EXHIBIT 10.36
SENIOR SECURED CREDIT AGREEMENT,
dated as of February 23, 2000,
among
THE TITAN CORPORATION,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS FROM TIME TO TIME
PARTIES HERETO,
as the Lenders,
CREDIT SUISSE FIRST BOSTON,
as Lead Arranger and as Administrative Agent for the Lenders,
FIRST UNION SECURITIES, INC.,
as Co-Arranger and as Syndication Agent,
and
THE BANK OF NOVA SCOTIA,
as the Documentation Agent.
TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 Defined Terms....................................................1
Section 1.2 Use of Defined Terms............................................35
Section 1.3 Cross-References................................................35
Section 1.4 Accounting and Financial Determinations.........................35
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
Section 2.1 Revolving Loan Commitment and Swing Line Loan Commitment........36
Section 2.2 Letter of Credit Commitment.....................................36
Section 2.3 Term Loan Commitments...........................................37
Section 2.4 Lenders Not Permitted or Required to Make Loans.................38
Section 2.5 Issuer Not Permitted or Required to Issue Letters of Credit.....39
Section 2.6 Reduction of the Commitment Amounts.............................39
Section 2.7 Borrowing Procedure.............................................40
Section 2.8 Swing Line Loans................................................41
Section 2.9 Continuation and Conversion Elections...........................42
Section 2.10 Funding.........................................................42
Section 2.11 Letters of Credit...............................................42
Section 2.12 Notes...........................................................45
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
Section 3.1 Repayments and Prepayments......................................46
Section 3.2 Application.....................................................50
Section 3.3 Interest Rates..................................................51
Section 3.4 Default Rates...................................................52
Section 3.5 Payment Dates...................................................52
Section 3.6 Fees............................................................53
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
Section 4.1 LIBO Rate Lending Unlawful......................................54
Section 4.2 Deposits Unavailable............................................54
Section 4.3 Increased LIBO Rate Loan Costs, etc.............................54
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Section 4.4 Funding Losses..................................................55
Section 4.5 Increased Capital Costs.........................................55
Section 4.6 Taxes...........................................................56
Section 4.7 Payments, Computations, etc.....................................58
Section 4.8 Sharing of Payments.............................................59
Section 4.9 Setoff..........................................................59
Section 4.10 Replacement of Lender...........................................59
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
Section 5.1 Conditions Precedent to the Effectiveness of this Agreement.....60
Section 5.2 All Credit Extensions...........................................66
Section 5.3 Term C Loans....................................................68
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.1 Organization, etc...............................................68
Section 6.2 Due Authorization, Non-Contravention, etc.......................68
Section 6.3 Government Approval, Regulation, etc............................69
Section 6.4 Validity, etc...................................................69
Section 6.5 Financial Information...........................................69
Section 6.6 No Material Adverse Effect......................................69
Section 6.7 Litigation, Labor Controversies, etc............................70
Section 6.8 Subsidiaries....................................................70
Section 6.9 Ownership of Properties.........................................70
Section 6.10 Taxes...........................................................70
Section 6.11 Pension and Welfare Plans.......................................70
Section 6.12 Environmental Warranties........................................71
Section 6.13 Accuracy of Information.........................................72
Section 6.14 Regulations T, U and X..........................................72
Section 6.15 Year 2000 Problem...............................................73
Section 6.16 Government Contracts............................................73
Section 6.17 No Debarment....................................................73
Section 6.18 Assignment of Payments..........................................73
Section 6.19 Solvency........................................................73
ARTICLE VII
AFFIRMATIVE COVENANTS
Section 7.1 Financial Information, Reports, Notices, etc....................74
Section 7.2 Maintenance of Existence; Compliance with Laws, etc.............75
Section 7.3 Maintenance of Properties.......................................75
Section 7.4 Insurance.......................................................76
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Section 7.5 Books and Records...............................................76
Section 7.6 Environmental Law Covenant......................................77
Section 7.7 Future Subsidiaries; Collateral.................................77
Section 7.8 Use Of Proceeds.................................................79
Section 7.9 Contract Obligations............................................79
ARTICLE VIII
NEGATIVE COVENANTS
Section 8.1 Business Activities.............................................79
Section 8.2 Indebtedness....................................................80
Section 8.3 Liens...........................................................81
Section 8.4 Financial Condition and Operations..............................82
Section 8.5 Investments.....................................................84
Section 8.6 Restricted Payments, etc........................................85
Section 8.7 Subordinated Debt...............................................86
Section 8.8 Stock of Restricted Subsidiaries................................87
Section 8.9 Consolidation, Merger, etc......................................87
Section 8.10 Permitted Dispositions..........................................88
Section 8.11 Modification of Certain Agreements..............................89
Section 8.12 Transactions with Affiliates....................................89
Section 8.13 Restrictive Agreements, etc.....................................89
Section 8.14 Sale and Leaseback..............................................90
Section 8.15 Indebtedness of Foreign Subsidiaries............................90
Section 8.16 Restrictions on Titan Capital Trust.............................90
ARTICLE IX
EVENTS OF DEFAULT
Section 9.1 Events of Default...............................................90
Section 9.2 Action if Bankruptcy............................................94
Section 9.3 Action if Other Event of Default................................94
ARTICLE X
THE CREDIT AGENTS
Section 10.1 Actions.........................................................94
Section 10.2 Funding Reliance, etc...........................................95
Section 10.3 Exculpation.....................................................95
Section 10.4 Successor.......................................................96
Section 10.5 Credit Extensions by the Credit Agents..........................96
Section 10.6 Credit Decisions................................................97
Section 10.7 Copies, etc.....................................................97
ARTICLE XI
MISCELLANEOUS PROVISIONS
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Section 11.1 Waivers, Amendments, etc........................................97
Section 11.2 Notices.........................................................99
Section 11.3 Payment of Costs and Expenses...................................99
Section 11.4 Indemnification................................................100
Section 11.5 Survival.......................................................101
Section 11.6 Severability...................................................101
Section 11.7 Headings.......................................................101
Section 11.8 Execution in Counterparts, Effectiveness, etc..................101
Section 11.9 Governing Law; Entire Agreement................................102
Section 11.10 Successors and Assigns.........................................102
Section 11.11 Sale and Transfer of Loans and Notes;
Participations in Loans and Notes..............................102
Section 11.12 Other Transactions.............................................106
Section 11.13 Confidentiality................................................107
Section 11.14 Forum Selection and Consent to Jurisdiction....................107
Section 11.15 Waiver of Jury Trial...........................................108
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SCHEDULE I - Disclosure Schedule
SCHEDULE II - Percentages; LIBO Office; Domestic Office
SCHEDULE III - Synergies
EXHIBIT A-1 - Form of Revolving Note
EXHIBIT A-2 - Form of Swing Line Note
EXHIBIT A-3 - Form of Term B Note
EXHIBIT A-4 - Form of Multi-Draw Term Note
EXHIBIT A-5 - Form of Term C Note
EXHIBIT B-1 - Form of Borrowing Request
EXHIBIT B-2 - Form of Issuance Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D - Form of Borrower Closing Date Certificate
EXHIBIT E - Form of Compliance Certificate
EXHIBIT F-1 - Form of Borrower Pledge Agreement
EXHIBIT F-2 - Form of Subsidiary Pledge Agreement
EXHIBIT G-1 - Form of Borrower Security Agreement
EXHIBIT G-2 - Form of Subsidiary Security Agreement
EXHIBIT H - Form of Opinion of Counsel to the Obligors
EXHIBIT I - Form of Subsidiary Guaranty
EXHIBIT J - Form of Interco Subordination Agreement
EXHIBIT K - Form of Lender Assignment Agreement
EXHIBIT L - Form of Officer's Solvency Certificate
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SENIOR SECURED CREDIT AGREEMENT
THIS SENIOR SECURED CREDIT AGREEMENT, dated as of February 23,
2000, is among THE TITAN CORPORATION, a Delaware corporation (the "BORROWER"),
the various financial institutions from time to time parties hereto (the
"LENDERS"), CREDIT SUISSE FIRST BOSTON ("CSFB"), as Lead Arranger and as
administrative agent (in such capacity, the "ADMINISTRATIVE AGENT") for the
Lenders, FIRST UNION SECURITIES, INC. ("FUSI"), as Co-Arranger and syndication
agent (in such capacity, the "SYNDICATION AGENT"), and THE BANK OF NOVA SCOTIA
("SCOTIABANK"), as documentation agent (in such capacity, the "DOCUMENTATION
AGENT").
W I T N E S S E T H:
WHEREAS, the Borrower has requested the Lenders to extend, and
the Lenders have agreed to extend, certain senior secured credit facilities in
an aggregate principal amount of up to $275,000,000 to the Borrower, the
proceeds of which will be used, together with up to $250,000,000 from the
issuance of HIGH TIDES-SM-, to repay certain existing indebtedness of the
Borrower and its Subsidiaries, to pay related fees and expenses and to provide
financing for working capital, capital expenditures and other general corporate
purposes of Borrower and its Subsidiaries, including permitted acquisitions; and
WHEREAS, the Lenders are willing to make such senior secured
credit facilities available upon and subject to the terms and conditions
contained herein.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 DEFINED TERMS. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"ACQUISITION INCENTIVES" means, with respect to any Person,
any earn-out or holdback arrangements made in connection with Permitted
Acquisitions by such Person or any of its Subsidiaries; PROVIDED that such
arrangements are unsecured and subordinated to the Obligations on terms and
conditions reasonably satisfactory to the Required Lenders.
"ACS" means Advanced Communication Services, Inc.
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"ACS ACQUISITION" means the acquisition of all of the issued
and outstanding Capital Stock of ACS by the Borrower pursuant to the ACS Merger
Agreement.
"ACS MERGER AGREEMENT" means the Agreement and Plan of Merger,
dated as of December 9, 1999, among the Borrower, AT Acquisition Corp., and ACS,
as amended, restated, supplemented, or otherwise modified in accordance with
SECTION 8.11.
"ACQUISITION TWO" means "Acquisition Two" as defined in the
Confidential Information Memorandum dated January 2000 with respect to
$275,000,000 Senior Secured Credit Facilities for the Borrower.
"ADDITIONAL LENDER" is defined in SECTION 2.3(c)(ii).
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE and includes
each other Person appointed as the successor Administrative Agent pursuant to
SECTION 10.4.
"AFFECTED LENDER" is defined in SECTION 4.10.
"AFFILIATE" of any Person means any other Person which,
directly or indirectly, controls, is controlled by or is under common control
with such Person. "Control" of a Person means the power, directly or indirectly,
(a) to vote 10% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors,
managing members or general partners (as applicable); or
(b) to direct or cause the direction of the management and
policies of such Person (whether by contract or otherwise).
"AGREEMENT" means this Senior Secured Credit Agreement, as it
may be amended, restated, supplemented, or otherwise modified from time to time.
"ALTERNATE BASE RATE" means, on any date and with respect to
all Base Rate Loans, a fluctuating rate of interest per annum (rounded upward,
if necessary, to the next highest 1/16 of 1%) equal to the higher of
(a) the Base Rate in effect on such day; and
(b) the Federal Funds Rate in effect on such day plus
1/2 of 1%.
Changes in the rate of interest on that portion of any Loans maintained as Base
Rate Loans will take effect simultaneously with each change in the Alternate
Base Rate. The Administrative Agent will give notice promptly to the Borrower
and the Lenders of changes in the Alternate
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Base Rate; PROVIDED, that the failure to give such notice shall not affect
the Alternate Base Rate in effect after such change.
"APPLICABLE MARGIN" means, subject to SECTION 3.3(c), at all
times during the applicable periods set forth below:
(a) (i) if, on the Closing Date, the Total Debt to EBITDA
Ratio is less than or equal to 2.0:1.0 (giving PRO FORMA effect to the
consummation of the ACS Acquisition), from the Closing Date until the
date which is six months after the Closing Date, the Applicable Margin
shall equal (x) with respect to Base Rate Loans, (A) 1.00% for
Multi-Draw Term Loans and Revolving Loans and (B) 1.75% for Term B
Loans and (y) with respect to LIBO Rate Loans, (A) 2.00% for Multi-Draw
Term Loans and Revolving Loans and (B) 2.75% for Term B Loans; and (ii)
on the date which is six months after the Closing Date, so long as no
Default or Event of Default shall have occurred and be continuing, the
Applicable Margin will be determined by reference to the Total Debt to
EBITDA Ratio as set forth in the performance pricing grid below.
(b) if, on the Closing Date, the Total Debt to EBITDA Ratio is
greater than 2.0:1.0 (giving PRO FORMA effect to the consummation of
the ACS Acquisition), so long as no Default or Event of Default shall
have occurred and be continuing, the Applicable Margin will be
determined by reference to the Total Debt to EBITDA Ratio as set forth
in the performance pricing grid below.
TOTAL DEBT TO
EBITDA RATIO LIBO RATE LOANS BASE RATE LOANS
------------- ------------------------------------ -------------------------------------
MULTI-DRAW TERM MULTI-DRAW TERM
LOANS AND LOANS AND
REVOLVING LOANS TERM B LOANS REVOLVING LOANS TERM B LOANS
--------------- ------------ --------------- ------------
greater than 2.0 2.25% 3.00% 1.25% 2.00%
1.5 x 2.0 2.00% 2.75% 1.00% 1.75%
less than 1.5 1.75% 2.75% 0.75% 1.75%
The Total Debt to EBITDA Ratio used to compute the
Applicable Margin shall be determined as at the last day of each Fiscal
Quarter as set forth in the Compliance Certificate most recently delivered by
the Borrower to the Administrative Agent; changes in interest rates resulting
from changes in such ratio shall become effective on the first day on which
the financial statements covering the quarter-end date as of which such ratio
is computed are filed with the SEC. If the Borrower shall fail to deliver a
Compliance Certificate within 60 days after the end of any Fiscal Quarter (or
within 105 days, in the case of the l ast Fiscal Quarter of the Fiscal
Year), the Applicable Margin from and including the 61st (or 106th, as the
case may be) day after the end of such Fiscal Quarter to but not including
the date the Borrower delivers to the
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Administrative Agent a Compliance Certificate shall conclusively equal the
highest Applicable Margin set forth above.
"APPROVED FUND" means, with respect to any Lender which is a
fund that invests in bank loans, any other fund or trust or entity that invests
in bank loans and is advised or managed by the same investment advisor as such
Lender or by an Affiliate of such investment advisor.
"ASSET SALE" means any sale, lease, sale and leaseback,
assignment, conveyance, transfer or other disposition by the Borrower or any of
its Restricted Subsidiaries of any of its property or assets, including the
Capital Stock of any Restricted Subsidiary, permitted pursuant to SECTION
8.10(e).
"ASSIGNEE LENDER" is defined in SECTION 11.11(a).
"ASSIGNMENT OF CLAIMS ACT" means ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code
Section 3727 and ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code Section 15, as revised or amended,
and any rules or regulations issued pursuant thereto, and also shall be deemed
to include any other laws, rules or regulations governing the assignment of
government contracts or claims against a Governmental Authority.
"AUTHORIZED OFFICER" means, relative to any Obligor, those of
its officers, general partners or managing members (as applicable) whose
signatures and incumbency shall have been certified to the Administrative Agent,
the Lenders and the Issuers in the certificate of incumbency most recently
delivered by such Obligor.
"BASE RATE" means, at any time, the rate of interest then most
recently established by the Administrative Agent in New York as its base rate
for U.S. dollars loaned in the United States. The Base Rate is not necessarily
intended to be the lowest rate of interest determined by the Administrative
Agent in connection with extensions of credit. The Administrative Agent or any
other Lender may make commercial loans or other loans at rates of interest at,
above or below the Base Rate.
"BASE RATE LOAN" means a Loan bearing interest at a
fluctuating rate determined by reference to the Alternate Base Rate.
"BORROWER" is defined in the PREAMBLE.
"BORROWER PLEDGE AGREEMENT" means the Pledge Agreement
executed and delivered by the Borrower pursuant to ARTICLE V substantially in
the form of EXHIBIT F-1 hereto, as amended, restated, supplemented or otherwise
modified from time to time.
"BORROWER SECURITY AGREEMENT" means the Security Agreement
executed and delivered by the Borrower pursuant to ARTICLE V substantially in
the form of EXHIBIT G-1 hereto, as amended, restated, supplemented or otherwise
modified from time to time.
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"BORROWING" means the Loans of the same type and, in the case
of LIBO Rate Loans, having the same Interest Period made by all Lenders required
to make such Loans on the same Business Day and pursuant to the same Borrowing
Request.
"BORROWING REQUEST" means a Loan request and certificate duly
executed by an Authorized Officer of the Borrower, substantially in the form of
EXHIBIT B-1 hereto.
"BUSINESS DAY" means
(a) any day which is neither a Saturday or Sunday nor a legal
holiday on which banks are authorized or required to be closed in New
York, New York; and
(b) relative to the making, continuing, prepayment or
repayment of any LIBO Rate Loans, any day which is a Business Day
described in CLAUSE (a) above and which is also a day on which dealings
in Dollars are carried on in the interbank eurodollar market of the
Administrative Agent's LIBOR Office.
"CAPITAL EXPENDITURES" means, for any period, the aggregate
amount of all expenditures of the Borrower and its Restricted Subsidiaries for
fixed or capital assets made during such period which, in accordance with GAAP,
would be classified as capital expenditures; PROVIDED, HOWEVER, that such
expenditures shall not include up to $45,000,000 per year of amounts expended by
the Borrower and its Restricted Subsidiaries for either the Titan Wireless or
Titan Scan business units during Fiscal Year 2000 and Fiscal Year 2001 (and
Fiscal Year 2002 to the extent rolled pursuant to the last sentence of this
paragraph). Any portion of the $45,000,000 not expended in Fiscal Year 2000 (up
to a maximum of $25,000,000) may be rolled into Fiscal Year 2001. Any portion of
the amount permitted to be expended in Fiscal Year 2001 ($45,000,000 plus the
amount rolled from Fiscal Year 2000) not expended in Fiscal Year 2001 (up to a
maximum of $25,000,000) may be rolled into Fiscal Year 2002.
"CAPITAL STOCK" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of such Person's capital, whether now outstanding
or issued after the Closing Date.
"CAPITALIZED LEASE LIABILITIES" means all monetary
obligations of the Borrower or any of its Restricted Subsidiaries under any
leasing or similar arrangement which have been (or, in accordance with GAAP,
should be) classified as capitalized leases, and for purposes of each Loan
Document the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP, and the stated maturity thereof
shall be the date of the last payment of rent or 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 premium or a penalty.
"CASH EQUIVALENTS" means (a) marketable direct obligations
issued or unconditionally guaranteed by the United States government and backed
by the full faith and
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credit of the United States government; (b) domestic and Eurodollar
certificates of deposit and time deposits, bankers' acceptances and floating
rate certificates of deposit issued by any commercial bank organized under
the laws of the United States, any state thereof, the District of Columbia,
any foreign bank, or its branches or agencies (fully protected against
currency fluctuations), which, at the time of acquisition, are rated A-1 (or
better) by S&P or P-1 (or better) by ▇▇▇▇▇'▇; (c) commercial paper of United
States and foreign banks and bank holding companies and their Subsidiaries
and United States and foreign finance, commercial industrial or utility
companies which, at the time of acquisition, are rated A-1 (or better) by S&P
or P-1 (or better) by ▇▇▇▇▇'▇; (d) marketable direct obligations of any State
of the United States of America or any political subdivision of any such
State given on the date of such investment the highest credit rating by
▇▇▇▇▇'▇ and S&P; PROVIDED, that the maturities of all obligations of the type
specified in CLAUSES (a) through (d) above shall not exceed one hundred
eighty (180) days; and (e) reverse purchase agreements covering obligations
of the type specified in CLAUSE (a) above.
"CASH EQUIVALENT INVESTMENT" means, at any time:
(a) any direct obligation of (or unconditionally guaranteed
by) the United States of America or a State thereof (or any agency or
political subdivision thereof, to the extent such obligations are
supported by the full faith and credit of the United States of America
or a State thereof) maturing not more than one year after such time;
(b) commercial paper maturing not more than 270 days from the
date of issue, which is issued by
(i) a corporation (other than an Affiliate of any
Obligor) organized under the laws of any State of the United
States or of the District of Columbia and rated A-1 or higher
by S&P or P-1 or higher by ▇▇▇▇▇'▇, or
(ii) any Lender (or its holding company);
(c) any certificate of deposit, time deposit or bankers
acceptance, maturing not more than one year after its date of issuance,
which is issued by either
(i) any bank organized under the laws of the United
States (or any State thereof) and which has (x) a credit
rating of A2 or higher from ▇▇▇▇▇'▇ or A or higher from S&P
and (y) a combined capital and surplus greater than
$500,000,000, or
(ii) any Lender; or
(d) any repurchase agreement having a term of 30 days or less
entered into with any Lender or any commercial banking institution
satisfying the criteria set forth in CLAUSE (c)(i) which
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(i) is secured by a fully perfected security interest
in any obligation of the type described in CLAUSE (a), and
(ii) has a market value at the time such repurchase
agreement is entered into of not less than 100% of the
repurchase obligation of such commercial banking institution
thereunder.
"CAYENTA" means Cayenta, Inc., a wholly owned Subsidiary of
the Borrower.
"CAYENTA GROUP" means Cayenta and each Subsidiary directly or
indirectly owned by Cayenta but not owned directly by the Borrower or any
Subsidiary of the Borrower other than Cayenta or a Subsidiary of Cayenta.
"CAYENTA POST IPO" means the Cayenta Group, subsequent to the
issuance of shares in connection with the initial public offering of Cayenta
pursuant to the terms of the applicable underwriting agreement.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response
Compensation Liability Information System List.
"CHANGE IN CONTROL" means (i) the acquisition by any
person, entity or "group", within the meaning of Section 13(d)(3) or 14(d)(2)
of the Exchange Act, (excluding, for this purpose, the Borrower or its
Restricted Subsidiaries, or any employee benefit plan of the Borrower or its
Restricted Subsidiaries which acquires beneficial ownership of voting
securities of the Borrower) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 25% or more of either the
then outstanding shares of common stock of the Borrower or the combined
voting power of the Borrower's then outstanding voting securities entitled to
vote generally in the election of directors; or (ii) individuals who, as of
the Closing Date, constitute the Board of Directors (the "INCUMBENT BOARD")
cease for any reason to constitute at least a majority of the Board of
Directors, provided that any person becoming a director subsequent to the
Closing Date whose election, or nomination for election by the Borrower's
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such person
were a member of the Incumbent Board; or (iii) approval by the stockholders
of the Borrower of a reorganization, merger or consolidation, in each case
with respect to which Persons who were the stockholders of the Borrower
immediately prior to such reorganization, merger or consolidation do not,
immediately thereafter, own more than 66 2/3% of the combined voting power
entitled to vote generally in the election of directors of the reorganized,
merged or consolidated company's then outstanding voting securities or (iv)
any "Change of Control" (or substantially similar provision) under (and as
defined in) any Sub Debt Document.
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"CLOSING DATE" means the first date on which all of the
conditions precedent set forth in SECTION 5.1 have been satisfied, but in no
event shall such date be later than March 31, 2000.
"CODE" means the Internal Revenue Code of 1986, and the
regulations thereunder, in each case as amended, reformed or otherwise modified
from time to time.
"COLLATERAL DOCUMENTS" means the Borrower Pledge Agreement,
the Borrower Security Agreement, the Subsidiary Pledge Agreement, the Subsidiary
Security Agreement, each Copyright Security Agreement, each Trademark Security
Agreement and each Patent Security Agreement.
"COMMITMENT" means, as the context may require, a Lender's
respective Multi-Draw Term Loan Commitment, Term B Loan Commitment, Term C Loan
Commitment, Revolving Loan Commitment or Letter of Credit Commitment, or CSFB's
Swing Line Loan Commitment.
"COMMITMENT AMOUNT" means, as the context may require, a Term
Loan Commitment Amount, the Revolving Loan Commitment Amount, the Letter of
Credit Commitment Amount or the Swing Line Loan Commitment Amount.
"COMMITMENT TERMINATION DATE" means, as the context may
require, a Term Loan Commitment Termination Date or the Revolving Loan
Commitment Termination Date.
"COMMITMENT TERMINATION EVENT" means
(a) the occurrence of any Event of Default described in
SECTION 9.1(i); or
(b) the occurrence and continuance of any other Event of
Default and either
(i) the declaration of all or any portion of the
Loans to be due and payable pursuant to SECTION 9.3, or
(ii) the giving of notice by the Administrative
Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated.
"COMPLIANCE CERTIFICATE" means a certificate duly completed
and executed by an Authorized Officer of the Borrower, substantially in the form
of EXHIBIT E hereto, together with such changes thereto as the Administrative
Agent may from time to time request for the purpose of monitoring the Borrower's
compliance with the financial covenants contained herein.
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"CONTINGENT LIABILITY" means any agreement, undertaking or
arrangement by which any Person guarantees, endorses or otherwise becomes or is
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the
Indebtedness or any other obligation of any other Person (other than (i) by
endorsements of instruments in the course of collection, (ii) guarantees of
obligations of Restricted Subsidiaries incurred in the ordinary course of
business and not constituting Indebtedness and (iii) subsequent to the issuance
of shares in connection with the initial public offering of Cayenta pursuant to
the terms of the applicable underwriting agreement, the guaranty of Cayenta's
obligations under its existing lease for office space), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Liability shall
(subject to any limitation set forth therein) be deemed to be the outstanding
principal amount of the debt, obligation or other liability guaranteed thereby.
"CONTINUATION/CONVERSION NOTICE" means a notice of
continuation or conversion and certificate duly executed by an Authorized
Officer of the Borrower, substantially in the form of EXHIBIT C hereto.
"CONTROLLED GROUP" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c) of the
Code or Section 4001 of ERISA.
"COPYRIGHT SECURITY AGREEMENT" means any Copyright Security
Agreement executed and delivered by any Obligor in substantially the form of
Exhibit C to any Security Agreement, as amended, restated, supplemented or
otherwise modified from time to time.
"CREDIT AGENTS" means, collectively, the Administrative Agent,
the Syndication Agent, the Documentation Agent, and CSFB in its capacity as
Agent (as defined in each of the Collateral Documents) for each of the Secured
Parties under the Collateral Documents.
"CREDIT EXTENSION" means, as the context may require,
(a) the making of a Loan by a Lender; or
(b) the issuance of any Letter of Credit, or the extension of
any Stated Expiry Date of any existing Letter of Credit, by an Issuer.
"CREDIT EXTENSION REQUEST" means, as the context may require,
any Borrowing Request or Issuance Request.
"CSFB" means Credit Suisse First Boston.
9
"DECLARATION OF TRUST" means the Declaration of Trust, dated
as of January 19, 2000, as amended and restated by the Amended and Restated
Declaration of Trust, dated as of February 9, 2000, by and among the Borrower,
as depositor, Wilmington Trust Company, as Delaware trustee and property
trustee, and the administrative trustees thereunder.
"DEBENTURES" means those convertible senior subordinated
debentures, due February 2030, issued by the Borrower to Titan Capital Trust
pursuant to the Indenture, dated as of February 9, 2000, between the Borrower
and Wilmington Trust Company, including as such Debentures may be remarketed
pursuant to the terms of the HIGH TIDES Documents and the Sub Debt Documents.
"DEFAULT" means any Event of Default or any condition,
occurrence or event which, after notice or lapse of time or both, would
constitute an Event of Default.
"DISBURSEMENT" is defined in SECTION 2.11(c).
"DISBURSEMENT DATE" is defined in SECTION 2.11(c).
"DISCLOSURE SCHEDULE" means the Disclosure Schedule attached
hereto as SCHEDULE I, as it may be amended, restated, supplemented or otherwise
modified from time to time by the Borrower with the written consent of the
Required Lenders.
"DISQUALIFIED STOCK" means any Capital Stock of the Borrower
or any Subsidiary of the Borrower which by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable) or upon the happening of any event (a) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise, (b) is
convertible or exchangeable for Indebtedness or Disqualified Stock, or (c) is
redeemable or subject to required repurchase at the option of the holder
thereof, in whole or in part, in each case in this clause (c) before the final
Stated Maturity Date; PROVIDED that notwithstanding the foregoing, the HIGH
TIDES shall not constitute Disqualified Stock.
"DOCUMENTATION AGENT" is defined in the PREAMBLE.
"DOLLAR" and the sign "$" mean lawful money of the United
States.
"DOMESTIC OFFICE" means, relative to any Lender, the office of
such Lender designated as such Lender's "Domestic Office" set forth opposite its
name on SCHEDULE II hereto or in a Lender Assignment Agreement, or such other
office of a Lender (or any successor or assign of such Lender) within the United
States as may be designated from time to time by notice from such Lender, as the
case may be, to each other Person party hereto.
"EBITDA" means, for the Borrower and its U.S. Subsidiaries,
for any applicable period, the sum (without duplication) of the following:
10
(a) Net Income,
PLUS
(b) all amounts deducted by the Borrower and its U.S.
Subsidiaries, in determining Net Income, representing either non-cash
or non-recurring losses, including fees, costs, charges and other
expenses incurred by the Borrower and its U.S. Subsidiaries in
connection with any discontinued operation, acquisition,
reorganization, consolidation, restructuring or changes in accounting
treatment under GAAP,
MINUS
(c) all amounts added by the Borrower and its U.S.
Subsidiaries, in determining Net Income, representing either non-cash
or non-recurring gains, including as a result of changes in accounting
treatment under GAAP,
PLUS
(d) the amount deducted by the Borrower and its U.S.
Subsidiaries, in determining Net Income, representing amortization, as
determined in accordance with GAAP,
PLUS
(e) the amount deducted, in determining Net Income, of all
federal, state and local income taxes (whether paid in cash or
deferred) of the Borrower and its U.S. Subsidiaries,
PLUS
(f) the amount deducted, in determining Net Income, of
Interest Expense of the Borrower and its U.S. Subsidiaries,
PLUS
(g) the amount deducted, in determining Net Income,
representing depreciation of assets of the Borrower and its U.S.
Subsidiaries, as determined in accordance with GAAP,
PLUS
(h) the synergies set forth in SCHEDULE III attached hereto
for the periods described therein.
"ENVIRONMENTAL LAWS" means all applicable federal, state or
local statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and
11
administrative orders) relating to pollution, public health and safety and
protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto of similar import, together
with the regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections thereto.
"EVENT OF DEFAULT" is defined in SECTION 9.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXEMPTION CERTIFICATE" is defined in CLAUSE (e) OF SECTION
4.6.
"EXISTING LETTERS OF CREDIT" means the Letters of Credit
issued by Scotiabank prior to the date hereof which remain outstanding as of the
Closing Date.
"EXISTING SUBORDINATED DEBT" means the Debentures.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to
(a) 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
(b) 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 it.
"FEE LETTER" means the confidential letter, dated January 27,
2000, from CSFB and First Union National Bank to the Borrower.
"FISCAL QUARTER" means a quarter ending on the last day of
each March, June, September or December.
"FISCAL YEAR" means any period of twelve consecutive calendar
months ending on December 31 of each year; references to a Fiscal Year with a
number corresponding to any calendar year (E.G., the "Fiscal Year 2000") refer
to the Fiscal Year ending on December 31 of such calendar year.
12
"FIXED CHARGE COVERAGE RATIO" means, as of the close of any
Fiscal Quarter, the ratio computed for the period consisting of such Fiscal
Quarter and each of the three immediately preceding Fiscal Quarters with respect
to the Borrower and its Restricted Subsidiaries on a consolidated basis of:
(a) EBITDA (for all such Fiscal Quarters) minus Capital
Expenditures made during such Fiscal Quarters;
TO
(b) the sum (for all such Fiscal Quarters) of
(i) Interest Expense paid in cash;
PLUS
(ii) scheduled principal payments of the Term Loans
pursuant to the provisions of CLAUSE (d) of SECTION 3.1 after
giving effect to any reductions in such scheduled principal
repayments attributable to any optional or mandatory
prepayments of the Term Loans;
PLUS
(iii) Restricted Payments;
PLUS
(iv) all federal, state and foreign income taxes
actually paid in cash by the Borrower and its Restricted
Subsidiaries (excluding any cash taxes paid in connection with
the sale of IPivot Inc.).
"FOREIGN SUBSIDIARY" means any Subsidiary that is not a U.S.
Subsidiary.
"F.R.S. BOARD" means the Board of Governors of the Federal
Reserve System or any successor thereto.
"GAAP" is defined in SECTION 1.4.
"GOVERNMENTAL AUTHORITY" means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
13
"GUARANTOR" means each direct and indirect U.S. Subsidiary of
the Borrower whether now existing or hereafter acquired or organized (other than
Titan Capital Trust and Titan Africa, Inc.), each of which shall be required to
execute and deliver the Subsidiary Guaranty, or a supplement thereto, to the
Administrative Agent; PROVIDED, HOWEVER, that each member of the Cayenta Group
shall be released from the Subsidiary Guaranty and shall no longer be a
"Guarantor" upon satisfaction of the following conditions precedent: (a) the
issuance of shares in connection with the initial public offering of Cayenta
pursuant to the terms of the applicable underwriting agreement and (b) delivery
of an officer's certificate to the Administrative Agent certifying that no
Default shall have occurred and then be continuing or would result from the
initial public offering.
"HAZARDOUS MATERIAL" means
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource
Conservation and Recovery Act, as amended; or
(c) any pollutant or contaminant or hazardous, dangerous or
toxic chemical, material or substance (including any petroleum product)
within the meaning of any other applicable federal, state or local law,
regulation, ordinance or requirement (including consent decrees and
administrative orders) relating to or imposing liability or standards
of conduct under any Environmental Law, all as amended.
"HEDGING AGREEMENTS" means currency exchange agreements,
interest rate swap agreements, interest rate cap agreements and interest rate
collar agreements, and all other agreements or arrangements designed to protect
such Person against fluctuations in interest rates or currency exchange rates.
"HEDGING OBLIGATIONS" means, with respect to any Person, all
liabilities of such Person under Hedging Agreements.
"HEREIN", "HEREOF", "HERETO", "HEREUNDER" and similar terms
contained in this Agreement or any other Loan Document refer to this Agreement
or such other Loan Document, as the case may be, as a whole and not to any
particular Section, paragraph or provision of this Agreement or such other Loan
Document.
"HIGH TIDES" means those Convertible Preferred Securities,
Remarketable Term Income Deferrable Equity Securities (HIGH TIDES)-SM- issued by
Titan Capital Trust in accordance with the terms and provisions of the
Declaration of Trust, including as such HIGH TIDES may be remarketed pursuant to
the HIGH TIDES Documents. For all purposes under this Agreement, the HIGH TIDES
shall be considered equity. (The terms Remarketable Term Income Deferrable
Equity Securities (HIGH TIDES)-SM- and HIGH TIDES-SM- are registered service
marks of CSFB.)
14
"HIGH TIDES DOCUMENTS" means (a) the HIGH TIDES, (b) the
Declaration of Trust, (c) the Preferred Securities Guarantee, dated as of
February 9, 2000, between the Borrower and Wilmington Trust Company, as
guarantee trustee, issued by the Borrower with respect to distributions on, the
redemption of and liquidation amounts on the HIGH TIDES, (d) the Common
Securities Guarantee, dated as of February 9, 2000, issued by the Borrower, (e)
the Remarketing Agreement, dated as of February 9, 2000, among Titan Capital
Trust, Wilmington Trust Company, as Tender Agent, and Credit Suisse First Boston
Corporation, as Remarketing Agent, (f) the Registration Rights Agreement, dated
as of February 9, 2000, among the Borrower, Titan Capital Trust and Credit
Suisse First Boston Corporation, on behalf of the several purchasers, and (g)
any other documents related to the issuance of the HIGH TIDES.
"IMPERMISSIBLE QUALIFICATION" means, relative to the opinion
or certification of any independent public accountant as to any financial
statement of the Borrower, any qualification or exception to such opinion or
certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of
matters relevant to such financial statement; or
(c) which relates to the treatment or classification of any
item in such financial statement and which, as a condition to its
removal, would require an adjustment to such item the effect of
which would be to cause the Borrower to be in default of any of its
obligations under SECTION 8.4.
"INCLUDING" and "INCLUDE" means including without limiting the
generality of any description preceding such term, and, for purposes of this
Agreement and each other Loan Document, the parties hereto agree that the rule
of ejusdem generis shall not be applicable to limit a general statement, which
is followed by or referable to an enumeration of specific matters, to matters
similar to the matters specifically mentioned.
"INCUMBENT BOARD" is defined in the definition of "Change in
Control."
"INDEBTEDNESS" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money or
advances and all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments;
(b) all obligations, contingent or otherwise, relative to the
face amount of all letters of credit, whether or not drawn, and
banker's acceptances issued for the account of such Person;
(c) all Capitalized Lease Liabilities of such Person;
15
(d) net liabilities of such Person under all Hedging
Obligations;
(e) whether or not so included as liabilities in accordance
with GAAP, all obligations of such Person to pay the deferred purchase
price of property or services excluding Acquisition Incentives which
are not overdue and trade accounts payable in the ordinary course of
business which are not overdue for a period of more than 90 days or, if
overdue for more than 90 days, as to which a dispute exists and
adequate reserves in conformity with GAAP have been established on the
books of such Person, and indebtedness or other obligations secured by
(or for which the holder of such indebtedness or other obligations has
an existing right, contingent or otherwise, to be secured by) a Lien on
property owned or being acquired by such Person (including indebtedness
or other obligations arising under conditional sales or other title
retention agreements), whether or not such indebtedness or other
obligations shall have been assumed by such Person or is limited in
recourse;
(f) all Contingent Liabilities of such Person;
(g) the principal portion of all obligations of such Person
under any Synthetic Lease; and
(h) all Disqualified Stock of such Person.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent such Person is liable therefor as a
result of such Person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide that such
Person is not liable therefor. In no event shall the HIGH TIDES be considered
Indebtedness under this Agreement.
"INDEMNIFIED LIABILITIES" is defined in SECTION 11.4.
"INDEMNIFIED PARTIES" is defined in SECTION 11.4.
"INTERCO SUBORDINATION AGREEMENT" means the Subordination
Agreement, substantially in the form of EXHIBIT J hereto.
"INTEREST COVERAGE RATIO" means, as of the close of any Fiscal
Quarter, the ratio computed for the period consisting of such Fiscal Quarter and
each of the three immediately preceding Fiscal Quarters with respect to the
Borrower and its Restricted Subsidiaries on a consolidated basis of:
(a) EBITDA (for all such Fiscal Quarters)
TO
16
(b) Interest Expense paid in cash.
"INTEREST EXPENSE" means, for any Fiscal Quarter, the
aggregate interest expense of the Borrower and its Restricted Subsidiaries for
such Fiscal Quarter, as determined in accordance with GAAP, including the
portion of any payments made in respect of Capitalized Lease Liabilities
allocable to interest expense; PROVIDED, HOWEVER, that distributions on the HIGH
TIDES shall not be included in Interest Expense.
"INTEREST PERIOD" means, relative to any LIBO Rate Loan, the
period beginning on (and including) the date on which such LIBO Rate Loan is
made or continued as, or converted into, a LIBO Rate Loan pursuant to SECTION
2.7 or 2.9 and shall end on (but exclude) the day which numerically corresponds
to such date 2 weeks or one, two, three or six months thereafter, or, if
generally made available by all Lenders, nine or twelve months thereafter (or,
if such month has no numerically corresponding day, on the last Business Day of
such month), as the Borrower may select in its relevant notice pursuant to
SECTION 2.7 or 2.9; PROVIDED, HOWEVER, that
(a) the Borrower shall not be permitted to select Interest
Periods to be in effect at any one time which have expiration dates
occurring on more than ten different dates;
(b) if such Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall end on the next
following Business Day (unless such next following Business Day is the
first Business Day of a calendar month, in which case such Interest
Period shall end on the Business Day next preceding such numerically
corresponding day); and
(c) no Interest Period for any Loan may end later than the
Stated Maturity Date for such Loan.
"INVESTMENT" means, relative to any Person, (a) any direct or
indirect purchase or other acquisition by such Person of, or of a beneficial
interest in, the Capital Stock or other debt or equity securities (including
options, warrants or other rights to acquire such Capital Stock or other
securities) of any other Person, (b) any direct or indirect purchase or other
acquisition by such Person of any assets constituting a business unit of any
Person or all or substantially all of a Person's assets, (c) any direct or
indirect loan, advance (excluding commission, travel, ▇▇▇▇▇ cash, relocation and
similar advances to officers and employees made in the ordinary course of
business) or capital contribution by such Person to any other Person, including
all Indebtedness and accounts receivable acquired from that other Person that
are not current assets or did not arise from sales to that other Person in the
ordinary course of business, (c) Hedging Agreements and (d) any Contingent
Liability of such Person. The amount of any Investment shall be the original
principal or capital amount thereof less all returns of principal or equity
thereon and shall, if made by the transfer or exchange of property other than
cash, be deemed to have been made in an original principal or capital amount
equal to the fair market value of such property at the time of such Investment.
17
"ISSUANCE REQUEST" means a Letter of Credit request and
certificate duly executed by an Authorized Officer of the Borrower,
substantially in the form of EXHIBIT B-2 hereto.
"ISSUER" means Scotiabank (solely with respect to Existing
Letters of Credit), Comerica Bank, Imperial Bank or any other Lender acceptable
to the Administrative Agent and the Borrower; PROVIDED, HOWEVER, that no Lender
other than Comerica Bank and Imperial Bank shall have any obligation to issue
Letters of Credit hereunder.
"LENDER ASSIGNMENT AGREEMENT" means an assignment agreement
substantially in the form of EXHIBIT L hereto.
"LENDERS" is defined in the PREAMBLE and, in addition, shall
include any commercial bank or other financial institution that becomes a Lender
pursuant to SECTION 11.11(a).
"LENDER'S ENVIRONMENTAL LIABILITY" means any and all
losses, liabilities, obligations, penalties, claims, litigation, demands,
defenses, costs, judgments, suits, proceedings, damages (including
consequential damages), disbursements or expenses of any kind or nature
whatsoever (including reasonable attorneys' fees at trial and appellate
levels and experts' fees and disbursements and expenses incurred in
investigating, defending against or prosecuting any litigation, claim or
proceeding) which may at any time be imposed upon, incurred by or asserted or
awarded against the Administrative Agent, any Lender or any Issuer or any of
such Person's Affiliates, shareholders, directors, officers, employees, and
agents in connection with or arising from:
(a) any Hazardous Material on, in, under or affecting all or
any portion of any property of the Borrower or any of its Subsidiaries,
the groundwater thereunder, or any surrounding areas thereof to the
extent caused by Releases from the Borrower's or any of its
Subsidiaries' or any of their respective predecessors' properties;
(b) any misrepresentation, inaccuracy or breach of any
warranty, contained or referred to in SECTION 6.12;
(c) any violation or claim of violation by the Borrower or any
of its Subsidiaries of any Environmental Laws; or
(d) the imposition of any lien for damages caused by, or the
recovery of any costs for, the cleanup, release or threatened release
of any Hazardous Material (i) by the Borrower or any of its
Subsidiaries or (ii) in connection with any property owned or formerly
owned by the Borrower or any of its Subsidiaries.
"LETTER OF CREDIT" is defined in SECTION 2.2 and shall include
each of the Existing Letters of Credit.
18
"LETTER OF CREDIT COMMITMENT" means, with respect to an
Issuer, such Issuer's obligation to issue Letters of Credit pursuant to SECTION
2.2 and, with respect to each Revolving Loan Lender, the obligations of each
such Lender to participate in such Letters of Credit pursuant to SECTION
2.11(b).
"LETTER OF CREDIT COMMITMENT AMOUNT" means, on any date, a
maximum amount of $20,000,000, as such amount may be permanently reduced from
time to time pursuant to SECTION 2.6.
