIONS
-----------------------
SCHEDULE IV
-----------
FICTITIOUS BUSINESS NAMES
-------------------------
SCHEDULE V
----------
TAX MATTERS
-----------
SCHEDULE VI
-----------
SUBSIDIARIES
------------
SCHEDULE VII
------------
REAL PROPERTIES
---------------
SCHEDULE VIII
-------------
COLLECTIVE BARGAINING AGREEMENTS
--------------------------------
SCHEDULE IX
-----------
INSURANCE
---------
SCHEDULE X
----------
PERMITTED LIENS
---------------
SCHEDULE XI
-----------
EXISTING INDEBTEDNESS
---------------------
SCHEDULE XII
------------
INVESTMENTS
-----------
SCHEDULE XIII
-------------
TRANSACTIONS WITH AFFILIATES
----------------------------
SCHEDULE XIV
------------