"LETTER OF CREDIT OUTSTANDINGS" means, on any date, an amount
equal to the sum of
(a) the then aggregate amount which is undrawn and available
under all issued and outstanding Letters of Credit,
PLUS
(b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
"LIBO RATE" means the rate per annum determined by the
Administrative Agent at approximately 11:00 A.M. (London time) on the date which
is two (2) Business Days prior to the beginning of the relevant Interest Period
(as specified in the applicable Credit Extension Request) by reference to the
British Bankers' Association Interest Settlement Rates for deposits in Dollars
(as set forth by any service selected by the Administrative Agent which has been
nominated by the British Bankers' Association as an authorized information
vendor for the purpose of displaying such rates) for a period equal to such
Interest Period; PROVIDED, that a one month LIBO Rate shall be used for an
Interest Period of two weeks; and PROVIDED FURTHER, that, to the extent that an
interest rate is not ascertainable pursuant to the foregoing provisions of this
definition, the "LIBO Rate" shall be the interest rate per annum determined by
the Administrative Agent to be the average of the rates per annum at which
deposits in Dollars are offered for such relevant Interest Period to major banks
in the London interbank market in London, England by the Reference Lenders at
approximately 11:00 A.M. (London time) on the date which is two Business Days
prior to the beginning of such Interest Period. If any of the Reference Lenders
shall be unable or shall otherwise fail to supply such rates to the
Administrative Agent upon its request, the rate of interest shall be determined
on the basis of the quotations of the remaining Reference Lender.
"LIBO RATE LOAN" means a Loan bearing interest, at all times
during an Interest Period applicable to such Loan, at a rate of interest
determined by reference to the LIBO Rate (Reserve Adjusted).
19
"LIBO RATE (RESERVE ADJUSTED)" means, relative to any Loan to
be made, continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum determined pursuant to the following formula:
LIBO Rate = LIBO RATE
-------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans
will be determined by the Administrative Agent on the basis of the LIBOR Reserve
Percentage in effect two Business Days before the first day of such Interest
Period.
"LIBOR OFFICE" means, relative to any Lender, the office of
such Lender designated as such Lender's "LIBOR Office" set forth opposite its
name on SCHEDULE II hereto or in a Lender Assignment Agreement, or such other
office of a Lender as designated from time to time by notice from such Lender
to the Borrower and the Administrative Agent, whether or not outside the
United States, which shall be making or maintaining LIBO Rate Loans of such
Lender hereunder.
"LIBOR RESERVE PERCENTAGE" means, relative to any Interest
Period for LIBO Rate Loans, the reserve percentage (expressed as a decimal)
equal to the maximum aggregate reserve requirements (including all basic,
emergency, supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to assets or liabilities consisting of or including
"Eurocurrency Liabilities", as currently defined in Regulation D of the F.R.S.
Board, having a term approximately equal or comparable to such Interest Period.
"LIEN" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
otherwise), charge against or interest in property, or other priority or
preferential arrangement of any kind or nature whatsoever, to secure payment of
a debt or performance of an obligation.
"LINCOM" means LinCom Corporation, a Delaware corporation.
"LINCOM ACQUISITION AGREEMENT" means the Stock Purchase
Agreement, dated as of January 28, 2000, among the Borrower, LinCom and the
stockholders of LinCom.
"LOAN DOCUMENTS" collectively means this Agreement, the
Letters of Credit, the Fee Letter, the Interco Subordination Agreement, the
Collateral Documents, each Subsidiary Guaranty, each agreement pursuant to which
the Administrative Agent is granted a Lien to secure the Obligations and each
other agreement, certificate, document or instrument delivered in connection
with this Agreement or such other Loan Documents, whether or not specifically
mentioned herein or therein.
20
"LOANS" means, as the context may require, a Revolving Loan,
each Term Loan, or a Swing Line Loan, of any type.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(i) the business, condition (financial or otherwise), operations, assets,
properties or prospects of the Borrower or the Borrower and its Subsidiaries
taken as a whole, (ii) the rights and remedies of the Administrative Agent, any
Lender or any Issuer under any Loan Document or (iii) the ability of any Obligor
to perform its Obligations under any Loan Document.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTI-DRAW TERM LOAN" is defined in SECTION 2.3(b).
"MULTI-DRAW TERM LOAN COMMITMENT" means, relative to any
Lender, such Lender's obligation (if any) to make Multi-Draw Term Loans pursuant
to SECTION 2.3(b).
"MULTI-DRAW TERM LOAN COMMITMENT AMOUNT" means, on any date,
$75,000,000, as such amount may be reduced from time to time pursuant to SECTION
2.6.
"MULTI-DRAW TERM LOAN COMMITMENT TERMINATION DATE" means the
earliest of:
(a) ▇▇▇▇▇ ▇▇, ▇▇▇▇ (▇▇ the initial Credit Extension has not
occurred on or prior to such date);
(b) the date which is nine months after the Closing Date;
(c) the date on which the Multi-Draw Term Loan Commitment
Amount is terminated in full or reduced to zero pursuant to SECTION
2.6; and
(d) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in CLAUSES (a), (b), (c) or (d), the
Multi-Draw Term Loan Commitments shall terminate automatically without any
further action.
"MULTI-DRAW TERM LOAN LENDER" means the Lenders listed on
SCHEDULE II with Multi-Draw Term Loan Commitments and Lenders from time to time
holding Multi-Draw Term Loans and Multi-Draw Term Loan Commitments after giving
effect to any assignments permitted by SECTION 11.11.
"MULTI-DRAW TERM NOTE" means a promissory note of the Borrower
payable to any Lender, in the form of EXHIBIT A-4 hereto (as such promissory
note may be amended, endorsed or otherwise modified from time to time),
evidencing the aggregate Indebtedness of the Borrower to such Lender resulting
from outstanding Multi-Draw Term Loans, and also means all other promissory
notes accepted from time to time in substitution therefor or renewal thereof.
21
"NET INCOME" means for any period, the aggregate of all
amounts which would be included as net income on the consolidated financial
statements of the Borrower and its U.S. Subsidiaries for such period, as
determined in accordance with GAAP.
"NET PROCEEDS" means (a) with respect to the issuance of
any equity securities (other than the issuance or exercise of stock options
in connection with employee incentive programs or employee benefit programs)
of the Borrower, the EXCESS of (i) the proceeds received by the Borrower from
the sale or issuance to any Person of any stock, warrants or options or the
exercise of any such warrants or options, OVER (ii) all reasonable and
customary underwriting commissions and legal, investment banking, brokerage
and accounting and other professional fees, sales commissions and
disbursements actually incurred in connection with such sale or issuance; (b)
with respect to any Asset Sale, the EXCESS of (i) the proceeds received from
any Asset Sale OVER (ii) the reasonable cash costs of such Asset Sale, taxes
paid or payable as a result thereof, and all reasonable and customary legal,
investment banking, accounting, and other professional fees, sales
commissions or disbursements actually incurred in connection with such Asset
Sale which have not been paid to Affiliates of the Borrower in connection
therewith; (c) with respect to the incurrence or issuance of Indebtedness,
the EXCESS of (i) the proceeds received from the incurrence or issuance of
any Indebtedness (except for Indebtedness permitted by SECTION 8.2) of the
Borrower or any of its Restricted Subsidiaries OVER (ii) the reasonable costs
incurred in such transaction, and all reasonable and customary legal,
investment banking, accounting, and other professional fees, sales
commissions or disbursements actually incurred in connection with such
transaction; and (d) the cash proceeds of any repayment of the principal
portion (including capitalized interest) of Indebtedness outstanding at the
date of issuance of shares in connection with the initial public offering of
Cayenta pursuant to the terms of the applicable underwriting agreement owing
from Cayenta to the Borrower or any Restricted Subsidiary when repaid after
Cayenta's initial public offering.
The amount of the proceeds described in CLAUSES (a) and (b)
which, at the option of the Borrower and so long as no Default shall have
occurred and be continuing, the Borrower uses, or causes any Restricted
Subsidiary to use, to purchase (x) substantially similar assets useful in the
business of the Borrower or such Restricted Subsidiary, or (y) Capital Stock of
Persons which, immediately after giving effect to such purchase, become a
Restricted Subsidiary (with such assets or interests described in CLAUSES (x)
and (y), collectively, referred to as "QUALIFIED ASSETS") within 180 days (with
respect to the proceeds described in CLAUSE (a)), and 360 days (with respect to
the proceeds described in CLAUSE (b)), after the consummation (and with the
proceeds) of such sale, conveyance or disposition, and in the event the Borrower
or such Restricted Subsidiary elects to exercise its right to purchase Qualified
Assets with the Net Proceeds pursuant to this provision, the Borrower shall
deliver a certificate of an Authorized Officer to the Administrative Agent
within 120 days following the receipt of Net Proceeds (with respect to the
proceeds described in CLAUSE (a) above) or within 180 days following receipt of
Net Proceeds (with respect to the proceeds described in CLAUSE (b) above)
setting forth the amount of the Net Proceeds which the Borrower or such
Restricted Subsidiary expects to use to purchase Qualified Assets during such
180-day or 360-day period, as applicable. Any amount of such Net
22
Proceeds which the Borrower does not expect to use to purchase Qualified
Assets shall be paid to the Administrative Agent in accordance with SECTION
3.1(c) on the 120th day following receipt of such Net Proceeds (with respect
to the proceeds described in CLAUSE (a) above) or the 180th day following
receipt of such Net Proceeds (with respect to the proceeds described in
CLAUSE (b) above). If the Borrower fails to deliver a certificate within such
120- or 180-day period, as applicable, specifying the amount of Net Proceeds
which the Borrower expects to use to purchase Qualified Assets, all of the
Net Proceeds received shall be paid to the Administrative Agent in accordance
with SECTION 3.1(c) on the 120th day following receipt of such Net Proceeds
(with respect to the proceeds described in CLAUSE (a) above) or the 180th day
following receipt of such Net Proceeds (with respect to the proceeds
described in CLAUSE (b) above).
If and to the extent that the Borrower or such Restricted
Subsidiary has elected to reinvest Net Proceeds referred to in CLAUSES (a) and
(b) as permitted above, then on the date which is 180 days or 360 days, as
appropriate, after the relevant sale, conveyance or disposition, the Borrower
shall deliver a certificate of an Authorized Officer to the Administrative Agent
certifying as to the amount and use of such Net Proceeds actually used to
purchase Qualified Assets. To the extent such Net Proceeds are not so used to
purchase Qualified Assets then the Loans shall be repaid as set forth in SECTION
3.1(c) and the Revolving Loan Commitment Amount or the Multi-Draw Term Loan
Commitment Amount, as appropriate pursuant to SECTION 2.6(b), shall be
automatically reduced by an amount equal to the aggregate amount of such
proceeds not so used to purchase Qualified Assets. Notwithstanding the
foregoing, Net Proceeds shall not include proceeds described in CLAUSE (b) of
the first paragraph of this definition to the extent such proceeds are utilized
to acquire Capital Stock pursuant to SECTION 8.6(f) within 180 days following
receipt thereof.
"NET WORTH" means, with respect to any Person at any date, on
a consolidated basis for such Person and its Subsidiaries:
(a) the sum of Capital Stock taken at par value, capital
surplus and retained earnings (or accumulated deficit) of such Person
at such date;
MINUS
(b) treasury stock of such Person and, to the extent included
in the preceding CLAUSE (a), minority interests in Subsidiaries of such
Person at such date.
"NON-EXCLUDED TAXES" means any Taxes other than net income and
franchise taxes imposed with respect to the Administrative Agent or any Lender
by the Governmental Authority under the laws of which the Administrative Agent
or such Lender, as applicable, is organized or in which it maintains its
applicable lending office.
"NON-U.S. LENDER" means any Lender that is not a "United
States person", as defined under section 7701(a)(30) of the Code.
23
"NON-UTILIZATION FEE" means a Usage-based fee equal to the
percentage specified in the grid below of (i) prior to the Multi-Draw Term Loan
Commitment Termination Date, the undrawn portion of each of the Revolving Loan
Commitment Amount and the Multi-Draw Term Loan Commitment Amount and (ii) after
the Multi-Draw Term Loan Commitment Termination Date, the undrawn portion of the
Revolving Loan Commitment Amount:
USAGE NON-UTILIZATION FEE
----- -------------------
less than 30% 1.00%
30% Usage 50% 0.75%
greater than 50% 0.50%
"NOTE" means, as the context may require, a Revolving Note, a
Term Note, or a Swing Line Note.
"OBLIGATIONS" means all obligations (monetary or otherwise,
whether absolute or contingent, matured or unmatured) of the Borrower and each
other Obligor arising under or in connection with this Agreement, each other
Loan Document and any Hedging Agreement between the Borrower and a Lender or an
Affiliate of a Lender.
"OBLIGOR" means, as the context may require, the Borrower and
each other Person (other than a Secured Party) obligated under any Loan
Document.
"ORGANIC DOCUMENT" means, relative to any Obligor, as
applicable, its certificate of incorporation, by-laws, certificate of
partnership, partnership agreement, certificate of formation, limited liability
agreement and all shareholder agreements, voting trusts and similar arrangements
applicable to any of such Obligor's partnership interests, limited liability
company interests or authorized shares of Capital Stock.
"OTHER TAXES" means any and all stamp, documentary or similar
taxes, or any other excise or property taxes or similar levies that arise on
account of any payment being or being required to be made hereunder or under any
Note or from the execution, delivery, registration, recording or enforcement of
this Agreement or any other Loan Document.
"PARTICIPANT" is defined in SECTION 11.11(b).
"PATENT SECURITY AGREEMENT" means any Patent Security
Agreement executed and delivered by any Obligor in substantially the form of
Exhibit A to any Security Agreement, as amended, restated, supplemented, or
otherwise modified from time to time.
24
"PBGC" means the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"PENSION PLAN" means a "pension plan", as such term is
defined in Section 3(2) of ERISA, which is subject to Title IV of ERISA
(other than a multiemployer plan as defined in Section 4001(a)(3) of ERISA),
and to which the Borrower or any corporation, trade or business that is,
along with the Borrower, a member of a Controlled Group, may have liability,
including any liability by reason of having been a substantial employer
within the meaning of Section 4063 of ERISA at any time during the preceding
five years, or by reason of being deemed to be a contributing sponsor under
Section 4069 of ERISA.
"PERCENTAGE" means, relative to any Lender, the applicable
percentage relating to Revolving Loans or Revolving Loan Commitments, Multi-Draw
Term Loans or Multi-Draw Term Loan Commitments, Term B Loans or Term B Loan
Commitments, or Term C Loans or Term C Loan Commitments, as applicable, set
forth opposite its name on SCHEDULE II hereto under the applicable column
heading or set forth in a Lender Assignment Agreement under the applicable
column heading, as such percentage may be adjusted from time to time pursuant to
Lender Assignment Agreement(s) executed by such Lender and its Assignee
Lender(s) and delivered pursuant to SECTION 11.11(a). A Lender shall not have
any Commitment to make Revolving Loans, Multi-Draw Term Loans, Term B Loans or
Term C Loans if its percentage under the respective column heading is zero (0%).
"PERMITTED ACQUISITIONS" means (a) the ACS Acquisition,
PROVIDED that (i) it is consummated no later than June 1, 2000 and pursuant to
the terms of the ACS Merger Agreement and (ii) no Default has occurred and is
continuing at the time of consummation of the ACS Acquisition or would result
therefrom, (b) the acquisition of LinCom, PROVIDED that (i) it is consummated no
later than June 1, 2000 and pursuant to the terms of the LinCom Acquisition
Agreement and (ii) no Default has occurred and is continuing at the time of
consummation of such acquisition or would result therefrom, (c) the acquisition
of Acquisition Two, PROVIDED that (i) it is consummated no later than June 1,
2000 and pursuant to the terms of documentation reasonably satisfactory to the
Administrative Agent (including the amount of any liabilities assumed by the
Obligors in connection with the acquisition of Acquisition Two) and (ii) no
Default has occurred and is continuing at the time of consummation of such
acquisition or would result therefrom and (d) an acquisition (whether pursuant
to an acquisition of stock, assets or otherwise) by the Borrower or any
Guarantor of any Person or the assets of any Person which meets all of the
following conditions: (i) such Person is primarily engaged in a similar line of
business as the Borrower or such Guarantor as of the Closing Date; (ii) all or
substantially all of the assets acquired or owned by the Person being acquired
are located in the United States and such Person (in the case of an acquisition
of Capital Stock) is organized under the laws of the United States or a state
thereof or the District of Columbia and will become a Guarantor upon the
consummation of such acquisition and otherwise comply with SECTION 7.7; (iii)
all or substantially all of the Capital Stock or assets so acquired will become
subject to Liens created under the Loan Documents; (iv) with respect to any
single acquisition, or a series of related acquisitions with a single or
aggregate net purchase price of greater than $25,000,000, including
25
any assumed Indebtedness (with any non-cash consideration being valued in
good faith by senior management of the Borrower as set forth in an Officer's
Certificate delivered to the Administrative Agent), the Borrower has obtained
the prior consent of the Required Lenders; (v) immediately before and after
giving effect to such acquisition, no Default shall have occurred and be
continuing or would result therefrom (including under SECTION 8.1); (vi) the
Borrower shall have delivered to the Administrative Agent a Compliance
Certificate for the period of four full Fiscal Quarters immediately preceding
such acquisition (prepared in good faith and in a manner and using such
methodology which is consistent with the most recent financial statements
delivered pursuant to SECTION 7.1) giving PRO FORMA effect in accordance with
this Agreement to the consummation of such acquisition and evidencing
compliance with the covenants set forth in SECTION 8.4; and (vii) the
Administrative Agent shall have received a certificate, dated a date
reasonably acceptable to the Administrative Agent, of an Authorized Officer
of the Borrower certifying as to a true and complete copy of each purchase
agreement, and all other documents and instruments delivered in connection
with the consummation of any Permitted Acquisitions and that are required to
be delivered pursuant to the terms of the relevant purchase agreement and the
Administrative Agent shall be satisfied with all amendments, waiver or other
modifications of, or other forebearance to exercise any rights with respect
to, any of the terms or provisions of such purchase agreements and the
exhibits and schedules thereto.
"PERSON" means any natural person, corporation, limited
liability company, partnership, joint venture, association, trust or
unincorporated organization, Governmental Authority or any other legal entity,
whether acting in an individual, fiduciary or other capacity.
"PLAN" means any Pension Plan or Welfare Plan.
"PLEDGE AGREEMENT" means, as the context may require, the
Borrower Pledge Agreement or the Subsidiary Pledge Agreement.
"PLEDGED SUBSIDIARY" means, at any time, each Subsidiary in
respect of which the Administrative Agent has been granted, at such time, a
security interest in and to, or a pledge of, (i) any of the issued and
outstanding shares of Capital Stock of such Subsidiary, or (ii) any intercompany
notes of such Subsidiary owing to the Borrower or another Subsidiary of the
Borrower.
"PRO FORMA FINANCIAL STATEMENTS" is defined in SECTION 5.1(h).
"QUALIFIED ASSETS" is defined in the definition of "Net
Proceeds".
"QUARTERLY PAYMENT DATE" means the third Business Day of
January, April, July and October.
"REFERENCE LENDERS" means (i) CSFB and (ii) another Lender
determined by the Administrative Agent with the consent of the Borrower.
26
"REFUNDED SWING LINE LOANS" is defined in SECTION 2.8.
"REGULATION S-X" means Regulation S-X promulgated by the SEC.
"REIMBURSEMENT OBLIGATION" is defined in SECTION 2.11(d).
"RELEASE" means a "RELEASE", as such term is defined in
CERCLA.
"REPLACEMENT LENDER" is defined in of SECTION 4.10.
"REQUIRED LENDERS" means, at any time, Lenders holding at
least 51% of the Total Exposure Amount.
"RESOURCE CONSERVATION AND RECOVERY ACT" means the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901, ET SEQ., as amended.
"RESTRICTED PAYMENT" means the declaration or payment of any
dividend (other than dividends payable solely in common stock of the Borrower)
on, or the making of any payment or distribution on account of, or setting apart
assets for a sinking or other analogous fund for, the purchase, redemption,
defeasance, retirement or other acquisition of any class of Capital Stock of the
Borrower or any Subsidiary or any warrants or options to purchase any such
Capital Stock, whether now or hereafter outstanding, or the making of any other
distribution in respect thereof, either directly or indirectly, whether in cash
or property, obligations of the Borrower or any Subsidiary or otherwise.
"RESTRICTED SUBSIDIARIES" means all Guarantors, Titan Africa,
Inc. and Titan Capital Trust.
"REVOLVING LOAN" is defined in SECTION 2.1.
"REVOLVING LOAN COMMITMENT" means, relative to any Lender,
such Lender's obligation (if any) to make Revolving Loans pursuant to CLAUSE (a)
of SECTION 2.1.
"REVOLVING LOAN COMMITMENT AMOUNT" means, on any date,
$100,000,000, as such amount may be reduced from time to time pursuant to
SECTION 2.6.
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means the
earliest of:
(a) ▇▇▇▇▇ ▇▇, ▇▇▇▇ (▇▇ the initial Credit Extension has not
occurred on or prior to such date);
(b) the fifth anniversary of the Closing Date;
(c) the date on which the Revolving Loan Commitment Amount is
terminated in full or reduced to zero pursuant to SECTION 2.6; and
27
(d) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in the preceding CLAUSES (a), (b),
(c) or (d), the Revolving Loan Commitments shall terminate automatically and
without any further action.
"REVOLVING LOAN LENDER" means the Lenders listed on SCHEDULE
II with Revolving Loan Commitments and Lenders from time to time holding
Revolving Loans and Revolving Loan Commitments after giving effect to any
assignments permitted by SECTION 11.11.
"REVOLVING NOTE" means a promissory note of the Borrower
payable to any Revolving Loan Lender, in the form of EXHIBIT A-1 hereto (as such
promissory note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to such Revolving
Loan Lender resulting from outstanding Revolving Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.
"S&P" means Standard & Poor's Rating Services.
"SCOTIABANK" is defined in the PREAMBLE.
"SEC" means the Securities and Exchange Commission.
"SECURED PARTIES" means the Lenders, any Lender or Affiliate
of a Lender which has entered into a Hedging Agreement with the Borrower, the
Issuers, the Administrative Agent, and (in each case), each of their respective
successors, transferees and assigns.
"SECURITY AGREEMENT" means, as the context may require, the
Borrower Security Agreement and the Subsidiary Security Agreement, in each case
as amended, restated, supplemented, or otherwise modified from time to time.
"SIGNIFICANT SUBSIDIARY" has the meaning given to such term in
Rule 1-02(w) of Regulation S-X.
"SOLVENT" means, with respect to any Person, that as of the
date of determination both (i) (a) the then fair saleable value of the property
sold as a going concern of such Person is (y) greater than the total amount of
liabilities (including contingent liabilities but excluding amounts payable
under intercompany promissory notes) of such Person and (z) not less than the
amount that will be required to pay the probable liabilities on such Person's
then existing debts as they become absolute and matured considering all
financing alternatives and potential asset sales reasonably available to such
Person; (b) such Person's capital is not unreasonably small in relation to its
business or any contemplated or undertaken transaction; and (c) such Person does
not intend to incur, or believe that it will incur, debts beyond its ability to
pay such debts as they become due; and (ii) such Person is "solvent" within the
meaning given that term and similar
28
terms under applicable laws relating to fraudulent transfers and conveyances.
For purposes of this definition, the amount of any contingent liability at
any time shall be computed as the amount that, in light of all of the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"STATED AMOUNT", means on any date and with respect to a
particular Letter of Credit, the total amount then available to be drawn under
such Letter of Credit.
"STATED EXPIRY DATE" is defined in SECTION 2.11(a).
"STATED MATURITY DATE" means with respect to
(a) the Revolving Loans, the fifth anniversary of the Closing Date;
(b) the Multi-Draw Term Loans, the sixth anniversary of the Closing
Date;
(c) the Term B Loans, the seventh anniversary of the Closing Date; and
(d) the Term C Loans, the applicable date on which all such Term C
Loans mature and are due and payable, as determined at the time of the initial
borrowing thereof.
"SUB DEBT DOCUMENTS" means, collectively, the loan agreements,
indentures, note purchase agreements, promissory notes, guarantees, and other
instruments and agreements evidencing the terms of Subordinated Debt, as
amended, supplemented, amended and restated in accordance with SECTION 8.11.
"SUBORDINATED DEBT" means (i) the Existing Subordinated Debt,
and (ii) unsecured Indebtedness of the Borrower subordinated in right of payment
to the Obligations pursuant to documentation containing maturities, amortization
schedules, covenants, defaults, remedies, subordination provisions and other
terms reasonably satisfactory to the Required Lenders.
"SUBORDINATED NOTES" means, collectively, any promissory notes
evidencing Subordinated Debt, as such notes or instruments may be amended,
supplemented or otherwise modified from time to time in accordance with SECTION
8.11.
"SUBSIDIARY" means, with respect to any Person, any
corporation, limited liability company, partnership or other entity of which
more than 50% of the outstanding securities (or other ownership interest) having
ordinary voting power to elect the board of directors, managers or other voting
members of the governing body of such corporation, limited liability company,
partnership or other entity (irrespective of whether at the time securities (or
other ownership interest) of any other class or classes of such corporation,
limited liability company, partnership or other entity shall or might have
voting power upon the occurrence of any contingency) is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more
other Subsidiaries of such Person, or by one or more other Subsidiaries of such
Person. Unless
29
the context otherwise specifically requir es, the term "Subsidiary" shall be
a reference to a Subsidiary of the Borrower.
"SUBSIDIARY GUARANTY" means the subsidiary guaranty executed
and delivered by each Guarantor pursuant to the terms of this Agreement,
substantially in the form of EXHIBIT I hereto, as amended, restated,
supplemented or otherwise modified from time to time.
"SUBSIDIARY PLEDGE AGREEMENT" means the Pledge Agreement
executed and delivered by each Restricted Subsidiary that in turn has any
Subsidiaries, substantially in the form of EXHIBIT F-2 hereto, in each case as
amended, restated, supplemented or otherwise modified from time to time.
"SUBSIDIARY SECURITY AGREEMENT" means, collectively, each
Security Agreement executed and delivered by any Restricted Subsidiary in favor
of the Administrative Agent for the benefit of the Secured Parties pursuant to
the terms of this Agreement, in substantially the form of EXHIBIT G-2, in each
case, as amended, restated, supplemented or otherwise modified from time to
time.
"SWING LINE LENDER" means, subject to the terms of this
Agreement, CSFB.
"SWING LINE LOAN" is defined in CLAUSE (b) of SECTION 2.1.
"SWING LINE LOAN COMMITMENT" is defined in CLAUSE (b) of
SECTION 2.1.
"SWING LINE LOAN COMMITMENT AMOUNT" means, on any date,
$10,000,000, as such amount may be reduced from time to time pursuant to SECTION
2.6.
"SWING LINE NOTE" means a promissory note of the Borrower
payable to CSFB, in the form of EXHIBIT A-2 hereto (as such promissory note may
be amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to CSFB resulting from outstanding Swing
Line Loans, and also means all other promissory notes accepted from time to time
in substitution therefor or renewal thereof.
"SYNTHETIC LEASE" means any synthetic lease, tax retention
operating lease or off-balance sheet financing product where such transaction is
considered borrowed money Indebtedness for tax purposes but which is classified
as an operating lease pursuant to GAAP.
"TAXES" means any and all income, stamp or other taxes,
duties, levies, imposts, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, and all interest, penalties or similar liabilities with respect
thereto.
"TERM B LOAN" is defined in SECTION 2.3(a).
30
"TERM B LOAN COMMITMENT" means, relative to any Lender, such
Lender's obligation (if any) to make Term B Loans pursuant to SECTION 2.3(a).
"TERM B LOAN COMMITMENT AMOUNT" means, on any date,
$100,000,000.
"TERM B LOAN COMMITMENT TERMINATION DATE" means the earliest
of:
(a) ▇▇▇▇▇ ▇▇, ▇▇▇▇ (▇▇ the initial Credit Extension has not
occurred on or prior to such date);
(b) the date the initial Credit Extensions are made
(immediately after the making of the Term B Loans on such date); and
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in CLAUSES (a), (b) or (c), the Term
B Loan Commitments shall terminate automatically and without any further action.
"TERM B LOAN LENDER" means the Lenders listed on SCHEDULE II
with Term B Loan Commitments and Lenders from time to time holding Term B Loans
after giving effect to any assignments permitted by SECTION 11.11.
"TERM B NOTE" means a promissory note of the Borrower payable
to any Lender, in the form of EXHIBIT A-3 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Term B Loans, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
"TERM C LOAN" is defined in SECTION 2.3(c)(iii).
"TERM C LOAN COMMITMENT" is defined in SECTION 2.3(c)(i).
"TERM C LOAN COMMITMENT AMOUNT" means an aggregate principal
amount of up to $100,000,000.
"TERM C LOAN COMMITMENT TERMINATION DATE" means the earliest
of:
(a) ▇▇▇▇▇ ▇▇, ▇▇▇▇ (▇▇ the initial Credit Extension has not
occurred on or prior to such date);
(b) the Term C Loan Draw Date (immediately after the making of
the Term C Loans); and
(c) the date on which any Commitment Termination Event occurs.
31
Upon the occurrence of any event described in CLAUSES (a), (b) or (c), the Term
C Loan Commitments shall terminate automatically and without any further action.
"TERM C LOAN DRAW DATE" means the date on which the Term C
Loans are drawn by the Borrower.
"TERM C LOAN LENDER" is defined in SECTION 2.3(c)(ii).
"TERM C NOTE" means a promissory note of the Borrower payable
to any Lender, in the form of EXHIBIT A-5 hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from outstanding
Term C Loans, and also means all other promissory notes accepted from time to
time in substitution therefor or renewal thereof.
"TERM LOAN" means, as the context may require, a Multi-Draw
Term Loan, a Term B Loan and/or a Term C Loan.
"TERM LOAN COMMITMENT" means, as the context may require, a
Term B Loan Commitment, a Term C Loan Commitment and/or a Multi-Draw Term Loan
Commitment.
"TERM LOAN COMMITMENT AMOUNT" means, as the context may
require, the Term B Loan Commitment Amount, the Term C Loan Commitment Amount
and/or the Multi-Draw Term Loan Commitment Amount.
"TERM LOAN COMMITMENT TERMINATION DATE" means, as the context
may require, the Term B Loan Commitment Termination Date, the Term C Loan
Commitment Termination Date and/or the Multi-Draw Term Loan Commitment
Termination Date.
"TERM LOAN LENDER" means each Multi-Draw Term Loan Lender,
each Term B Loan Lender and each Term C Loan Lender.
"TERM NOTE" means, as the context may require, a Multi-Draw
Term Note, a Term B Note and/or a Term C Note.
"TITAN CAPITAL TRUST" means Titan Capital Trust, a Delaware
business trust and a wholly owned Subsidiary of the Borrower.
"TOTAL DEBT" means, on any date of determination, the
outstanding principal amount of all Indebtedness of the Borrower and its
Restricted Subsidiaries (which, in the case of the Loans, shall be deemed to
equal the aggregate amount of Loans outstanding on such date and which, in the
case of Letter of Credit Outstandings shall be deemed to equal the aggregate
amount of Letter of Credit Outstandings on such date), exclusive of (i)
intercompany Indebtedness between the Borrower and any of its Subsidiaries
(including, without limitation, the
32
Debentures so long as they are held by Titan Capital Trust) and (ii) the
Indebtedness of Titan Africa, Inc. in connection with the project financing
in Benin, so long as such Indebtedness remains non-recourse to the Borrower
and its Subsidiaries (other than Titan Africa, Inc.) and the Borrower and its
Subsidiaries (other than Titan Africa, Inc.) have no liability or obligations
with respect to such Indebtedness.
"TOTAL DEBT TO EBITDA RATIO" means, as of the last day of any
Fiscal Quarter, the ratio of:
(a) Total Debt outstanding on the last day of such Fiscal
Quarter
TO
(b) EBITDA computed for the period consisting of such Fiscal
Quarter and each of the three immediately preceding Fiscal Quarters.
"TOTAL EXPOSURE AMOUNT" means, on any date of determination
(and without duplication), the outstanding principal amount of all Loans, the
aggregate amount of all Letter of Credit Outstandings and the unfunded amount of
the Commitments.
"TOTAL PERCENTAGE" means, relative to any Lender, the
applicable percentage equal to the sum of (a) the total outstanding amount of
Loans made by such Lender, (b) without duplication of CLAUSE (a), such Lender's
participation interest in Letter of Credit Outstandings, if any, AND (c) the
total unfunded amount of the Commitments of such Lender, DIVIDED BY the Total
Exposure Amount, as such percentage may be adjusted from time to time pursuant
to Lender Assignment Agreement(s) executed by such Lender and its Assignee
Lender(s) and delivered pursuant to SECTION 11.11(a).
"TRADEMARK SECURITY AGREEMENT" means any Trademark Security
Agreement executed and delivered by any Obligor substantially in the form of
Exhibit B to any Security Agreement, as amended, restated, supplemented or
otherwise modified from time to time.
"TYPE" means, relative to any Loan, the portion thereof, if
any, being maintained as a Base Rate Loan or a LIBO Rate Loan.
"U.C.C." means the Uniform Commercial Code as from time to
time in effect in the State of New York.
"UNITED STATES" or "U.S." means the United States of America,
its fifty states and the District of Columbia.
"U.S. SUBSIDIARY" means any Subsidiary that is incorporated or
organized under the laws of the United States or a state thereof or the District
of Columbia.
33
"USAGE" means, for each applicable Fiscal Quarter, a
percentage equal to (a) the daily average of the sum of (i) the aggregate
principal amount of all outstanding Revolving Loans (including the aggregate
principal amount of all outstanding Swing Line Loans and the Letter of Credit
Outstandings but excluding Revolving Loans made for the purpose of repaying any
Refunded Swing Line Loans or reimbursing the Issuers for any amount drawn under
any Letter of Credit but not yet so applied, to the extent such amounts are
included as outstanding Swing Line Loans or Letter of Credit Outstandings) PLUS
(ii) the aggregate principal amount of all outstanding Multi-Draw Term Loans,
DIVIDED by (b) the daily average of the sum of (i) the Revolving Loan Commitment
Amount and (ii) either (x) the Multi-Draw Term Loan Commitment Amount (prior to
the Multi-Draw Term Loan Commitment Termination Date) or (y) the aggregate
principal amount of all outstanding Multi-Draw Term Loans (subsequent to the
Multi-Draw Term Loan Commitment Date), for such Fiscal Quarter.
"VOTING STOCK" means, with respect to any Person, Capital
Stock of any class or kind ordinarily having the power to vote for the election
of directors, managers or other voting members of the governing body of such
Person.
"WELFARE PLAN" means a "WELFARE PLAN", as such term is defined
in section 3(1) of ERISA.
"WHOLLY OWNED" means any Subsidiary all of the outstanding
common stock (or similar equity interest) of which (other than any director's
qualifying shares or investments by foreign nationals mandated by applicable
laws) is owned directly or indirectly by the Borrower and the officers,
directors or employees of such Subsidiary.
Section 1.2 USE OF DEFINED TERMS. Unless otherwise defined or
the context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in each other Loan Document and the
Disclosure Schedule.
Section 1.3 CROSS-REFERENCES. Unless otherwise specified,
references in this Agreement and in each other Loan Document to any Article or
Section are references to such Article or Section of this Agreement or such
other Loan Document, as the case may be, and, unless otherwise specified,
references in any Article, Section or definition to any clause are references to
such clause of such Article, Section or definition.
Section 1.4 ACCOUNTING AND FINANCIAL DETERMINATIONS. Unless
otherwise specified, all accounting terms used herein or in any other Loan
Document shall be interpreted, and all accounting determinations and
computations hereunder or thereunder (including under SECTION 8.4) shall be
made, in accordance with, those generally accepted accounting principles
("GAAP") in effect on the Closing Date. Unless otherwise expressly provided,
all financial covenants and defined financial terms shall be computed on a
consolidated basis for the Borrower and its U.S. Subsidiaries, in each case
without duplication.
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ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
Section 2.1 REVOLVING LOAN COMMITMENT AND SWING LINE LOAN
COMMITMENT.
(a) On the terms and subject to the conditions
set forth in this Agreement, from time to time on any Business Day occurring
after the Closing Date but prior to the Revolving Loan Commitment Termination
Date, each Revolving Loan Lender will make loans (relative to such Revolving
Loan Lender, its "REVOLVING LOANS") to the Borrower equal to such Revolving Loan
Lender's Percentage of the aggregate amount of each Borrowing of the Revolving
Loans requested by the Borrower to be made on such day. On the terms and subject
to the conditions hereof, the Borrower may from time to time borrow, prepay and
reborrow the Revolving Loans.
(b) On the terms and subject to the conditions
set forth in this Agreement, from time to time on any Business Day occurring
after the Closing Date but prior to the Revolving Loan Commitment Termination
Date, CSFB will make loans (relative to CSFB, its "SWING LINE LOAN") to the
Borrower equal to the principal amount of the Swing Line Loan requested by the
Borrower to be made on such day. The Commitment of CSFB described in this CLAUSE
(b) is herein referred to as its "SWING LINE LOAN COMMITMENT". On the terms and
subject to the conditions hereof, the Borrower may from time to time borrow,
prepay and reborrow Swing Line Loans.
Section 2.2 LETTER OF CREDIT COMMITMENT. On the terms and
subject to the conditions set forth in this Agreement, from time to time on any
Business Day occurring from and after the Closing Date but prior to the
Revolving Loan Commitment Termination Date, the Issuer will (a) issue one or
more standby letters of credit (together with the Existing Letters of Credit,
each a "LETTER OF CREDIT") for the account of the Borrower or any Guarantor in
the Stated Amount requested by the Borrower on such day or (b) extend the Stated
Expiry Date of a standby Letter of Credit previously issued hereunder (but
excluding any Existing Letter of Credit) to a date not later than the earlier of
(i) five Business Days prior to the Revolving Loan Commitment Termination Date
and (ii) 12 months from the date of such extension; PROVIDED, HOWEVER, that with
respect to Letters of Credit with an aggregate undrawn face amount not exceeding
$2,000,000, the Stated Expiry Date of such Letters of Credit may be up to 24
months following the issuance or extension thereof. Notwithstanding the
foregoing, the face amount of all Existing Letters of Credit and all Letters of
Credit issued on the Closing Date shall not exceed $6,000,000.
Section 2.3 TERM LOAN COMMITMENTS.
(a) TERM B LOANS. In a single borrowing (which
shall be a Business Day) occurring on or prior to the Term B Loan Commitment
Termination Date, each Term B Loan Lender will make loans (relative to suchTerm
B Loan Lender, its "TERM B LOANS") to the
35
Borrower equal to such Term B Loan Lender's Percentage of the aggregate
amount of each Borrowing of the Term B Loans requested by the Borrower to be
made on the Closing Date. No amounts paid or prepaid with respect to Term B
Loans may be reborrowed.
(b) MULTI-DRAW TERM LOANS. From time to time on
any Business Day occurring after the Closing Date but prior to the Multi-Draw
Term Loan Commitment Termination Date, each Multi-Draw Term Loan Lender will
make loans (relative to such Multi-Draw Term Loan Lender, its "MULTI-DRAW TERM
LOANS") to the Borrower equal to such Multi-Draw Term Loan Lender's Percentage
of the aggregate amount of each Borrowing of the Multi-Draw Term Loans requested
by the Borrower to be made on such day. No amounts paid or prepaid with respect
to Multi-Draw Term Loans may be reborrowed.
(c) TERM C LOANS.
(i) So long as no Default has occurred
and is continuing, at any time prior to the Stated Maturity Date with
respect to Term B Loans, the Borrower may request an additional
commitment up to an aggregate principal amount of $100,000,000 (the
"TERM C LOAN COMMITMENT"). No Lender or other Person shall be obligated
to provide any Term C Loan Commitment. Each of the Credit Agents shall
assist and cooperate with (but shall not be obligated to provide a Term
C Loan Commitment to) the Borrower in connection with obtaining the
Term C Loan Commitments. All Term C Loan Commitments will be issued on
the same date.
(ii) The Administrative Agent, in
consultation with the Borrower, will attempt to identify Persons to
provide the Term C Loan Commitments (it being understood that all such
Persons will be required to satisfy the criteria of a "Lender"
hereunder). Term C Loan Commitments may, subject to the foregoing, be
made by existing Lenders or new Lenders (each, an "ADDITIONAL LENDER")
that will be required to become a party to this Agreement in connection
with the issuance of a Term C Loan Commitment. The aggregate amount of
all Term C Loan Commitments shall not exceed $100,000,000. The existing
Lenders and the Additional Lenders which agree to provide Term C Loan
Commitments are collectively referred to herein as the "TERM C LOAN
LENDERS."
(iii) The Term C Loan Commitments
shall become effective upon the receipt by the Administrative Agent
of an agreement in form and substance satisfactory to the
Administrative Agent signed by the Borrower and by each Term C Loan
Lender, setting forth the Term C Loan Commitments of such Term C
Loan Lenders, the maturity, amortization and interest rates
applicable to the Term C Loans and the agreement of each Additional
Lender to become a party to this Agreement and to be bound by all
the terms and provisions hereof, together with such evidence of
appropriate corporate authorization on the part of the Borrower with
respect to the Term C Loan Commitments and such opinions of counsel
for the Borrower with respect to the Term C Loan Commitments and
such
36
agreement as the Administrative Agent may reasonably request. So
long as no Default is in existence or would result therefrom, the
Borrower may borrow under the Term C Loan Commitments by following
the procedures with respect to Credit Extensions set forth herein
(each such loan made by a Term C Loan Lender, a "TERM C LOAN"). The
Term C Loans shall have a final maturity no earlier than the Term B
Loans.
Section 2.4 LENDERS NOT PERMITTED OR REQUIRED TO MAKE LOANS.
No Lender shall be permitted or required to make any Loan if, after giving
effect thereto, the aggregate outstanding principal amount of:
(a) all Revolving Loans
(i) of all Revolving Loan Lenders and \
the outstanding principal amount of all Swing Line Loans, together with
the aggregate amount of all Letter of Credit Outstandings, would exceed
the then existing Revolving Loan Commitment Amount; or
(ii) of such Revolving Loan Lender,
together with such Lender's Percentage of the aggregate amount of all
Swing Line Loans and Letter of Credit Outstandings, would exceed such
Lender's Percentage of the then existing Revolving Loan Commitment
Amount;
(b) all Term B Loans
(i) of all Lenders made on the Closing
Date would exceed the Term B Loan Commitment Amount; or
(ii) of such Lender with a Term B Loan
Commitment made on the Closing Date would exceed such Lender's
Percentage of the Term B Loan Commitment Amount; or
(c) all Multi-Draw Term Loans
(i) of all Lenders made prior to the
Multi-Draw Term Loan Commitment Termination Date would exceed the
Multi-Draw Term Loan Commitment Amount; or
(ii) of such Lender with a Multi-Draw
Term Loan Commitment made prior to the Multi-Draw Term Loan Commitment
Termination Date would exceed such Lender's Percentage of the
Multi-Draw Term Loan Commitment Amount; or
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(d) all Swing Line Loans
(i) would exceed the then existing
Swing Line Loan Commitment Amount; or
(ii) together with all Revolving Loans
and the aggregate amount of all Letter of Credit Outstandings, would
exceed the then existing Revolving Loan Commitment Amount.
Section 2.5 ISSUER NOT PERMITTED OR REQUIRED TO ISSUE LETTERS
OF CREDIT. No Issuer shall be permitted or required to issue any Letter of
Credit if, after giving effect thereto, (a) the aggregate amount of all Letter
of Credit Outstandings would exceed the Letter of Credit Commitment Amount or
(b) the sum of the aggregate amount of all Letter of Credit Outstandings plus
the aggregate principal amount of all Revolving Loans and Swing Line Loans then
outstanding would exceed the Revolving Loan Commitment Amount.
Section 2.6 REDUCTION OF THE COMMITMENT AMOUNTS. The
Commitment Amounts are subject to reduction from time to time pursuant to this
SECTION 2.6.
(a) OPTIONAL. The Borrower may, from time to
time on any Business Day occurring after the Closing Date, voluntarily reduce
the amount of the Revolving Loan Commitment Amount, the Multi-Draw Term Loan
Commitment Amount, the Swing Line Loan Commitment Amount or the Letter of Credit
Commitment Amount on the Business Day so specified by the Borrower; PROVIDED,
HOWEVER, that all such reductions shall require at least one Business Day's
prior notice to the Administrative Agent and be permanent, and any partial
reduction of any Commitment Amount shall be in a minimum amount of $1,000,000
and in an integral multiple of $500,000. Any reduction of the Revolving Loan
Commitment Amount which reduces the Revolving Loan Commitment Amount below the
then current amount of the Swing Line Loan Commitment Amount shall result in an
automatic and corresponding reduction of the Swing Line Loan Commitment Amount
to the amount of the Revolving Loan Commitment Amount, as so reduced, without
any further action on the part of CSFB or otherwise. Any reduction of the
Revolving Loan Commitment Amount which reduces the Revolving Loan Commitment
Amount below the then current amount of the Letter of Credit Commitment Amount
shall result in an automatic and corresponding reduction of the Letter of
Credit Commitment Amount to the amount of the Revolving Loan Commitment Amount,
as so reduced, without any further action on the part of the Administrative
Agent, the Issuers or otherwise.
(b) MANDATORY. (i) On the Multi-Draw Term Loan
Commitment Termination Date, the Multi-Draw Term Loan Commitment Amount shall
automatically and without the requirement of any action on the part of any
Person be permanently reduced to zero, and (ii) on the date the Borrower or any
of its Restricted Subsidiaries receives any Net Proceeds and after the
expiration of any period designated for the purchase of Qualified Assets, if
appropriate (in accordance with the definition of "Net Proceeds"), (1) with
respect to any Net
38
Proceeds not applied to reduce the outstanding Term Loans in accordance with
SECTION 3.1(c), the Multi-Draw Term Loan Commitment Amount (prior to the
Multi-Draw Term Loan Commitment Termination Date) shall be reduced by an
amount equal to 100% of Net Proceeds with respect to Net Proceeds described
in CLAUSES (b), (c), and (d) of the definition thereof and 50% of such Net
Proceeds with respect to the Net Proceeds described in CLAUSE (a) of the
definition thereof and (2) the Revolving Loan Commitment Amount (after
application of such Net Proceeds pursuant to SECTION 3.2(b)) shall be reduced
by an amount equal to 100% of the remaining Net Proceeds with respect to Net
Proceeds described in CLAUSES (b), (c), and (d) of the definition thereof and
50% of such Net Proceeds with respect to the Net Proceeds described in CLAUSE
(a) of the definition thereof.
Section 2.7 BORROWING PROCEDURE. In the case of other than
Swing Line Loans, by delivering a Borrowing Request to the Administrative Agent
on or before 1:00 p.m., New York time, on a Business Day, the Borrower may from
time to time irrevocably request, on not less than one Business Day's notice in
the case of Base Rate Loans, or three Business Days' notice in the case of LIBO
Rate Loans, and in either case not more than five Business Days' notice, that a
Borrowing be made, in the case of Revolving Loans, in a minimum amount of
$1,000,000 and an integral multiple of $1,000,000, in the case of Multi-Draw
Term Loans, in a minimum amount of $2,000,000 and an integral multiple of
$1,000,000 or, in either case, in the unused amount of the applicable
Commitment. On the terms and subject to the conditions of this Agreement, each
Borrowing shall be comprised of the type of Loans, and shall be made on the
Business Day, specified in such Borrowing Request. Promptly after receipt of a
Borrowing Request, the Administrative Agent shall provide a notice to the
applicable Lenders specifying the global amount of the Borrowing, such Lender's
pro rata share thereof, the type of Loan, and, in the case of LIBO Rate Loans,
the Interest Period with respect thereto. In the case of other than Swing Line
Loans, on or before 2:00 p.m. (New York time) on such Business Day each Lender
that has a Commitment to make the Loans being requested shall deposit with the
Administrative Agent same day funds in an amount equal to such Lender's
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Administrative Agent shall specify from time to time by notice to the
Lenders. To the extent funds are received from the Lenders, the Administrative
Agent shall make such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Borrowing Request. No Lender's
obligation to make any Loan shall be affected by any other Lender's failure to
make any Loan.
Section 2.8 SWING LINE LOANS. By telephonic notice, promptly
followed (within one Business Day) by the delivery of a confirming Borrowing
Request, to CSFB on or before 2:00 p.m., New York time, on the Business Day the
proposed Swing Line Loan is to be made, the Borrower may from time to time
irrevocably request that Swing Line Loans be made by CSFB in an aggregate
minimum principal amount of $500,000 and an integral multiple of $500,000. All
Swing Line Loans shall be made as Base Rate Loans and shall not be entitled to
be converted into LIBO Rate Loans. The proceeds of each Swing Line Loan shall be
made available by CSFB, by its close of business on the Business Day telephonic
notice is received by it as provided in this clause to the Borrower by wire
transfer to the account the Borrower shall have specified in its notice
therefor.
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If (i) any Swing Line Loan shall be outstanding for more than
four Business Days or (ii) any Default shall occur and be continuing, each
Revolving Loan Lender (other than CSFB) irrevocably agrees that it will, at the
request of CSFB, make a Revolving Loan (which shall initially be funded as a
Base Rate Loan) in an amount equal to such Lender's Percentage of the aggregate
principal amount of all such Swing Line Loans then outstanding (such outstanding
Swing Line Loans hereinafter referred to as the "REFUNDED SWING LINE LOANS"). On
or before 2:00 p.m. (New York time) on the first Business Day following receipt
by each Lender of a request to make Revolving Loans as provided in the preceding
sentence, each Revolving Loan Lender shall deposit in an account specified by
CSFB the amount so requested in same day funds and such funds shall be applied
by CSFB to repay the Refunded Swing Line Loans. At the time the aforementioned
Lenders make the above referenced Revolving Loans, CSFB shall be deemed to have
made, (in consideration of the making of the Refunded Swing Line Loans),
Revolving Loans in an amount equal to CSFB's Percentage (determined by reference
to its Revolving Loan Commitment) of the aggregate principal amount of the
Refunded Swing Line Loans. Upon the making (or deemed making, in the case of
CSFB) of any Revolving Loans pursuant to this clause, the amount so funded shall
become outstanding under such Revolving Loan Lender's Revolving Note and shall
no longer be owed under the Swing Line Note. All interest payable with respect
to any Revolving Loans made (or deemed made, in the case of CSFB) pursuant to
this clause shall be appropriately adjusted to reflect the period of time during
which CSFB had outstanding Swing Line Loans in respect of which such Revolving
Loans were made. Each Revolving Loan Lender's obligation to make the Revolving
Loans referred to in this clause shall be absolute and unconditional and shall
not be affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against CSFB, any
Obligor or any Person for any reason whatsoever; (ii) the occurrence or
continuance of any Default; (iii) any adverse change in the condition (financial
or otherwise) of any Obligor; (iv) the acceleration or maturity of any
Obligations or the termination of any Commitment after the making of any Swing
Line Loan; (v) any breach of this Agreement or any other Loan Document by any
Person; or (vi) any other circumstance, happening or event whatsoever, whether
or not similar to any of the foregoing.
Section 2.9 CONTINUATION AND CONVERSION ELECTIONS. By
delivering a Continuation/Conversion Notice to the Administrative Agent on or
before 1:00 p.m., New York time, on a Business Day, the Borrower may from time
to time irrevocably elect, on not less than one Business Days' notice in the
case of conversion to Base Rate Loans, or three Business Days' notice in the
case of conversion to LIBO Rate Loans, and in either case not more than five
Business Days' notice, that all, or any portion in an aggregate minimum amount
of $1,000,000 and an integral multiple of $1,000,000 be, in the case of Base
Rate Loans, converted into LIBO Rate Loans or be, in the case of LIBO Rate
Loans, converted into Base Rate Loans or continued as LIBO Rate Loans (in the
absence of delivery of a Continuation/Conversion Notice with respect to any LIBO
Rate Loan at least three Business Days (but not more than five Business Days)
before the last day of the then current Interest Period with respect thereto,
such LIBO Rate Loan shall, on such last day, automatically convert to a Base
Rate Loan); PROVIDED, HOWEVER, that (x) each such conversion or continuation
shall be pro rated among the applicable outstanding
40
Loans of all Lenders that have made such Loans, and (y) no portion of the
outstanding principal amount of any Loans may be continued as, or be
converted into, LIBO Rate Loans when any Default has occurred and is
continuing.
Section 2.10 FUNDING. Each Lender may, if it so elects,
fulfill its obligation to make, continue or convert LIBO Rate Loans hereunder by
causing one of its foreign branches or Affiliates (or an international banking
facility created by such Lender) to make or maintain such LIBO Rate Loan;
PROVIDED, HOWEVER, that such LIBO Rate Loan shall nonetheless be deemed to have
been made and to be held by such Lender, and the obligation of the Borrower to
repay such LIBO Rate Loan shall nevertheless be to such Lender for the account
of such foreign branch, Affiliate or international banking facility. In
addition, the Borrower hereby consents and agrees that, for purposes of any
determination to be made for purposes of SECTION 4.1, 4.2, 4.3 or 4.4, it shall
be conclusively assumed that each Lender elected to fund all LIBO Rate Loans by
purchasing Dollar deposits in its LIBOR Office's interbank eurodollar market.
Section 2.11 LETTERS OF CREDIT.
(a) ISSUANCE PROCEDURES. By delivering to the
Administrative Agent an Issuance Request on or before 12:00 noon, New York time,
on a Business Day, the Borrower may from time to time irrevocably request on not
less than three (or such shorter period as may be agreed to by the Issuers in
their sole discretion) nor more than ten Business Days' notice, that an Issuer
issue, or extend the Stated Expiry Date of, as the case may be, an irrevocable
Letter of Credit in such form as may be requested by the Borrower and approved
by such Issuer, solely for the purposes described in SECTION 7.8. Each Letter of
Credit shall by its terms be stated to expire on a date (its "STATED EXPIRY
DATE") no later than the earlier to occur of (i) five Business Days prior to the
Revolving Loan Commitment Termination Date and (ii) 12 months from the date of
its issuance; PROVIDED, HOWEVER, that with respect to Letters of Credit with an
aggregate undrawn face amount not exceeding $2,000,000, the Stated Expiry Date
of such Letters of Credit may be up to 24 months following the issuance or
extension thereof. Each Issuer will make available to the beneficiary thereof
the original of the Letter of Credit which it issues hereunder.
(b) OTHER LENDERS' PARTICIPATION. Upon the
issuance of each Letter of Credit issued by an Issuer pursuant hereto, and
without further action, each Revolving Loan Lender (other than such Issuer)
shall be deemed to have irrevocably purchased, to the extent of its Percentage
to make Revolving Loans, a participation interest in such Letter of Credit
(including the Contingent Liability and any Reimbursement Obligation with
respect thereto), and such Revolving Loan Lender shall, to the extent of its
Percentage to make Revolving Loans, be responsible for reimbursing promptly (and
in any event within one Business Day) the Issuer for Reimbursement Obligations
which have not been reimbursed by the Borrower in accordance with SECTION
2.11(d). In addition, such Revolving Loan Lender shall, to the extent of its
Percentage to make Revolving Loans, be entitled to receive a ratable portion of
the Letter of Credit fees payable pursuant to SECTION 3.6(c) with respect to
each Letter of Credit (other than the fronting and issuance fees payable to an
Issuer pursuant to SECTION 3.6(c)(i)(1) and SECTION 3.6(c)(ii)) and of interest
payable pursuant to SECTION 3.3 with respect to any Reimbursement Obligation. To
41
the extent that any Revolving Loan Lender has reimbursed any Issuer for a
Disbursement, such Lender shall be entitled to receive its ratable portion of
any amounts subsequently received (from the Borrower or otherwise) in respect
of such Disbursement.
(c) DISBURSEMENTS. An Issuer will notify the
Borrower and the Administrative Agent promptly of the presentment for payment of
any Letter of Credit issued by such Issuer, together with notice of the date
(the "DISBURSEMENT DATE") such payment shall be made (each such payment, a
"DISBURSEMENT"). Subject to the terms and provisions of such Letter of Credit
and this Agreement, the applicable Issuer shall make such payment to the
beneficiary (or its designee) of such Letter of Credit. Prior to 1:00 p.m., New
York time, on the first Business Day following the Disbursement Date, the
Borrower will reimburse the Administrative Agent, for the account of the
applicable Issuer, for all amounts which such Issuer has disbursed under such
Letter of Credit, together with interest thereon at a rate per annum equal to
the rate per annum then in effect for Base Rate Loans (with the then Applicable
Margin for Revolving Loans accruing on such amount) pursuant to SECTION 3.3 for
the period from the Disbursement Date through the date of such reimbursement.
Without limiting in any way the foregoing and notwithstanding anything to the
contrary contained herein or in any separate application for any Letter of
Credit, the Borrower hereby acknowledges and agrees that it shall be obligated
to reimburse the applicable Issuer upon each Disbursement of a Letter of Credit,
and it shall be deemed to be the obligor for purposes of each such Letter of
Credit issued hereunder (whether the account party on such Letter of Credit is
the Borrower or a Subsidiary).
(d) REIMBURSEMENT. The obligation (a
"REIMBURSEMENT OBLIGATION") of the Borrower under SECTION 2.11(c) to
reimburse an Issuer with respect to each Disbursement (including interest
thereon), and, upon the failure of the Borrower to reimburse an Issuer, each
Revolving Loan Lender's obligation under SECTION 2.11(B) to reimburse an
Issuer, shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment which the
Borrower or such Revolving Loan Lender, as the case may be, may have or have
had against such Issuer or any Lender, including any defense based upon the
failure of any Disbursement to conform to the terms of the applicable Letter
of Credit (if, in such Issuer's good faith opinion, such Disbursement is
determined to be appropriate) or any non-application or misapplication by the
beneficiary of the proceeds of such Letter of Credit; PROVIDED, HOWEVER, that
after paying in full its Reimbursement Obligation hereunder, nothing herein
shall adversely affect the right of the Borrower or such Lender, as the case
may be, to commence any proceeding against an Issuer for any wrongful
Disbursement made by such Issuer under a Letter of Credit as a result of acts
or omissions constituting gross negligence or wilful misconduct on the part
of such Issuer.
(e) DEEMED DISBURSEMENTS. Upon the occurrence
and during the continuation of any Default under SECTION 9.1(i) or upon
notification by the Administrative Agent (acting at the direction of the
Required Lenders) to the Borrower of its obligations under this Section,
following the occurrence and during the continuation of any other Event of
Default,
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(i) the aggregate Stated Amount of all
Letters of Credit shall, without demand upon or notice to the Borrower
or any other Person, be deemed to have been paid or disbursed by the
Issuers of such Letters of Credit (notwithstanding that such amount may
not in fact have been paid or disbursed); and
(ii) the Borrower shall be immediately
obligated to reimburse the Issuers for the amount deemed to have been
so paid or disbursed by such Issuers.
Amounts payable by the Borrower pursuant to this Section shall be deposited in
immediately available funds with the Administrative Agent and held as collateral
security for the Reimbursement Obligations and all other Obligations. When all
Defaults giving rise to the deemed disbursements under this Section have been
cured or waived the Administrative Agent shall, if no other Default is then
existing, return to the Borrower all amounts then on deposit with the
Administrative Agent pursuant to this Section which have not been applied to the
satisfaction of the Reimbursement Obligations and all other Obligations.
(f) NATURE OF REIMBURSEMENT OBLIGATIONS. The
Borrower, each other Obligor and, to the extent set forth in SECTION 2.11(b),
each Revolving Loan Lender shall assume all risks of the acts, omissions or
misuse of any Letter of Credit by the beneficiary thereof. No Issuer (except to
the extent of its own gross negligence or wilful misconduct) shall be
responsible for:
(i) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any Letter of Credit or any
document submitted by any party in connection with the application for
and issuance of a Letter of Credit, even if it should in fact prove to
be in any or all respects invalid, insufficient, inaccurate, fraudulent
or forged;
(ii) the form, validity, sufficiency,
accuracy, genuineness or legal effect of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the
rights or benefits thereunder or the proceeds thereof in whole or in
part, which may prove to be invalid or ineffective for any reason;
(iii) failure of the beneficiary to
comply fully with conditions required in order to demand payment under
a Letter of Credit;
(iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise; or
43
(v) any loss or delay in the
transmission or otherwise of any document or draft required in order to
make a Disbursement under a Letter of Credit.
None of the foregoing shall affect, impair or prevent the vesting of any of the
rights or powers granted to any Issuer or any Revolving Loan Lender hereunder.
In furtherance and not in limitation or derogation of any of the foregoing, any
action taken or omitted to be taken by an Issuer in good faith (and not
constituting gross negligence or willful misconduct) shall be binding upon each
Obligor and each such Secured Party, and shall not put such Issuer under any
resulting liability to any Obligor or any Secured Party, as the case may be.
(g) REPORTING REQUIREMENTS FOR ISSUERS. Within
two Business Days following the last day of each calendar month, each Issuer
shall deliver to the Administrative Agent a report detailing all activity during
the preceding month with respect to any Letters of Credit issued by any such
Issuer, including the face amount, the account party, the beneficiary and the
expiration date of such Letters of Credit and any other information with respect
thereto as may be requested by the Administrative Agent.
Section 2.12 NOTES. Each Lender's Loans under a Commitment
shall be evidenced by a Note payable to the order of such Lender in a maximum
principal amount equal to such Lender's Percentage of the original applicable
Commitment Amount. The Borrower hereby irrevocably authorizes each Lender to
make (or cause to be made) appropriate notations on the grid attached to such
Lender's Note (or on any continuation of such grid), which notations, if made,
shall evidence, INTER ALIA, the date of, the outstanding principal of, and the
interest rate and Interest Period applicable to the Loans evidenced thereby.
Such notations shall be rebuttably presumptive evidence of the accuracy of the
information so set forth; PROVIDED, HOWEVER, that the failure of any Lender to
make any such notations shall not limit or otherwise affect any Obligations of
any Obligor.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
Section 3.1 REPAYMENTS AND PREPAYMENTS. The Borrower shall
repay in full the unpaid principal amount of each Loan upon the applicable
Stated Maturity Date therefor. Prior thereto, payments and prepayments of Loans
shall or may be made as set forth below.
(a) From time to time on any Business Day, the
Borrower may make a voluntary prepayment, in whole or in part, of the
outstanding principal amount of any:
(i) Loans (other than Swing Line
Loans), PROVIDED, HOWEVER, that
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(1) any such prepayment of the
Term Loans shall be made PRO RATA among all the Term Loans and, if
applicable, having the same Interest Period of all Lenders that have
made such Term Loans, and shall be applied to the remaining
amortization payments, for the relevant Term Loans as provided for in
SECTION 3.1(d) and any such prepayment of Revolving Loans shall be made
PRO RATA among the Revolving Loans of the same type and, if applicable,
having the same Interest Period of all Lenders that have made such
Revolving Loans;
(2) all such voluntary
prepayments shall require at least one but no more than five Business
Days' prior written notice to the Administrative Agent; and
(3) all such voluntary partial
prepayments shall be in an aggregate minimum amount of $1,000,000 and
an integral multiple of $1,000,000; and
(ii) Swing Line Loans, PROVIDED that
(1) all such voluntary
prepayments shall require prior telephonic notice to CSFB on or before
2:00 p.m., New York time, on the day of such prepayment (such notice to
be confirmed in writing within 24 hours thereafter); and
(2) all such voluntary partial
prepayments shall be in an aggregate minimum amount of $500,000 and an
integral multiple of $500,000.
(b) On each date when the sum of (i) the
aggregate outstanding principal amount of all Revolving Loans and Swing Line
Loans and (ii) the aggregate amount of all Letter of Credit Outstandings exceeds
the Revolving Loan Commitment Amount (as it may be reduced from time to time,
including pursuant to SECTION 2.6), the Borrower shall make a mandatory
prepayment of all the Revolving Loans or all Swing Line Loans (or both) and, if
necessary, give cash collateral to the Administrative Agent pursuant to an
agreement satisfactory to the Administrative Agent to collateralize Letter of
Credit Outstandings, in an aggregate amount equal to such excess.
(c) Concurrently with the receipt (or deemed
receipt) of any Net Proceeds (or after the expiration of any period designated
for the purchase of Qualified Assets, if appropriate) by the Borrower or any of
its Restricted Subsidiaries, the Borrower shall make a mandatory prepayment of
the Loans (i) in an amount equal to 100% of the Net Proceeds with respect to Net
Proceeds described in CLAUSES (b), (c) AND (d) of the definition thereof and
(ii) 50% of such Net Proceeds with respect to the Net Proceeds described in
CLAUSE (a) of the definition thereof, in each case, to be applied as set forth
in SECTION 3.2. The Borrower will, prior to
45
prepaying the Loans, give the Administrative Agent telephone notice (promptly
confirmed in writing) requesting that the Administrative Agent provide notice
of such prepayment to each Lender entitled to receive any portion of such
prepayment.
(d) The Borrower shall make a scheduled
repayment of the aggregate outstanding principal amount of:
(i) Multi-Draw Term Loans in
installments on the dates set forth below (PROVIDED that if such date
is not a Business Day, the installment shall be paid on the preceding
Business Day), each such installment to be in an amount equal to the
corresponding percentages set forth below of the principal amount of
the Multi-Draw Term Loans outstanding as of the Multi-Draw Term Loan
Commitment Termination Date:
SCHEDULED REPAYMENT
DATE OF MULTI-DRAW TERM
LOANS
---- -------------------
June 30, 2001 2.50%
September 30, 2001 2.50%
December 31, 2001 2.50%
March 31, 2002 2.50%
June 30, 2002 3.75%
September 30, 2002 3.75%
December 31, 2002 3.75%
March 31, 2003 3.75%
June 30, 2003 5.00%
September 30, 2003 5.00%
December 31, 2003 5.00%
March 31, 2004 5.00%
June 30, 2004 6.25%
September 30, 2004 6.25%
December 31, 2004 6.25%
March 31, 2005 6.25%
June 30, 2005 7.50%
September 30, 2005 7.50%
December 31, 2005 7.50%
Sixth Anniversary 7.50%
of the Closing Date
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; PROVIDED that the scheduled installments of principal of the Multi-Draw
Term Loans set forth above shall be reduced on a PRO RATA basis in connection
with any voluntary or mandatory prepayments of the Multi-Draw Term Loans in
accordance with SECTION 3.1; and PROVIDED, FURTHER that the final installment
specified above for the repayment by the Borrower of the Multi-Draw Term
Loans shall be in an amount, if such amount is different from that specified
above, sufficient to repay all amounts owing by the Borrower under this
Agreement with respect to the Multi-Draw Term Loans.
(ii) Term B Loans in installments on the
dates set forth below (PROVIDED that if such date is not a Business
Day, the installment shall be paid on the preceding Business Day), each
such installment to be in an amount equal to the corresponding
percentages set forth below of the principal amount of the Term B Loans
outstanding on the Closing Date:
SCHEDULED REPAYMENT
DATE OF
TERM B LOANS
---- --------------------
June 30, 2000 0.25%
September 30, 2000 0.25%
December 31, 2000 0.25%
March 31, 2001 0.25%
June 30, 2001 0.25%
September 30, 2001 0.25%
December 31, 2001 0.25%
March 31, 2002 0.25%
June 30, 2002 0.25%
September 30, 2002 0.25%
December 31, 2002 0.25%
March 31, 2003 0.25%
June 30, 2003 0.25%
September 30, 2003 0.25%
December 31, 2003 0.25%
March 31, 2004 0.25%
June 30, 2004 0.25%
September 30, 2004 0.25%
December 31, 2004 0.25%
March 31, 2005 0.25%
June 30, 2005 0.25%
September 30, 2005 0.25%
December 31, 2005 0.25%
March 31, 2006 0.25%
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June 30, 2006 23.5%
September 30, 2006 23.5%
December 31, 2006 23.5%
Seventh Anniversary 23.5%
of the Closing Date
; PROVIDED that the scheduled installments of principal of the Term B Loans set
forth above shall be reduced on a PRO RATA basis in connection with any
voluntary or mandatory prepayments of the Term B Loans in accordance with
SECTION 3.1; and PROVIDED, FURTHER that the final installment specified above
for the repayment by the Borrower of the Term B Loans shall be in an amount, if
such amount is different from that specified above, sufficient to repay all
amounts owing by the Borrower under this Agreement with respect to the Term B
Loans.
(iii) Term C Loans in equal quarterly
installments payable at the end of each Fiscal Quarter (commencing with
the end of the first full Fiscal Quarter following the Term C Loan Draw
Date) aggregating 1.0% per year of the aggregate principal amount of
Term C Loans outstanding on the Term C Loan Draw Date, except for the
final year during which the Borrower will pay one-quarter of the
remaining principal amount outstanding of the Term C Loans at the end
of each Fiscal Quarter of such final year (PROVIDED that if such date
is not a Business Day, the installment shall be paid on the preceding
Business Day); PROVIDED that the scheduled installments of principal of
the Term C Loans set forth above shall be reduced on a PRO RATA basis
in connection with any voluntary or mandatory prepayments of the Term C
Loans in accordance with SECTION 3.1; and PROVIDED, FURTHER that the
final installment specified above for the repayment by the Borrower of
the Term C Loans shall be in an amount, if such amount is different
from that specified above, sufficient to repay all amounts owing by the
Borrower under this Agreement with respect to the Term C Loans.
(e) Immediately upon any acceleration of the
Stated Maturity Date of any Loans pursuant to SECTION 9.2 or SECTION 9.3, the
Borrower shall repay all the Loans, unless, pursuant to SECTION 9.3, only a
portion of all the Loans is so accelerated (in which case the portion so
accelerated shall be so repaid).
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by SECTION 4.4. No prepayment of
principal of any Revolving Loans or Swing Line Loans pursuant to CLAUSE (a) or
(b) shall cause a reduction in the Revolving Loan Commitment Amount or the Swing
Line Loan Commitment Amount, as the case may be.
48
Section 3.2 APPLICATION. Amounts prepaid shall be applied as
set forth in this Section.
(a) Subject to CLAUSE (b), each prepayment or
repayment of the principal of the Loans shall be applied, to the extent of such
prepayment or repayment, FIRST, to the principal amount thereof being maintained
as Base Rate Loans, and SECOND, to the principal amount thereof being maintained
as LIBO Rate Loans; PROVIDED, that prepayments of LIBO Rate Loans made pursuant
to SECTION 3.1, if not made on the last day of the Interest Period with respect
thereto, shall be (i) prepaid subject to the provisions of SECTION 4.4 (together
with a payment of all accrued interest) or (ii) upon the written request of the
Borrower, so long as no Default or Event of Default has occurred and is
continuing, the last day of the relevant Interest Period so long as the funds
representing such prepayment are deposited with the Administrative Agent
pursuant to arrangements and documentation in form and substance reasonably
satisfactory to the Administrative Agent.
(b) Each prepayment of Loans made pursuant to
CLAUSE (c) of SECTION 3.1 shall be applied (i) FIRST, to the mandatory
prepayment of the outstanding principal amount of all Term Loans (with the
amount of such prepayment of the Term Loans being applied PRO RATA to all
remaining amortization payments of each Term Loan, PRO RATA among all such
outstanding Term Loans), until all Term Loans have been paid in full, and
except that with respect to the amount of any such prepayment that is
allocated to the then outstanding Term B Loans and Term C Loans, each such
Term B Loan Lender and Term C Loan Lender shall have the right to refuse any
such prepayment by giving written notice of such refusal to the
Administrative Agent (such written notice to be delivered to the Borrower
upon request) within five Business Days after such Term B Loan Lender's or
such Term C Loan Lender's receipt of notice from the Administrative Agent of
such prepayment (and the Borrower shall not prepay any such Term B Loans and
Term C Loans until the tenth Business Day); PROVIDED that (x) 100% of any
prepayment so refused shall be applied PRO RATA to the Multi-Draw Term Loans
until the Multi-Draw Term Loans have been repaid in full and (y) after all
Multi-Draw Term Loans have been repaid in full and the Multi-Draw Term Loan
Commitment has terminated, any remaining amount of the prepayment refused by
the Term B Loan Lenders and the Term C Loan Lenders shall be applied PRO RATA
to the Term B Loans and the Term C Loans; and (ii) SECOND, once all Term
Loans have been repaid in full and all Term Loan Commitment Amounts have been
reduced to $0, all prepayments of Loans made pursuant to CLAUSE (c) of
SECTION 3.1 shall be applied to the repayment of any outstanding Revolving
Loans and a reduction of the Revolving Loan Commitment Amount in accordance
with SECTION 2.6(b).
Section 3.3 INTEREST RATES. Subject to CLAUSE (c) below and
SECTION 2.8, pursuant to an appropriately delivered Borrowing Request or
Continuation/Conversion Notice, the Borrower may elect that Loans comprising a
Borrowing accrue interest at a rate per annum:
(a) on that portion maintained from time to time
as a Base Rate Loan, equal to the sum of the Alternate Base Rate from time to
time in effect plus the Applicable
49
Margin; PROVIDED that all Swing Line Loans shall always accrue interest at
the then effective Applicable Margin for Revolving Loans maintained as Base
Rate Loans; and
(b) on that portion maintained as a LIBO Rate
Loan, during each Interest Period applicable thereto, equal to the sum of the
LIBO Rate (Reserve Adjusted) for such Interest Period plus the Applicable
Margin.
Notwithstanding the foregoing, from the Closing Date until the
earlier to occur of (x) the date syndication is reasonably determined to be
closed by the Administrative Agent and (y) thirty (30) days after the Closing
Date, all Loans shall bear interest at the Alternate Base Rate plus the
Applicable Margin.
All LIBO Rate Loans shall bear interest from and including
the first day of the applicable Interest Period to (but not including) the
last day of such Interest Period at the interest rate determined as
applicable to such LIBO Rate Loan. Following the occurrence and during the
continuance of a Default or an Event of Default, all Loans shall be
maintained as Base Rate Loans; provided that LIBO Rate Loans in effect upon
the occurrence thereof shall be converted to Base Rate Loans upon the
expiration of the then current Interest Period.
(c) The Term C Loans shall bear interest at a
rate determined by the Administrative Agent on the Term C Loan Draw Date. On the
Term C Loan Draw Date, the interest rate (and Applicable Margin) applicable to
the Term B Loans shall be reset to the greater of (i) the interest rate (and
Applicable Margin) applicable to the Term B Loans on the Term C Loan Draw Date
and (ii) the interest rate (and Applicable Margin) applicable to the Term C
Loans.
Section 3.4 DEFAULT RATES. Upon the occurrence and during the
continuation of a Default or an Event of Default, the Borrower shall pay
interest on all Obligations at a rate per annum equal to two percent (2%) above
the otherwise applicable interest rate or, if no such rate is applicable, at a
rate per annum equal to the Alternate Base Rate from time to time in effect plus
the Applicable Margin then in effect plus a margin of 2%.
Section 3.5 PAYMENT DATES. Interest accrued on each Loan shall
be payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any conversion of a LIBO Rate
Loan to a Base Rate Loan;
(c) on the date of any payment or prepayment, in
whole or in part, of principal outstanding on such Loan on the principal amount
so paid or prepaid;
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(d) with respect to Base Rate Loans, on each
Quarterly Payment Date occurring after the Closing Date for the period ending on
(and including) the last day of the immediately preceding December, March, June
or September, respectively;
(e) with respect to LIBO Rate Loans, on the last
day of each applicable Interest Period (and, if such Interest Period shall
exceed three months, on the date occurring on each three-month interval
occurring after the first day of such Interest Period); and
(f) on that portion of any Loans the Stated
Maturity Date of which is accelerated pursuant to SECTION 9.2 or SECTION 9.3,
immediately upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
Section 3.6 FEES. The Borrower agrees to pay the fees set
forth in this SECTION 3.6. All such fees shall be non-refundable.
(a) NON-UTILIZATION FEE. The Borrower agrees to
pay to the Administrative Agent for the account of each Lender, in accordance
with such Lender's Percentage of the sum of (i) the Revolving Loan Commitment
Amount and (ii) the Multi-Draw Term Loan Commitment Amount (on and prior to the
Multi-Draw Term Loan Commitment Termination Date) or the outstanding Multi-Draw
Term Loans (subsequent to the Multi-Draw Term Loan Commitment Termination Date),
for the period (including any portion thereof when any of its Commitments are
suspended by reason of the Borrower's inability to satisfy any condition of
ARTICLE V) commencing on the Closing Date and continuing through the Revolving
Loan Commitment Termination Date, the Non-Utilization Fee. The Non-Utilization
Fee payable pursuant to this Section shall be calculated on a year comprised of
360 days and payable by the Borrower in arrears on each Quarterly Payment Date,
commencing with the first Quarterly Payment Date following the Closing Date, for
the period ending on (and including) the last day of the immediately preceding
December, March, June or September, respectively, on the Multi-Draw Term Loan
Commitment Termination Date and on the Revolving Loan Commitment Termination
Date.
(b) AGENT'S FEE. The Borrower agrees to pay to
the Administrative Agent, for its own account, the fees in the amounts and on
the dates set forth in the Fee Letter.
(c) LETTER OF CREDIT FEE. The Borrower agrees to
pay the following amounts to the Administrative Agent for the account of the
Issuers and the Revolving Loan Lenders, as applicable, with respect to Letters
of Credit issued by the Issuers for the account of the Borrower or any of its
Subsidiaries:
(i) with respect to each Letter of
Credit, (1) a fronting fee equal to 0.25% per annum of the Stated
Amount of such Letter of Credit and (2) a
51
Letter of Credit fee equal to the product of (x) the then Applicable
Margin for Revolving Loans maintained as LIBO Rate Loans and (y) the
Stated Amount of such Letter of Credit, in each case payable in
arrears on each Quarterly Payment Date for the period ending on (and
including) the last day of the immediately preceding December,
March, June or September, respectively, and on the Revolving Loan
Commitment Termination Date and computed on the basis of a 360-day
year for the actual number of days elapsed; and
(ii) with respect to the issuance,
amendment or transfer of each Letter of Credit (without duplication of
the fees payable under CLAUSE (i) above), documentary and processing
charges in accordance with such Issuer's standard schedule for such
charges in effect at the time of such issuance, amendment or transfer,
as the case may be.
Promptly upon receipt by the Administrative Agent of any amount described in
CLAUSE (i)(2) of this SECTION 3.6(c), the Administrative Agent shall distribute
to each other Revolving Loan Lender its Percentage of such amount.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
Section 4.1 LIBO RATE LENDING UNLAWFUL. If any Lender shall
determine (which determination shall, upon notice thereof to the Borrower and
the other Lenders, be conclusive and binding on the Borrower) that the
introduction of or any change in or in the interpretation of any law makes it
unlawful, or any central bank or other Governmental Authority asserts that it is
unlawful, for such Lender to make, continue or maintain any Loan as, or to
convert any Loan into, a LIBO Rate Loan, the obligations of such Lender to make,
continue, maintain or convert any such LIBO Rate Loan shall, upon such
determination, forthwith be suspended until such Lender shall notify the
Administrative Agent that the circumstances causing such suspension no longer
exist, and all outstanding LIBO Rate Loans of such Lender shall automatically
convert into Base Rate Loans at the end of the then current Interest Periods
with respect thereto or sooner, if required by such law or assertion.
Section 4.2 DEPOSITS UNAVAILABLE. If the Administrative Agent
shall have determined that:
(a) Dollar deposits in the relevant amount and
for the relevant Interest Period are not available to it in its relevant market;
or
(b) by reason of circumstances affecting its
relevant market, adequate means do not exist for ascertaining the interest rate
applicable hereunder to LIBO Rate Loans,
52
then, upon notice from the Administrative Agent to the Borrower and the
Lenders, the obligations of all Lenders under SECTION 2.7 and SECTION 2.9 to
make or continue any Loans as, or to convert any Loans into, LIBO Rate Loans
shall forthwith be suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.
Section 4.3 INCREASED LIBO RATE LOAN COSTS, ETC. The
Borrower agrees to reimburse each Lender for any increase in the cost to such
Lender of, or any reduction in the amount of any sum receivable by such
Lender in respect of, making, continuing or maintaining (or of its obligation
to make, continue or maintain) any Loans as, or of converting (or of its
obligation to convert) any Loans into, LIBO Rate Loans that arise in
connection with any change in, or the introduction, adoption, effectiveness,
interpretation, reinterpretation or phase-in after the date hereof of, any
law or regulation, directive, guideline, decision or request (whether or not
having the force of law) of any court, central bank, regulator or other
Governmental Authority, except for such changes with respect to increased
capital costs and taxes which are governed by SECTIONS 4.5 and 4.6,
respectively. Such Lender shall promptly notify the Administrative Agent and
the Borrower in writing of the occurrence of any such event, such notice to
state, in reasonable detail, the reasons therefor and the additional amount
required fully to compensate such Lender for such increased cost or reduced
amount. Such additional amounts shall be payable by the Borrower directly to
such Lender within five days (with at least one day being a Business Day) of
its receipt of such notice, and such notice shall, in the absence of manifest
error, be conclusive and binding on the Borrower.
Section 4.4 FUNDING LOSSES. In the event any Lender shall
incur any loss or expense (including any loss or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to make, continue or maintain any portion of the principal amount of any
Loan as, or to convert any portion of the principal amount of any Loan into, a
LIBO Rate Loan) as a result of:
(a) any conversion or repayment or prepayment of
the principal amount of any LIBO Rate Loans on a date other than the scheduled
last day of the Interest Period applicable thereto, whether pursuant to SECTION
3.1 or otherwise;
(b) any Loans not being made as LIBO Rate Loans
in accordance with the Borrowing Request therefor; or
(c) any Loans not being continued as, or
converted into, LIBO Rate Loans in accordance with the Continuation/Conversion
Notice therefor,
then, upon the written notice of such Lender to the Borrower (with a copy to the
Administrative Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or expense.
Such written notice (which shall include calculations in reasonable detail)
shall be rebuttably presumptive evidence of the amount of such loss or expense.
53
Section 4.5 INCREASED CAPITAL COSTS. If any change in, or
the introduction, adoption, effectiveness, interpretation, reinterpretation
or phase-in of, any law or regulation, directive, guideline, decision or
request (whether or not having the force of law) of any court, central bank,
regulator or other Governmental Authority affects or would affect the amount
of capital required or expected to be maintained by any Lender (including any
Issuer) or any Person controlling such Lender, and such Lender determines (in
good faith but in its sole and absolute discretion) that the rate of return
on its or such controlling Person's capital as a consequence of the
Commitments or the Loans made, or the Letters of Credit issued by or
participated in, by such Lender is reduced to a level below that which such
Lender or such controlling Person could have achieved but for the occurrence
of any such circumstance, then, in any such case upon notice from time to
time by such Lender to the Borrower, the Borrower shall immediately pay
directly to such Lender additional amounts sufficient to compensate such
Lender or such controlling Person for such reduction in rate of return. A
statement of such Lender as to any such additional amount or amounts
(including calculations thereof in reasonable detail) shall be rebuttably
presumptive evidence of the amount of such loss or expense. In determining
such amount, such Lender may use any method of averaging and attribution that
it (in its sole and absolute discretion) shall deem applicable.
Section 4.6 TAXES.
(a) Any and all payments by the Borrower and
each other Obligor under this Agreement and each other Loan Document shall be
made without setoff, counterclaim or other defense, and free and clear of, and
without deduction or withholding for or on account of, any Taxes, except to the
extent such Taxes are required by law to be deducted or withheld. In the event
that any Taxes are required by law to be deducted or withheld from any payment
required to be made by the Borrower or any other Obligor to or on behalf of the
Administrative Agent or any Lender hereunder or under any other Loan Document,
then:
(i) subject to CLAUSE (f), if such
Taxes are Non-Excluded Taxes, the amount of such payment shall be
increased as may be necessary such that such payment is made, after
withholding or deduction for or on account of such Taxes, in an amount
that is not less than the amount provided for herein or in such other
Loan Document; and
(ii) the Borrower shall withhold the
full amount of such Taxes from such payment (as increased pursuant to
CLAUSE (a) (i)) and shall pay such amount to the Governmental Authority
imposing such Taxes in accordance with applicable law.
(b) In addition, the Borrower and each other
Obligor shall pay any and all Other Taxes imposed to the relevant Governmental
Authority imposing such Other Taxes in accordance with applicable law.
54
(c) As promptly as practicable after the payment
of any Taxes or Other Taxes, and in any event within 45 days of any such payment
being due, the Borrower shall furnish to the Administrative Agent a copy of an
official receipt (or a certified copy thereof) evidencing the payment of such
Taxes or Other Taxes. The Administrative Agent shall make copies thereof
available to any Lender upon request therefor.
(d) Subject to CLAUSE (f), the Borrower shall
indemnify the Administrative Agent and each Lender for any Non-Excluded Taxes
and Other Taxes levied, imposed or assessed on (and whether or not paid
directly by) the Administrative Agent or such Lender (and whether or not such
Non-Excluded Taxes or Other Taxes are correctly or legally asserted by the
relevant Governmental Authority). Promptly upon having knowledge that any
such Non-Excluded Taxes or Other Taxes have been levied, imposed or assessed,
and promptly upon notice thereof by the Administrative Agent or any Lender,
the Borrower shall pay such Non-Excluded Taxes or Other Taxes directly to the
relevant Governmental Authority (PROVIDED, HOWEVER, that neither the
Administrative Agent nor any Lender shall be under any obligation to provide
any such notice to the Borrower). In addition, the Borrower shall indemnify
the Administrative Agent and each Lender for any incremental Taxes that may
become payable by the Administrative Agent or any Lender as a result of any
failure of the Borrower to pay any Taxes when due to the appropriate
Governmental Authority or to deliver to the Administrative Agent, pursuant to
CLAUSE (c), documentation evidencing the payment of Taxes or Other Taxes.
With respect to indemnification for Non-Excluded Taxes and Other Taxes
actually paid by the Administrative Agent or any Lender or the
indemnification provided in the immediately preceding sentence, such
indemnification shall be made within 30 days after the date the
Administrative Agent or such Lender, as the case may be, makes written demand
therefor. The Borrower acknowledges that any payment made to the
Administrative Agent or any Borrower or to any Governmental Authority in
respect of the indemnification obligations of the Borrower provided in this
clause shall constitute a payment in respect of which the provisions of
CLAUSE (a) and this clause shall apply.
(e) Each Non-U.S. Lender, on or prior to the
date on which such Non- U.S. Lender becomes a Lender hereunder (and from time to
time thereafter upon the request of the Borrower or the Administrative Agent,
but only for so long as such Non-U.S. Lender is legally entitled to do so),
shall deliver to the Borrower and the Administrative Agent either
(i) two duly completed copies of either
(A) Internal Revenue Service Form W-8BEN or (B) Internal Revenue
Service Form W-8ECI, or in either case an applicable successor form; or
(ii) in the case of a Non-U.S. Lender
claiming exemption from U.S. federal income withholding tax under
Section 871(h) or 881(c) of the Code with respect to payment of
"portfolio interest", (x) a certificate of a duly authorized officer of
such Non-U.S. Lender to the effect that such Non-U.S. Lender is not (A)
a "bank" within the meaning of Section 881(c)(3)(A) of the Code, (B) a
"10 percent shareholder" of the Borrower within the meaning of Section
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881(c)(3)(B) of the Code, or (C) a controlled foreign corporation
receiving interest from a related person within the meaning of
Section 881(c)(3)(C) of the Code (such certificate, an "Exemption
Certificate") and (y) two duly completed copies of Internal Revenue
Service Form W-8BEN or an applicable successor form.
(f) The Borrower shall not be obligated to
gross up any payments to any Lender pursuant to CLAUSE (a)(i), or to
indemnify any Lender pursuant to CLAUSE (d), in respect of United States
federal withholding taxes to the extent imposed as a result of (i) the
failure of such Lender to deliver to the Borrower the form or forms and/or an
Exemption Certificate, as applicable to such Lender, pursuant to CLAUSE (e),
(ii) such form or forms and/or Exemption Certificate not establishing a
complete exemption from U.S. federal withholding tax or the information or
certifications made therein by the Lender being untrue or inaccurate on the
date delivered in any material respect, or (iii) the Lender designating a
successor lending office at which it maintains its Loans which has the effect
of causing such Lender to become obligated for tax payments in excess of
those in effect immediately prior to such designation; PROVIDED, HOWEVER,
that the Borrower shall be obligated to gross up any payments to any such
Lender pursuant to CLAUSE (a)(i), and to indemnify any such Lender pursuant
to CLAUSE (d), in respect to United States federal withholding taxes if (i)
any such failure to deliver a form or forms or an Exemption Certificate or
the failure of such form or forms or Exemption Certificate to establish a
complete exemption from U.S. federal withholding tax or inaccuracy or untruth
contained therein resulted from a change in any applicable statute, treaty,
regulation or other applicable law or any interpretation of any of the
foregoing occurring after the date hereof, which change rendered such Lender
no longer legally entitled to deliver such form or forms or Exemption
Certificate or otherwise ineligible for a complete exemption from U.S.
federal withholding tax, or rendered the information or certifications made
in such form or forms or Exemption Certificate untrue or inaccurate in a
material respect, (ii) the redesignation of the Lender's lending office was
made at the request of the Borrower or (iii) the obligation to gross up
payments to any such Lender pursuant to CLAUSE (a)(i) or to indemnify any
such Lender pursuant to CLAUSE (d) is with respect to an Assignee Lender that
becomes an Assignee Lender as a result of an assignment made at the request
of the Borrower.
Section 4.7 PAYMENTS, COMPUTATIONS, ETC. Unless otherwise
expressly provided, all payments by the Borrower pursuant to this Agreement, the
Notes, each Letter of Credit or any other Loan Document shall be made by the
Borrower to the Administrative Agent for the PRO RATA account of the Lenders
entitled to receive such payment. All such payments required to be made to the
Administrative Agent shall be made, without setoff, deduction or counterclaim,
not later than 1:00 p.m., New York time, on the date due, in same day or
immediately available funds, to such account as the Administrative Agent shall
specify from time to time by notice to the Borrower. Funds received after that
time shall be deemed to have been received by the Administrative Agent on the
next succeeding Business Day. The Administrative Agent shall promptly remit in
same day funds to each Lender its share, if any, of such payments received by
the Administrative Agent for the account of such Lender. All interest (including
interest on LIBO Rate Loans) and fees shall be computed on the basis of the
actual number of
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days (including the first day but excluding the last day) occurring during
the period for which such interest or fee is payable over a year comprised of
360 days (or, in the case of interest on a Base Rate Loan (calculated at
other than the Federal Funds Rate), 365 days or, if appropriate, 366 days).
Whenever any payment to be made shall otherwise be due on a day which is not
a Business Day, such payment shall (except as otherwise required by CLAUSE
(c) of the definition of the term "INTEREST PERIOD") be made on the next
succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
Section 4.8 SHARING OF PAYMENTS. If any Lender shall obtain
any payment or other recovery (whether voluntary, involuntary, by application of
setoff or otherwise) on account of any Loan or Reimbursement Obligation (other
than pursuant to the terms of SECTION 4.3, 4.4, 4.5 or 4.6) in excess of its PRO
RATA share of payments then or therewith obtained by all Lenders, such Lender
shall purchase from the other Lenders such participations in Credit Extensions
made by them as shall be necessary to cause such purchasing Lender to share the
excess payment or other recovery ratably with each of them; PROVIDED, HOWEVER,
that if all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Lender, the purchase shall be rescinded and each
Lender which has sold a participation to the purchasing Lender shall repay to
the purchasing Lender the purchase price to the ratable extent of such recovery
together with an amount equal to such selling Lender's ratable share (according
to the proportion of (a) the amount of such selling Lender's required repayment
to the purchasing Lender TO (b) the total amount so recovered from the
purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section may, to the fullest extent permitted by law, exercise
all its rights of payment (including pursuant to SECTION 4.9) with respect to
such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives a secured claim
in lieu of a setoff to which this Section applies, such Lender shall, to the
extent practicable, exercise its rights in respect of such secured claim in a
manner consistent with the rights of the Lenders entitled under this Section to
share in the benefits of any recovery on such secured claim.
Section 4.9 SETOFF. Each Lender shall, upon the occurrence and
during the continuance of any Event of Default or any Default described in
SECTION 9.1(i), have the right to appropriate and apply to the payment of the
Obligations (whether or not then due), and (as security for such Obligations)
the Borrower hereby grants to each Lender a continuing security interest in, any
and all balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter maintained with such Lender or any Affiliate of such Lender;
PROVIDED, HOWEVER, that any such appropriation and application shall be subject
to the provisions of SECTION 4.8. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such setoff and application made
by such Lender or its Affiliate; PROVIDED, HOWEVER, that the failure to give
such notice shall not affect the validity of such setoff and application. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff under applicable law or otherwise)
which such Lender may have.
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Section 4.10 REPLACEMENT OF LENDER. Each Lender agrees
that, upon the occurrence of any event set forth in SECTIONS 4.1, 4.3, 4.5,
or 4.6, such Lender will use reasonable efforts to book and maintain its
Loans through a different lending office or to transfer its Loans to an
Affiliate with the objective of avoiding or minimizing the consequences of
such event; PROVIDED that such booking or transfer is not otherwise
disadvantageous to such Lender as determined by such Lender in its sole and
absolute discretion. If any Lender has demanded to be paid additional amounts
pursuant to SECTIONS 4.1, 4.3, 4.5 or 4.6, and the payment of such additional
amounts are, and are likely to continue to be, more onerous in the reasonable
judgment of the Borrower than with respect to the other Lenders, then the
Borrower shall have the right at any time when no Default or Event of Default
shall have occurred and be continuing to seek one or more financial
institutions which are not Affiliates of the Borrower (each, a "REPLACEMENT
LENDER") to purchase with the written consent of the Administrative Agent
(which consent shall not be (x) required if such proposed Replacement Lender
is already a Lender, or an Affiliate of a Lender, or (y) unreasonably delayed
or withheld) the outstanding Loans and Commitments of such Lender (the
"AFFECTED LENDER"), and if the Borrower locates a Replacement Lender, the
Affected Lender shall, upon
(a) prior written notice to the Administrative
Agent,
(b) (i) payment to the Affected Lender of the
purchase price agreed between it and the Replacement Lender (or, failing such
agreement, a purchase price in the amount of the outstanding principal amount of
the Affected Lender's Loans and accrued interest thereon to the date of payment)
by the Replacement Lender plus (ii) payment by the Borrower of all amounts
(other than principal and interest) then due to the Affected Lender or accrued
for its account hereunder or under any other Loan Document,
(c) satisfaction of the provisions set forth in
SECTION 11.11(a), and
(d) payment by the Borrower to the Affected
Lender and the Administrative Agent of all reasonable out-of-pocket expenses in
connection with such assignment and assumption (including the processing fees
described in SECTION 11.11(a)),
assign and delegate all its rights and obligations under this Agreement and any
other Loan Document to which it is a party (including its outstanding Loans) to
the Replacement Lender (such assignment to be made without recourse,
representation or warranty), and the Replacement Lender shall assume such rights
and obligations, whereupon the Replacement Lender shall in accordance with
SECTION 11.11(a) become a party to each Loan Document to which the Affected
Lender is a party and shall have the rights and obligations of a Lender
thereunder and the Affected Lender shall be released from its obligations
hereunder and each other Loan Document to the extent of such assignment and
delegation.
ARTICLE V
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CONDITIONS TO CREDIT EXTENSIONS
Section 5.1 CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF
THIS AGREEMENT. This Credit Agreement shall become effective on the date when
each of the conditions precedent set forth in this SECTION 5.1 have been
satisfied (unless waived by the Lenders or unless the deadline for delivery
has been extended by the Administrative Agent). All such conditions may occur
contemporaneously but shall be deemed to have occurred simultaneously.
(a) EXECUTION OF COUNTERPARTS. The
Administrative Agent shall have received counterparts of this Agreement, duly
executed and delivered on behalf of each of the Borrower and the Lenders.
(b) RESOLUTIONS, ETC. The Administrative Agent
shall have received from the Borrower and each Guarantor, (i) a copy of a good
standing certificate, dated a date reasonably near the Closing Date, and (ii) a
certificate, dated the Closing Date and with counterparts for each Lender, duly
executed and delivered by such Person's Secretary or Assistant Secretary, as to:
(A) resolutions of such Person's Board of Directors then
in full force and effect authorizing the execution, delivery and performance of
each Loan Document to be executed by such Person and the transactions
contemplated by the Loan Documents to be performed by such Person;
(B) the incumbency and signatures of those of its
officers, authorized to act with respect to each Loan Document to be executed by
such Person; and
(C) the full force and validity of each Organic Document
of such Person and copies thereof; upon which certificates the Administrative
Agent, each Lender and each Issuer may conclusively rely until it shall have
received a further certificate of the Secretary or Assistant Secretary, of such
Person, canceling or amending its prior certificate.
(c) CLOSING DATE CERTIFICATE. The Administrative
Agent shall have received, with counterparts for each Lender, a certificate (the
"CLOSING DATE CERTIFICATE"), dated the Closing Date and duly executed and
delivered by an Authorized Officer of the Borrower, in which certificate the
Borrower shall agree and acknowledge that the statements made therein shall be
deemed to be true and correct representations and warranties of the Borrower as
of such date, and, at the time each such certificate is delivered, such
statements shall in fact be true and correct. All documents and agreements
required to be appended to the Closing Date Certificate shall be in form and
substance reasonably satisfactory to the Administrative Agent.
(d) NOTES. The Administrative Agent shall have
received, for the account of each Lender, such Lender's Revolving Note,
Multi-Draw Term Note and Term B
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Note, as applicable. In addition, the Administrative Agent shall have
received, for the account of CSFB, the Swing Line Note.
(e) PLEDGE AGREEMENTS. The Administrative Agent
shall have received, with counterparts for each Lender,
(i) the Borrower Pledge Agreement,
dated as of the Closing Date, duly executed and delivered by an
Authorized Officer of the Borrower, together with:
(1) certificates evidencing
all of the issued and outstanding shares of Capital Stock of each of
its Subsidiaries (other than Titan Capital Trust) owned by the
Borrower, which certificates shall be accompanied by undated stock
powers duly executed in blank; and
(2) all Pledged Notes (as
defined in the Borrower Pledge Agreement), if any, evidencing
Indebtedness of any of the Borrower's Subsidiaries payable to the
Borrower duly endorsed to the order of the Administrative Agent;
(ii) the Subsidiary Pledge Agreement,
dated as of the Closing Date, duly executed and delivered by an
Authorized Officer of each Guarantor, together with:
(1) certificates evidencing
all of the issued and outstanding shares of Capital Stock owned by such
Guarantor which certificates shall be accompanied by undated stock
powers duly executed in blank; and
(2) all Pledged Notes (as
defined in the Subsidiary Pledge Agreement), if any, evidencing
Indebtedness payable to a Guarantor duly endorsed to the order of the
Administrative Agent; and
(iii) the Administrative Agent and its
counsel shall be satisfied that the Lien granted to the Administrative
Agent, for the benefit of the Secured Parties in the collateral
described above is a first priority (or local equivalent thereof)
security interest; and no Lien exists on any of the collateral
described above other than the Lien created in favor of the
Administrative Agent, for the benefit of the Secured Parties, pursuant
to a Loan Document.
(f) SECURITY AGREEMENTS. The Administrative
Agent shall have received, with counterparts for each Lender, counterparts of
the Borrower Security Agreement, duly executed by the Borrower, and of the
Subsidiary Security Agreement, executed by each Guarantor, each dated as of the
Closing Date, together with
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(i) executed copies of Uniform
Commercial Code financing statements (Form UCC-1), naming the
applicable Obligor as a debtor and the Administrative Agent as the
secured party, or other similar instruments or documents, to be
filed under the Uniform Commercial Code of all jurisdictions as may
be necessary or, in the opinion of the Administrative Agent,
desirable to perfect the security interests of the Administrative
Agent pursuant to the applicable Security Agreement;
(ii) executed copies of proper Uniform
Commercial Code Form UCC-3 termination statements necessary to release
all Liens and other rights of any Person in any collateral described in
such Security Agreement previously granted by any Person together with
such other Uniform Commercial Code Form UCC-3 termination statements as
the Administrative Agent may reasonably request from such Obligors; and
(iii) certified copies of Uniform
Commercial Code Requests for Information or Copies (Form UCC-11), or a
similar search report certified by a party acceptable to the
Administrative Agent, dated a date reasonably near to the Closing Date,
listing all effective financing statements which name any Obligor
(under its present name and any previous names) as the debtor and which
are filed in the jurisdictions in which filings were made pursuant to
CLAUSE (a) above, together with copies of such financing statements.
(iv) the Administrative Agent and its
counsel shall be satisfied that the Lien granted to the Administrative
Agent, for the benefit of the Secured Parties in the collateral
described above is a first priority (or local equivalent) security
interest (subject to the filing of the documents described in CLAUSE b
above); and no other effective Lien (other than Liens permitted under
SECTION 8.3) exists on any of the collateral described above other than
the Lien created in favor of the Administrative Agent, for the benefit
of the Secured Parties, pursuant to a Loan Document.
(g) PATENT SECURITY AGREEMENT, COPYRIGHT
SECURITY AGREEMENT AND TRADEMARK SECURITY AGREEMENT. The Administrative Agent
shall have received the Patent Security Agreement, the Copyright Security
Agreement and the Trademark Security Agreement, as applicable, each dated as of
the Closing Date, duly executed and delivered by the Borrower and any Subsidiary
of the Borrower that is required to execute and deliver such Loan Documents
pursuant to the Credit Agreement.
(h) FINANCIAL INFORMATION, ETC. The
Administrative Agent shall have received, with copies for each Lender, financial
statements of the Borrower (including notes thereto), consisting of (i)
consolidated financial statements of the Borrower and its Subsidiaries including
balance sheets as of the end of each of the last two Fiscal Years and income and
cash
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flow statements as of the end of and for each of the last three Fiscal Years,
in each case audited by independent public accountants of recognized national
standing and prepared in conformity with GAAP, together with the report
thereon which shall not contain an Impermissible Qualification; (ii)
unaudited selected financial information of the Borrower and its Subsidiaries
for the two Fiscal Years immediately preceding the last three Fiscal Years;
(iii) comparable unaudited historical and pro forma interim financial
statements covering all quarterly or other appropriate periods subsequent to
the Fiscal Year most recently ended (the "PRO FORMA FINANCIAL STATEMENTS"),
giving effect to the contemplated financing, the contemplated ACS Acquisition
and reflecting the existing and proposed legal and capital structure (both
debt and equity) of the Borrower and its Subsidiaries, and (iv) such final
projections in respect of the Obligors and their respective Subsidiaries as
the Lenders may reasonably request; and all such financial statements,
historical or pro forma, delivered pursuant to this CLAUSE (h) shall be in
compliance with the requirements of Regulation S-X for a public offering
registered under the Securities Act of 1933, and all financial statements and
projections referred to in this CLAUSE (h) shall not be materially
inconsistent with financial statements, projections and estimates previously
provided to the Lenders.
(i) COMPLIANCE CERTIFICATE. The Administrative
Agent shall have received, with counterparts for each Lender, a Compliance
Certificate on a PRO FORMA basis as if the Credit Extension to be made on the
Closing Date had occurred as of December 31, 1999 and as to such items therein
as the Administrative Agent reasonably requests, dated the Closing Date, duly
executed (and with all schedules thereto duly completed) and delivered by the
chief executive officer, the chief financial officer, the treasurer or the
assistant treasurer of the Borrower.
(j) SOLVENCY, ETC. The Administrative Agent
shall have received, with counterparts for each Lender, a certificate duly
executed and delivered by the chief financial officer, the treasurer or the
assistant treasurer of the Borrower, dated the Closing Date, in the form of
EXHIBIT L attached to this Agreement.
(k) SUBSIDIARY GUARANTY. The Administrative
Agent shall have received, with counterparts for each Lender, the Subsidiary
Guaranty, dated as of the Closing Date, duly executed and delivered by each
Guarantor.
(l) INTERCO SUBORDINATION AGREEMENT. The
Administrative Agent shall have received, with counterparts for each Lender, a
copy of the Interco Subordination Agreement executed by each Guarantor.
(m) INSURANCE. The Administrative Agent shall
have received, with copies for each Lender, certificates of insurance from one
or more insurance companies satisfactory to the Administrative Agent, evidencing
coverage required to be maintained pursuant to this Agreement and each other
Loan Document.
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(n) OPINIONS OF COUNSEL. The Administrative
Agent shall have received opinions, dated the Closing Date and addressed to
the Administrative Agent and all Lenders, from (i) ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇,
LLP and (ii) ▇▇▇▇▇▇ Godward LLP, counsel to the Obligors, in form and
substance reasonably satisfactory to the Administrative Agent.
(o) MATERIAL ADVERSE CHANGE. Since December 31,
1998, there shall not have occurred or become known to the Lenders any event or
events, adverse condition or change that, individually or in the aggregate,
would reasonably be expected to have a Material Adverse Effect.
(p) PAYMENT OF OUTSTANDING INDEBTEDNESS, ETC.
After giving effect to the transactions contemplated by this Agreement, no
Obligor shall have outstanding any Indebtedness or preferred stock other than
(i) the Loans and Letters of Credit hereunder, (ii) the HIGH TIDES, (iii) the
Indebtedness permitted under SECTION 8.2, and (iv) 2,345,000 shares of preferred
stock issued by Cayenta Operating Company. The Administrative Agent shall have
received payoff letters satisfactory in form and substance to the Administrative
Agent with respect to any Indebtedness to be repaid on the Closing Date.
(q) CONSENTS, ETC. All governmental and third
party approvals and consents required to be obtained prior to the Closing Date
in connection with the acquisitions of Acquisition Two and LinCom and all
governmental and third party approvals and consents necessary in connection with
the ACS Acquisition (other than the approval of the shareholders of ACS), the
financing contemplated pursuant to this Agreement (including the execution and
delivery of this Agreement and each other Loan Document required hereunder by
each Obligor and the performance of their respective Obligations) and continuing
operations of the Borrower, each Guarantor, ACS (after giving effect to the
consummation of the ACS Acquisition), Acquisition Two and LinCom (after giving
effect to the consummation of the acquisitions of Acquisition Two and LinCom)
shall have been obtained and be in full force and effect (and, to the extent
requested by the Administrative Agent, the Administrative Agent shall have
received true and correct copies of such approvals and consents) and all
applicable waiting periods shall have expired without any action being taken or
threatened by any competent authority which would restrain, prevent or otherwise
impose adverse conditions on the transactions contemplated by this Agreement.
(r) LITIGATION, ETC. There shall exist no
pending or, to the knowledge of the Borrower, threatened, litigation,
proceedings or investigations which could reasonably be expected to have (i) a
material adverse effect on the ACS Acquisition or the acquisitions of
Acquisition Two and LinCom or (ii) a Material Adverse Effect.
(s) DUE DILIGENCE. The Administrative Agent
shall have completed and be satisfied in its sole discretion with respect to its
comprehensive due diligence in all matters pertaining to the business,
properties, operations, financial condition or prospects of the Borrower, its
Restricted Subsidiaries and ACS, including, without limitation, any
documentation as the Administrative Agent may require in its sole discretion.
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(t) APPROVAL OF ACS ACQUISITION AND ACQUISITIONS
OF ACQUISITION TWO AND LINCOM. The Administrative Agent shall review and be
satisfied in its reasonable discretion with (i) the final legal and capital
structure of the ACS Acquisition and the acquisitions of Acquisition Two and
LinCom, (ii) the sources and uses of proceeds used to consummate the ACS
Acquisition and the acquisitions of Acquisition Two and LinCom and (iii) the
terms and provisions of all documents, agreements and contracts related to the
ACS Acquisition and the acquisition of LinCom (including the amount of
liabilities assumed by the Obligors in connection with the ACS Acquisition and
the acquisition of LinCom).
(u) CLOSING FEES, EXPENSES, ETC. The
Administrative Agent shall have received for its own account all fees, costs and
expenses due and payable pursuant to SECTIONS 3.6 and 11.3 of this Agreement, if
then invoiced (in reasonable detail).
(v) LEGAL DETAILS, ETC. All documents executed
or submitted pursuant hereto shall be reasonably satisfactory in form and
substance to the Administrative Agent and its counsel. The Administrative Agent
and its counsel shall have received all information and such counterpart
originals or such certified or other copies or such materials, as the
Administrative Agent or its counsel may reasonably request, and all legal, tax
and accounting matters incident to the transactions contemplated by this
Agreement shall be satisfactory to the Administrative Agent and its counsel.
(w) NO MATERIAL ADVERSE CHANGE IN THE MARKET.
There shall not have occurred and be continuing (i) any general suspension of
trading in securities on the New York or American Stock Exchange or in the
NASDAQ National Market System (other than circuit breakers), (ii) the
declaration of a banking moratorium or any suspension of payments in respect of
banks in the United States, or (iii) any other material adverse change in
banking or capital market conditions that has had or could reasonably be
expected to have a material adverse effect on the syndication of leveraged bank
credit facilities or the consummation of high yield offerings, as the case may
be, that the Administrative Agent reasonably determines makes it impracticable
to successfully syndicate the Commitments and the Loans.
(x) MARGIN REGULATIONS. All Loans and other
Credit Extensions made by the Lenders shall be in full compliance with all
applicable requirements of Regulations T, U and X of the F.R.S. Board.
(y) PRO FORMA EBITDA. The Borrower shall have a
minimum EBITDA, pro forma for the twelve months ended September 30, 1999, of
$45,600,000, excluding pending acquisitions and any unrealized synergies.
Section 5.2 ALL CREDIT EXTENSIONS. The obligation of each
Lender and each Issuer to make any Credit Extension (including the initial
Credit Extension) shall be subject to SECTIONS 2.4 and 2.5 and the satisfaction
of each of the conditions precedent set forth in this SECTION 5.2.
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(a) COMPLIANCE WITH WARRANTIES, NO DEFAULT, ETC.
Both before and after giving effect to any Credit Extension, the following
statements shall be true and correct:
(i) the representations and warranties
set forth in ARTICLE VI (excluding, however, those contained in SECTION
6.7) and in each other Loan Document shall, in each case, be true and
correct in all respects (with respect to representations and warranties
qualified by materiality or Material Adverse Effect) and in all
material respects (with respect to all other representations and
warranties) with the same effect as if then made (unless stated to
relate solely to an earlier date, in which case such representations
and warranties shall be true and correct in all material respects as of
such earlier date unless such representations and warranties are
qualified by materiality or Material Adverse Effect, in which case such
representations and warranties shall be true and correct as of such
earlier date);
(ii) except as disclosed by the Borrower
to the Administrative Agent and the Lenders pursuant to SECTION 6.7,
(1) no labor controversy,
litigation, arbitration or governmental investigation or proceeding
shall be pending or, to the knowledge of the Borrower, threatened
against the Borrower or any of its Subsidiaries which could reasonably
be expected to have a Material Adverse Effect, or which would adversely
affect the legality, validity or enforceability of this Agreement or
any other Loan Document; and
(2) no development shall have
occurred in any labor controversy, litigation, arbitration or
governmental investigation or proceeding disclosed pursuant to SECTION
6.7 which could reasonably be expected to have a Material Adverse
Effect; and
(iii) no Default shall have then occurred
and be continuing.
(b) CREDIT EXTENSION REQUEST, ETC. Subject to
SECTION 2.8, the Administrative Agent shall have received a Borrowing Request if
Loans are being requested, or an Issuance Request if a Letter of Credit is being
requested or extended. Each of the delivery of a Borrowing Request or Issuance
Request and the acceptance by the Borrower of the proceeds of such Credit
Extension shall constitute a representation and warranty by the Borrower that on
the date of such Credit Extension (both immediately before and after giving
effect to such Credit Extension and the application of the proceeds thereof) the
statements made in SECTION 5.2(a) are true and correct in all material respects.
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(c) SATISFACTORY LEGAL FORM. All documents
executed or submitted pursuant hereto by or on behalf of the Borrower or any of
its Subsidiaries or any other Obligors shall be reasonably satisfactory in form
and substance to the Administrative Agent and its counsel; the Administrative
Agent and its counsel shall have received all information, approvals, opinions,
documents or instruments as the Administrative Agent or its counsel may
reasonably request.
Section 5.3 TERM C LOANS. In addition to the conditions set
forth in SECTION 5.2, on the Term C Loan Draw Date, the Administrative Agent
shall have received, for the account of each Term C Loan Lender, such Lender's
Term C Note and executed counterparts of the agreements and documents referenced
in SECTION 2.3(c).
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Secured Parties to enter into this Agreement and
to make Credit Extensions hereunder, the Borrower represents and warrants to
each Secured Party as set forth in this Article.
Section 6.1 ORGANIZATION, ETC. The Borrower and each of its
Subsidiaries is (a) validly organized and existing and in good standing under
the laws of the state or jurisdiction of its incorporation or organization, and
(b) duly qualified to do business and is in good standing as a foreign entity in
each jurisdiction where the nature of its business requires such qualification,
except where the failure to so qualify would not result in a Material Adverse
Effect, and has full power and authority and holds all requisite governmental
licenses, permits and other approvals to enter into and perform its Obligations
under this Agreement and each other Loan Document to which it is a party and to
own and hold under lease its property and to conduct its business substantially
as currently conducted by it except where the failure to hold such licenses,
permits and other approvals would not result in a Material Adverse Effect.
Section 6.2 DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The
execution, delivery and performance by the Borrower of this Agreement and each
other Loan Document executed or to be executed by it and the execution, delivery
and performance by each other Obligor of each Loan Document executed or to be
executed by it, are in each case within each such Person's powers, have been
duly authorized by all necessary action, and do not
(a) contravene any such Person's Organic
Documents;
(b) contravene any contractual restriction
binding on or affecting any such Person;
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(c) contravene (i) any court decree or order
binding on or affecting any such Person or (ii) any law or governmental
regulation binding on or affecting any such Person; or
(d) result in, or require the creation or
imposition of, any Lien on any of such Person's properties (except as permitted
by this Agreement).
Section 6.3 GOVERNMENT APPROVAL, REGULATION, ETC. Except as
set forth in Item 6.3 of the Disclosure Schedule, no authorization or approval
or other action by, and no notice to or filing with, any Governmental Authority
or regulatory body or other Person other than those that have been duly obtained
or made and which are in full force and effect is required for the due
execution, delivery or performance by the Borrower or any other Obligor of any
Loan Document to which it is a party. Neither the Borrower nor any of its
Subsidiaries is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or 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.
Section 6.4 VALIDITY, ETC. This Agreement and each other Loan
Document executed by the Borrower will, on the due execution and delivery
thereof, constitute, the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower in accordance with their respective terms; and
each other Loan Document executed by each other Obligor will, on the due
execution and delivery thereof by such Obligor, constitute the legal, valid and
binding obligation of such Obligor enforceable against such Obligor in
accordance with its terms (except, in any case, as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally and by principles of equity).
Section 6.5 FINANCIAL INFORMATION. The financial statements of
the Borrower and its Subsidiaries furnished to the Administrative Agent and each
Lender pursuant to SECTION 5.1(h) have been prepared in accordance with GAAP
consistently applied, and present fairly the consolidated financial condition of
the Persons covered thereby as at the dates thereof and the results of their
operations for the periods then ended. All balance sheets, all statements of
operations, shareholders' equity and cash flow and all other financial
information of each of the Borrower and its Subsidiaries furnished pursuant to
SECTION 7.1 have been and will for periods following the Closing Date be
prepared in accordance with GAAP consistently applied, and do or will present
fairly the consolidated financial condition of the Persons covered thereby as at
the dates thereof and the results of their operations for the periods then
ended.
Section 6.6 NO MATERIAL ADVERSE EFFECT. (a) No Material
Adverse Effect has occurred since December 31, 1998 with respect to the Borrower
and its Subsidiaries and (b) no material adverse effect on the business,
condition (financial or otherwise), operations, assets, properties or prospects
has occurred since December 31, 1998 with respect to ACS and its Subsidiaries,
Acquisition Two and its Subsidiaries or LinCom and its Subsidiaries, which would
67
have a Material Adverse Effect with respect to the Borrower and its
Subsidiaries after giving effect to the ACS Acquisition and the acquisitions
of Acquisition Two and LinCom.
Section 6.7 LITIGATION, LABOR CONTROVERSIES, ETC. There is no
pending or, to the knowledge of the Borrower or its Subsidiaries, threatened
litigation, action, proceeding, investigation or labor controversy (a) affecting
the Borrower or any of its Subsidiaries or any Obligor, or any of their
respective properties, businesses, assets or revenues, which could, if adversely
determined, have a Material Adverse Effect except as disclosed in ITEM 6.7 of
the Disclosure Schedule or (b) which purports to affect the legality, validity
or enforceability of this Agreement or any other Loan Document.
Section 6.8 SUBSIDIARIES. The Borrower has no Subsidiaries,
except those Subsidiaries
(a) which are identified in ITEM 6.8 of the
Disclosure Schedule; or
(b) which constitute Investments permitted by
SECTION 8.5 or which are permitted to have been organized or acquired in
accordance with SECTIONS 8.5 or 8.9.
Section 6.9 OWNERSHIP OF PROPERTIES. The Borrower and each of
its Subsidiaries owns (a) in the case of owned real property, good and
marketable fee title to, and (b) in the case of owned personal property, good
and valid title to, or, in the case of leased real or personal property, valid
and enforceable leasehold interests (as the case may be) in, all of its
properties and assets, real and personal, tangible and intangible, of any nature
whatsoever, free and clear in each case of all Liens or claims, except for Liens
permitted pursuant to SECTION 8.3.
Section 6.10 TAXES. The Borrower and each of its Subsidiaries
has timely filed all tax returns and reports required by law to have been filed
by it, and all such tax returns are complete, accurate and correct in all
material respects. The Borrower and each of its Subsidiaries has paid all
material taxes and governmental charges due and payable on or prior to the date
hereof, except any such taxes or charges which are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.
Section 6.11 PENSION AND WELFARE PLANS. During the
twelve-consecutive-month period prior to the date of the execution and delivery
of this Agreement and prior to the date of any Credit Extension hereunder, no
steps have been taken to terminate any Pension Plan under circumstances in which
the Pension Plan has insufficient assets to pay all of its benefit liabilities
(as required by section 4041(b)(1) of ERISA), and no contribution failure has
occurred with respect to any Pension Plan, sufficient to give rise to a Lien
under section 302(f) of ERISA. No condition exists or event or transaction has
occurred with respect to any Pension Plan which might result in the incurrence
by the Borrower or any member of the Controlled Group of any material liability,
material fine or material penalty. Except as disclosed in ITEM 6.11 of the
Disclosure Schedule, neither the Borrower nor any member of the Controlled Group
has any
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material contingent liability with respect to any post-retirement benefit
under a Welfare Plan, other than liability for continuation coverage
described in Part 6 of Title I of ERISA.
Section 6.12 ENVIRONMENTAL WARRANTIES. Except as set forth in
ITEM 6.12 of the Disclosure Schedule:
(a) all facilities and property (including
underlying groundwater) owned or leased by the Borrower or any of its
Subsidiaries have been, and continue to be, owned or leased by the Borrower and
its Subsidiaries in material compliance with all Environmental Laws;
(b) there have been no past, and there are no
pending or threatened
(i) actions, investigations, claims,
complaints, notices or requests for information received by the
Borrower or any of its Subsidiaries with respect to any alleged
violation of any Environmental Law which could result in a liability to
the Borrower or its Restricted Subsidiaries in excess of $1,000,000
individually or $2,000,000 in the aggregate, or
(ii) actions, investigations,
complaints, notices or inquiries to the Borrower or any of its
Subsidiaries regarding potential liability under any Environmental Law
which could result in a liability to the Borrower or its Restricted
Subsidiaries in excess of $1,000,000 individually or $2,000,000 in the
aggregate;
(c) there have been no Releases of Hazardous
Materials at, on or under any property now or previously owned or leased by the
Borrower or any of its Subsidiaries that have, or could reasonably be expected
to result in a liability to the Borrower or its Restricted Subsidiaries in
excess of $1,000,000 individually or $2,000,000 in the aggregate;
(d) the Borrower and its Subsidiaries have been
issued and are in material compliance with all permits, certificates, approvals,
licenses and other authorizations relating to environmental matters and
necessary for their businesses;
(e) no property now or previously owned or
leased by the Borrower or any of its Subsidiaries is listed or proposed for
listing (with respect to owned property only) on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list of sites
requiring investigation or clean-up;
(f) there are no underground storage tanks,
active or abandoned, including petroleum storage tanks, on or under any property
now or previously owned or leased by the Borrower or any of its Subsidiaries
that, singly or in the aggregate, have, or could
reasonably be expected to result in a liability to the Borrower or its
Restricted Subsidiaries in excess of $1,000,000 individually or $2,000,000 in
the aggregate;
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(g) neither the Borrower nor any Subsidiary of
the Borrower has directly transported or directly arranged for the
transportation of any Hazardous Material to any location which is listed or
proposed for listing on the National Priorities List pursuant to CERCLA, on the
CERCLIS or on any similar state list or which is the subject of federal, state
or local enforcement actions or other investigations which may lead to material
claims against the Borrower or such Subsidiary for any response costs, remedial
work, damage to natural resources or personal injury, including claims under
CERCLA;
(h) there are no polychlorinated biphenyls or
friable asbestos present at any property now or previously owned or leased by
the Borrower or any Subsidiary of the Borrower that, singly or in the aggregate,
have, or could reasonably be expected to result in a liability to the Borrower
or its Restricted Subsidiaries in excess of $1,000,000 individually or
$2,000,000 in the aggregate; and
(i) no conditions exist at, on or under any
property now or previously owned or leased by the Borrower which, with the
passage of time, or the giving of notice or both, would give rise to material
liability under any Environmental Law.
Section 6.13 ACCURACY OF INFORMATION. None of the factual
information heretofore or contemporaneously furnished by or on behalf of the
Borrower in writing to any Secured Party for purposes of or in connection with
this Agreement, or any transaction contemplated hereby or with respect to any
Permitted Acquisition or the financing contemplated hereby (true and complete
copies of which were furnished to the Secured Parties in connection with its
execution and delivery hereof), contains any untrue statement of a material
fact, and none of the other factual information hereafter furnished in
connection with this Agreement or any other Loan Document by the Borrower or any
other Obligor to any Secured Party will contain any untrue statement of a
material fact on the date as of which such information is dated or certified
and, as of the date of the execution and delivery of this Agreement by the
Administrative Agent and each Lender, the information delivered prior to the
date of execution and delivery of this Agreement (unless such information
specifically relates to a prior date) does not, and the factual information
hereafter furnished shall not on the date as of which such information is dated
or certified, omit to state any material fact necessary to make any information
not misleading.
Section 6.14 REGULATIONS T, U AND X. No Obligor is engaged in
the business of extending credit for the purpose of purchasing or carrying
margin stock, and no proceeds of any Credit Extensions will be used to purchase
or carry margin stock or otherwise for a purpose which violates, or would be
inconsistent with, F.R.S. Board Regulation T, U or X. Terms for which meanings
are provided in F.R.S. Board Regulation T, U or X or any regulations substituted
therefor, as from time to time in effect, are used in this Section with such
meanings.
Section 6.15 YEAR 2000 PROBLEM. No Obligor has been adversely
affected by the "Year 2000 Problem" (that is, the risk that computer
applications used by such Obligor may
70
be unable to recognize and properly perform date-sensitive functions
involving certain dates prior to and any date after December 31, 1999). No
Obligor reasonably believes that the "Year 2000 Problem" could reasonably be
expected to have a Material Adverse Effect. At the request of the
Administrative Agent, the Borrower shall provide the Administrative Agent
assurance reasonably acceptable to the Administrative Agent of the Borrower's
Year 2000 compatibility.
Section 6.16 GOVERNMENT CONTRACTS. The Borrower is not
materially in default as to the terms of any government contract and has
received no notices of default or notices to cure under any government contract
for which the performance deficiency noted by any Governmental Authority has not
been cured or otherwise resolved to such Governmental Authority's satisfaction.
Section 6.17 NO DEBARMENT. The Borrower is not subject to any
pending or threatened debarment proceedings.
Section 6.18 ASSIGNMENT OF PAYMENTS. Except with respect to
contracts for which the government has determined that a prohibition on
assignment of claims is in the government's interest, the Borrower has the right
to assign to the Administrative Agent all payments due or to become due under
each of the Borrower's or the Restricted Subsidiary's government contracts, and
there exists no uncancelled prior assignment of payments under any of such
Persons's government contracts.
Section 6.19 SOLVENCY. The Borrower and its Subsidiaries,
taken as a whole, are, and, upon the incurrence of any Obligations by any
Obligor (including, without limitation, the making of the Loans, the delivery of
the Subsidiary Guaranty and the Liens created by the Collateral Documents) on
any date on which this representation is made, will be, Solvent.
ARTICLE VII
AFFIRMATIVE COVENANTS
The Borrower agrees with each Lender, each Issuer and the
Administrative Agent that until all Commitments have expired or terminated, all
Obligations have been paid and performed in full and all Letters of Credit have
expired or terminated (or the Administrative Agent shall have received cash (in
a cash collateral account on terms satisfactory to the Administrative Agent) in
the amount of all Letters of Credit Outstanding), the Borrower will, and will
cause its Subsidiaries to, perform or cause to be performed the obligations set
forth below.
Section 7.1 FINANCIAL INFORMATION, REPORTS, NOTICES, ETC. The
Borrower will furnish or cause to be furnished to the Administrative Agent (with
sufficient copies for each Lender) copies of the following financial statements,
reports, notices and information:
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(a) as soon as available and in any event within
60 days after the end of each of the first three Fiscal Quarters of each Fiscal
Year, an unaudited consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such Fiscal Quarter and consolidated statements of
income and cash flow of the Borrower and its Subsidiaries for such Fiscal
Quarter and for the period commencing at the end of the previous Fiscal Year and
ending with the end of such Fiscal Quarter, and including (in each case), in
comparative form the figures for the corresponding Fiscal Quarter in, and year
to date portion of, the immediately preceding Fiscal Year, certified as complete
and correct by the chief financial or accounting Authorized Officer of the
Borrower;
(b) as soon as available and in any event within
105 days after the end of each Fiscal Year, a copy of the consolidated balance
sheet of the Borrower and its Subsidiaries, and the related consolidated
statements of stockholders' equity and cash flow and the consolidated statements
of income of the Borrower and its Subsidiaries for such Fiscal Year, setting
forth in comparative form the figures for the immediately preceding Fiscal Year,
audited (without any Impermissible Qualification) by independent public
accountants acceptable to the Administrative Agent, stating that, in performing
the examination necessary to deliver the audited financial statements of the
Borrower, no knowledge was obtained of any Default;
(c) concurrently with the delivery of the
financial information pursuant to CLAUSES (a) and (b), a Compliance Certificate,
executed by the chief executive, financial or accounting Authorized Officer of
the Borrower, showing compliance with the financial covenants set forth in
SECTION 8.4 and stating that no Default has occurred and is continuing (or, if a
Default has occurred, specifying the details of such Default and the action that
the Borrower has taken or proposes to take with respect thereto);
(d) as soon as possible and in any event within
five days after the Borrower or any of its Subsidiaries obtains knowledge of the
occurrence of a Default, a statement of the chief executive, financial or
accounting Authorized Officer of the Borrower setting forth details of such
Default and the action which the Borrower has taken and proposes to take with
respect thereto;
(e) as soon as possible and in any event within
five days after the Borrower or any of its Subsidiaries obtains knowledge of (i)
the occurrence of any material adverse development with respect to any
litigation, action, proceeding or labor controversy described in ITEM 6.7 of the
Disclosure Schedule or (ii) the commencement of any litigation, action,
proceeding or labor controversy of the type and materiality described in SECTION
6.7, notice thereof and, to the extent the Administrative Agent requests, copies
of all documentation relating thereto;
(f) promptly after the sending or filing
thereof, copies of all reports, notices, prospectuses and registration
statements which the Borrower or any of its Subsidiaries files with the SEC or
any national securities exchange;
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(g) immediately upon becoming aware of (i) the
institution of any steps by the Borrower or any other Person to terminate any
Pension Plan, (ii) the failure to make a required contribution to any Pension
Plan if such failure is sufficient to give rise to a Lien under Section 302(f)
of ERISA, (iii) the taking of any action with respect to a Pension Plan which
could result in the requirement that the Borrower furnish a bond or other
security to the PBGC or such Pension Plan, or (iv) the occurrence of any event
with respect to any Pension Plan which could result in the incurrence by the
Borrower of any material liability, fine or penalty, notice thereof and copies
of all documentation relating thereto;
(h) promptly upon receipt thereof from the
Borrower's audit committee, copies of all "management letters" submitted to the
Borrower by the independent public accountants referred to in CLAUSE (b) in
connection with each audit made by such accountants; and
(i) such other financial and other information
as any Lender through the Administrative Agent may from time to time reasonably
request (including information and reports in such detail as the Administrative
Agent may request with respect to the terms of and information provided pursuant
to the Compliance Certificate).
Section 7.2 MAINTENANCE OF EXISTENCE; COMPLIANCE WITH LAWS,
ETC. The Borrower will, and will cause each of its Subsidiaries to,
(a) except as otherwise permitted by SECTION
8.9, preserve and maintain its legal existence; and
(b) comply in all material respects with all
applicable laws, rules, regulations and orders, including the payment, before
the same become delinquent, of all taxes, assessments and governmental charges
imposed upon the Borrower or its Subsidiaries or upon their property except to
the extent being diligently contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with GAAP have been set aside on
the books of the Borrower or its Subsidiaries, as applicable.
Section 7.3 MAINTENANCE OF PROPERTIES. The Borrower will, and
will cause each of its Subsidiaries to, maintain, preserve, protect and keep its
and their respective properties in good repair, working order and condition
(ordinary wear and tear excepted), and make necessary repairs, renewals and
replacements so that the business carried on by the Borrower and its
Subsidiaries may be properly conducted at all times, unless the Borrower
determines in good faith that the continued maintenance of such property is no
longer economically desirable.
Section 7.4 INSURANCE. The Borrower will, and will cause each
of its Subsidiaries to:
(a) maintain insurance on its property with
financially sound and reputable insurance companies against loss and damage in
at least the amounts (and with only
73
those deductibles) customarily maintained, and against such risks as are
typically insured against in the same general area, by Persons of comparable
size engaged in the same or similar business as the Borrower and its
Subsidiaries; and
(b) all worker's compensation, employer's
liability insurance or similar insurance as may be required under the laws of
any state or jurisdiction in which it may be engaged in business.
Without limiting the foregoing, all insurance policies required pursuant to this
Section shall (i) name the Administrative Agent on behalf of the Secured Parties
as loss payee (in the case of property insurance) or additional insured (in the
case of liability insurance), as applicable, and provide that no cancellation or
modification of the policies will be made without thirty days' prior written
notice (or ten days' prior written notice with respect to failure to pay the
premium), to the Administrative Agent and (ii) be in addition to any
requirements to maintain specific types of insurance contained in the other Loan
Documents.
Section 7.5 BOOKS AND RECORDS. The Borrower will, and will
cause each of its Subsidiaries to, keep books and records in accordance with
GAAP which accurately reflect all of its business affairs and transactions and
permit the Administrative Agent and each Lender or any of their respective
representatives, at reasonable times and intervals upon reasonable notice to the
Borrower, to visit its offices, to discuss its financial matters with its
officers and employees, and its independent public accountants (and the Borrower
hereby authorizes such independent public accountants to discuss the Borrower's
and Subsidiaries' financial matters with the Administrative Agent and each
Lender or their representatives whether or not any representative of the
Borrower is present so long as the Borrower has been given reasonable prior
written notice of such meeting) and to examine (and photocopy extracts from) any
of its books and records. The Borrower shall pay any fees of such independent
public accountants incurred in connection with the Administrative Agent's or any
Lender's exercise of its rights pursuant to this Section. In addition to having
the right to perform field audits of the Borrower's books and records, the
Administrative Agent shall have the right, but not the obligation, to contact
the contracting officer under any government contract directly to determine the
Borrower's or any Restricted Subsidiary's contract performance status on the
government contract; however, any contact between the Administrative Agent and
the contracting officer shall be made on reasonable notice to the Borrower and
in the presence of a representative or representatives of the Borrower. At the
Administrative Agent's request, the Borrower shall promptly arrange for such
communications between the Administrative Agent and a contracting officer.
Section 7.6 ENVIRONMENTAL LAW COVENANT. The Borrower will, and
will cause each of its Subsidiaries to,
(a) use and operate all of its facilities and
properties in material compliance with all Environmental Laws, keep all
necessary permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in
74
material compliance therewith, and handle all Hazardous Materials in material
compliance with all applicable Environmental Laws; and
(b) promptly notify the Administrative Agent and
provide copies upon receipt of all material written claims, complaints, notices
or inquiries relating to the condition of its facilities and properties in
respect of, or as to compliance with, Environmental Laws, and shall promptly
resolve any non-compliance with Environmental Laws and keep its property free of
any Lien imposed by any Environmental Law.
Section 7.7 FUTURE SUBSIDIARIES; COLLATERAL. The Borrower
shall promptly notify the Administrative Agent upon any Person becoming a
Subsidiary, or upon an Obligor directly or indirectly acquiring additional
Capital Stock of any existing Subsidiary or real property described in CLAUSE
(d) below, and
(a) such Person shall, if it is a U.S.
Subsidiary, (i) execute and deliver to the Administrative Agent a supplement to
the Subsidiary Guaranty and a supplement to the Subsidiary Security Agreement
and (ii) to the extent such U.S. Subsidiary is required to pledge stock of a
Subsidiary pursuant to CLAUSE (b) of SECTION 7.7, execute and deliver to the
Administrative Agent a supplement to the Subsidiary Pledge Agreement, if not
already a party thereto as a pledgor, in a manner satisfactory to the
Administrative Agent;
(b) the Borrower and each U.S. Subsidiary shall,
pursuant to the applicable Pledge Agreement (as supplemented, if necessary, by a
foreign pledge agreement in form and substance satisfactory to the
Administrative Agent), pledge to the Administrative Agent all of the outstanding
shares of Capital Stock of (i) each U.S. Subsidiary and (ii) any Subsidiary that
is not a U.S. Subsidiary owned (other than where such ownership is in such U.S.
Subsidiary's capacity as a nominee shareholder) directly by the Borrower or such
U.S. Subsidiary (PROVIDED, that, subject to the last sentence of this Section,
not more than 65% of the Capital Stock of any Foreign Subsidiary shall be so
pledged), along with undated stock powers for such certificates, executed in
blank (or, if any such shares of Capital Stock are uncertificated, confirmation
and evidence satisfactory to the Administrative Agent that the security interest
in such uncertificated securities has been perfected (as a first priority Lien)
by the Administrative Agent, for the benefit of the Secured Parties, in
accordance with the U.C.C. or any other similar or local or foreign law which
may be applicable);
(c) the Borrower and each U.S. Subsidiary
shall, pursuant to the applicable Pledge Agreement, pledge to the
Administrative Agent for its benefit and that of the Secured Parties, all
intercompany notes evidencing Indebtedness in favor of the Borrower or such
U.S. Subsidiary (which shall be in a form acceptable to the Administrative
Agent); and
(d) if such Person owns any real property having
a value as determined in good faith by the Administrative Agent in excess of
$2,500,000, such Obligor will execute and deliver to the Administrative Agent a
Mortgage, together with, in the case of real property, mortgagee's title
insurance policies in amounts, in form and substance (including, if available, a
75
revolving credit endorsement) and issued by insurers satisfactory to the
Administrative Agent, and such policies shall be accompanied by evidence of
the payment in full of all premiums thereon;
together, in each case, with such opinions of legal counsel for the Borrower,
which may be the corporate general counsel of the Borrower (which shall be from
counsel satisfactory to the Administrative Agent) relating thereto, which legal
opinions shall be in form and substance satisfactory to the Administrative
Agent. The Borrower agrees that if, as a result of a change in law after the
date hereof, (i) a Foreign Subsidiary can execute and deliver a supplement to
the Subsidiary Guaranty or execute and deliver a supplement to the Subsidiary
Pledge Agreement as a pledgor or (ii) the Borrower or any Subsidiary can pledge
more than 65% of the Capital Stock of any Foreign Subsidiary or any intercompany
Indebtedness of any Subsidiary evidenced by a note or other instrument, in any
such case without material adverse tax consequences to the Borrower or such
Subsidiary, then the provisions of CLAUSE (a) of this Section shall thereafter
apply to any Foreign Subsidiary and/or (as the case may be) the provisions of
CLAUSE (b) of this Section shall thereafter apply to 100% of the Capital Stock
of such Foreign Subsidiary.
The Borrower shall, and shall cause each of its Subsidiaries
to, cause the Administrative Agent on behalf of the Secured Parties to have at
all times a first priority perfected security interest (subject only to Liens
permitted under SECTION 8.3) in all of the property (real and personal,
including Capital Stock owned by such Obligors) now or hereafter acquired from
time to time by the Borrower and such Subsidiaries to the extent the same is of
the type of property that constitutes "Collateral" (as defined in any Loan
Document) or is required to be pledged or assigned to the Administrative Agent
on behalf of the Secured Parties hereunder. Without limiting the generality of
the foregoing, the Borrower shall, and shall cause each of its Subsidiaries to,
promptly execute, deliver and/or file (as applicable) Uniform Commercial Code
financing statements and other instruments and documentation deemed necessary by
the Administrative Agent to grant and perfect such security interest, in each
case in form and substance satisfactory to the Administrative Agent.
Notwithstanding the foregoing, in no event shall (i) Cayenta
Post IPO, Titan Capital Trust or Titan Africa, Inc. be subject to the provisions
of this SECTION 7.7 or be required to grant any Liens in favor of the
Administrative Agent on behalf of the Secured Parties and (ii) the Borrower be
required to grant any Lien on any Capital Stock of Titan Capital Trust.
Section 7.8 USE OF PROCEEDS. The Borrower (a) will apply the
Revolving Loans only in accordance with CLAUSES (i), (ii) and (iii) below, (b)
will apply the proceeds of the Term B Loans only in accordance with CLAUSE (iv)
below and (c) will apply the proceeds of the Multi-Draw Term Loans and the Term
C Loans only in accordance with CLAUSES (i), (ii), (iii) and (iv) below:
(i) for working capital and general corporate purposes of
the Borrower and its Restricted Subsidiaries, including Permitted Acquisitions
by such Persons;
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(ii) to pay fees and expenses related to the Loans and the
Letters of Credit;
(iii) to finance Capital Expenditures; and
(iv) to repay certain existing Indebtedness of the
Borrower and its Subsidiaries and pay related fees and expenses.
Section 7.9 CONTRACT OBLIGATIONS. The Borrower shall, and
shall cause each Restricted Subsidiary, to perform in accordance with its terms
every contract, agreement, obligation or other arrangement to which such Person
is a party or by which it or any of its property is bound, including government
contracts. In the event that any material default or material performance
deficiency occurs, the Borrower shall notify the Administrative Agent promptly
in writing. The Borrower shall provide the Administrative Agent promptly with
copies of any cure notices or default notices it may receive from a Governmental
Authority on any government contract and detail the proposed corrective action.
At the Administrative Agent's request, the Borrower shall also provide the
Administrative Agent with copies of any stop work notices in effect at the date
of the Administrative Agent's request.
ARTICLE VIII
NEGATIVE COVENANTS
The Borrower covenants and agrees with each Lender, each
Issuer and the Administrative Agent that until all Commitments have expired or
terminated, all Obligations have been paid and performed in full and all Letters
of Credit have expired or terminated (or the Administrative Agent shall have
received immediately available funds in a collateral account on terms
satisfactory to the Administrative Agent in the amount of all Letters of Credit
Outstanding), the Borrower will not, and will not permit its Restricted
Subsidiaries to, do any of the following.
Section 8.1 BUSINESS ACTIVITIES. The Borrower will not, and
will not permit any of its Restricted Subsidiaries to, engage in any business
activity except those business activities primarily engaged in by the
Borrower and its Restricted Subsidiaries as of the Closing Date and
activities reasonably incidental thereto.
Section 8.2 INDEBTEDNESS. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, create, incur, assume or permit to
exist any Indebtedness, other than:
(a) Indebtedness in respect of the Obligations;
(b) Indebtedness in respect of Hedging
Obligations;
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(c) Indebtedness existing as of the Closing Date
which is identified in ITEM 8.2 of the Disclosure Schedule;
(d) unsecured Indebtedness (i) incurred in the
ordinary course of business of the Borrower and the Guarantors (including open
accounts extended by suppliers on normal trade terms in connection with
purchases of goods and services which are not overdue for a period of more than
90 days or, if overdue for more than 90 days, as to which a dispute exists and
adequate reserves in conformity with GAAP have been established on the books of
the Borrower or such Guarantor) and (ii) in respect of performance, surety or
appeal bonds provided in the ordinary course of business, but excluding (in each
case), Indebtedness incurred through the borrowing of money or Contingent
Liabilities in respect thereof;
(e) Indebtedness of any Guarantor owing to the
Borrower or any other Guarantor, which Indebtedness shall be evidenced by one or
more promissory notes in form and substance satisfactory to the Administrative
Agent, duly executed and delivered in pledge to the Administrative Agent
pursuant to a Loan Document, and shall not be forgiven or otherwise discharged
for any consideration other than payment in full or in part in cash (PROVIDED,
that only the amount repaid in part shall be discharged);
(f) unsecured Indebtedness (not evidenced by a
note or other instrument) of the Borrower owing to a Guarantor that has
previously executed and delivered to the Administrative Agent the Interco
Subordination Agreement;
(g) Indebtedness of the Borrower and the
Guarantors in respect of purchase money Indebtedness and Capitalized Lease
Liabilities which does not exceed $15,000,000 in the aggregate; and
(h) Indebtedness of the Borrower to Titan
Capital Trust consisting of the Debentures in an aggregate principal amount not
to exceed $257,732,000 plus the amount of any accrued interest which is added to
principal in accordance with the HIGH TIDES Documents and the Sub Debt
Documents;
(i) other unsecured Indebtedness of the Borrower
and the Guarantors in an aggregate amount at any time outstanding not to exceed
$15,000,000;
PROVIDED, HOWEVER, that no Indebtedness otherwise permitted by CLAUSE (e) shall
be assumed or otherwise incurred if a Default has occurred and is then
continuing or would result therefrom.
Section 8.3 LIENS. The Borrower will not, and will not permit
any of its Restricted Subsidiaries to, create, incur, assume or permit to exist
any Lien upon any of its property (including Capital Stock of any Person),
revenues or assets, whether now owned or hereafter acquired, except:
(a) Liens securing payment of the Obligations;
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(b) Liens existing as of the Closing Date and
disclosed in ITEM 8.3 of the Disclosure Schedule securing Indebtedness described
in CLAUSE (c) of SECTION 8.2; PROVIDED that no such Lien shall encumber any
additional collateral and the amount of Indebtedness secured by such Lien is not
increased from that existing on the Closing Date;
(c) Liens for taxes, assessments or other
governmental charges or levies not at the time delinquent or thereafter payable
without penalty or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books;
(d) Liens in favor of carriers, warehousemen,
mechanics, materialmen and landlords granted in the ordinary course of business
for amounts not overdue or being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books;
(e) Liens incurred or deposits made in the
ordinary course of business in connection with workmen's compensation,
unemployment insurance or other forms of governmental insurance or benefits, or
to secure performance of tenders, statutory obligations, bids, leases or other
similar obligations (other than for borrowed money) entered into in the ordinary
course of business or to secure obligations on surety and appeal bonds or
performance bonds;
(f) judgment Liens in existence for less than 45
days after the entry thereof or with respect to which execution has been stayed
or the payment of which is covered in full (subject to a customary deductible)
by insurance maintained with responsible insurance companies and which do not
otherwise result in an Event of Default under SECTION 9.1(f);
(g) easements, rights-of-way, zoning
restrictions, minor defects or irregularities in title and other similar
encumbrances not interfering in any material respect with the value or use of
the property to which such Lien is attached; and
(h) Liens securing payment of Indebtedness of
the type described in CLAUSE (g) of SECTION 8.2 used to purchase or lease assets
of the Borrower or any Guarantor so long as such Lien extends only to the asset
or assets so financed.
Section 8.4 FINANCIAL CONDITION AND OPERATIONS. The Borrower
will not permit to occur any of the events set forth below.
(a) TOTAL DEBT TO EBITDA RATIO. The Borrower
will not permit the Total Debt to EBITDA Ratio as of the last day of any Fiscal
Quarter to be greater than the ratio set forth opposite such date:
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DATE TOTAL DEBT TO EBITDA RATIO
Closing Date and First Fiscal Quarter of
Fiscal Year 2000 3.50:1.00
Second Fiscal Quarter of Fiscal Year 2000 3.50:1.00
Third Fiscal Quarter of Fiscal Year 2000 3.50:1.00
Fourth Fiscal Quarter of Fiscal Year 2000 3.50:1.00
First Fiscal Quarter of Fiscal Year 2001 3.25:1.00
Second Fiscal Quarter of Fiscal Year 2001 3.25:1.00
Third Fiscal Quarter of Fiscal Year 2001 3.25:1.00
Fourth Fiscal Quarter of Fiscal Year 2001 3.25:1.00
First Fiscal Quarter of Fiscal Year 2002 3.00:1.00
Second Fiscal Quarter of Fiscal Year 2002 3.00:1.00
Third Fiscal Quarter of Fiscal Year 2002 3.00:1.00
Fourth Fiscal Quarter of Fiscal Year 2002 3.00:1.00
First Fiscal Quarter of Fiscal Year 2003 and
each Fiscal Quarter thereafter 2.50:1.00
(b) MINIMUM NET WORTH.
(i) Prior to the consummation of the
ACS Acquisition, the Borrower shall not permit its Net Worth as of
the end of any Fiscal Quarter to be less than the sum of (u)
$80,000,000, PLUS (v) 50% of Net Income in excess of zero for all
Fiscal Quarters, commencing with the Fiscal Quarter ending March 31,
2000, PLUS (w) the product of 80% TIMES the net increase to the
Borrower's shareholders' equity resulting from the initial public
offering of Cayenta after the Closing Date, PLUS (x) the product of
80% TIMES the net cash proceeds derived from the issuance of common
stock by the Borrower after the Closing Date, MINUS (y) subsequent
to any spin-off of Cayenta, the portion of Net Worth attributable to
Cayenta immediately prior to such spin-off, MINUS (z) the net
decrease to the Borrower's shareholders' equity resulting from the
deferred compensation charge related to the employee, director,
officer and consultant stock options of Cayenta in connection with
the initial public offering of Cayenta.
(ii) Subsequent to the consummation of
the ACS Acquisition, the Borrower shall not permit its Net Worth as of
the end of the Fiscal Quarter during which the ACS Acquisition occurred
and each Fiscal Quarter thereafter to be less than the sum of (u)
$115,000,000, PLUS (v) 50% of Net Income in excess of zero for all
Fiscal Quarters, commencing with the Fiscal Quarter ending March 31,
2000, PLUS (w) the product of 80% TIMES the net increase to the
Borrower's shareholders' equity resulting from the initial public
offering of Cayenta after the Closing Date, PLUS (x) the product of 80%
TIMES the
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net cash proceeds derived from the issuance of common stock by the
Borrower after the Closing Date, MINUS (y) subsequent to any
spin-off of Cayenta, the portion of Net Worth attributable to
Cayenta immediately prior to such spin-off, MINUS (z) the net
decrease to the Borrower's shareholders' equity resulting from the
deferred compensation charge related to the employee, director,
officer and consultant stock options of Cayenta in connection with
the initial public offering of Cayenta.
(c) FIXED CHARGE COVERAGE RATIO. The Borrower
will not permit the Fixed Charge Coverage Ratio as of the end of any Fiscal
Quarter to be less than 1.00:1.00.
(d) INTEREST COVERAGE RATIO. The Borrower will
not permit the Interest Coverage Ratio as of the last day of any Fiscal Quarter
to be less than the ratio set forth below:
(i) For any Fiscal Quarter of Fiscal
Year 2000, 3.25:1.00;
(ii) For any Fiscal Quarter of Fiscal
Year 2001, 3.75:1.00; and
(iii) For any Fiscal Quarter of Fiscal
Year 2002 and thereafter, 4.00:1.00.
(e) Any calculation to determine compliance
with CLAUSES (a), (b) or (d) of this SECTION 8.4 or to determine whether a
Default has occurred or would occur as a result of a particular transaction
shall be on a PRO FORMA basis and calculated on the assumption that any
Permitted Acquisitions or other relevant transaction which occurred during
the relevant period were consummated on the first day of such period. Any
calculation to determine compliance with CLAUSE (c) of this SECTION 8.4 or to
determine whether a Default has occurred or would occur as a result of a
particular transaction shall be (i) on a PRO FORMA basis and calculated on
the assumption that any Permitted Acquisitions using the pooling method of
accounting or other transaction (except as set forth in CLAUSE (ii) below)
which occurred during the relevant period were consummated on the first day
of such period and (ii) on a historical basis with respect solely to the
Borrower and its U.S. Subsidiaries to the extent any Permitted Acquisitions
using the purchase method of accounting were consummated during the relevant
period.
Section 8.5 INVESTMENTS. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, purchase, make, incur, assume or
permit to exist any Investment in any other Person, except:
(a) Investments existing on the Closing Date and
identified in ITEM 8.5 of the Disclosure Schedule;
(b) Cash Equivalent Investments;
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(c) without duplication, Investments to the
extent permitted as Indebtedness pursuant to SECTION 8.2;
(d) Investments by way of contributions to
capital or purchases of equity (i) by the Borrower in any Guarantor (other than
Cayenta) or by such Guarantor in other Guarantors (other than Cayenta); or (ii)
by any Subsidiary in the Borrower;
(e) Investments constituting (i) accounts
receivable arising, (ii) trade debt granted, or (iii) deposits made in
connection with the purchase price of goods or services, in each case in the
ordinary course of business;
(f) Investments by way of Permitted
Acquisitions;
(g) Investments received in connection with the
bankruptcy or reorganization of, or settlement of delinquent accounts and
disputes with, customers and suppliers, in each case in the ordinary course of
business;
(h) Investments consisting of any deferred
portion of the sales price received by the Borrower or any Guarantor in
connection with any asset sale permitted under SECTION 8.10;
(i) Hedging Agreements; and
(j) after the Closing Date, other Investments
(other than any acquisition of any Person) in an amount not to exceed
$25,000,000 in the aggregate over the remaining term of this Agreement;
PROVIDED, HOWEVER, that
(i) any Investment which when made
complies with the requirements of CLAUSES (a), (b) or (c) of the
definition of the term "Cash Equivalent Investment" may continue to be
held notwithstanding that such Investment if made thereafter would not
comply with such requirements;
(ii) no Investment otherwise permitted
by CLAUSES (c), (d), (e), (f), (g) or (j) shall be permitted to be made
if any Default has occurred and is continuing or would result
therefrom; and
(iii) after the Closing Date the
aggregate amount of acquisitions (whether pursuant to an acquisition of
stock, assets constituting a business unit of any Person or all or
substantially all of the assets of any Person or otherwise and
including any assumed debt) by the Borrower or any Guarantor of any
Person or the assets of any Person shall not exceed $100,000,000 over
the remaining term of this Agreement (excluding the ACS Acquisition and
the
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acquisitions of Acquisition Two and LinCom and the amount of any
acquisition which has received the prior written consent of the
Required Lenders).
Section 8.6 RESTRICTED PAYMENTS, ETC. The Borrower will not,
and will not permit any of its Restricted Subsidiaries to, declare or make a
Restricted Payment, or make any deposit for any Restricted Payment, other than:
(a) dividends or distributions payable in common
stock of the Borrower and its Restricted Subsidiaries;
(b) Restricted Payments made by Restricted
Subsidiaries to the Borrower or wholly owned Restricted Subsidiaries;
(c) the payment of accrued and unpaid
distributions by Titan Capital Trust on the HIGH TIDES so long as no Default
shall have occurred and be continuing or would result therefrom;
(d) solely in the event that the ACS Acquisition
is not consummated on or prior to March 31, 2000, the repurchase of HIGH TIDES
having an aggregate liquidation value not to exceed the lesser of (x) an amount
equal to 50% of the gross proceeds of the HIGH TIDES (including any HIGH TIDES
issued as a result of the exercise of the over-allotment option) plus a premium
equal to 2.5% of such gross proceeds and (y) the aggregate liquidation value of
HIGH TIDES tendered pursuant to the repurchase offer made by Titan Capital Trust
as a result of the failure to consummate such acquisition plus a premium equal
to 2.5% of such aggregate liquidation value;
(e) subsequent to the issuance of shares in
connection with the initial public offering of Cayenta pursuant to the terms
of the applicable underwriting agreement, the spin-off of Cayenta to
shareholders of the Borrower; provided that the Total Debt to EBITDA Ratio
does not exceed 3.00:1:00 (calculated on a PRO FORMA basis) at the time of
such spin-off and, at the time of such spin-off, no Default shall have
occurred and be continuing or be caused thereby, both before and after giving
effect to such spin-off (with financial covenants to be calculated on a
historical and a PRO FORMA basis after giving effect to such spin-off); and
(f) redemptions of Capital Stock, provided, that
the following conditions are met:
(i) the Total Debt to EBITDA Ratio,
immediately following such redemption is less than 3.00:1.00,
calculated on a PRO FORMA basis; and
(ii) the Fixed Charge Coverage Ratio
immediately following the redemption shall not be less than the ratio
required for the period in
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which such redemption occurs, as set forth in SECTION 8.4(c),
calculated on a PRO FORMA basis; and
(iii) the aggregate value of such
redemptions shall not exceed $5,000,000 in any Fiscal Year; and
(iv) the aggregate value of all such
redemptions shall not exceed $20,000,000; and
(v) the unborrowed Revolving Loan
Commitment Amount shall not be less than $20,000,000 at the time of
such redemption; and
(vi) at the time of such Restricted Payment,
both before and after giving effect to such Restricted Payment, no
Default shall have occurred and be continuing or caused thereby.
Section 8.7 SUBORDINATED DEBT. The Borrower will not, and
will not permit any of its Restricted Subsidiaries to, (a) make any payment
or prepayment of principal of, or premium or interest on, any Subordinated
Debt; (b) pay or cause to be paid any consideration, whether by way of
payment of principal, interest, fee, indemnity or otherwise, to (i) any
holder of any Indebtedness (in its capacity as such) that is subordinate or
junior in right of payment to amounts owing hereunder or (ii) any holder (in
its capacity as such) of any Capital Stock or other securities of any Obligor
or any warrants, options or subscription rights with respect to any Capital
Stock of any Obligor (whether as payment of such obligations, Capital Stock,
securities, warrants, options or subscription rights or otherwise or as
inducement to, any consent, waiver or amendment of any of the terms or
provisions of the documentation evidencing such Subordinated Debt or such
Capital Stock, securities, warrants, options or subscription rights); (c)
refinance, redeem, retire, purchase, defease or otherwise acquire any
Subordinated Debt; or (d) make any deposit (including the payment of amounts
into a sinking fund or other similar fund) for any of the foregoing purposes;
PROVIDED that
(i) the Borrower and its Restricted
Subsidiaries may pay, in the case of interest only, interest on such
Subordinated Debt no earlier than the stated, scheduled date for such
payment of interest set forth in the Sub Debt Documents governing such
Subordinated Debt, so long as no Default shall have occurred and be
continuing or would result therefrom;
(ii) (x) the Borrower may redeem the
Debentures having an aggregate principal amount not to exceed the
aggregate liquidation value of HIGH TIDES permitted to be repurchased
under SECTION 8.6(d) plus a premium of 2.5% of such principal amount
and pay accrued and unpaid interest on such redeemed Debentures in the
event that the ACS Acquisition is not consummated on or prior to March
31, 2000 and (y) the Borrower may remarket
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the Debentures in accordance with the HIGH TIDES Documents and the
Sub Debt Documents and pay any interest thereon in accordance with
CLAUSE (i) above; and
(iii) the Borrower and its Restricted
Subsidiaries may make Restricted Payments as permitted under SECTION
8.6.
Section 8.8 STOCK OF RESTRICTED SUBSIDIARIES. The Borrower
will not permit any of its Restricted Subsidiaries to, (a) issue any Capital
Stock (whether for value or otherwise) to any Person other than (i) officers or
employees of the Guarantors, in connection with incentive compensation programs
or employee benefit plans, (ii) the Borrower or another wholly owned Guarantor,
(iii) in connection with any remarketing of the HIGH TIDES or (b) other than as
set forth in SECTION 8.6, become liable in respect of any obligation (contingent
or otherwise) to purchase, redeem, retire, acquire or make any other payment in
respect of any shares of Capital Stock of the Borrower or any Restricted
Subsidiary or any option, warrant or other right to acquire any such shares of
Capital Stock; PROVIDED, HOWEVER, that Titan Capital Trust may incur such
obligations contemplated by, the HIGH TIDES Documents (it being understood that
performance of such obligations shall be subject to the provisions of this
Agreement); PROVIDED, FURTHER, that the options and warrants issued by the
Guarantors as set forth in ITEM 8.8 of the Disclosure Schedule shall be
permitted; and PROVIDED, FURTHER, that each Guarantor (other than any member of
the Cayenta Group) may issue options and warrants for up to five percent (5%) of
such Guarantor's Capital Stock, inclusive of options and warrants issued by such
Guarantor as set forth in ITEM 8.8 of the Disclosure Schedule.
Section 8.9 CONSOLIDATION, MERGER, ETC. The Borrower will not,
and will not permit any of its Restricted Subsidiaries to, liquidate or
dissolve, consolidate with, or merge into or with, any other Person, or purchase
or otherwise acquire all or substantially all of the assets of any Person (or of
any division thereof), except
(a) any Guarantor may liquidate or dissolve
voluntarily into, and may merge with and into, the Borrower or any other
Guarantor, and the assets or stock of any Guarantor may be purchased or
otherwise acquired by the Borrower or any other Guarantor; PROVIDED, FURTHER,
that in no event shall any Guarantor consolidate with or merge with and into any
other Guarantor unless after giving effect thereto, the Administrative Agent
shall have a perfected pledge of, and security interest in and to, at least the
same percentage of the issued and outstanding shares of Capital Stock of the
surviving Person as the Administrative Agent had immediately prior to such
merger or consolidation in form and substance satisfactory to the Administrative
Agent and its counsel, pursuant to such documentation and opinions as shall be
necessary in the opinion of the Administrative Agent to create, perfect or
maintain the collateral position of the Administrative Agent and the Secured
Parties therein as contemplated by this Agreement; and
(b) so long as no Default has occurred and is
continuing or would occur after giving effect thereto, the Borrower or any
Guarantor may (to the extent permitted by CLAUSE (f) of SECTION 8.5) purchase
all or substantially all of the assets or stock of any Person (or
85
any division thereof) (other than the Borrower or any Restricted Subsidiary,
such intercompany transactions being subject to CLAUSE (a)), or acquire such
Person by merger.
Section 8.10 PERMITTED DISPOSITIONS. Other than in
connection with the Borrower's incentive compensation arrangements, the
Borrower will not, and will not permit any of its Restricted Subsidiaries to,
sell, transfer, lease, contribute or otherwise convey (including by way of
merger), or grant options, warrants or other rights with respect to, any of
the Borrower's or such Restricted Subsidiaries' assets (including accounts
receivable and Capital Stock of the Borrower and its Restricted Subsidiaries)
to any Person in one transaction or series of transactions unless such
transaction is (a) in the ordinary course of its business (including, without
limitation, leasing of equipment of the Titan Wireless or Titan Scan business
units) or in connection with the Borrower's internal reorganization, so long
as such transaction does not involve all or substantially all of the
Borrower's or a Guarantor's assets and the transaction is solely between or
among the Borrower and the Guarantors, (b) a transaction among the Borrower
and/or the Guarantors permitted by SECTION 8.9(a), (c) the disposition of
Capital Stock of Cayenta in connection with an initial public offering (i) so
long as no Default shall have occurred and then be continuing or would result
from the initial public offering and (ii) the Borrower continues to own at
least 51% of the Capital Stock of Cayenta subsequent to such initial public
offering, (d) a spin-off of the remaining Capital Stock of Cayenta owned by
the Borrower to the shareholders of the Borrower subsequent to Cayenta's
initial public offering so long as (i) the Total Debt to EBITDA Ratio does
not exceed 3.00:1:00 (calculated on a PRO FORMA basis) at the time of such
spin-off and (ii) at the time of such spin-off, no Default shall have
occurred and be continuing or be caused thereby, both before and after giving
effect to such spin-off (with financial covenants to be calculated on a
historical and a PRO FORMA basis after giving effect to such spin-off), or
(e) of assets having an aggregate fair market value not in excess of
$10,000,000 in any Fiscal Year or $40,000,000 over the term of this Agreement
so long as the Borrower complies with SECTION 3.1(c).
Section 8.11 MODIFICATION OF CERTAIN AGREEMENTS. The Borrower
will not, and will not permit any of its Restricted Subsidiaries to, consent to
any amendment, supplement, waiver or other modification of, or enter into any
forbearance from exercising any rights with respect to the terms or provisions
contained in,
(a) the Sub Debt Documents or the HIGH TIDES
Documents, other than (i) pursuant to the remarketing provisions contained in
the HIGH TIDES Documents or (ii) any amendment, supplement, waiver or
modification which (x) extends the date or reduces the amount of any required
repayment, prepayment or redemption of the principal of such Subordinated Debt
or the liquidation value of the HIGH TIDES, (y) reduces the rate or extends the
date of payment of the interest, premium (if any) or fees payable on such
Subordinated Debt or the distributions payable on the HIGH TIDES, or (z) makes
the covenants, events of default or remedies in such Sub Debt Documents or HIGH
TIDES Documents less restrictive on the Borrower or Titan Capital Trust; or
86
(b) each purchase agreement pursuant to which a
Permitted Acquisition occurs (including, without limitation, the ACS Acquisition
Agreement); or
(c) the Borrower's or any Restricted
Subsidiary's Organic Documents to the extent that any such change would be
adverse to the interests of the Secured Parties.
Section 8.12 TRANSACTIONS WITH AFFILIATES. The Borrower will
not, and will not permit any of its Restricted Subsidiaries to, enter into or
cause or permit to exist any arrangement or contract (including for the
purchase, lease or exchange of property or the rendering of services) with any
of its other Affiliates, unless such arrangement or contract (i) is on fair and
reasonable terms no less favorable to the Borrower or such Restricted Subsidiary
than it could obtain in an arm's-length transaction with a Person that is not an
Affiliate and (ii) is of the kind which would be entered into by a prudent
Person in the position of the Borrower or such Restricted Subsidiary with a
Person that is not one of its Affiliates.
Section 8.13 RESTRICTIVE AGREEMENTS, ETC. The Borrower will
not, and will not permit any of its Restricted Subsidiaries to, enter into any
agreement prohibiting
(a) the creation or assumption of any Lien upon
its properties, revenues or assets, whether now owned or hereafter acquired;
(b) the ability of any Obligor to amend or
otherwise modify this Agreement or any other Loan Document; or
(c) the ability of any Restricted Subsidiary to
make any payments, directly or indirectly, to the Borrower, including by way of
dividends, advances, repayments of loans, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on investments.
The foregoing prohibitions shall not apply to restrictions contained in this
Agreement and any other Loan Document.
Section 8.14 SALE AND LEASEBACK. The Borrower will not, and
will not permit any of its Restricted Subsidiaries to, directly or indirectly
enter into any agreement or arrangement providing for the sale or transfer by it
of any property (now owned or hereafter acquired) to a Person and the subsequent
lease or rental of such property or other similar property from such Person
involving an amount of sale proceeds in excess of $5,000,000 per transaction or
series of related transactions. The Net Proceeds of such sale and leaseback
shall be applied by the Borrower pursuant to SECTION 3.1(c).
Section 8.15 INDEBTEDNESS OF FOREIGN SUBSIDIARIES. The
Borrower will not permit any of its direct or indirect Foreign Subsidiaries to
create, incur, assume or permit to exist any Indebtedness in excess of
$10,000,000 in the aggregate at any one time outstanding, other
87
than any such Indebtedness which is non-recourse to the Borrower or any of
its U.S. or Foreign Subsidiaries.
Section 8.16 RESTRICTIONS ON TITAN CAPITAL TRUST.
Notwithstanding anything herein to the contrary, the Borrower shall not permit
Titan Capital Trust to engage in any business or conduct any activities other
than as permitted under the Declaration of Trust.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.1 EVENTS OF DEFAULT. Each of the following events or
occurrences described in this Article shall constitute an "EVENT OF DEFAULT".
(a) NON-PAYMENT OF OBLIGATIONS. The Borrower
shall default in the payment or prepayment when due of
(i) any principal of or interest on any
Loan, or any Reimbursement Obligation or any deposit of cash for
collateral purposes pursuant to SECTION 2.11(E); or
(ii) any fee described in ARTICLE III or
any other monetary Obligation and such default shall continue
unremedied for a period of three days (including one Business Day)
after such amount was due.
(b) BREACH OF WARRANTY. Any representation or
warranty of any Obligor made or deemed to be made in any Loan Document
(including any certificates delivered pursuant to ARTICLE V) is or shall be
incorrect (i) in any respect when made or deemed to have been made (with respect
to representations and warranties qualified by materiality or a Material Adverse
Effect) or (ii) in any material respect when made or deemed to have been made
(with respect to all other representations or warranties).
(c) NON-PERFORMANCE OF CERTAIN COVENANTS AND
OBLIGATIONS. The Borrower shall default in the due performance or observance of
any of its obligations under SECTION 7.1, SECTION 7.8 or ARTICLE VIII or any
Obligor shall default in the due performance or observance of its obligations
under (i) Articles III or IV of the Subsidiary Guaranty, (ii) Articles III or IV
of a Security Agreement, or (iii) Articles III or IV of a Pledge Agreement.
(d) NON-PERFORMANCE OF OTHER COVENANTS AND
OBLIGATIONS. Any Obligor shall default in the due performance and observance of
any other agreement contained herein or in any other Loan Document executed by
it, and such default shall continue unremedied for a period of 30 days after
notice thereof shall have been given to the Borrower by the Administrative Agent
or any Lender.
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(e) DEFAULT ON OTHER INDEBTEDNESS. A default
shall occur in the payment when due (subject to any applicable grace period),
whether by acceleration or otherwise, of any Indebtedness (including for
purposes of this SECTION 9.1(e), all items which, in accordance with GAAP, would
be included as liabilities on the liability side of the balance sheet of a
Person as of the date at which Indebtedness is to be determined, but excluding
Indebtedness described in SECTION 9.1(a)) of the Borrower or any of its
Subsidiaries (other than Cayenta Post IPO) or any other Obligor having a
principal amount, individually or in the aggregate, in excess of $5,000,000, or
a default shall occur in the performance or observance of any obligation or
condition with respect to such Indebtedness if the effect of such default is to
accelerate the maturity of any such Indebtedness or such default shall continue
unremedied for any applicable period of time sufficient to permit the holder or
holders of such Indebtedness, or any trustee or agent for such holders, to cause
or declare such Indebtedness to become due and payable or to require such
Indebtedness to be prepaid, redeemed, purchased or defeased, or require an offer
to purchase or defease such Indebtedness to be made, prior to its expressed
maturity.
(f) JUDGMENTS. Any judgment or order for the
payment of money in excess of $4,000,000 (exclusive of any amounts fully
covered by insurance (less any applicable deductible) and as to which the
insurer has acknowledged its responsibility to cover such judgment or order)
shall be rendered against the Borrower or any of its Subsidiaries (other than
Cayenta Post IPO) or any other Obligor and such judgment shall not have been
vacated or discharged or stayed or bonded pending appeal within 30 days after
the entry thereof.
(g) PENSION PLANS. Any of the following events
shall occur with respect to any Pension Plan
(i) the institution of any steps by the
Borrower, any member of its Controlled Group or any other Person to
terminate a Pension Plan if, as a result of such termination, the
Borrower or any such member could be required to make a contribution to
such Pension Plan, or could reasonably expect to incur a liability or
obligation to such Pension Plan, in excess of $1,000,000; or
(ii) a contribution failure occurs with
respect to any Pension Plan sufficient to give rise to a Lien under
section 302(f) of ERISA.
(h) CHANGE IN CONTROL. Any Change in Control
shall occur.
(i) BANKRUPTCY, INSOLVENCY, ETC. The Borrower,
any of its Restricted Subsidiaries, any other Significant Subsidiary (other than
Cayenta Post IPO) or any other Obligor shall
(i) become insolvent or generally fail
to pay, or admit in writing its inability or unwillingness generally to
pay, debts as they become due;
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(ii) apply for, consent to, or acquiesce
in the appointment of a trustee, receiver, sequestrator or other
custodian for any substantial part of the property of any thereof, or
make a general assignment for the benefit of creditors;
(iii) in the absence of such application,
consent or acquiescence, permit or suffer to exist the appointment of a
trustee, receiver, sequestrator or other custodian for a substantial
part of the property of any thereof, and such trustee, receiver,
sequestrator or other custodian shall not be discharged within 60 days;
PROVIDED, that the Borrower, each Subsidiary (other than Cayenta Post
IPO) and each other Obligor hereby expressly authorizes each Secured
Party to appear in any court conducting any relevant proceeding during
such 60-day period to preserve, protect and defend their rights under
the Loan Documents;
(iv) permit or suffer to exist the
commencement of any bankruptcy, reorganization, debt arrangement or
other case or proceeding under any bankruptcy or insolvency law or
any dissolution, winding up or liquidation proceeding, in respect
thereof, and, if any such case or proceeding is not commenced by the
Borrower, any Subsidiary (other than Cayenta Post IPO) or any
Obligor, such case or proceeding shall be consented to or acquiesced
in by the Borrower, such Subsidiary or such Obligor, as the case may
be, or shall result in the entry of an order for relief or shall
remain for 60 days undismissed; PROVIDED, that the Borrower, each
Subsidiary (other than Cayenta Post IPO) and each Obligor hereby
expressly authorizes each Secured Party to appear in any court
conducting any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents;
or
(v) take any action authorizing, or in
furtherance of, any of the foregoing.
(j) IMPAIRMENT OF SECURITY, ETC. Any Loan
Document or any Lien granted thereunder shall (except in accordance with its
terms), in whole or in part, terminate, cease to be effective or cease to be the
legally valid, binding and enforceable obligation of any Obligor party thereto;
any Obligor or any other party shall, directly or indirectly, contest in any
manner such effectiveness, validity, binding nature or enforceability; or,
except as permitted under any Loan Document, any Lien securing any Obligation
shall, in whole or in part, cease to be a perfected first priority Lien.
(k) FAILURE OF SUBORDINATION. Unless otherwise
waived or consented to by the Administrative Agent, the Lenders and the Issuers
in writing, the subordination provisions relating to any Subordinated Debt (the
"SUBORDINATION PROVISIONS") shall fail to be enforceable by the Administrative
Agent, the Lenders and the Issuers in accordance with the terms thereof, or the
monetary Obligations shall fail to constitute "Senior Indebtedness" or "Secured
Debt" (or
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similar term) referring to the Obligations; or the Borrower or any of its
Subsidiaries shall, directly or indirectly, disavow or contest in any manner
(i) the effectiveness, validity or enforceability of any of the Subordination
Provisions, (ii) that the Subordination Provisions exist for the benefit of
the Administrative Agent, the Lenders and the Issuers or (iii) that all
payments of principal of or premium and interest on the Subordinated Debt, or
realized from the liquidation of any property of any Obligor, shall be
subject to any of such Subordination Provisions.
(l) GOVERNMENT CONTRACTS. Any government
contract is terminated for default or any "show cause" letter is not ultimately
cured.
(m) ISSUANCE OF DEBENTURES TO HOLDERS OF HIGH
TIDES OR REDEMPTION. Any event occurs which, pursuant to the terms of the HIGH
TIDES Documents, requires the Borrower to dissolve Titan Capital Trust and issue
the Debentures directly to the holders of the HIGH TIDES or requires the
Borrower or Titan Capital Trust to redeem, prepay or offer to purchase the
Debentures or the HIGH TIDES (except as permitted by SECTION 8.6(d) and SECTION
8.7(d)(ii)).
(n) EVENT OF DEFAULT UNDER DECLARATION OF TRUST.
Any "Event of Default" as defined in the Declaration of Trust, or any event
which, with the passing of time or the giving of notice, or both, would
constitute an "Event of Default" as defined in the Declaration of Trust, occurs.
Section 9.2 ACTION IF BANKRUPTCY. If any Event of Default
described in SECTION 9.1(i) shall occur, the Commitments (if not theretofore
terminated) shall automatically terminate and the outstanding principal amount
of all outstanding Loans and all other Obligations (including Reimbursement
Obligations) shall automatically be and become immediately due and payable,
without presentment, protest, notice or demand (all of which are hereby
expressly waived by the Borrower) and the Borrower or any other Obligor shall
automatically and immediately be obligated to deposit with the Administrative
Agent cash collateral in an amount equal to all Letter of Credit Outstandings.
Section 9.3 ACTION IF OTHER EVENT OF DEFAULT. If any Event of
Default (other than any Event of Default described in SECTION 9.1(i)) shall
occur for any reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required Lenders, shall by
notice to the Borrower declare all or any portion of the outstanding principal
amount of the Loans and other Obligations (including Reimbursement Obligations)
to be due and payable and/or the Commitments (if not theretofore terminated) to
be terminated, whereupon the full unpaid amount of such Loans and other
Obligations which shall be so declared due and payable shall be and become
immediately due and payable, without further presentment, protest, notice or
demand (all of which are hereby expressly waived by the Borrower) and/or, as the
case may be, the Commitments shall terminate and the Borrower and the Obligors
shall automatically and immediately be obligated to deposit with the
Administrative Agent cash collateral in an amount equal to all Letter of Credit
Outstandings.
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ARTICLE X
THE CREDIT AGENTS
Section 10.1 ACTIONS. Each Lender hereby appoints (a) CSFB
as its Administrative Agent, First Union Securities, Inc. as its Syndication
Agent and Scotiabank as its Documentation Agent under and for purposes of
this Agreement, the Notes and each other Loan Document, and (b) CSFB as its
Administrative Agent under and for purposes of the Collateral Documents. Each
Lender authorizes the Credit Agents to act on behalf of such Lender under
this Agreement, the Notes and each other Loan Document and, in the absence of
other written instructions from the Required Lenders received from time to
time by the Credit Agents (with respect to which the Credit Agents agree that
they will comply, except as otherwise provided in this Section or as
otherwise advised by counsel in order to avoid contravention of applicable
law), to exercise such powers hereunder and thereunder as are specifically
delegated to or required of the Credit Agents by the terms hereof and
thereof, together with such powers as may be reasonably incidental thereto.
Each Lender hereby indemnifies, to the extent not indemnifed by the Borrower
(which indemnity shall survive any termination of this Agreement), the Credit
Agents, PRO RATA according to such Lender's Total Percentage, from and
against any and all liabilities, obligations, losses, damages, claims, costs
or expenses of any kind or nature whatsoever which may at any time be imposed
on, incurred by, or asserted against, the Credit Agents in any way relating
to or arising out of this Agreement, the Notes and any other Loan Document,
including reasonable attorneys' fees, and as to which the Credit Agents are
not reimbursed by the Borrower; PROVIDED, HOWEVER, that no Lender shall be
liable for the payment of any portion of such liabilities, obligations,
losses, damages, claims, costs or expenses which are determined by a court of
competent jurisdiction in a final proceeding to have resulted from the Credit
Agents' gross negligence or wilful misconduct. The Credit Agents shall not be
required to take any action hereunder or under any other Loan Document, or to
prosecute or defend any suit in respect of this Agreement or any other Loan
Document, unless they are indemnified hereunder to their satisfaction. If any
indemnity in favor of the Credit Agents shall be or become, in the Credit
Agents' determination, inadequate, the Credit Agents may call for additional
indemnification from the Lenders and cease to do the acts indemnified against
hereunder until such additional indemnity is given; PROVIDED, HOWEVER, that
any such additional indemnity shall be in accordance with, and limited to,
such Lender's Total Percentage.
Section 10.2 FUNDING RELIANCE, ETC. Unless the Administrative
Agent shall have been notified by telephone, confirmed in writing, by any Lender
by 3:00 p.m., New York time, on the Business Day prior to a Borrowing that such
Lender will not make available the amount which would constitute its Percentage
of such Borrowing on the date specified therefor, the Administrative Agent may
assume that such Lender has made such amount available to the Administrative
Agent and, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If and to the extent that such Lender shall not have made
such amount available to the Administrative Agent, such Lender and the Borrower
severally agree to repay the
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Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date the Administrative Agent
made such amount available to the Borrower to the date such amount is repaid
to the Administrative Agent, at the interest rate applicable at the time to
Loans comprising such Borrowing (in the case of the Borrower) and (in the
case of a Lender), at the Federal Funds Rate for the first two Business Days
after which such amount has not been repaid, and thereafter at the interest
rate applicable to Loans comprising such Borrowing.
Section 10.3 EXCULPATION. Neither the Credit Agents nor any
of their directors, officers, employees or agents shall be liable to any
Lender for any action taken or omitted to be taken by them under this
Agreement or any other Loan Document, or in connection herewith or therewith,
except for their own wilful misconduct or gross negligence, nor responsible
for any recitals or warranties herein or therein, nor for the effectiveness,
enforceability, validity or due execution of this Agreement or any other Loan
Document, nor for the creation, perfection or priority of any Liens purported
to be created by any of the Loan Documents, or the validity, genuineness,
enforceability, existence, value or sufficiency of any collateral security,
nor to make any inquiry respecting the performance by the Borrower of its
obligations hereunder or under any other Loan Document. Any such inquiry
which may be made by the Credit Agents shall not obligate it to make any
further inquiry or to take any action. The Credit Agents shall be entitled to
rely upon advice of counsel concerning legal matters and upon any notice,
consent, certificate, statement or writing which the Credit Agents believe to
be genuine and to have been presented by a proper Person.
Section 10.4 SUCCESSOR. Any of the Credit Agents may resign
from its agency position at any time upon at least 30 days' prior notice to the
Borrower and all Lenders. If any of the Credit Agents at any time shall resign,
the Required Lenders may, upon at least 3 days' (so long as one of such days is
a Business Day) prior notice to the Borrower and all Lenders, appoint another
Lender as a successor Administrative Agent, Syndication Agent or Documentation
Agent, as appropriate, which shall thereupon become the Administrative Agent,
Syndication Agent or Documentation Agent, as appropriate, hereunder. If no
successor Administrative Agent, Syndication Agent or Documentation Agent, as
appropriate, shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the retiring Credit Agent's
giving notice of resignation, then the retiring Credit Agent may, on behalf of
the Lenders, upon at least 3 days' prior notice to the Borrower and all Lenders,
appoint a successor Administrative Agent, Syndication Agent or Documentation
Agent, as appropriate, which shall be one of the Lenders or a commercial banking
institution organized under the laws of the U.S. (or any State thereof) or a
U.S. branch or agency of a commercial banking institution, and having (x) a
combined capital and surplus of at least $250,000,000 and (y) a credit rating of
AA or better by ▇▇▇▇▇'▇ or a comparable rating by S&P; PROVIDED, HOWEVER, that
if, after expending all reasonable commercial efforts, such retiring Credit
Agent is unable to find a commercial banking institution which is willing to
accept such appointment and which meets the qualifications set forth in CLAUSE
(y) above, such retiring Credit Agent shall be permitted to appoint as its
successor from all available commercial banking institutions willing to accept
such appointment such institution having the highest credit rating of all such
available and willing
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institutions. Upon the acceptance of any appointment as such Credit Agent
hereunder by a successor Credit Agent, such successor Credit Agent shall be
entitled to receive from the retiring Credit Agent such documents of transfer
and assignment as such successor Credit Agent may reasonably request, and
shall thereupon succeed to and become vested with all rights, powers,
privileges and duties of the retiring Credit Agent, and the retiring Credit
Agent shall be discharged from its duties and obligations under this
Agreement. After any retiring Credit Agent's resignation hereunder as the
Credit Agent, the provisions of
(a) this ARTICLE X shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was a Credit Agent
under this Agreement; and
(b) SECTION 11.3 and SECTION 11.4 shall continue
to inure to its benefit.
Section 10.5 CREDIT EXTENSIONS BY THE CREDIT AGENTS. Each
of the Credit Agents, in its individual capacity, shall have the same rights
and powers with respect to (x) the Credit Extensions made by it or any of its
Affiliates, and (y) the Notes held by it or any of its Affiliates as any
other Lender and may exercise the same as if it were not a Credit Agent. Such
Credit Agent and its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with the Borrower or any Subsidiary
or Affiliate of the Borrower as if such Credit Agent were not a Credit Agent
hereunder.
Section 10.6 CREDIT DECISIONS. Each Lender acknowledges that
it has, independently of the Credit Agents and each other Lender, and based on
such Lender's review of the financial information of the Borrower, this
Agreement, the other Loan Documents (the terms and provisions of which being
satisfactory to such Lender) and such other documents, information and
investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitments. Each Lender also acknowledges that it will,
independently of the Credit Agents and each other Lender, and based on such
other documents, information and investigations as it shall deem appropriate at
any time, continue to make its own credit decisions as to exercising or not
exercising from time to time any rights and privileges available to it under
this Agreement or any other Loan Document.
Section 10.7 COPIES, ETC. Each Credit Agent shall give prompt
notice to each Lender of each notice or request required or permitted to be
given to such Credit Agent by the Borrower pursuant to the terms of this
Agreement (unless concurrently delivered to the Lenders by the Borrower). Such
Credit Agent will distribute to each Lender each document or instrument received
for its account and copies of all other communications received by such Credit
Agent from the Borrower for distribution to the Lenders by such Credit Agent in
accordance with the terms of this Agreement or any other Loan Document.
ARTICLE XI
MISCELLANEOUS PROVISIONS
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Section 11.1 WAIVERS, AMENDMENTS, ETC. The provisions of this
Agreement and of each other Loan Document may from time to time be amended,
modified or waived, if such amendment, modification or waiver is in writing and
consented to by the Borrower and the Required Lenders; PROVIDED, HOWEVER, that
no such amendment, modification or waiver shall:
(a) extend any Commitment Termination Date or
modify this SECTION 11.1 without the consent of all Lenders;
(b) increase any Commitment Amount, increase the
aggregate amount of any Lender's Percentage of any Commitment Amount, increase
the aggregate amount of any Loans required to be made by a Lender pursuant to
its Commitments or reduce any fees described in ARTICLE III payable to any
Lender without the consent of such Lender;
(c) extend the Stated Maturity Date for any
Lender's Loan, or reduce the principal amount of or rate of interest on any
Lender's Loan or extend the date on which interest or fees are payable in
respect of such Lender's Loans, in each case, without the consent of such Lender
(it being understood and agreed, however, that any vote to rescind any
acceleration made pursuant to SECTION 9.2 and SECTION 9.3 of amounts owing with
respect to the Loans and other Obligations shall only require the vote of the
Required Lenders);
(d) change the definition of "Required Lenders"
or any requirement hereunder that any particular action be taken by all Lenders
without the consent of all Lenders;
(e) increase the Stated Amount of any Letter of
Credit unless consented to by the Issuer of such Letter of Credit;
(f) release (i) any Guarantor from its
obligations under a Guaranty (except as contemplated under this Agreement with
respect to the Cayenta Group upon the issuance of shares in connection with the
initial public offering of Cayenta pursuant to the terms of the applicable
underwriting agreement) or (ii) all or substantially all of the collateral under
the Loan Documents, in either case without the consent of all Lenders as
expressly provided herein or therein;
(g) change any of the terms of CLAUSE (d) of
SECTION 2.4 or SECTION 2.8 without the consent of CSFB; or
(h) affect adversely the interests, rights or
obligations of the Administrative Agent (in its capacity as the Administrative
Agent), or any Issuer (in its capacity as Issuer), unless consented to by the
Administrative Agent or such Issuer, as the case may be.
Notwithstanding the foregoing, any technical amendments or
modifications to this Agreement required to give effect to the issuance of the
Term C Loan Commitment or the Term C Loans in accordance with SECTION 2.3(c)
shall only require the consent of the Administrative
95
Agent, the Term C Loan Lenders and the Borrower. Any technical amendments or
modifications to this Agreement required to give effect to the increase, if
any, in the interest rate (and Applicable Margin) with respect to the Term B
Loans in accordance with SECTION 3.3(c) shall only require the consent of the
Administrative Agent, the Term B Loan Lenders and the Borrower.
No failure or delay on the part of the Administrative
Agent, any Issuer or any Lender in exercising any power or right under this
Agreement or any other Loan Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power or right preclude any
other or further exercise thereof or the exercise of any other power or
right. No notice to or demand on the Borrower or any other Obligor in any
case shall entitle it to any notice or demand in similar or other
circumstances. No waiver or approval by the Administrative Agent, any Issuer
or any Lender under this Agreement or any other Loan Document shall, except
as may be otherwise stated in such waiver or approval, be applicable to
subsequent transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted hereunder.
Section 11.2 NOTICES. All notices and other communications
provided to any party hereto under this Agreement or any other Loan Document
shall be in writing or by facsimile and addressed, delivered or transmitted to
such party at its address or facsimile number set forth below its signature
hereto or set forth in the Lender Assignment Agreement or at such other address
or facsimile number as may be designated by such party in a notice to the other
parties. Any notice, if mailed and properly addressed with postage prepaid or if
properly addressed and sent by pre-paid courier service, shall be deemed given
when received; any notice, if transmitted by facsimile, shall be deemed given
when the confirmation of transmission thereof is received by the transmitter.
Section 11.3 PAYMENT OF COSTS AND EXPENSES. The Borrower
agrees to pay on demand all reasonable expenses of the Administrative Agent
(including the reasonable fees, costs and out-of-pocket expenses of counsel to
the Administrative Agent, special counsel to the Administrative Agent, and of
local counsel, if any, who may be retained by counsel to the Administrative
Agent) in connection with
(a) (i) the syndication efforts of CSFB and any
due diligence investigation; PROVIDED, HOWEVER, that the Borrower shall not pay
for expenses incurred in connection with assignments which occur 30 days after
the Closing Date and (ii) the negotiation, preparation, execution and delivery
and administration of this Agreement and of each other Loan Document, including
schedules and exhibits, and any amendments, waivers, consents, supplements or
other modifications to this Agreement or any other Loan Document as may from
time to time hereafter be required, whether or not the transactions contemplated
hereby or thereby are consummated; and
(b) the filing, recording, refiling or
rerecording of any Loan Document and/or any Uniform Commercial Code financing
statements relating thereto and all amendments,
96
supplements, amendments and restatements and other modifications to any
thereof and any and all other documents or instruments of further assurance
required to be filed or recorded or refiled or rerecorded by the terms hereof
or the terms of any Loan Document; and
(c) the preparation and review of the form of
any document or instrument relevant to this Agreement or any other Loan
Document.
The Borrower further agrees to pay, and to save each Secured Party harmless
from all liability for, any stamp or other taxes which may be payable in
connection with the execution or delivery of this Agreement, the Credit
Extensions hereunder, or the issuance of the Notes, Letters of Credit or any
other Loan Documents. The Borrower also agrees to reimburse each Secured
Party upon demand for all reasonable out-of-pocket expenses (including
reasonable attorneys' fees and legal expenses of counsel to each Secured
Party) incurred by such Secured Party in connection with (x) the negotiation
of any restructuring or "work-out" with the Borrower, whether or not
consummated, of any Obligations and (y) the enforcement of any Obligations.
Section 11.4 INDEMNIFICATION. In consideration of the
execution and delivery of this Agreement by each Secured Party, the Borrower
hereby indemnifies, exonerates and holds each Secured Party and each of their
respective officers, directors, employees and agents (collectively, the
"INDEMNIFIED PARTIES") free and harmless from and against any and all actions,
causes of action, suits, losses, costs, liabilities and damages, and expenses
incurred in connection therewith (irrespective of whether any such Indemnified
Party is a party to the action for which indemnification hereunder is sought),
including reasonable attorneys' fees and disbursements, whether incurred in
connection with actions between or among the parties hereto or the parties
hereto and third parties (collectively, the "INDEMNIFIED LIABILITIES"), incurred
by the Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed
in whole or in part, directly or indirectly, with the proceeds of any Credit
Extension, including all Indemnified Liabilities arising in connection with
transactions contemplated hereby or by any other Loan Document or transactions
which are financed with proceeds of any Loan or which are supported by any
Letter of Credit;
(b) the entering into and performance of this
Agreement and any other Loan Document by any of the Indemnified Parties
(including any action brought by or on behalf of the Borrower as the result of
any determination by the Required Lenders pursuant to ARTICLE V not to fund any
Credit Extension);
(c) any investigation, litigation or proceeding
related to any acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any Person, whether
or not an Indemnified Party is party thereto;
(d) any investigation, litigation or proceeding
related to any environmental cleanup, audit, compliance or other matter relating
to Environmental Laws or the
97
protection of the environment or the Release by the Borrower or any of its
Subsidiaries of any Hazardous Material;
(e) the presence on or under, or the Release or
threatened Release from, any real property owned or operated by the Borrower or
any Subsidiary thereof of any Hazardous Material (including any losses,
liabilities, damages, injuries, costs, expenses or claims asserted or arising
under any Environmental Law), regardless of whether caused by, or within the
control of, the Borrower or such Subsidiary; or
(f) each Lender's Environmental Liability
(the indemnification herein shall survive repayment of the Notes and any
transfer of the property of the Borrower or any of its Subsidiaries by
foreclosure or by a deed in lieu of foreclosure for any Lender's
Environmental Liability, regardless of whether caused by, or within the
control of, the Borrower or such Subsidiary);
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or wilful misconduct. The Borrower and its successors and assigns
hereby waive, release and agree not to make any claim or bring any cost recovery
action against, any Secured Party under CERCLA or any state equivalent, or any
similar law now existing or hereafter enacted. It is expressly understood and
agreed that to the extent that any of such Persons is strictly liable under any
Environmental Laws, the Borrower's obligation to such Person under this
indemnity shall likewise be without regard to fault on the part of the Borrower
with respect to the violation or condition which results in liability of such
Person. If and to the extent that the foregoing undertaking may be unenforceable
for any reason, the Borrower hereby agrees to make the maximum contribution to
the payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.
Section 11.5 SURVIVAL. The obligations of the Borrower under
SECTIONS 4.3, 4.4, 4.5, 4.6, 11.3 and 11.4, and the obligations of the Lenders
under SECTION 10.1, shall in each case survive any assignment from one Lender to
another (in the case of SECTIONS 11.3 and 11.4) and any termination of this
Agreement, the payment in full of all the Obligations and the termination of all
the Commitments. The representations and warranties made by the Borrower and
each other Obligor in this Agreement and in each other Loan Document shall
survive the execution and delivery of this Agreement and each such other Loan
Document.
Section 11.6 SEVERABILITY. Any provision of this Agreement or
any other Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such provision and such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such Loan Document or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 11.7 HEADINGS. The various headings of this Agreement
and of each other Loan Document are inserted for convenience only and shall not
affect the meaning or interpretation of this Agreement or such other Loan
Document or any provisions hereof or thereof.
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Section 11.8 EXECUTION IN COUNTERPARTS, EFFECTIVENESS, ETC.
This Agreement may be executed by the parties hereto in several counterparts,
each of which shall be an original and all of which shall constitute together
but one and the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower, the Administrative Agent
and each Lender (or notice thereof satisfactory to the Administrative Agent)
shall have been received by the Administrative Agent and notice thereof shall
have been given by the Administrative Agent to the Borrower and each Lender.
Section 11.9 GOVERNING LAW; ENTIRE AGREEMENT. THIS AGREEMENT,
THE NOTES AND EACH OTHER LOAN DOCUMENT (INCLUDING PROVISIONS WITH RESPECT TO
INTEREST, LOAN CHARGES AND COMMITMENT FEES) SHALL EACH BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT THE
VALIDITY OR PERFECTION OF A SECURITY INTEREST OR MORTGAGE HEREUNDER, OR REMEDIES
HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK. This Agreement, the Notes, the
other Loan Documents and the Fee Letter constitute the entire understanding
among the parties hereto with respect to the subject matter hereof and thereof
and supersede any prior agreements, written or oral, with respect thereto.
Section 11.10 SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; PROVIDED, HOWEVER, that:
(a) the Borrower may not assign or transfer its
rights or obligations hereunder without the prior written consent of the
Administrative Agent and all Lenders; and
(b) the rights of sale, assignment and transfer
of the Lenders are subject to SECTION 11.11.
Section 11.11 SALE AND TRANSFER OF LOANS AND NOTES;
PARTICIPATIONS IN LOANS AND NOTES. Each Lender may assign, or sell
participations in, its Loans, Letters of Credit and Commitments to one or more
other Persons in accordance with this SECTION 11.11.
(a) ASSIGNMENTS. Any Lender,
(i) with the consent of the Borrower
and the Administrative Agent (which consents shall not be unreasonably
delayed or withheld and, which consent, in the case of the Borrower,
shall not be required during the continuation of a Default) may at any
time assign and delegate to one or more commercial banks; other
financial institutions; special-purpose investment funds which are
organized for the specific purpose of making,
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acquiring participations in or investing in loans of the type made
pursuant to this Agreement; and funds that typically invest in bank
loans, and
(ii) upon notice to the Borrower and the
Administrative Agent, may assign and delegate to any of its Affiliates,
any other Lender or an Approved Fund
(each Person described in either of the foregoing clauses as being the Person to
whom such assignment and delegation is to be made, being hereinafter referred to
as an "ASSIGNEE LENDER"), all or any fraction of such Lender's total Loans,
Letter of Credit Outstandings and Commitments in a minimum aggregate amount of
$2,500,000 (or, if less, the entire remaining amount of such Lender's Loans,
Letter of Credit Outstandings and Commitments) if such assignment is to a party
other than an Affiliate of the assignor Lender or an Approved Fund (for which
such Affiliate or Approved Fund, there is no minimum aggregate assignment amount
requirement). Each Obligor and the Administrative Agent shall be entitled to
continue to deal solely and directly with a Lender in connection with the
interests so assigned and delegated to an Assignee Lender until
(iii) notice of such assignment and
delegation, together with (1) payment instructions, (2) the Internal
Revenue Service Forms or other statements contemplated or required to
be delivered pursuant to SECTION 4.6, if applicable, and (3) addresses
and related information with respect to such Assignee Lender, shall
have been delivered to the Borrower and the Administrative Agent by
such assignor Lender and such Assignee Lender;
(iv) such Assignee Lender shall have
executed and delivered to the Borrower and the Administrative Agent a
Lender Assignment Agreement, accepted by the Administrative Agent; and
(v) the processing fees, if applicable,
described below shall have been paid.
From and after the date that the Administrative Agent accepts such Lender
Assignment Agreement, (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights and
obligations hereunder have been assigned and delegated to such Assignee Lender
in connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y)
the assignor Lender, to the extent that rights and obligations hereunder have
been assigned and delegated by it in connection with such Lender Assignment
Agreement, shall be released from its obligations hereunder and under the other
Loan Documents. Within five Business Days after its receipt of notice that the
Administrative Agent has received and accepted an executed Lender Assignment
Agreement (and if requested by the Assignee Lender), but subject to CLAUSE (iii)
above, the Borrower shall execute and deliver to the Administrative Agent (for
delivery to the relevant Assignee Lender) a new Note evidencing such Assignee
Lender's assigned Loans and Commitments and, if the assignor Lender has retained
Loans and Commitments hereunder (and if requested by such Lender), a replacement
Note in the principal amount of the Loans and
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Commitments retained by the assignor Lender hereunder (such Note to be in
exchange for, but not in payment of, the Note then held by such assignor
Lender). Each such Note shall be dated the date of the predecessor Note. The
assignor Lender shall ▇▇▇▇ each predecessor Note "exchanged" and deliver each
of them to the Borrower. Accrued interest on that part of each predecessor
Note evidenced by a new Note, and accrued fees, shall be paid as provided in
the Lender Assignment Agreement. Accrued interest on that part of each
predecessor Note evidenced by a replacement Note shall be paid to the
assignor Lender. Accrued interest and accrued fees shall be paid at the same
time or times provided in the predecessor Note and in this Agreement. Such
assignor Lender or such Assignee Lender must also pay a processing fee in the
amount of $3,500 to the Administrative Agent upon delivery of any Lender
Assignment Agreement unless such Assignee Lender is an Affiliate of such
assignor Lender or an Approved Fund (for which, in any case, no processing
fee will be required). Notwithstanding any other term of this Section, the
agreement of CSFB to provide the Swing Line Loan Commitment shall not impair
or otherwise restrict in any manner the ability of CSFB to make any
assignment of its Loans or Commitments, it being understood and agreed that
CSFB may terminate its Swing Line Loan Commitment, either in whole or in
part, in connection with the making of any assignment so long as the assignee
has agreed to assume the Swing Line Loan Commitment. Any attempted assignment
and delegation not made in accordance with this SECTION 11.11(a) shall be
null and void. Notwithstanding anything to the contrary set forth above, (A)
any Lender may (without requesting the consent of the Borrower or the
Administrative Agent) pledge its Loans to a Federal Reserve Bank in support
of borrowings made by such Lender from such Federal Reserve Bank, and (B) any
Lender that is a fund that invests in bank loans may (without the consent of
the Borrower or the Administrative Agent) pledge all or any portion of its
rights in connection with this Agreement to holders of obligations owed, or
securities issued, by such fund as security for such obligations or
securities, or to the trustee for, or other representative of, such holders,
PROVIDED, that any foreclosure or other exercise of remedies by such holder
or trustee shall be subject to the provisions of this Section regarding
assignments in all respects. No pledge described in the immediately preceding
CLAUSE (b) shall release such Lender from its obligations hereunder.
(vi) In the event that S&P or ▇▇▇▇▇'▇,
shall, after the date that any Person becomes a Lender, downgrade the
long-term certificate of deposit ratings of such Lender, and the
resulting ratings shall be below BBB- or Baa3, respectively, or the
equivalent, then the Borrower, the Swingline Lender and each Issuer
shall each have the right, but not the obligation, upon notice to such
Lender and the Administrative Agent, to replace such Lender with a
Replacement Lender acceptable to the Borrower and the Administrative
Agent (such consents not to be unreasonably withheld or delayed;
PROVIDED, that no such consent shall be required if the Replacement
Lender is an existing Lender), and upon any such downgrading of any
Lender's long-term certificate of deposit rating, each such Lender
hereby agrees to transfer and assign (in accordance with SECTION
11.11(A)) all of its Commitments, Loans, Notes and other rights and
obligations under this Agreement and all other Loan Documents
(including Reimbursement Obligations) to such Replacement Lender;
PROVIDED, HOWEVER, that (i) such assignment shall be without recourse,
representation or warranty
101
(other than that such Lender owns the Commitments, Loans and Notes
being assigned, free and clear of any Liens) and (ii) the purchase
price paid by the Replacement Lender shall be in the amount of such
Lender's Loans and its Percentage of outstanding Reimbursement
Obligations, together with all accrued and unpaid interest and fees
in respect thereof, plus all other amounts (other than the amounts
(if any) demanded and unreimbursed under SECTIONS 4.2, 4.3, 4.5 and
4.6, which shall be paid by the Borrower), owing to such Lender
hereunder. Upon any such termination or assignment, such Lender
shall cease to be a party hereto but shall continue to be entitled
to the benefits of any provisions of this Agreement which by their
terms survive the termination of this Agreement.
(vii) Upon receipt by the Borrower of the
predecessor Note marked "canceled", the Borrower shall issue a
replacement Note or Notes, as the case may be, to such Replacement
Lender and such institution shall become a "Lender" for all purposes
under this Agreement and the other Loan Documents.
The Borrower hereby designates the Administrative Agent to serve as the
Borrower's agent, solely for the purpose of this Section, to maintain a register
(the "REGISTER") on which the Administrative Agent will record each Lender's
Commitment, the Loans made by each Lender and the Notes evidencing such Loans,
and each repayment in respect of the principal amount of the Loans of each
Lender and annexed to which the Administrative Agent shall retain a copy of each
Lender Assignment Agreement delivered to the Administrative Agent pursuant to
this Section. Failure to make any recordation, or any error in such recordation,
shall not affect the Borrower's or any other Obligor's Obligations in respect of
such Loans or Notes. The entries in the Register shall be conclusive, in the
absence of manifest error, and the Borrower, the Administrative Agent and the
Lenders shall treat each Person in whose name a Loan and related Note is
registered as the owner thereof for all purposes of this Agreement,
notwithstanding notice or any provision herein to the contrary. A Lender's
Commitment and the Loans made pursuant thereto and the Notes evidencing such
Loans may be assigned or otherwise transferred in whole or in part only by
registration of such assignment or transfer in the Register. Any assignment or
transfer of a Lender's Commitment or the Loans or the Notes evidencing such
Loans made pursuant thereto shall be registered in the Register only upon
delivery to the Administrative Agent of a Lender Assignment Agreement duly
executed by the assignor thereof. No assignment or transfer of a Lender's
Commitment or the Loans made pursuant thereto or the Notes evidencing such Loans
shall be effective unless such assignment or transfer shall have been recorded
in the Register by the Administrative Agent as provided in this Section.
(b) PARTICIPATIONS. Any Lender may sell to one
or more commercial banks, financial institutions, any of its Affiliates, a fund,
an Approved Fund or another Lender (each of such commercial banks, financial
institutions, any of its Affiliates, a fund, an Approved Fund and another Lender
being herein called a "PARTICIPANT") participating interests in any of the
Loans, Commitments, or other interests of such Lender hereunder; PROVIDED,
HOWEVER, that
102
(i) no participation contemplated in
this SECTION 11.11(b) shall relieve such Lender from its Commitments or
its other obligations hereunder or under any other Loan Document;
(ii) such Lender shall remain solely
responsible for the performance of its Commitments and such other
obligations;
(iii) the Borrower and each other Obligor
and the Administrative Agent shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and
obligations under this Agreement and each of the other Loan Documents;
(iv) no Participant, unless such
Participant is an Affiliate of such Lender or is itself a Lender, shall
be entitled to require such Lender to take or refrain from taking any
action hereunder or under any other Loan Document, except that such
Lender may agree with any Participant that such Lender will not,
without such Participant's consent, take any actions of the type
described in CLAUSE (a), (b), (f) or, to the extent requiring the
consent of each Lender, CLAUSE (c) of SECTION 11.1; and
(v) the Borrower shall not be required
to pay any amount under this Agreement that is greater than the amount
which it would have been required to pay had no participating interest
been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
SECTIONS 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 7.1, 11.3 and 11.4, shall be considered a
Lender. Each Participant shall only be indemnified for increased costs pursuant
to SECTION 4.3, 4.5 or 4.6 if and to the extent that the Lender which sold such
participating interest to such Participant is entitled to make, and does make, a
claim on the Borrower for such increased costs. Any Lender that sells a
participating interest in any Loan, Commitment or other interest to a
Participant under this SECTION 11.11(b) shall indemnify and hold harmless the
Borrower and the Administrative Agent from and against any taxes, penalties,
interest or other costs or losses (including reasonable attorneys' fees and
expenses) incurred or payable by the Borrower or the Administrative Agent as a
result of the failure of the Borrower or the Administrative Agent to comply with
its obligations to deduct or withhold any Taxes from any payments made pursuant
to this Agreement to such Lender or the Administrative Agent, as the case may
be, which Taxes would not have been incurred or payable if such Participant had
been a Non-U.S. Lender that was entitled to deliver to the Borrower, the
Administrative Agent or such Lender, and did in fact so deliver, a duly
completed and valid Form W-8BEN or W-8ECI (or applicable successor form)
entitling such Participant to receive payments under this Agreement without
deduction or withholding of any United States federal taxes.
Section 11.12 OTHER TRANSACTIONS. Nothing contained herein
shall preclude the Administrative Agent, any Issuer or any other Lender from
engaging in any transaction, in addition to those contemplated by this Agreement
or any other Loan Document, with the
103
Borrower or any of its Affiliates in which the Borrower or such Affiliate is
not restricted hereby from engaging with any other Person.
Section 11.13 CONFIDENTIALITY. The Administrative Agent, the
Issuers and the Lenders shall hold all non-public information (which has been
identified as such by the Borrower or any of its Subsidiaries) provided to them
by the Borrower or any of its Subsidiaries pursuant to or in connection with
this Agreement in accordance with their customary procedures for handling
confidential information of this nature, but may make disclosure to any of their
examiners, regulators (including the National Association of Insurance
Commissioners), Affiliates, outside auditors, counsel and other professional
advisors in connection with this Agreement or any other Loan Document or as
reasonably required by any potential BONA FIDE transferee, participant or
assignee, or in connection with the exercise of remedies under a Loan Document,
or to any direct or indirect contractual conterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
conterparty or professional advisor to such contractual counterparty agrees to
be bound by the provisions of this SECTION 11.13), or to any nationally
recognized rating agency that requires access to information about a Lender's
investment portfolio in connection with ratings issued with respect to such
Lender, or as requested by any governmental agency or representative thereof or
pursuant to legal process; PROVIDED, HOWEVER, that unless specifically
prohibited by applicable law or court order, the Administrative Agent, the
Issuers and each Lender shall use reasonable efforts to promptly notify the
Borrower of any request by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial
condition of the Administrative Agent, the Issuers or such Lender by such
governmental agency) for disclosure of any such non-public information and,
where practicable, prior to disclosure of such information; PROVIDED, HOWEVER,
that none of the Administrative Agent, the Issuers or the Lenders shall be
liable to the Borrower if any such Person fails to provide such notice; prior to
any such disclosure pursuant to this SECTION 11.13, the Administrative Agent,
the Issuers and each Lender shall require any such BONA FIDE transferee,
participant and assignee receiving a disclosure of non-public information to
agree, for the benefit of the Borrower and its Subsidiaries, in writing to be
bound by this SECTION 11.13; and to require such Person to require any other
Person to whom such Person discloses such non-public information to be similarly
bound by this SECTION 11.13; and except as may be required by an order of a
court of competent jurisdiction and to the extent set forth therein, no Lender
shall be obligated or required to return any materials furnished by the Borrower
or any of its Subsidiaries.
Section 11.14 FORUM SELECTION AND CONSENT TO JURISDICTION.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE
ADMINISTRATIVE AGENT, THE LENDERS, ANY ISSUER OR THE BORROWER IN CONNECTION
HEREWITH OR THEREWITH SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT
104
AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY IRREVOCABLY
APPOINTS CSC UNITED STATES CORPORATION COMPANY (THE "PROCESS AGENT"), WITH AN
OFFICE ON THE DATE HEREOF AT ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, AS
ITS AGENT TO RECEIVE, ON ITS BEHALF AND ON BEHALF OF ITS PROPERTY, SERVICE OF
COPIES OF THE SUMMONS AND COMPLAINT AND ANY OTHER PROCESS WHICH MAY BE SERVED
IN ANY SUCH ACTION OR PROCEEDING. SUCH SERVICE MAY BE MADE BY MAILING OR
DELIVERING A COPY OF SUCH PROCESS TO THE BORROWER IN CARE OF THE PROCESS
AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND THE BORROWER HEREBY
IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT SUCH SERVICE
ON ITS BEHALF. THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY
REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT
THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 11.2.
THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO
THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED
TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT
IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE
BORROWER HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
Section 11.15 WAIVER OF JURY TRIAL. THE ADMINISTRATIVE AGENT,
EACH LENDER, EACH ISSUER AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT,
OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR
WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, SUCH LENDER, SUCH ISSUER OR THE
BORROWER IN CONNECTION HEREWITH OR THEREWITH. THE BORROWER ACKNOWLEDGES AND
AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
(AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY)
AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
105
ADMINISTRATIVE AGENT, EACH LENDER AND EACH ISSUER ENTERING INTO THIS
AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
106
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.
THE TITAN CORPORATION
By:
-------------------------------------------------
▇▇. ▇▇▇▇ ▇. ▇▇▇
Chairman, President and Chief Executive Officer
Address: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
CREDIT SUISSE FIRST BOSTON,
as the Administrative Agent
By:
-------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
By:
-------------------------------------------------
Name:
Title:
Address: Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
FIRST UNION SECURITIES, INC.,
as the Syndication Agent
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.:
Attention:
THE BANK OF NOVA SCOTIA,
as the Documentation Agent
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
LENDERS: BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By:
-------------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
THE BANK OF NOVA SCOTIA
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
BANK POLSKA KASA OPIEKI S.A.,
NEW YORK BRANCH
By:
-------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
Vice President
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
COMERICA BANK
By:
-------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
CREDIT SUISSE FIRST BOSTON,
By:
-------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
By:
-------------------------------------------------
Name:
Title:
Address: Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
ERSTE BANK
By:
-------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
FIRST UNION NATIONAL BANK
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.:
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
FLEET NATIONAL BANK
By:
-------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
Title
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
FRANKLIN FLOATING RATE TRUST
By:
-------------------------------------------------
Name:
Title
Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
IBM CREDIT CORPORATION
By:
-------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title:
Address: ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
IMPERIAL BANK
By:
-------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Senior Vice President
Address: ▇▇▇ ▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
KEY BANK NATIONAL ASSOCIATION.
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
METROPOLITAN LIFE INSURANCE
COMPANY
By:
-------------------------------------------------
Name:
Title:
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
NATIONAL CITY BANK
By:
-------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title:
Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ SENIOR FLOATING
RATE FUND
By:
-------------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Assistant Vice President
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
PRINCIPAL LIFE INSURANCE COMPANY
BY: PRINCIPAL CAPITAL MANAGEMENT, LLC
A DELAWARE LIMITED LIABILITY COMPANY
ITS AUTHORIZED SIGNATORY
By:
-------------------------------------------------
Name:
Title
By:
-------------------------------------------------
Name:
Title
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
SANWA BANK CALIFORNIA
By:
-------------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
Vice President
Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇
KZH SOLEIL-2 LLC
By:
-------------------------------------------------
Name:
Title
Address: ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
KZH SHOSHONE LLC
By:
-------------------------------------------------
Name:
Title
Address: ▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
TRANSAMERICA BUSINESS CREDIT
CORPORATION
By:
-------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Senior Vice President
Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇-▇▇▇
▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
SCHEDULE I
DISCLOSURE SCHEDULE TO CREDIT AGREEMENT
ITEM 6.1 Organization.
ITEM 6.3 Governmental Approval, Regulation.
ITEM 6.7 Litigation.
ITEM 6.8 Existing Subsidiaries.
ITEM 6.11 Employee Benefit Plans.
ITEM 6.12 Environmental Matters.
ITEM 8.2 Outstanding Indebtedness.
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
-------- ----------------------------
ITEM 8.3 Ongoing Liens.
ITEM 8.5 Ongoing Investments.
ITEM 8.8 Options and Warrants.
SCHEDULE II
PERCENTAGES;
LIBO OFFICE;
DOMESTIC OFFICE
PERCENTAGES
-------------------------------------------------------------
REVOLVING MULTI-DRAW
NAME AND NOTICE DOMESTIC LOAN TERM B LOAN TERM LOAN AGGREGATE
ADDRESS OF LENDER LIBO OFFICE OFFICE COMMITMENT COMMITMENT COMMITMENT COMMITMENT
----------------- ----------- ------ ---------- ---------- ---------- ----------
Credit Suisse First Boston Same as Same as 9.14285714% 70.0% 9.14285714% 31.27272727%
Eleven Madison Avenue Notice Notice
New York, New York Address Address
▇▇▇▇▇
The Bank of Nova Scotia Same as Same as 8.▇▇▇▇▇▇▇▇% 0% 8.57142857% 5.45454545%
Atlanta Agency Notice Notice
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Eudia ▇▇▇▇▇
First Union National Bank Same as Same as 8.57142857% 3.0% 8.57142857% 5.45454545%
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ Notice Notice
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
Comerica Bank Same as Same as 8.0% 0% 8.0% 5.09090909%
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Notice Notice
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Bank Polska Kasa Opieki, Same as Same as 2.85714286% 0% 2.857142856% 1.81818182%
S.A., New York Branch Notice Notice
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
PERCENTAGES
-------------------------------------------------------------
REVOLVING MULTI-DRAW
NAME AND NOTICE DOMESTIC LOAN TERM B LOAN TERM LOAN AGGREGATE
ADDRESS OF LENDER LIBO OFFICE OFFICE COMMITMENT COMMITMENT COMMITMENT COMMITMENT
----------------- ----------- ------ ---------- ---------- ---------- ----------
National City Bank Same as Same as 8.0% 0% 8.0% 5.09090909%
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇- Address Address
3484
TransAmerica Business Same as Same as 8.0% 0% 8.0% 5.09090909%
Credit Corporation Notice Notice
555 ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇ ▇-▇▇▇
▇▇▇, ▇▇ ▇▇▇▇▇
Erste Bank Same as Same as 4.57142857% 0% 4.57142857% 2.90909091%
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ Floor Address Address
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fleet National Bank Same as Same as 8.0% 0% 8.0% 5.09090909%
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Address Address
Key Bank National Same as Same as 8.0% 0% 8.0% 5.09090909%
Association Notice Notice
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
IBM Credit Corporation 5000 Executive Same as LIBO 8.0% 0% 8.0% 5.09090909%
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇
▇▇▇▇▇
Imperial Bank Same as Same as 8.0% 0% 8.0% 5.09090909%
▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ Address Address
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
PERCENTAGES
-------------------------------------------------------------
REVOLVING MULTI-DRAW
NAME AND NOTICE DOMESTIC LOAN TERM B LOAN TERM LOAN AGGREGATE
ADDRESS OF LENDER LIBO OFFICE OFFICE COMMITMENT COMMITMENT COMMITMENT COMMITMENT
----------------- ----------- ------ ---------- ---------- ---------- ----------
Bank Austria Creditanstalt Same as Same as 5.71428571% 0% 5.71428571% 3.63636364%
Corporate Finance, Inc. Notice Notice
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Sanwa Bank California Same as Same as 4.57142857% 0% 4.57142857% 2.90909091%
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Notice Notice
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ Senior Same as Same as 0% 2.5% 0% 0.90909091%
Floating Rate Fund Notice Notice
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ Address Address
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-
3924
Franklin Floating Rate Same as Same as 0% 7.0% 0% 1.81818182%
Trust Notice Notice
777 Mariners Island ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Metropolitan Life Same as Same as 0% 5.0% 0% 1.81818182%
Insurance Company Notice Notice
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Address Address
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇
KZH Soleil-2 LLC Same as Same as 0% 5.0% 0% 1.81818182%
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Notice Notice
Bank Address Address
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇
▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
KZH Shoshone LLC Same as Same as 0% 2.5% 0% 0.90909091%
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Notice Notice
Bank Address Address
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇
▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
PERCENTAGES
-------------------------------------------------------------
REVOLVING MULTI-DRAW
NAME AND NOTICE DOMESTIC LOAN TERM B LOAN TERM LOAN AGGREGATE
ADDRESS OF LENDER LIBO OFFICE OFFICE COMMITMENT COMMITMENT COMMITMENT COMMITMENT
----------------- ----------- ------ ---------- ---------- ---------- ----------
Principal Life Insurance Same as Same as 0% 5.0% 0% 1.81818182%
Company Notice Notice
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Address Address
Des Moines, IA 50392-
0800
SCHEDULE III
SYNERGIES
ACQUISITIONS OF ASSIST AND MAINSAVER EBITDA
------------------------------------ ------
For the twelve months ended March 31, 2000 $1,900,000
For the twelve months ended June 30, 2000 $1,425,000
For the twelve months ended September 30, 2000 $950,000
For the twelve months ended December 31, 2000 $475,000
For all periods thereafter $0
ACS ACQUISITION
---------------
For the twelve months ended the last day of FQ1* $3,000,000
For the twelve months ended the last day of FQ2* $2,225,000
For the twelve months ended the last day of FQ3* $1,500,000
For the twelve months ended the last day of FQ4* $750,000
For all periods thereafter $0
ACQUISITION OF LINCOM
---------------------
For the twelve months ended the last day of FQ1* $500,000
For the twelve months ended the last day of FQ2* $375,000
For the twelve months ended the last day of FQ3* $250,000
For the twelve months ended the last day of FQ4* $125,000
For all periods thereafter $0
ACQUISITION OF ACQUISITION TWO
------------------------------
For the twelve months ended the last day of FQ1* $1,100,000
For the twelve months ended the last day of FQ2* $825,000
For the twelve months ended the last day of FQ3* $550,000
For the twelve months ended the last day of FQ4* $275,000
For all periods thereafter $0
* FQ1 means the Fiscal Quarter during which the acquisition occurred.
* FQ2 means the Fiscal Quarter following FQ1.
* FQ3 means the Fiscal Quarter following FQ2.
* FQ4 means the Fiscal Quarter following FQ3.
EXHIBIT A-1
REVOLVING NOTE
$[ ] February ___, 2000
FOR VALUE RECEIVED, the undersigned, THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), promises to pay to the order of [Name of Lender]
and its registered assigns (the "REVOLVING LENDER") on the Stated Maturity Date
for all Revolving Loans, the principal sum of [
] DOLLARS ($[ ]) or, if less, the aggregate unpaid principal
amount of all Revolving Loans made by the Revolving Lender pursuant to that
certain Senior Secured Credit Agreement, dated as of February __, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among the Borrower, the various financial institutions
(including the Revolving Lender) as are or may become parties thereto
(collectively, the "LENDERS"), Credit Suisse First Boston, as administrative
agent for the Lenders ("ADMINISTRATIVE AGENT"), First Union Securities, Inc., as
Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent. Unless
otherwise defined, terms used herein have the meanings provided in the Credit
Agreement.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement. Payments of
both principal and interest are to be made in lawful money of the United States
of America in same day or immediately available funds to the account designated
by the Administrative Agent pursuant to the Credit Agreement.
This Revolving Note is one of the Revolving Notes referred to in, and
evidences Obligations incurred under, the Credit Agreement, to which reference
is made for a description of the security for this Revolving Note and for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments and repayments of principal of the Obligations
evidenced by this Revolving Note and on which such Obligations may be declared
to be immediately due and payable.
The Borrower hereby irrevocably authorizes the Revolving Lender to make (or
cause to be made) appropriate notations on the grid attached hereto (or on any
continuation of such grid), which notations, if made, shall evidence, inter
alia, the date of and the outstanding principal of, the Revolving Loans
evidenced hereby. Such notations shall be rebuttable presumptive evidence of
the accuracy of the information so set forth; provided, however, that the
failure of the Revolving Lender to make any such notations shall not limit or
otherwise affect any Obligations of the Borrower.
-1-
Any assignment or transfer of this Revolving Note shall be effective solely
by registration thereof in the Register pursuant to the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
THIS REVOLVING NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH
PURPOSES SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK).
THE TITAN CORPORATION
By:
---------------------------
Name:
Title:
-2-
REVOLVING LOANS AND PRINCIPAL PAYMENTS
Amount of Revolving Amount of Principal Unpaid Principal
Loan Made Repaid Balance
------------------- ------------------- ----------------
Interest
Alternate LIBO Period Alternate LIBO Alternate LIBO Total Notation
Date Base Rate Rate (If Applicable) Base Rate Rate Base Rate Rate Made By
===========================================================================================================================
EXHIBIT A-2
SWING LINE NOTE
$10,000,000 February __, 2000
FOR VALUE RECEIVED, the undersigned, THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), promises to pay to the order of CREDIT SUISSE
FIRST BOSTON and its registered assigns (the "SWING LINE LENDER") on the Stated
Maturity Date for all Revolving Loans, the principal sum of TEN MILLION DOLLARS
($10,000,000) or, if less, the aggregate unpaid principal amount of all Swing
Line Loans made by the Swing Line Lender pursuant to that certain Senior Secured
Credit Agreement, dated as of February __, 2000 (as amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
among the Borrower, the various financial institutions (including the Swing Line
Lender) as are or may become parties thereto (collectively, the "LENDERS"),
Credit Suisse First Boston, as administrative agent for the Lenders (the
"ADMINISTRATIVE AGENT"), First Union Securities, Inc., as Syndication Agent, and
The Bank of Nova Scotia, as Documentation Agent. Unless otherwise defined,
terms used herein have the meanings provided in the Credit Agreement.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement. Payments of
both principal and interest are to be made in lawful money of the United States
of America in same day or immediately available funds to the account designated
by the Administrative Agent pursuant to the Credit Agreement.
This Swing Line Note is the Swing Line Note referred to in, and evidences
Obligations incurred under, the Credit Agreement, to which reference is made for
a description of the security for this Swing Line Note and for a statement of
the terms and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the Obligations evidenced by this
Swing Line Note and on which such Obligations may be declared to be immediately
due and payable.
The Borrower hereby irrevocably authorizes the Swing Line Lender to make
(or cause to be made) appropriate notations on the grid attached hereto (or on
any continuation of such grid), which notations, if made, shall evidence, INTER
ALIA, the date of and the outstanding principal of, the Swing Line Loans
evidenced hereby. Such notations shall be rebuttable presumptive evidence of
the accuracy of the information so set forth; PROVIDED, HOWEVER, that
-1-
the failure of the Swing Line Lender to make any such notations shall not
limit or otherwise affect any Obligations of the Borrower.
Any assignment or transfer of this Swing Line Note shall be effective
solely by registration thereof in the Register pursuant to the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
THIS SWING LINE NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH
PURPOSES SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK).
THE TITAN CORPORATION
By
------------------------------
Name:
Title:
-2-
SWING LINE LOANS AND PRINCIPAL PAYMENTS
Amount of Amount of Unpaid
Swing Line Principal Principal Notation
Date Loan Made Repaid Balance Total Made By
========================================================================================
EXHIBIT A-3
TERM B NOTE
$_________ February __, 2000
FOR VALUE RECEIVED, the undersigned, THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), promises to pay to the order of [Name of Lender]
and its registered assigns (the "TERM B LOAN LENDER") on the Stated Maturity
Date for all Term B Loans, the principal sum of [_______________] DOLLARS
($_________) or, if less, the aggregate unpaid principal amount of all Term B
Loans made by the Term B Loan Lender pursuant to that certain Senior Secured
Credit Agreement, dated as of February __, 2000 (as amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
among the Borrower, the various financial institutions (including the Term B
Loan Lender) as are or may become parties thereto (collectively, the "LENDERS"),
Credit Suisse First Boston, as administrative agent for the Lenders (the
"ADMINISTRATIVE AGENT"), First Union Securities, Inc., as Syndication Agent, and
The Bank of Nova Scotia, as Documentation Agent. Terms used herein have the
meanings provided in the Credit Agreement.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement. Payments of
both principal and interest are to be made in lawful money of the United States
of America in same day or immediately available funds to the account designated
by the Administrative Agent pursuant to the Credit Agreement.
This Term B Note is one of the Term B Notes referred to in, and evidences
Obligations incurred under, the Credit Agreement, to which reference is made for
a description of the security for this Term B Note and for a statement of the
terms and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the Obligations evidenced by this
Term B Note and on which such Obligations may be declared to be immediately due
and payable.
The Borrower hereby irrevocably authorizes the Term B Loan Lender to make
(or cause to be made) appropriate notations on the grid attached hereto (or on
any continuation of such grid), which notations, if made, shall evidence, INTER
ALIA, the date of and the outstanding principal of, the Term B Loans evidenced
hereby. Such notations shall be rebuttable presumptive evidence of the accuracy
of the information so set forth; PROVIDED, HOWEVER, that the failure of the Term
B Loan Lender to make any such notations shall not limit or otherwise affect any
Obligations of the Borrower.
-1-
Any assignment or transfer of this Term B Note shall be effective solely by
registration thereof in the Register pursuant to the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
THIS TERM B NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED
BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSES
SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK).
THE TITAN CORPORATION
By
------------------------------
Name:
Title:
-2-
TERM B LOAN AND PRINCIPAL PAYMENTS
Amount of
Term B Loan Made Amount of Principal Unpaid Principal
Repaid Balance
-----------------------------------------------------------------------------------------------------------
Interest
Date Alternate LIBO Period Alternate LIBO Alternate LIBO Notation
Base Rate Rate (If Applicable) Base Rate Rate Base Rate Rate Total Made By
===========================================================================================================
EXHIBIT A-4
MULTI-DRAW TERM NOTE
$_________ ____________, 2000
FOR VALUE RECEIVED, the undersigned, THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), promises to pay to the order of [Name of Lender]
and its registered assigns (the "MULTI-DRAW TERM LOAN LENDER") on the Stated
Maturity Date for all Multi-Draw Term Loans, the principal sum of
[_______________] DOLLARS ($_________) or, if less, the aggregate unpaid
principal amount of all Multi-Draw Term Loans made by the Multi-Draw Term Loan
Lender pursuant to that certain Senior Secured Credit Agreement, dated as of
February __, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among the Borrower, the various financial
institutions (including the Multi-Draw Term Loan Lender) as are or may become
parties thereto (collectively, the "LENDERS"), Credit Suisse First Boston, as
administrative agent for the Lenders (the "ADMINISTRATIVE AGENT"), First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent. Terms used herein have the meanings provided in the Credit
Agreement.
The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement. Payments of
both principal and interest are to be made in lawful money of the United States
of America in same day or immediately available funds to the account designated
by the Administrative Agent pursuant to the Credit Agreement.
This Multi-Draw Term Note is one of the Multi-Draw Term Notes referred to
in, and evidences Obligations incurred under, the Credit Agreement, to which
reference is made for a description of the security for this Multi-Draw Term
Note and for a statement of the terms and conditions on which the Borrower is
permitted and required to make prepayments and repayments of principal of the
Obligations evidenced by this Multi-Draw Term Note and on which such Obligations
may be declared to be immediately due and payable.
The Borrower hereby irrevocably authorizes the Multi-Draw Term Loan Lender
to make (or cause to be made) appropriate notations on the grid attached hereto
(or on any continuation of such grid), which notations, if made, shall evidence,
INTER ALIA, the date of and the outstanding principal of, the Multi-Draw Term
Loans evidenced hereby. Such notations shall be rebuttable presumptive evidence
of the accuracy of the information so set forth; PROVIDED, HOWEVER, that the
failure of the Multi-Draw Term Loan Lender to make any such notations shall not
limit or otherwise affect any Obligations of the Borrower.
-1-
Any assignment or transfer of this Multi-Draw Term Note shall be effective
solely by registration thereof in the Register pursuant to the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
THIS MULTI-DRAW TERM NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH
PURPOSES SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK).
THE TITAN CORPORATION
By
----------------------------
Name:
Title:
-2-
MULTI-DRAW TERM LOAN AND PRINCIPAL PAYMENTS
Amount of
Multi-Draw Term Loan Amount of Principal Unpaid Principal
Made Repaid Balance
-------------------------------------------------------------------------------------------------------------
Interest
Alternate LIBO Period Alternate LIBO Alternate LIBO Notation
Date Base Rate Rate (If Applicable) Base Rate Rate Base Rate Rate Total Made By
==============================================================================================================
EXHIBIT A-5
TERM C NOTE
$_________ _______________, 2000
FOR VALUE RECEIVED, the undersigned, THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), promises to pay to the order of [Name of Lender]
and its registered assigns (the "TERM C LOAN LENDER") on the Stated Maturity
Date for all Term C Loans, the principal sum of [_______________] DOLLARS
($_________) or, if less, the aggregate unpaid principal amount of all Term C
Loans made by the Term C Loan Lender pursuant to that certain Senior Secured
Credit Agreement, dated as of February __, 2000 (as amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
among the Borrower, the various financial institutions (including the Term C
Loan Lender) as are or may become parties thereto (collectively, the "LENDERS"),
Credit Suisse First Boston, as administrative agent for the Lenders (the
"ADMINISTRATIVE AGENT"), First Union Securities, Inc., as Syndication Agent, and
The Bank of Nova Scotia, as Documentation Agent. Terms used herein have the
meanings provided in the Credit Agreement.
The Borrower also promises to pay interest on the unpaid principal
amount hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Credit Agreement. Payments of
both principal and interest are to be made in lawful money of the United States
of America in same day or immediately available funds to the account designated
by the Administrative Agent pursuant to the Credit Agreement.
This Term C Note is one of the Term C Notes referred to in, and
evidences Obligations incurred under, the Credit Agreement, to which reference
is made for a description of the security for this Term C Note and for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments and repayments of principal of the Obligations
evidenced by this Term C Note and on which such Obligations may be declared to
be immediately due and payable.
The Borrower hereby irrevocably authorizes the Term C Loan Lender to
make (or cause to be made) appropriate notations on the grid attached hereto (or
on any continuation of such grid), which notations, if made, shall evidence,
INTER ALIA, the date of and the outstanding principal of, the Term C Loans
evidenced hereby. Such notations shall be rebuttable presumptive evidence of the
accuracy of the information so set forth; PROVIDED, HOWEVER, that the failure of
the Term C Loan Lender to make any such notations shall not limit or otherwise
affect any Obligations of the Borrower.
-1-
Any assignment or transfer of this Term C Note shall be effective solely
by registration thereof in the Register pursuant to the Credit Agreement.
All parties hereto, whether as makers, endorsers, or otherwise,
severally waive presentment for payment, demand, protest and notice of dishonor.
THIS TERM C NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH
PURPOSES SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK).
THE TITAN CORPORATION
By
-----------------------------
Name:
Title:
-2-
TERM C LOAN AND PRINCIPAL PAYMENTS
Amount of Amount of Principle Upaid Principle
Term C Loan Made Repaid Balance
--------------------------------------------------------------------------------------------------------------
Interest
Alternate LIBO Period Alternate LIBO Alternate LIBO Notation
Date Base Rate Rate (If Applicable) Base Rate Rate Base Rate Rate Total Made By
==============================================================================================================
EXHIBIT B-1
BORROWING REQUEST
Credit Suisse First Boston,
as Administrative Agent
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:______________________
THE TITAN CORPORATION
Gentlemen and Ladies:
This Borrowing Request is delivered to you pursuant to Section 2.7 of
the Senior Secured Credit Agreement, dated as of February __, 2000 (as amended,
restated, supplemented or otherwise modified from time to time, the "CREDIT
AGREEMENT"), among The Titan Corporation (the "BORROWER"), the various financial
institutions as are or may become parties thereto (collectively, the "LENDERS"),
Credit Suisse First Boston, as administrative agent for the Lenders (the
"ADMINISTRATIVE AGENT"), First Union Securities, Inc., as Syndication Agent, and
The Bank of Nova Scotia, as Documentation Agent. Unless otherwise defined herein
or the context otherwise requires, terms used herein have the meanings provided
in the Credit Agreement.
The Borrower hereby requests that a [Revolving Loan]
[Multi-Draw Term Loan] [Term B Loan] [Term C Loan] [Swing Line Loan] be made
in the aggregate principal amount of $_____ on______ ,_____as a
*[LIBO Rate Loan having an Interest Period of [two weeks] [one] [two] [three]
[six] [nine] [twelve] month(s)] [Base Rate Loan].
The Borrower hereby acknowledges that, pursuant to Section 5.2(b) of
the Credit Agreement, each of the delivery of this Borrowing Request and the
acceptance by the Borrower of the proceeds of the Loans requested hereby
constitute a representation and warranty by the Borrower that, on the date of
such Loans, both immediately before and after giving effect thereto and to the
application of the proceeds therefrom, the statements set forth_______________
* Insert appropriate interest rate option and, if applicable, the number
of weeks or months with respect to LIBO Rate Loans. Note that Swing
Line Loans must be made as Base Rate Loans.
-1-
in Section 5.2(a) of the Credit Agreement are true and correct (it being
understood that such representations and warranties not qualified by reference
to materiality or Material Adverse Effect are true and correct in all material
respects).
The Borrower agrees that if prior to the time of the Borrowing
requested hereby any matter certified to herein by it will not be true and
correct in all material respects at such time as if then made, it will
immediately so notify the Administrative Agent. Except to the extent, if any,
that prior to the time of the Borrowing requested hereby the Administrative
Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed once again to be certified as true
and correct in all material respects at the date of such Borrowing as if then
made.
Please wire transfer the proceeds of the Borrowing to the accounts of
the following persons at the financial institutions indicated respectively:
Amount to be Name, Account No.,
TRANSFERRED PERSON TO BE PAID ADDRESS, ETC.
______________ __________________ ____________________
$_____________ _________________________
_________________________
Attention:______________
$_____________ _________________________
_________________________
Attention:______________
$_____________ _________________________
Balance of such _________________________
proceeds Attention:______________
-2-
IN WITNESS WHEREOF, the Borrower has caused this Borrowing Request to
be executed and delivered, and the certification and representations and
warranties contained herein to be made, by its duly Authorized Officer this __
day of ____________, ____.
THE TITAN CORPORATION
By
-------------------------
Name:
Title:
-3-
EXHIBIT B-2
ISSUANCE REQUEST
Credit Suisse First Boston,
as Administrative Agent
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:____________________
THE TITAN CORPORATION
Gentlemen and Ladies:
This Issuance Request is delivered to you pursuant to Section 2.11(a)
of the Senior Secured Credit Agreement, dated as of February __, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among The Titan Corporation, a Delaware corporation (the
"BORROWER"), the various financial institutions as are or may become parties
thereto (collectively, the "LENDERS"), Credit Suisse First Boston, as
administrative agent for the Lenders (the "ADMINISTRATIVE AGENT"), First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent. Unless otherwise defined herein or the context otherwise
requires, terms used herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that [name of Issuer], as Issuer *[issue a
Letter of Credit on____________ ,____ (the "DATE OF ISSUANCE") in the initial
Stated Amount of____________ with a Stated Expiry Date (as defined therein) of
______________, ____][extend the Stated Expiry Date (as defined under Letter of
Credit No.__, issued on _______________, ____, in the initial Stated Amount of
$_____________)to a revised Stated Expir y Date (as defined therein) of
________________, ____].
**[The beneficiary of the requested Letter of Credit will be
[_____________________.]
--------
* Insert and complete as appropriate.
** Delete if Issuance Request is for an extension.
-1-
The Borrower hereby acknowledges that, pursuant to Section 5.2(b) of
the Credit Agreement, each of the delivery of this Issuance Request and the
*[issuance] [extension] of the Letter of Credit requested hereby constitute a
representation and warranty by the Borrower that, on the date of such Credit
Extension, both immediately before and after giving effect thereto and to the
application of the proceeds therefrom, all statements set forth in Section
5.2(a) of the Credit Agreement are true and correct (it being understood that
such representations and warranties not qualified by reference to materiality or
Material Adverse Effect are true and correct in all material respects).
The Borrower agrees that if, prior to the time of the [issuance]
[extension] of the Letter of Credit requested hereby, any matter certified to
herein by it will not be true and correct in all material respects at such time
as if then made, it will immediately so notify the Administrative Agent. Except
to the extent, if any, that prior to the time of the [issuance] [extension] of
the Letter of Credit requested hereby the Administrative Agent and the Issuer
shall receive written notice to the contrary from the Borrower, each matter
certified to herein shall be deemed to be certified as true and correct in all
material respects at the date of such [issuance] [extension] as if then made.
--------
* Insert as appropriate.
-2-
IN WITNESS WHEREOF, the Borrower has caused this Issuance Request to be
executed and delivered, and the certification and representations and warranties
contained herein to be made, by its duly Authorized Officer this __ day of
___________, ____.
THE TITAN CORPORATION
By:
-------------------------
Name:
Title:
-3-
EXHIBIT C
CONTINUATION/CONVERSION NOTICE
Credit Suisse First Boston,
as Administrative Agent
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:_____________________
THE TITAN CORPORATION
Gentlemen and Ladies:
This Continuation/Conversion Notice is delivered to you pursuant to
Section 2.9 of the Senior Secured Credit Agreement, dated as of February __,
2000 (as amended, restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"), among The Titan Corporation, a Delaware
corporation (the "BORROWER"), the various financial institutions as are or may
become parties thereto (collectively, the "LENDERS"), Credit Suisse First
Boston, as administrative agent for the Lenders (the "ADMINISTRATIVE AGENT"),
First Union Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia,
as Documentation Agent. Unless otherwise defined herein or the context otherwise
requires, terms used herein have the meanings provided in the Credit Agreement.
The Borrower hereby requests that on ________, ____,
*[(1) **$ of the presently outstanding principal amount of
the [Revolving Loans] [Multi-Draw Term Loans] [Term B Loans] [Term C
Loans] originally made on _______, ____,]
_________________________________
* Delete if not applicable.
** Subject to minimum amounts and multiples contemplated in Section 2.9.
-1-
*[(2) and all Loans presently being maintained as *[Base Rate
Loans] [LIBO Rate Loans],]
(3) be [converted into] [continued as],
(4) **[LIBO Rate Loans having an Interest Period of [two weeks]
[one] [two] [three] [six] [nine] [twelve] month(s)] [Base Rate Loans].
The Borrower hereby:
(a) certifies and warrants that no Default has occurred and is
continuing or will (immediately after giving effect to the continuation
or conversion requested hereby) occur and be continuing; and
(b) agrees that if prior to the time of such continuation or
conversion any matter certified to herein by it will not be true and
correct at such time as if then made, it will immediately so notify the
Administrative Agent.
Except to the extent, if any, that prior to the time of the continuation
or conversion requested hereby the Administrative Agent shall receive written
notice to the contrary from the Borrower, each matter certified to herein shall
be deemed to be certified at the date of such continuation or conversion as if
then made.
___________________________________
* Delete if not applicable.
** Insert appropriate interest rate option and, if applicable, the
number of weeks or months with respect to LIBO Rate Loans.
-2-
IN WITNESS WHEREOF, the Borrower has caused this
Continuation/Conversion Notice to be executed and delivered, and the
certification and representations and warranties contained herein to be made, by
its duly Authorized Officer this ___ day of _____________,____.
THE TITAN CORPORATION
By:
--------------------------
Name:
Title:
-3-
EXHIBIT D
CLOSING DATE CERTIFICATE
THE TITAN CORPORATION
This Closing Date Certificate (this "CERTIFICATE") is delivered pursuant to
Section 5.1(c) of the Senior Secured Credit Agreement, dated as of February __,
2000 (as amended, restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT") among The Titan Corporation, a Delaware
corporation (the "BORROWER"), the various financial institutions as are or may
become parties thereto (collectively, the "LENDERS"), Credit Suisse First
Boston, as administrative agent for the Lenders (in such capacity, the
"ADMINISTRATIVE AGENT"), First Union Securities, Inc., as Syndication Agent, and
The Bank of Nova Scotia, as Documentation Agent. Capitalized terms not
otherwise defined herein shall have the meanings set forth in the Credit
Agreement.
The undersigned hereby certifies, represents and warrants for and on behalf
of the Borrower, as of the Closing Date, as follows:
1. FINANCIAL INFORMATION, ETC. Each of the financial statements required
pursuant to Section 5.1(h) of the Credit Agreement have been delivered to the
Administrative Agent.
2. PAYMENT OF OUTSTANDING INDEBTEDNESS, ETC. All Indebtedness to be
repaid pursuant to Section 5.1(p) of the Credit Agreement, together with all
interest, all prepayment premiums and other amounts due and payable with respect
thereto, has been paid in full from the proceeds of the HIGH TIDES and the
Credit Extension made on the Closing Date and the commitments in respect of such
Indebtedness have been terminated.
3. INSURANCE. Attached hereto as ANNEX I are certified copies of
certificates of insurance (or binders in respect thereof), from one or more
insurance companies, evidencing coverage required to be maintained pursuant to
the Credit Agreement and each Loan Document.
4. MATERIAL ADVERSE CHANGE. There has not occurred a Material Adverse
Effect since December 31, 1998.
5. COMPLIANCE WITH WARRANTIES, NO DEFAULT, ETC. Both before and after
giving effect to the Credit Extension made on the Closing Date:
(a)the representations and warranties set forth in ARTICLE VI
(excluding, however, those contained in SECTION 6.7) and in each other Loan
Document are, in each case, true
-1-
and correct in all respects (with respect to representations and warranties
qualified by materiality or Material Adverse Effect) and in all material
respects (with respect to all other representations and warranties) with
the same effect as if then made (unless stated to relate solely to an
earlier date, in which case such representations and warranties are true
and correct in all material respects as of such earlier date unless such
representations and warranties are qualified by materiality or Material
Adverse Effect, in which case such representations and warranties are true
and correct as of such earlier date);
(b) except as disclosed by the Borrower to the Administrative Agent
and the Lenders pursuant to SECTION 6.7,
(i) no labor controversy, litigation, arbitration or
governmental investigation or proceeding is pending or, to the
knowledge of the Borrower, threatened against the Borrower or any of
its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect, or which would adversely affect the legality, validity
or enforceability of the Credit Agreement or any other Loan Document;
and
(ii) no development has occurred in any labor controversy,
litigation, arbitration or governmental investigation or proceeding
disclosed pursuant to SECTION 6.7 which could reasonably be expected
to have a Material Adverse Effect; and
(iii) no Default has occurred and is continuing.
6. CONSENTS, ETC. All governmental and third party approvals and consents
required to be obtained prior to the Closing Date in connection with the
acquisitions of Acquisition Two and LinCom and all governmental and third party
approvals and consents necessary in connection with the ACS Acquisition (other
than the approval of the shareholders of ACS), the financing contemplated
pursuant to the Credit Agreement (including the execution and delivery of the
Credit Agreement and each other Loan Document required thereunder by each
Obligor and the performance of their respective Obligations) and continuing
operations of the Borrower, each Guarantor, ACS (after giving effect to the
consummation of the ACS Acquisition), Acquisition Two and LinCom (after giving
effect to the consummation of the acquisitions of Acquisition Two and LinCom)
have been obtained and are in full force and effect (and, to the extent
requested by the Administrative Agent, the Administrative Agent has received
true and correct copies of such approvals and consents) and all applicable
waiting periods have expired without any action being taken or threatened by any
competent authority which would restrain, prevent or otherwise impose adverse
conditions on the transactions contemplated by the Credit Agreement.
7. LITIGATION. There is no pending or, to the knowledge of the Borrower,
threatened, litigation, proceedings or investigations which could reasonably be
expected to have (i) a
-2-
material adverse effect on the ACS Acquisition or the acquisitions of
Acquisition Two and LinCom or (ii) a Material Adverse Effect.
8. PRO FORMA EBITDA. The Borrower has a minimum EBITDA, pro forma for the
twelve months ended September 30, 1999, of $45,600,000, excluding pending
acquisitions and any unrealized synergies.
-3-
IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed and delivered, and the certification, representations and warranties
contained herein to be duly made, by an Authorized Officer this _____ day of
February, 2000.
THE TITAN CORPORATION
By:
----------------------------
Name:
Title:
-4-
ANNEX I
INSURANCE CERTIFICATES
EXHIBIT E
COMPLIANCE CERTIFICATE
Credit Suisse First Boston,
as Administrative Agent
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
THE TITAN CORPORATION
Gentlemen and Ladies:
This Compliance Certificate is delivered to you pursuant to [Section
5.1(i)] [clause (c) of Section 7.1] of the Senior Secured Credit Agreement,
dated as of February __, 2000 (as amended, restated, supplemented or otherwise
modified from time to time, the "CREDIT AGREEMENT"), among The Titan
Corporation, a Delaware corporation (the "BORROWER"), the various financial
institutions as are or may become parties thereto (collectively, the "LENDERS"),
Credit Suisse First Boston, as administrative agent for the Lenders (in such
capacity, the "ADMINISTRATIVE AGENT"), First Union Securities, Inc., as
Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent. Unless
otherwise defined in this Compliance Certificate, terms used herein (including
the Attachments hereto) have the meanings provided in the Credit Agreement.
Each reference to a Section is to the relevant Section in the Credit Agreement.
The Borrower hereby certifies and warrants that as of __________ __, ____
(the "COMPUTATION DATE"):
1. The Total Debt to EBITDA Ratio was _____:1.00, as computed on ATTACHMENTS 1
and 2 hereto.
The maximum Total Debt to EBITDA Ratio permitted pursuant to clause (a) of
Section 8.4 is _____:1.00 and, accordingly, the Total Debt to EBITDA Ratio
covenant [has] [has not] been satisfied.
2. The Net Worth of the Borrower is $_________________, as computed on
ATTACHMENT 3 hereto.
The minimum Net Worth required pursuant to clause (b) of Section 8.4 (as
computed on ATTACHMENT 3 hereto) is $__________, and accordingly, the Net
Worth covenant [has][has not] been satisfied.
3. The Fixed Charge Coverage Ratio was _____:1.00, as computed on ATTACHMENT 4
hereto.
The minimum Fixed Charge Coverage Ratio permitted pursuant to clause (c) of
Section 8.4 is 1:00:1.00 and, accordingly, the Fixed Charge Coverage Ratio
covenant [has] [has not] been satisfied.
4. The Interest Coverge Ratio was _____:1.00, as computed on ATTACHMENT 5
hereto.
The minimum Interest Coverage Ratio permitted pursuant to clause (d) of
Section 8.4 is _____:1.00 and, accordingly, the Interest Coverage Ratio
covenant [has] [has not] been satisfied.
5. The Indebtedness of the Borrower and the Guarantors in respect of purchase
money Indebtedness and Capitalized Lease Liabilities under clause (g) of
Section 8.2 of the Credit Agreement, in the aggregate, was $_________. Such
Indebtedness pursuant to such clause (g) of Section 8.2 of the Credit
Agreement is not allowed to exceed $15,000,000 in the aggregate, and
accordingly, such Indebtedness was [not] permitted.
6. Other unsecured Indebtedness of the Borrower and the Guarantors under
clause (j) of Section 8.2 of the Credit Agreement, was, in the aggregate,
$____________. Such other unsecured Indebtedness pursuant to clause (h) of
Section 8.2 of the Credit Agreement is not allowed to exceed, in an
aggregate amount at any time, $15,000,000, and accordingly, such
Indebtedness was [not] permitted.
7. Other Investments of the Borrower or any of its Restricted Subsidiaries
under clause (j) of Section 8.5 of the Credit Agreement, was $__________.
Such other Investments pursuant to clause (j) of Section 8.5 of the Credit
Agreement are not permitted to exceed $25,000,000 in the aggregate over the
term of the Credit Agreement, and accordingly, to date, such Investments
were [not] permitted.
[8. Compliance with clause (e) of Section 8.6: The Total Debt to EBITDA Ratio
at the time of the spin off of Cayenta to the shareholders of the Borrower
was _____:1.00, calculated on a PRO FORMA basis. The maximum Total Debt
to EBITDA Ratio so calculated on a PRO FORMA basis may not exceed
3:00:1.00, and, accordingly, such spin-off was [not] permitted.]
[9. Compliance with clause (f) of Section 8.6:
(a) The Total Debt to EBITDA Ratio immediately following the proposed
redemption of Capital Stock of the Borrower or any of its Restricted
Subsections was ___:1.00, calculated on a PRO FORMA basis, giving
effect to such proposed redemption. The maximum Total Debt to EBITDA
Ratio so calculated on a PRO FORMA basis may not exceed 3:00:1.00,
and, accordingly, such redemption was [not] permitted. The aggregate
value of Capital Stock redemptions for the Borrower and its Restricted
Subsidiaries under clause (f)(iii) of Section 8.6 of the Credit
Agreement was $_______. The aggregate value of such redemptions
pursuant to clause (f)(iii) of Section 8.6 of the Credit Agreement are
not permitted to exceed $5,000,000, and accordingly, such redemptions
were [not] permitted.
(b) The aggregate value of Capital Stock redemptions for the Borrower and
its Restricted Subsidiaries under clause (f)(iv) of Section 8.6 of the
Credit Agreement was $_______. The aggregate value of such
redemptions pursuant to clause (f)(iv) of Section 8.6 of the Credit
Agreement are not permitted to exceed $20,000,000, and accordingly, to
date, such redemptions were [not] permitted.
(c) The unborrowed Revolving Loan Commitment Amount at the time of Capital
Stock redemptions for the Borrower and its Restricted Subsidiaries
under clause (f)(v) of Section 8.6 of the Credit Agreement was
$_______. The unborrowed Revolving Loan Commitment Amount at the time
of such Capital Stock redemptions pursuant to clause (f)(v) of Section
8.6 of the Credit Agreement are not permitted to be less than
$20,000,000, and accordingly, to date, such [redemptions] were [not]
permitted.]
10. [Name of Guarantor(s)] [have] [has] issued options and warrants
representing ___% of the Capital Stock of such Guarantor(s). The total
amount of options and warrants issued by any Guarantor (other than Cayenta,
which may not issue any options or warrants not disclosed on ITEM 8.8 of
the Disclosure Schedule) is not permitted to exceed 5% of the Capital Stock
of such Guarantor, inclusive of options and warrants issued by such
Guarantor as set forth in ITEM 8.8 of the Disclosure Schedule, and
accordingly, such issuance(s) [were] [was] [not] permitted.
11. The aggregate fair market value of the sales, transfers, leases,
contributions or conveyances (including by way of merger), or grants of
options, warrants or other rights with respect to, any of the Borrower's or
any Restricted Subsidiary's assets (including accounts receivable and
Capital Stock of the Borrower and its Restricted Subsidiaries) to any
Person in one transaction or series of transactions, pursuant to clause (e)
of Section 8.10 of the Credit Agreement made in the Fiscal Year to date in
which the Computation Date occurs was $_______. The maximum amount of
assets, in the aggregate, which may be disposed of pursuant to clause (e)
of Section 8.10 of the Credit Agreement is $10,000,000 in any Fiscal Year
and $40,000,000 over the term of the Credit Agreement, so long as the
Borrower complies with Section 3.1(c) of the Credit Agreement, and
accordingly, the aforementioned disposition [is][was][not] permitted.
12. The amount of sale proceeds from sale-leasebacks of the Borrower and its
Restricted Subsidiaries under Section 8.14 of the Credit Agreement was
$_________ per transaction. Such proceeds from sale-leasebacks pursuant to
such Section 8.14 of the Credit Agreement are not allowed exceed $5,000,000
per transaction or series of related transactions, and accordingly, such
sale-leasebacks were [not] permitted.
13. Indebtedness of Foreign Subsidiaries of the Borrower under Section 8.15 of
the Credit Agreement, was, in the aggregate, $____________. Such
Indebtedness pursuant to Section 8.15 of the Credit Agreement is not
allowed to exceed, in an aggregate amount at any time, $10,000,000
(excluding any such Indebtedness which is non-recourse to the Borrower or
any of its U.S. or Foreign Subsidiaries), and accordingly, such
Indebtedness was [not] permitted.
14. [No Default has occurred and is continuing.] [A Default has occurred and
is continuing. The details of such Default and the actions that the
Borrower has taken or proposed to take with respect thereto are set forth
on Schedule 1 hereto.]
IN WITNESS WHEREOF, the Borrower has caused this Certificate to be duly
executed and delivered by its chief executive, financial or accounting
Authorized Officer this ____ day of __________, ____.
THE TITAN CORPORATION
By: ________________________________
Name:
Title:
SCHEDULE 1
(to __/__/__ Compliance
Certificate)
DEFAULTS
[Describe details of Default and actions that the Borrower has taken or proposes
to take with respect thereto.]
ATTACHMENT 1
(to __/__/__ Compliance
Certificate)
TOTAL DEBT TO EBITDA RATIO
on __/__/__
(the "Computation Date")
1. Total Debt:
(a) all obligations of the Borrower and its Restricted
Subsidiaries for borrowed money or advances and all
obligations of the Borrower and its Restricted
Subsidiaries evidenced by bonds, debentures, notes or
similar instruments (which, in the case of the Loans,
shall be deemed to equal the aggregate amount of Loans
outstanding on the Computation Date) . . . . . . . . . $_______
(b) all obligations, contingent or otherwise, relative to the
face amount of all letters of credit, whether or not
drawn, and banker's acceptances issued for the account of
the Borrower and its Restricted Subsidiaries (which, in
the case of Letter of Credit Outstandings shall be deemed
to equal the aggregate amount of Letter of Credit
Outstandings on the Computation Date) . . . . . . . . . $_______
(c) all monetary obligations of the Borrower or any of its
Restricted Subsidiaries under any leasing or similar
arrangement which have been (or, in accordance with GAAP,
should be) classified as capitalized leases valued at the
capitalized amount thereof . . . . . . . . . . . . . . $_______
(d) net liabilities of the Borrower and its Restricted
Subsidiaries under all Hedging Obligations . . . . . . $_______
(e) whether or not so included as liabilities in accordance
with GAAP, all obligations of the Borrower and its
Restricted Subsidiaries to pay the deferred purchase
price of property or services excluding Acquisition
Incentives which are not overdue and trade accounts
payable in the ordinary course of business which are not
overdue for a period of more than 90 days or, if overdue
for more than 90 days, as to which a dispute exists and
adequate reserves in conformity with GAAP have been
established on the books of the Borrower or such
Restricted Subsidiary, and indebtedness or other
obligations secured by (or for which the holder of such
indebtedness or other obligations has an existing right,
contingent or otherwise, to be secured by) a Lien on
property owned or being acquired by the Borrower or any
Restricted Subsidiary (including indebtedness or other
obligations arising under conditional sales or other
title retention agreements), whether or not such
indebtedness or other obligations shall have been assumed
by the Borrower or such Restricted Subsidiary or is
limited in recourse . . . . . . . . . . . . . . . . . . $_______
(f) all Contingent Liabilities of the Borrower and its
Restricted Subsidiaries. . . . . . . . . . . . . . . . $_______
(g) the principal portion of all obligations of the Borrower
and its Restricted Subsidiaries under any Synthetic Leas $_______
(h) all Disqualified Stock of the Borrower and its Restricted
Subsidiaries . . . . . . . . . . . . . . . . . . . . . $_______
(i) The sum of ITEMS 1(a) through 1(h) . . . . . . . . . . $_______
(j) intercompany Indebtedness between the Borrower and any of
its Restricted Subsidiaries (including, without
limitation, the Debentures so long as they are held by
Titan Capital Trust) . . . . . . . . . . . . . . . . . $________
(k) the Indebtedness of Titan Africa, Inc. in connection with
the project financing in Benin, so long as such
Indebtedness remains non-recourse to the Borrower and its
Subsidiaries (other than Titan Africa, Inc.) and the
Borrower and its Subsidiaries (other than Titan Africa,
Inc.) have no liability or obligations with respect to
such Indebtedness . . . . . . . . . . . . . . . . . . . $________
(l) The sum of ITEMS 1(j) and 1(K) . . . . . . . . . . . . $________
(m) TOTAL DEBT: ITEM 1(i) minus ITEM 1(l) . . . . . . . . . $________
2. EBITDA: SEE ITEM 1(i) OF ATTACHMENT 2 $________
3. TOTAL DEBT TO EBITDA RATIO: The ratio of ITEM 1(m) to ITEM 2 ________:1.00
ATTACHMENT 2
(to__/__/__Compliance
Certificate)
EBITDA
for the four consecutive Fiscal Quarters
ending on ____ (the "Computation Date")
(the "Computation Period")
1. EBITDA:
(a) the aggregate of all amounts which would be included as
net income on the consolidated financial statements of
the Borrower and its U.S. Subsidiaries for the
Computation Period, determined in accordance with GAAP $_______
(b) all amounts deducted by the Borrower and its U.S.
Subsidiaries, in determining Net Income, representing
either non-cash or non-recurring losses, including fees,
costs, charges and other expenses incurred by the
Borrower and its U.S. Subsidiaries in connection with
any discontinued operation, acquisition, reorganization,
consolidation, restructuring or changes in accounting
treatment under GAAP . . . . . . . . . . . . . . . . . $_______
(c) the amount deducted by the Borrower and its U.S.
Subsidiaries, in determining Net Income, representing
amortization, as determined in accordance with GAAP . . $_______
(d) the amount deducted, in determining Net Income, of all
federal, state and local income taxes (whether paid in
cash or deferred) of the Borrower and its U.S.
Subsidiaries, . . . . . . . . . . . . . . . . . . . . . $_______
(e) the amount deducted, in determining Net Income, of
Interest Expense of the Borrower and its U.S.
Subsidiaries . . . . . . . . . . . . . . . . . . . . . $_______
(f) the amount deducted, in determining Net Income,
representing depreciation of assets of the Borrower and
its U.S. Subsidiaries, as determined in accordance with
GAAP . . . . . . . . . . . . . . . . . . . . . . . . . $_______
(g) the synergies set forth in SCHEDULE III to the Credit
Agreement for the periods described therein . . . . . .
(h) The sum of ITEMS 1(a) through 1(g) . . . . . . . . . . $_______
(i) all amounts added by the Borrower and its U.S.
Subsidiaries, in determining Net Income, representing
either non-cash or non-recurring gains, including as a
result of changes in accounting treatment under GAAP . $_______
(j) EBITDA: ITEM 1(h) minus ITEM 1(i) . . . . . . . . . . $_______
ATTACHMENT 3
(to __/__/__ Compliance
Certificate)
NET WORTH
for the ____ Fiscal Quarter,
ending on ________, ____
(the "Computation Date")
1. NET WORTH: As of the Computation Date, on a consolidated basis
for the Borrower and its Restricted Subsidiaries
a. The sum of Capital Stock taken at par value, capital $________
surplus and retained earnings (or accumulated deficit)
of the Borrower on the Computation Date:
b. Treasury stock of the Borrower and, to the extent
included in ITEM 1(a), minority interests in Restricted $________
Subsidiaries of the Borrower at such date:
c. NET WORTH: ITEM 1(a) minus ITEM 1(b): $________
2. REQUIRED NET WORTH: As of the Computation Date, on a consolidated
basis for the Borrower and its Restricted Subsidiaries:
(a) (i) prior to the consummation of the ACS Acquisition:
$80,000,000
(ii) after the consummation of the ACS Acquisition:
$115,000,000
(b) 50% of the aggregate Net Income in excess of zero for the
period commencing on the Closing Date and ending on the
last day of the Fiscal Quarter ending on or immediately
prior to the Computation Date . . . . . . . . . . . . . . $_______
(c) the product of 80% TIMES the net increase to the
Borrower's shareholders' equity resulting from the initial
public offering of Cayenta after the Closing Date . . . . $_______
(d) the product of 80% TIMES the net cash proceeds derived
from the issuance of common stock by the Borrower after
the Closing Date . . . . . . . . . . . . . . . . . . . . $_______
(e) subsequent to any spin-off of Cayenta, the portion of Net
Worth attributable to Cayenta immediately prior to such
spin-off . . . . . . . . . . . . . . . . . . . . . . . . $_______
(f) the net decrease to the Borrower's shareholders' equity
resulting from the deferred compensation charge related to
the employee stock options of Cayenta . . . . . . . . . . $_______
(g) Required Net Worth: The sum of ITEM(2)(a), ITEM 2(b), ITEM
2(c) and ITEM 2(d) minus ITEM 2(e) minus ITEM 2(f): . . $_______
ATTACHMENT 4
(to__/__/__Compliance
Certificate)
FIXED CHARGE COVERAGE RATIO
for the Fiscal Quarter,
ending on ____,____(the "Computation Date")
1. Fixed Charge Coverage Ratio
a. EBITDA (see ITEM 1(i) of Attachment 2) . . . . . $_________
b. Capital Expenditures made during the four
consecutive Fiscal Quarters ending on the
Computation Date . . . . . . . . . . . . . . . . $_________
c. ITEM 1(a) minus ITEM 1(b)
d. Interest Expense paid in cash . . . . . . . . . . $_________
e. Scheduled principal payments of the Term Loans
after giving effect to any reductions in such
scheduled principal repayments attributable to
any optional or mandatory prepayments of the Term
Loans . . . . . . . . . . . . . . . . . . . . . . $_________
f. Restricted Payments . . . . . . . . . . . . . . . $_________
g. All federal, state and foreign income taxes
actually paid in cash by the Borrower and its
Restricted Subsidiaries (excluding any cash taxes
paid in connection with the sale of IPivot Inc.) $_________
h. The sum of ITEMS 1(d) through 1(g) . . . . . . . $_________
i. FIXED CHARGE COVERAGE RATIO: The ratio of ITEM
1(c) to ITEM 1(h): _________: to 1.00
ATTACHMENT 5
to (__/__/__Compliance
Certificate)
INTEREST COVERAGE RATIO
for the Fiscal Quarter
ending on _____,____
(the "Computation Date)
1. Interest Coverage Ratio: for the Computation Date, on a
consolidated basis for the Borrower and the Restricted
Subsidiaries.
a. EBITDA (see ITEM 1(i) of Attachment 2) . . . . $________
b. Interest Expense paid in cash . . . . . . . . . $________
c. The ratio of ITEM 1(a) to ITEM 1(b) . . . . . . ________: to 1.00
EXHIBIT F-1
BORROWER PLEDGE AGREEMENT
This PLEDGE AGREEMENT (as amended, restated, supplemented, or otherwise
modified from time to time, this "PLEDGE AGREEMENT"), dated as of February 23,
2000, is made by THE TITAN CORPORATION, a Delaware corporation (the "PLEDGOR"),
in favor of CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as agent (the
"ADMINISTRATIVE AGENT") for each of the Secured Parties.
W I T N E S S E T H:
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented, or otherwise modified
from time to time, the "CREDIT AGREEMENT"), among the Pledgor, the various
financial institutions as are or may become parties thereto (the "LENDERS"),
CSFB, as Lead Arranger and Administrative Agent for the Lenders, First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Borrower;
WHEREAS, as a condition precedent to the making of the Credit Extensions
(including the initial Credit Extension) under the Credit Agreement, the Pledgor
is required to execute and deliver this Pledge Agreement;
WHEREAS, the Pledgor has duly authorized the execution, delivery and
performance of this Pledge Agreement; and
NOW THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, and in order to induce the Lenders
and the Issuers to make Credit Extensions (including the initial Credit
Extension) to the Pledgor pursuant to the Credit Agreement, the Pledgor agrees,
for the benefit of each Secured Party, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. CERTAIN TERMS. The following terms (whether or not
underscored) when used in this Pledge Agreement, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE.
1
"CERTIFICATED INTERESTS" means, collectively, all Pledged Shares evidenced
by certificates.
"COLLATERAL" is defined in SECTION 2.1.
"CREDIT AGREEMENT" is defined in the FIRST RECITAL.
"DISTRIBUTIONS" means all stock dividends, liquidating dividends, shares of
stock resulting from (or in connection with the exercise of) stock splits,
reclassifications, warrants, options, non-cash dividends, mergers,
consolidations, and all other distributions (whether similar or dissimilar to
the foregoing) on or with respect to any Pledged Interests or other shares of
Capital Stock constituting Collateral, but shall not include Dividends.
"DIVIDENDS" means cash dividends and cash distributions with respect to any
Pledged Interests made in the ordinary course of business and not a liquidating
dividend.
"INTEREST RATE HEDGING AGREEMENTS" means interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, and all other
agreements or arrangements designed to protect the Pledgor against fluctuations
in interest rates, entered into between the Pledgor and a Lender or an Affiliate
of a Lender, for the purpose of hedging interest rate risk with respect to the
Obligations.
"INTEREST RATE HEDGING OBLIGATIONS" means all liabilities of the Pledgor
under Interest Rate Hedging Agreements.
"LENDER" and "LENDERS" are defined in the FIRST RECITAL.
"LLC" means each limited liability company listed from time to time as a
Pledged Interest Issuer on ATTACHMENT 1 hereto.
"LLC INTEREST" means the entire ownership interest of the Pledgor in each
Pledged Interest Issuer that is an LLC listed on ATTACHMENT 1 hereto, including
such Pledgor's capital account, its gain, loss, deduction and credit of such
Pledged Interest Issuer, the Pledgor's interest in all distributions made or to
be made by such Pledged Interest Issuer to the Pledgor and all of the other
rights, titles and interests of the Pledgor as an owner or a member of such
Pledged Interest Issuer, whether set forth in the operating or membership
agreement of such Pledged Interest Issuer, by separate agreement or otherwise.
"PARTNERSHIP" means each general partnership or limited partnership listed
from time to time as a Pledged Interest Issuer on ATTACHMENT 1 hereto.
"PARTNERSHIP INTEREST" means the entire ownership interest of the Pledgor
in each Pledged Interest Issuer that is a Partnership listed on ATTACHMENT 1
hereto, including the Pledgor's capital account, its gain, loss, deduction and
credit of such Pledged Interest Issuer, the Pledgor's interest
2
in all distributions made or to be made by such Pledged Interest Issuer to
the Pledgor and all of the other rights, titles and interests of the Pledgor
as an owner, a general partner or a limited partner of such Pledged Interest
Issuer, whether set forth in the partnership agreement of such Pledged
Interest Issuer, by separate agreement or otherwise.
"PLEDGE AGREEMENT" is defined in the PREAMBLE.
"PLEDGED INTEREST ISSUERS" means each Person identified in ATTACHMENT 1
hereto as the issuer of the Pledged Interests (including the maker of each
Pledged Note) identified opposite the name of such Person and each Person whose
ownership, equity or other similar interests, including shares of Capital Stock,
Partnership Interests and LLC Interests, are, or are required to be, pledged
hereunder and under the Credit Agreement from time to time.
"PLEDGED INTERESTS" means (i) all Pledged Shares and (ii) all Pledged
Notes.
"PLEDGED NOTES" means all promissory notes of any Pledged Interest Issuer
identified on Attachment 1 hereto, and any promissory notes issued to Pledgor in
the future, as such promissory notes are amended, restated, supplemented or
otherwise modified from time to time, in accordance with SECTION 4.1.6, together
with any promissory note of any Pledged Interest Issuer taken in extension or
renewal thereof or substitution therefor.
"PLEDGED SHARES" means (a) all ownership, equity or other similar
interests, including shares of Capital Stock, Partnership Interests and LLC
Interests, of any Pledged Interest Issuer listed on Attachment 1 hereto and any
shares of Capital Stock, Partnership Interests and LLC Interests of any Pledged
Interest Issuer obtained in the future by the Pledgor, (b) the certificates
representing all such ownership, equity or similar interests and (c) all
securities convertible into, and all warrants, options or other rights to
acquire, such ownership, equity or similar interets; but excluding all shares of
voting stock of each class of any Foreign Subsidiary in excess of 65% of the
total issued and outstanding shares of the voting stock of each such class.
"PLEDGOR" is defined in the PREAMBLE.
"SECURED OBLIGATIONS" is defined in SECTION 2.2.
"SECURITIES ACT" is defined in SECTION 6.2.
"TERMINATION DATE" means the date on which all Obligations have been
indefeasibly paid in full, all Commitments have been fully terminated and all
Letters of Credit have been canceled or otherwise terminated.
"U.C.C." means the Uniform Commercial Code, as in effect from time to time
in the State of New York; PROVIDED, that if by reason of mandatory provisions of
law or the exercise of remedies, the perfection or the effect of perfection or
non-perfection of the Lien granted in any
3
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than New York, "U.C.C." means the Uniform Commercial Code
as in effect in such other jurisdiction for purposes of the provisions hereof
relating to such perfection or effect of perfection or non-perfection or the
exercise of remedies.
SECTION 1.2. CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Pledge Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
SECTION 1.3. U.C.C. DEFINITIONS. Unless otherwise defined herein or in
the Credit Agreement or the context otherwise requires, terms for which meanings
are provided in the U.C.C. are used in this Pledge Agreement with such meanings.
ARTICLE II
PLEDGE
SECTION 2.1. GRANT OF SECURITY INTEREST. The Pledgor hereby pledges,
hypothecates, assigns, charges, mortgages, delivers and transfers to the
Administrative Agent, for its benefit and the ratable benefit of each of the
Secured Parties, and the Pledgor hereby grants to the Administrative Agent, for
the ratable benefit of the Secured Parties, to secure the Secured Obligations, a
continuing security interest in, all of the following property (the
"COLLATERAL"):
(a) all Pledged Interests;
(b) all right, title and interest of the Pledgor, whether now existing
or hereafter arising or acquired, in, to and under any partnership
agreement, limited liability company agreement or similar agreement which
governs the rights and obligations of the holder of ownership, equity or
similar interests in a Pledged Interest Issuer;
(c) all Dividends, Distributions, interest and without duplication,
other payments and rights with respect to any Pledged Interest; and
(d) all proceeds of any of the foregoing.
SECTION 2.2. SECURITY FOR OBLIGATIONS. This Pledge Agreement secures the
payment in full of all Obligations of the Pledgor now or hereafter existing
under the Credit Agreement, each other Loan Document and each Interest Rate
Hedging Agreement, whether for principal, interest, costs, fees, indemnities,
expenses, Interest Rate Hedging Obligations or otherwise (including all
Obligations of the Pledgor now or hereafter existing under this Pledge Agreement
and each other Loan Document to which such Pledgor is or may become a party),
with all such Obligations being referred to as the "SECURED OBLIGATIONS".
4
SECTION 2.3. PLEDGE AND TRANSFER OF PLEDGED INTERESTS. Any Certificated
Interests representing or evidencing any Collateral shall be delivered to and
held by or on behalf of the Administrative Agent pursuant hereto, shall be in
suitable form for transfer by delivery, and shall be accompanied by all
necessary instruments of transfer or assignment, duly executed in blank by the
Pledgor or, if any Collateral is in the form of uncertificated securities,
confirmation and evidence satisfactory to the Administrative Agent that the
Pledgor has taken all actions requested by the Administrative Agent to provide
for the transfer to and perfection by the Administrative Agent of the security
interests in such uncertificated securities for the benefit of the Secured
Parties in accordance with the U.C.C. and any other applicable law.
SECTION 2.4. DIVIDENDS ON PLEDGED INTERESTS. In the event that any
Dividend or other payment is to be paid on any Pledged Interests (including any
payment of any principal or interest on any Pledged Note) at a time when no
Default has occurred and is continuing or would result therefrom, such Dividend
or payment may be paid directly to the Pledgor. If any such Default has
occurred and is continuing, then any such Dividend or payment shall be paid
directly to the Administrative Agent for the benefit of the Secured Parties.
SECTION 2.5. CONTINUING SECURITY INTEREST. This Pledge Agreement shall
create a continuing security interest in the Collateral and shall
(a) remain in full force and effect until the Termination Date;
(b) be binding upon the Pledgor and its successors, transferees and
assigns; and
(c) inure, together with the rights and remedies of the Administrative
Agent hereunder, to the benefit of the Administrative Agent and each other
Secured Party.
Without limiting CLAUSE (c), any Lender may assign or otherwise transfer (in
whole or in part) any Note or Loan held by it to any other Person or entity, and
such other Person or entity shall thereupon become vested with all the rights
and benefits in respect thereof granted to such Lender under any Loan Document
(including this Pledge Agreement) or otherwise, subject, however, to any
contrary provisions in such assignment or transfer, and to the provisions of
Section 11.11 and Article X of the Credit Agreement.
Upon (i) the sale, transfer or other disposition of Collateral in accordance
with the Credit Agreement or (ii) the occurrence of the Termination Date, the
security interests granted herein shall automatically terminate with respect to
(x) such Collateral (in the case of clause (i)) or (y) all Collateral (in the
case of clause (ii)), and at such time the Administrative Agent will, at the
Pledgor's sole expense, deliver to the applicable Pledgor, without any
representations, warranties or recourse of any kind whatsoever, all certificates
and instruments previously delivered to the Administrative Agent representing or
evidencing all Pledged Interests, together with all other Collateral held by the
Administrative Agent hereunder, and execute and deliver to the Pledgor such
documents as the Pledgor shall reasonably request to evidence such termination.
5
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. REPRESENTATIONS AND WARRANTIES, ETC. In order to induce the
Secured Parties to enter into the Credit Agreement and to make Credit Extensions
thereunder, the Pledgor represents and warrants to each Secured Party as set
forth in this Article.
SECTION 3.1.1. OWNERSHIP, NO LIENS, ETC. The Pledgor is the legal and
beneficial owner of, and has good and marketable title to (and has full right
and authority to pledge and assign) its Collateral, free and clear of all Liens,
options and other charges, except any Lien granted pursuant hereto in favor of
the Secured Parties.
SECTION 3.1.2. VALID SECURITY INTEREST. The execution and delivery of this
Pledge Agreement, together with (a)(i) in the case of Collateral in the form of
a Certificated Interest, the delivery of such Collateral to the Administrative
Agent together with undated stock powers executed in blank by the Pledgor, (ii)
in the case of Collateral in the form of an uncertificated security, the
registration with the Pledged Interest Issuer of such uncertificated security,
or (iii) in the case of Collateral in the form of Pledged Notes, delivery of
such Collateral and an ALLONGE to such Collateral to the Administrative Agent,
or (b) in the case of other than Certificated Interests, the filing of U.C.C.
financing statements in the filing offices listed on ATTACHMENT 2 hereto, is
effective to create a valid, perfected, first priority security interest in such
Collateral and all proceeds thereof, securing the Secured Obligations. No
further action is necessary to perfect or protect such security interest in the
Collateral and the proceeds thereof, subject to Section 9-306 of the U.C.C.
SECTION 3.1.3. AS TO PLEDGED INTERESTS. In the case of
(a) any Pledged Interests (other than Pledged Notes) constituting
Collateral,
(i) all of such Pledged Interests are duly authorized, and
validly issued, fully paid, and non-assessable, and constitute that
percentage of the issued and outstanding shares of Capital Stock,
Partnership Interests, LLC Interests and other ownership interest of
each Pledged Interest Issuer set forth on ATTACHMENT 1 hereto; and
(ii)the Pledgor has delivered to the Administrative Agent true
and complete copies of the partnership, membership, operating or
ownership agreements, as applicable, for each Pledged Interest Issuer
that is an LLC or a Partnership, which agreements are currently in
full force and effect and have not been amended or modified except as
disclosed to the Administrative Agent in writing; and
6
(b) each Pledged Note, all of such Pledged Notes have been duly
authorized, executed, endorsed, issued and delivered, and are the legal,
valid and binding obligation of the issuers thereof, and are not in
default.
SECTION 3.1.4. LOCATION OF PLEDGOR. The jurisdictions in which the
Pledgor is located for purposes of Sections 9-103 and 9-104 of the U.C.C. are
set forth in ATTACHMENT 2 hereto.
SECTION 3.1.5. NATURE OF PLEDGED INTERESTS. No LLC Interests or
Partnership Interests are Certificated Interests.
ARTICLE IV
COVENANTS
SECTION 4.1. COVENANTS. The Pledgor covenants and agrees that, at all
times prior to the Termination Date, it will perform, comply with and be bound
by the obligations set forth in this Article.
SECTION 4.1.1. PROTECT COLLATERAL; FURTHER ASSURANCES, ETC. The Pledgor
covenants and agrees that it will not sell, assign, transfer, pledge, or
encumber in any other manner the Collateral (except in favor of the
Administrative Agent hereunder). The Pledgor will warrant and defend the right
and title herein granted unto the Administrative Agent in and to the Collateral
(and all right, title, and interest represented by the Collateral) against the
claims and demands of all other Persons. The Pledgor agrees that from time to
time, at the expense of the Pledgor, it will promptly execute and deliver all
further instruments, and take all further action, that may be necessary or
desirable, or that the Administrative Agent may reasonably request, in order to
perfect and protect any security interest granted or purported to be granted
hereby or to enable the Administrative Agent to exercise and enforce its rights
and remedies hereunder with respect to any Collateral. The Pledgor will not,
without thirty (30) days' prior written notice to the Administrative Agent, (i)
change its name or structure so as to make any financing or other statement
filed pursuant to this Pledge Agreement become seriously misleading or (ii)
change the jurisdiction in which it is located to other than those specified in
SECTION 3.1.4. The Pledgor will pledge hereunder, immediately upon its
acquisition (directly or indirectly) thereof, any and all additional
Indebtedness owed to the Pledgor pursuant to any note with an Obligor. The
Pledgor further covenants and agrees as follows:
(a) If the Pledgor shall become entitled to receive or shall receive
any stock or other certificate (including any certificate representing a
Dividend or a Distribution in connection with any reclassification,
increase or reduction of capital or any certificate issued in connection
with any reorganization), option or rights, whether in addition to, in
substitution of, as a conversion of, or in exchange for any portion of the
Collateral (or otherwise in respect thereof), the Pledgor shall accept the
same as the agent of the Administrative Agent, hold the same in trust for
the Administrative Agent and deliver the
7
same forthwith to the Administrative Agent in the exact form received,
duly endorsed (in blank) by the Pledgor to the Administrative Agent, if
required, together with an undated stock power or other necessary
instrument of transfer covering such certificate duly executed in blank
by the Pledgor, to be held by the Administrative Agent, subject to the
terms of this Pledge Agreement, as additional security for the Secured
Obligations. In addition, any sums paid upon or in respect of the
Collateral upon the liquidation or dissolution of any Pledged Interest
Issuer shall be held by the Administrative Agent as additional security
for the Secured Obligations. If any sums of money or property so paid or
distributed in respect of any Collateral shall be received by the Pledgor,
then the Pledgor shall, until such money or property is paid or delivered
to the Administrative Agent, hold such money or property in trust for the
Administrative Agent (on behalf of the Secured Parties), segregated from
other funds of the Pledgor, as additional collateral securing the Secured
Obligations.
(b) Except as otherwise expressly permitted by the Credit Agreement,
without the prior written consent of the Administrative Agent, the Pledgor
will not (i) consent to any material modification, extension or alteration
of the terms of any partnership, membership or operating agreement of the
LLCs or the Partnerships or (ii) accept a surrender of any partnership,
membership or operating agreement of any of the LLCs or the Partnerships,
as applicable, or waive any breach of or default under any such agreement
by any other party thereto.
(c) The Pledgor will advise the Administrative Agent promptly, in
reasonable detail (i) of any Lien or claim made or asserted against any
material part of the Collateral, (ii) of any material change in the
composition of the Collateral, and (iii) of the occurrence of any other
event relating specifically to the Pledgor or its assets which could
reasonably be expected to have a material adverse effect on the aggregate
value of the Collateral or on the security interests created hereunder.
SECTION 4.1.2. REGISTRATION OF PLEDGED INTERESTS, ETC. Concurrently with
the execution and delivery of this Pledge Agreement, the Pledgor shall execute
and deliver to the applicable Pledged Interest Issuer instructions to register,
substantially in the form of EXHIBIT A hereto, and cause each Pledged Interest
Issuer to execute and deliver to the Administrative Agent the Initial
Transaction Statement, substantially in the form of EXHIBIT B hereto, confirming
that each Pledged Interest Issuer (in which the Pledgor owns a Pledged Interest
(other than in the case of a Certificated Interest or a Pledged Note)) has
registered the pledge by the Pledgor effected by this Pledge Agreement on its
books. In addition, the Pledgor agrees that it shall cause each issuer of
Certificated Interests to execute and deliver to the Administrative Agent an
acknowledgment in a form satisfactory to the Administrative Agent.
SECTION 4.1.3. STOCK POWERS, ETC. The Pledgor agrees that all
Certificated Interests constituting Collateral delivered by the Pledgor pursuant
to this Pledge Agreement will be accompanied by duly executed undated blank
stock powers, or other equivalent instruments of
8
transfer acceptable to the Administrative Agent, as are necessary under all
applicable laws to perfect the Lien in favor of the Secured Parties on such
Collateral. The Pledgor will, from time to time upon the request of the
Administrative Agent, promptly deliver to the Administrative Agent such stock
powers, instruments, and similar documents, satisfactory in form and substance
to the Administrative Agent, with respect to the Collateral as the
Administrative Agent may reasonably request and will, from time to time upon the
request of the Administrative Agent after the occurrence, and during the
continuance, of any Event of Default, promptly transfer any Pledged Interests or
other shares of Capital Stock or other ownership interests constituting
Collateral into the name of any nominee designated by the Administrative Agent.
SECTION 4.1.4. CONTINUOUS PLEDGE. The Pledgor will, at all times, keep
pledged to the Administrative Agent pursuant hereto all Pledged Interests and
all other shares of Capital Stock or other ownership interests constituting
Collateral, all Dividends and Distributions with respect thereto (provided that
if no Default described in Section 9.1(i) of the Credit Agreement or Event of
Default shall have occurred or be continuing, such Dividends and Distributions
may be used for working capital or other purposes), all Pledged Notes, all
interest, principal and other proceeds received by the Administrative Agent with
respect to the Pledged Notes, and all other Collateral and other securities,
instruments, proceeds, and rights from time to time received by or distributable
to the Pledgor in respect of any Collateral and will not permit any Pledged
Interest Issuer to issue any Capital Stock or other ownership interests or any
options, warrants or other rights to subscribe for or purchase Capital Stock
(other than as permitted by the Credit Agreement) which shall not have been
immediately duly pledged hereunder on a first priority perfected basis.
SECTION 4.1.5. VOTING RIGHTS; DIVIDENDS, ETC. The Pledgor agrees:
(a) after any Default of the nature referred to in Section 9.1(i) of
the Credit Agreement or any Event of Default shall have occurred and be
continuing, promptly upon receipt of notice thereof by the Pledgor and
without any request therefor by the Administrative Agent, such Pledgor will
deliver (properly endorsed where required hereby or requested by the
Administrative Agent) to the Administrative Agent all Dividends,
Distributions, all other cash payments, and all proceeds of the Collateral,
all of which shall be held by the Administrative Agent for the benefit of
the Secured Parties as additional Collateral for use in accordance with
SECTION 6.4; and
(b) after any Event of Default shall have occurred and be continuing
and the Administrative Agent has notified the Pledgor of the
Administrative Agent's intention to exercise its voting power under this
Section:
(i) the Administrative Agent may exercise (to the exclusion of
the Pledgor) the voting power and all other incidental rights of
ownership with respect to any Pledged Interests or other shares of
Capital Stock or other ownership interests constituting Collateral and
the Pledgor hereby grants the
9
Administrative Agent an irrevocable proxy, exercisable under such
circumstances, to vote the Pledged Interests and such other
Collateral; and
(ii) promptly to deliver to the Administrative Agent such
additional proxies and other documents requested by the Administrative
Agent as may be necessary to allow the Administrative Agent to
exercise such voting power.
All Dividends, Distributions, cash payments and proceeds which may at any time
and from time to time be held by the Pledgor but which the Pledgor is then
obligated to deliver to the Administrative Agent, shall, until delivery to the
Administrative Agent, be held by the Pledgor separate and apart from its other
property in trust for the Secured Parties. The Administrative Agent agrees that
unless an Event of Default shall have occurred and be continuing and the
Administrative Agent shall have given the notice referred to in CLAUSE (b), the
Pledgor shall have the exclusive voting power with respect to any shares of
Capital Stock or other ownership interests (including any of the Pledged
Interests) constituting Collateral and the Administrative Agent shall, upon the
written request of the Pledgor, promptly deliver such proxies and other
documents, if any, as shall be reasonably requested by the Pledgor which are
necessary to allow the Pledgor to exercise voting power with respect to any such
share of Capital Stock or other ownership interests (including any of the
Pledged Interests) constituting Collateral; PROVIDED, HOWEVER, that no vote
shall be cast, or consent, waiver, or ratification given, or action taken by the
Pledgor that would impair any Collateral or be inconsistent with or violate any
provision of the Credit Agreement, any other Loan Document or any Interest Rate
Hedging Agreement.
SECTION 4.1.6. ADDITIONAL UNDERTAKINGS. The Pledgor will not, without the
prior written consent of the Administrative Agent, take or omit to take any
action the taking or the omission of which could result in any impairment or
alteration of any instrument constituting Collateral. In furtherance of the
foregoing, the Pledgor agrees that it will not, without the prior written
consent of the Administrative Agent which consent shall not be unreasonably
withheld:
(a) enter into any agreement amending, supplementing, or waiving any
provision of any Pledged Note (including any underlying instrument pursuant
to which such Pledged Note is issued) or compromising or releasing or
extending the time for payment of any obligation of the maker thereof; or
(b) take or omit to take any action the taking or the omission of
which would result in any impairment or alteration of any obligation of the
maker of any Pledged Note or other instrument constituting Collateral.
SECTION 4.1.7. PLEDGOR REMAINS LIABLE. Anything herein to the contrary
notwithstanding,
10
(a) the Pledgor shall remain liable to perform all of its duties and
obligations as an owner of the Pledged Interests, to the same extent as if
this Pledge Agreement had not been executed;
(b) the exercise by the Administrative Agent or any other Secured
Party of any of its rights hereunder shall not release the Pledgor from any
of its duties or obligations as owner of the Pledged Interests; and
(c) neither the Administrative Agent nor any other Secured Party
shall have any obligation or liability as an owner of any Pledged Interest
as applicable, by reason of this Pledge Agreement.
ARTICLE V
THE AGENT
SECTION 5.1. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT. The Pledgor
hereby irrevocably appoints the Administrative Agent as the Pledgor's
attorney-in-fact, with full authority in the place and stead of the Pledgor and
in the name of the Pledgor or otherwise, from time to time in the Administrative
Agent's discretion, after the occurrence and during the continuance of a Default
of the nature referred to in Section 9.1(i) of the Credit Agreement or any other
Event of Default, to take any action and to execute any instrument which such
Administrative Agent may deem necessary or advisable to accomplish the purposes
of this Pledge Agreement, including without limitation:
(a) to ask, demand, collect, ▇▇▇ for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other instruments,
documents and chattel paper, in connection with CLAUSE (a); and
(c) to file any claims or take any action or institute any proceedings
which such Administrative Agent may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of
such Administrative Agent with respect to any of the Collateral.
The Pledgor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.
SECTION 5.2. ADMINISTRATIVE AGENT MAY PERFORM. If the Pledgor fails to
perform any agreement contained herein, the Administrative Agent may perform, or
cause performance of,
11
such agreement, and the reasonable expenses of the Administrative Agent incurred
in connection therewith shall be payable by the Pledgor pursuant to SECTION 6.4.
SECTION 5.3. ADMINISTRATIVE AGENT HAS NO DUTY. The powers conferred on
the Administrative Agent hereunder are solely to protect its interests (on
behalf of the Secured Parties) in the Collateral and shall not impose any duty
on it to exercise any such powers. Except for reasonable care of any Collateral
in its possession and the accounting for moneys actually received by it
hereunder, the Administrative Agent shall have no duty as to any Collateral or
responsibility for
(a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Pledged
Interests, whether or not the Administrative Agent has or is deemed to have
knowledge of such matters, or
(b) taking any necessary steps to preserve rights against prior
parties or any other rights pertaining to any Collateral.
SECTION 5.4. REASONABLE CARE. Other than the exercise of reasonable care
in the custody and preservation of the Collateral, the Administrative Agent
shall have no duty with respect thereto. The Administrative Agent shall be
deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Administrative Agent accords its own
property. The Administrative Agent shall not be liable or responsible for any
loss or damage to any of the Collateral, or for any diminution in the value
thereof, by reason of the act or omission of any agent or bailee selected by the
Administrative Agent in good faith.
ARTICLE VI
REMEDIES
SECTION 6.1. CERTAIN REMEDIES. If any Event of Default shall have
occurred and be continuing:
(a)The Administrative Agent may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party on default
under the U.C.C. (whether or not the U.C.C. applies to the affected
Collateral) and also may, without notice except as specified below, sell
the Collateral or any part thereof in one or more parcels at public or
private sale, at the Administrative Agent's offices or elsewhere, for
cash, on credit or for future delivery, and upon such other terms as the
Administrative Agent may deem commercially reasonable. The Pledgor agrees
that, to the extent notice of sale shall be required by law, at least ten
days' prior notice to the Pledgor of the time and place of any public sale
or the time after which any private sale is to be made shall constitute
reasonable notification.
12
The Administrative Agent shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. The
Administrative Agent may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which it was
so adjourned.
(b) The Administrative Agent may
(i) transfer all or any part of the Collateral into the name of
the Administrative Agent or its nominee, with or without disclosing
that such Collateral is subject to the Lien hereunder,
(ii) notify the parties obligated on any of the Collateral to
make payment to the Administrative Agent of any amount due or to
become due thereunder,
(iii) enforce collection of any of the Collateral by suit or
otherwise, and surrender, release or exchange all or any part thereof,
or compromise or extend or renew for any period (whether or not longer
than the original period) any obligations of any nature of any party
with respect thereto,
(iv) endorse any checks, drafts, or other writings in the
Pledgor's name to allow collection of the Collateral,
(v) take control of any proceeds of the Collateral,
(vi) execute (in the name, place and stead of the Pledgor)
endorsements, assignments, stock powers and other instruments of
conveyance or transfer with respect to all or any of the Collateral,
(vii) accelerate any Pledged Note which may be accelerated in
accordance with its terms and take any other action to collect upon
any Pledged Note (including, without limitation, to make any demand
for payment thereon), and
(viii) to vote all or any part of the Pledged Interests (whether
or not transferred into the name of the Administrative Agent) and give
all consents, waivers and ratifications in respect of the Collateral
(including, without limitation, under all operating agreements,
partnership agreements or other agreements relating to the Collateral)
and otherwise act with respect thereto as if it were the outright
owner thereof.
SECTION 6.2. SECURITIES LAWS. If the Administrative Agent shall determine
to exercise its right to sell all or any of the Collateral pursuant to SECTION
6.1, the Pledgor agrees that, upon request of the Administrative Agent, the
Pledgor will, at the Pledgor's own expense:
13
(a) execute and deliver, and cause each issuer of the Collateral
contemplated to be sold and the directors and officers thereof to execute
and deliver, all such instruments and documents, and do or cause to be done
all such other acts and things, as may be necessary or, in the opinion of
the Administrative Agent, advisable to register such Collateral under the
provisions of the Securities Act of 1933, as from time to time amended (the
"SECURITIES ACT") and comparable legislation in other jurisdictions, and to
cause the registration statement relating thereto to become effective and
to remain effective for such period as prospectuses are required by law to
be furnished, and to make all amendments and supplements thereto and to the
related prospectus which, in the opinion of the Administrative Agent, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto and comparable legislation, rules and
regulations in other jurisdictions;
(b) use its best efforts to qualify the Collateral under the state
securities or "Blue Sky" laws and to obtain all necessary governmental
approvals for the sale of the Collateral, as requested by the
Administrative Agent;
(c) cause each such Pledged Interest Issuer to make available to its
security holders, as soon as practicable, an earnings statement that will
satisfy the provisions of Section 11(a) of the Securities Act and
comparable legislation in other jurisdictions; and
(d) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Collateral or any part thereof valid and
binding and in compliance with applicable law.
The Pledgor further acknowledges the impossibility of ascertaining the amount of
damages that would be suffered by the Administrative Agent and the Secured
Parties by reason of the failure by the Pledgor to perform any of the covenants
contained in this Section and, consequently, agrees that, if the Pledgor shall
fail to perform any of such covenants, the Pledgor shall pay, as liquidated
damages and not as a penalty, an amount equal to the value (as determined by the
Administrative Agent) of the Collateral on the date the Administrative Agent
shall demand compliance with this Section. Notwithstanding the provisions of
this Section 6.2, the Administrative Agent shall not be obligated to register
any of the Collateral under the Securities Act in connection with the exercise
of remedies hereunder and may elect, in its sole discretion, to sell Collateral
or any part thereof by private sale in such manner and under such circumstances
as the Administrative Agent may deem necessary or advisable in order that such
sale be effected without such registration.
SECTION 6.3. COMPLIANCE WITH RESTRICTIONS. The Pledgor agrees that in any
sale of any of the Collateral whenever an Event of Default shall have occurred
and be continuing, the Administrative Agent is hereby authorized to comply with
any limitation or restriction in connection with such sale as it may be advised
by counsel is necessary in order to avoid any
14
violation of applicable law (including compliance with such procedures as may
restrict the number of prospective bidders and purchasers, require that such
prospective bidders and purchasers have certain qualifications, and restrict
such prospective bidders and purchasers to Persons who will represent and agree
that they are purchasing for their own account for investment and not with a
view to the distribution or resale of such Collateral), or in order to obtain
any required approval of the sale or of the purchaser by any governmental
regulatory authority or official, and the Pledgor further agrees that such
compliance shall not result in such sale being considered or deemed not to have
been made in a commercially reasonable manner, nor shall the Administrative
Agent or any other Secured Party be liable or accountable to the Pledgor for any
discount allowed by the reason of the fact that such Collateral is sold in
compliance with any such limitation or restriction.
SECTION 6.4. APPLICATION OF PROCEEDS. All cash proceeds received by the
Administrative Agent in respect of any sale of, collection from, or other
realization upon, all or any part of the Collateral may, in the discretion of
the Administrative Agent, be held by the Administrative Agent as additional
collateral security for, or then or at any time thereafter be applied in whole
or in part by the Administrative Agent against all or any part of the Secured
Obligations as follows:
(i) first, to the payment of all Obligations owing to the
Administrative Agent pursuant to Section 11.3 of the Credit Agreement
and SECTION 6.5;
(ii) second, after payment in full of the amounts specified in
CLAUSE (i), to the ratable payment of all other Obligations owing to
the Secured Parties, with such amounts applied first to fees and
expenses, then to accrued and unpaid interest, then to the outstanding
principal amount of the Loans, then to Letter of Credit Outstandings
and then to Interest Rate Hedging Obligations; and
(iii) third, after payment in full of the amounts specified in
CLAUSES (i) and (ii), and following the Termination Date, to the
Pledgor or any other Person lawfully entitled to receive such surplus.
SECTION 6.5. INDEMNITY AND EXPENSES. The Pledgor hereby agrees to
indemnify and hold harmless the Administrative Agent and the Secured Parties
from and against any and all claims, losses, and liabilities arising out of or
resulting from this Pledge Agreement (including enforcement of this Pledge
Agreement), except claims, losses, or liabilities resulting from the
Administrative Agent's or a Secured Party's gross negligence or wilful
misconduct. Upon demand, the Pledgor agrees that it will pay to the
Administrative Agent the amount of any and all reasonable expenses, including
the reasonable fees and disbursements of its counsel and of any experts, which
the Administrative Agent or any other Secured Party may incur in connection
with:
15
(a) the administration of this Pledge Agreement, the Credit Agreement
and any other Loan Document;
(b) the custody, preservation, use, or operation of, or the sale of,
collection from, or other realization upon, any of the Collateral;
(c) the exercise or enforcement of any of the rights of the
Administrative Agent hereunder; or
(d) the failure by the Pledgor to perform or observe any of the
provisions hereof.
The provisions of this SECTION 6.5 shall survive the Termination Date.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. LOAN DOCUMENT. This Pledge Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof, including Article XI thereof.
SECTION 7.2. PROTECTION OF COLLATERAL. The Administrative Agent may from
time to time, at its option, perform any act which the Pledgor agrees hereunder
to perform and which the Pledgor shall fail to perform after being requested in
writing so to perform (it being understood that no such request need be given
after the occurrence and during the continuance of an Event of Default) and the
Administrative Agent may from time to time take any other action which the
Administrative Agent reasonably deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein.
SECTION 7.3. BINDING ON SUCCESSORS, TRANSFEREES AND ASSIGNS; ASSIGNMENT.
This Pledge Agreement shall be binding upon the Pledgor and its successors,
transferees and assigns and shall inure to the benefit of and be enforceable by
each Secured Party and their respective successors, transferees and assigns;
PROVIDED, HOWEVER, that the Pledgor may not assign any of its obligations
hereunder without the prior written consent of all Lenders.
SECTION 7.4. AMENDMENTS, ETC. No amendment to or waiver of any provision
of this Pledge Agreement, nor consent to any departure by the Pledgor herefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Administrative Agent (on behalf of the Lenders or the Required Lenders,
as the case may be) and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
SECTION 7.5. NOTICES. All notices and other communications provided for
hereunder shall be in writing (including facsimile communication) and, mailed or
telecopied or delivered to
16
the Pledgor, at the address specified in the Credit Agreement. All such notices
and other communications, when mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any such notice or communication, if transmitted by
telecopier, shall be deemed given when transmitted and electronically confirmed.
SECTION 7.6. NO WAIVER; REMEDIES. No failure on the part of any Secured
Party to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
SECTION 7.7. CAPTIONS. Section captions used in this Pledge Agreement are
for convenience of reference only, and shall not affect the construction of this
Pledge Agreement.
SECTION 7.8. SEVERABILITY. Wherever possible each provision of this
Pledge Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Pledge Agreement shall
be prohibited by or invalid under such law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Pledge
Agreement.
SECTION 7.9. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS PLEDGE AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).
SECTION 7.10. COUNTERPARTS. This Pledge Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.
17
IN WITNESS WHEREOF, the Pledgor has caused this Pledge Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
THE TITAN CORPORATION
By:
------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
ACKNOWLEDGED AND ACCEPTED:
CREDIT SUISSE FIRST BOSTON
as Administrative Agent
By:
--------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
By:
---------------------------
Name:
Title:
S-1
EXHIBIT A
to Borrower
Pledge Agreement
INSTRUCTION TO REGISTER PLEDGE
___________ __, ____
[ ]
Attention: ________________
Ladies and Gentlemen:
The undersigned, a [member] [partner] [shareholder] of ___________, [a
___________ limited liability company] [a __________ corporation] [a ___________
partnership] (the "COMPANY"), hereby instructs the Company to register on the
books of the Company the pledge of the undersigned's [membership] [partnership]
interest in favor of Credit Suisse First Boston, as administrative agent (the
"ADMINISTRATIVE AGENT"), pursuant to the Borrower Pledge Agreement, dated as of
February 23, 2000, made by, among others, the undersigned in favor of the
Administrative Agent.
Very truly yours,
THE TITAN CORPORATION
By:______________________
Name:
Title:
cc: Credit Suisse First Boston
EXHIBIT B
to Borrower
Pledge Agreement
INITIAL TRANSACTION STATEMENT
___________ __, ____
To: Credit Suisse First Boston
Attention:
This statement is to advise you that a pledge of the following
uncertificated securities has been registered in the name of Credit Suisse First
Boston, as Administrative Agent (the "ADMINISTRATIVE AGENT"), as follows:
1. Uncertificated Securities:
The entire [limited liability company] [partnership] interests of THE
TITAN CORPORATION in the undersigned [limited liability company]
[_____ partnership] [corporation].
2. Registered Owner:
THE TITAN CORPORATION
3. Pledged in favor of:
Credit Suisse First Boston,
as the Administrative Agent
4. There are no liens or restrictions of the undersigned [limited
liability company] [_______ partnership] [corporation] and no adverse
claims to which the uncertificated securities are or may be subject
known to the undersigned [limited liability company] [______
partnership] [corporation], other than in favor of Credit Suisse First
Boston, in its capacity as the Administrative Agent.
5. The pledge was registered on _______ __, ____.
6. No transfer of the uncertificated securities shall be made without the
prior written consent of the Administrative Agent.
THIS STATEMENT IS MERELY A RECORD OF THE RIGHTS OF THE ADDRESSEE AS OF THE
TIME OF ITS ISSUANCE. DELIVERY OF THIS STATEMENT, OF ITSELF, CONFERS NO RIGHTS
ON THE RECIPIENT. THIS STATEMENT IS NEITHER A NEGOTIABLE INSTRUMENT NOR A
SECURITY.
Very truly yours,
[NAME OF PLEDGED INTEREST ISSUER]
By:___________________________________
Name:
Title:
ATTACHMENT 1
to Borrower
Pledge Agreement
PLEDGED INTERESTS
PLEDGED NOTES
LOCATION OF PLEDGOR (Section 3.1.4)
The Titan Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
EXHIBIT F-2
SUBSIDIARY PLEDGE AGREEMENT
This PLEDGE AGREEMENT (as amended, restated, supplemented, or otherwise
modified from time to time, the "PLEDGE AGREEMENT"), dated as of February 23,
2000 is made by each U.S. Subsidiary (as defined in the Credit Agreement
referred to below) of THE TITAN CORPORATION, a Delaware corporation, now or
after the date hereof (including pursuant to SECTION 7.6) a signatory hereto
(each, individually, a "PLEDGOR," and collectively, the "PLEDGORS"), in favor of
CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as Administrative Agent
(the "ADMINISTRATIVE AGENT") for each of the Secured Parties.
W I T N E S S E T H:
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented, or otherwise modified
from time to time, the "CREDIT AGREEMENT"), among THE TITAN CORPORATION, a
Delaware (the "BORROWER"), the various financial institutions as are or may
become parties thereto (the "LENDERS"), CSFB, as Lead Arranger and
Administrative Agent for the Lenders, First Union Securities, Inc., as
Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent, the
Lenders and the Issuers have extended Commitments to make Credit Extensions to
the Borrower;
WHEREAS, as a condition precedent to the making of the Credit Extensions
(including the initial Credit Extension) under the Credit Agreement, each
Pledgor is required to execute and deliver this Pledge Agreement;
WHEREAS, each Pledgor has duly authorized the execution, delivery and
performance of this Pledge Agreement; and
WHEREAS, it is in the best interests of each Pledgor to execute this Pledge
Agreement inasmuch as such Pledgor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders and the Issuers pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, and in order to induce the Lenders
and the Issuers to make Credit Extensions (including the initial Credit
Extension) to the Borrower pursuant to the Credit Agreement, each Pledgor
jointly and severally agrees, for the benefit of each Secured Party, as follows:
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ARTICLE I
DEFINITIONS
SECTION 1.1. CERTAIN TERMS. The following terms (whether or not
underscored) when used in this Pledge Agreement, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE.
"CERTIFICATED INTERESTS" means, collectively, all Pledged Shares evidenced
by certificates.
"COLLATERAL" is defined in SECTION 2.1.
"CREDIT AGREEMENT" is defined in the FIRST RECITAL.
"DISTRIBUTIONS" means all stock dividends, liquidating dividends, shares of
stock resulting from (or in connection with the exercise of) stock splits,
reclassifications, warrants, options, non-cash dividends, mergers,
consolidations, and all other distributions (whether similar or dissimilar to
the foregoing) on or with respect to any Pledged Interests or other shares of
Capital Stock constituting Collateral, but shall not include Dividends.
"DIVIDENDS" means cash dividends and cash distributions with respect to any
Pledged Interests made in the ordinary course of business and not a liquidating
dividend.
"INTEREST RATE HEDGING AGREEMENTS" means interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, and all other
agreements or arrangements designed to protect a Pledgor against fluctuations in
interest rates, entered into between such Pledgor and a Lender or an Affiliate
of a Lender, for the purpose of hedging interest rate risk with respect to the
Obligations.
"INTEREST RATE HEDGING OBLIGATIONS" means all liabilities of the Pledgors
under Interest Rate Hedging Agreements.
"LENDER" and "LENDERS" are defined in the FIRST RECITAL.
"LLC" means each limited liability company listed from time to time as a
Pledged Interest Issuer on ATTACHMENT 1 hereto.
"LLC INTEREST" means the entire ownership interest of any Pledgor in each
Pledged Interest Issuer that is a LLC listed on ATTACHMENT 1 hereto, including
such Pledgor's capital account, its gain, loss, deduction and credit of such
Pledged Interest Issuer, his interest in all distributions made or to be made by
such Pledged Interest Issuer to such Pledgor and all of the other rights, titles
and interests of such Pledgor as an owner or a member of such Pledged Interest
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Issuer, whether set forth in the operating or membership agreement of such
Pledged Interest Issuer, by separate agreement or otherwise.
"PARTNERSHIP" means each general partnership or limited partnership listed
from time to time as a Pledged Interest Issuer on ATTACHMENT 1 hereto.
"PARTNERSHIP INTEREST" means the entire ownership interest of the Pledgor
in each Pledged Interest Issuer that is a Partnership listed on ATTACHMENT 1
hereto, including the Pledgor's capital account, its gain, loss, deduction and
credit of such Pledged Interest Issuer, the Pledgor's interest in all
distributions made or to be made by such Pledged Interest Issuer to the Pledgor
and all of the other rights, titles and interests of the Pledgor as an owner, a
general partner or a limited partner of such Pledged Interest Issuer, whether
set forth in the partnership agreement of such Pledged Interest Issuer, by
separate agreement or otherwise.
"PLEDGE AGREEMENT" is defined in the PREAMBLE.
"PLEDGED INTEREST ISSUERS" means each Person identified in ATTACHMENT 1
hereto as the issuer of the Pledged Interests (including the maker of each
Pledged Note) identified opposite the name of such Person and each Person whose
ownership, equity or other similar interests, including shares of Capital Stock,
Partnership Interests and LLC Interests, are , or are required to be pledged
hereunder and under the Credit Agreement from time to time.
"PLEDGED INTERESTS" means (i) all Pledged Shares and (ii) all Pledged
Notes.
"PLEDGED NOTES" means all promissory notes of any Pledged Interest Issuer,
identified on Attachment 1 hereto, and any promissory notes issued to any
Pledgor in the future, as such promissory notes are amended, restated,
supplemented or otherwise modified from time to time, in accordance with SECTION
4.1.6, together with any promissory note any Pledged Interest Issuer taken in
extension or renewal thereof or substitution therefor.
"PLEDGED SHARES" means (a) all ownership, equity or other similar
interests, including shares of Capital Stock, Partnership Interests and LLC
Interests, of any Pledged Interest Issuer listed on Attachment 1 hereto and any
shares of Capital Stock, Partnership Interests and LLC Interests of any Pledged
Interest Issuer obtained in the future by any Pledgor, (b) the certificates
representing all such ownership, equity or similar interests and (c) all
securities convertible into, and all warrants, options or other rights to
acquire, such ownership, equity or similar interets; but excluding all shares of
voting stock of each class of any Foreign Subsidiary in excess of 65% of the
total issued and outstanding shares of the voting stock of each such class.
"PLEDGOR" is defined in the PREAMBLE.
"SECURED OBLIGATIONS" is defined in SECTION 2.2.
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"SECURITIES ACT" is defined in SECTION 6.2.
"TERMINATION DATE" means the date on which all Obligations have been
indefeasibly paid in full, all Commitments have been fully terminated and all
Letters of Credit have been canceled or otherwise terminated.
"U.C.C." means the Uniform Commercial Code, as in effect from time to time
in the State of New York; PROVIDED, that if by reason of mandatory provisions of
law or the exercise of remedies, the perfection or the effect of perfection or
non-perfection of the Lien granted in any Collateral is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than New York, "U.C.C."
means the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such perfection or effect of
perfection or non-perfection or the exercise of remedies.
SECTION 1.2. CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Pledge Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
SECTION 1.3. U.C.C. DEFINITIONS. Unless otherwise defined herein or in
the Credit Agreement or the context otherwise requires, terms for which meanings
are provided in the U.C.C. are used in this Pledge Agreement with such meanings.
ARTICLE II
PLEDGE
SECTION 2.1. GRANT OF SECURITY INTEREST. Each Pledgor hereby pledges,
hypothecates, assigns, charges, mortgages, delivers and transfers to the
Administrative Agent, for its benefit and the ratable benefit of each of the
Secured Parties, and each Pledgor hereby grants to the Administrative Agent, for
the ratable benefit of the Secured Parties, to secure the Secured Obligations, a
continuing security interest in, all of the following property (the
"COLLATERAL"):
(a) all Pledged Interests;
(b) all right, title and interest of such Pledgor, whether now
existing or hereafter arising or acquired, in, to and under any partnership
agreement, limited liability company agreement or similar agreement which
governs the rights and obligations of the holder of ownership, equity or
similar interests in a Pledged Interest Issuer;
(c) all Dividends, Distributions, interest and without duplication,
other payments and rights with respect to any Pledged Interest; and
(d) all proceeds of any of the foregoing.
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SECTION 2.2. SECURITY FOR OBLIGATIONS. This Pledge Agreement secures the
payment in full of (i) all Obligations of the Borrower now or hereafter existing
under the Credit Agreement, each other Loan Document to which the Borrower is or
may become a party, and each Interest Rate Hedging Agreement, whether for
principal, interest, costs, fees, expenses, Interest Rate Hedging Obligations or
otherwise, and (ii) all Obligations of each Pledgor now or hereafter existing
under the Credit Agreement and each other Loan Document and each Interest Rate
Hedging Agreement, whether for principal, interest, costs, fees, indemnities,
expenses, Interest Rate Hedging Obligations or otherwise (including all
Obligations of each Pledgor now or hereafter existing under this Pledge
Agreement and each other Loan Document to which such Pledgor is or may become a
party), with all such Obligations being referred to as the "SECURED
OBLIGATIONS".
SECTION 2.3. PLEDGE AND TRANSFER OF PLEDGED INTERESTS. Any Certificated
Interests representing or evidencing any Collateral shall be delivered to and
held by or on behalf of the Administrative Agent pursuant hereto, shall be in
suitable form for transfer by delivery, and shall be accompanied by all
necessary instruments of transfer or assignment, duly executed in blank by the
applicable Pledgor or, if any Collateral is in the form of uncertificated
securities, confirmation and evidence satisfactory to the Administrative Agent
that the applicable Pledgor has taken all actions requested by the
Administrative Agent to provide for the transfer to and perfection by the
Administrative Agent of the security interests in such uncertificated securities
for the benefit of the Secured Parties in accordance with the U.C.C. and any
other applicable law.
SECTION 2.4. DIVIDENDS ON PLEDGED INTERESTS. In the event that any
Dividend or other payment is to be paid on any Pledged Interests (including any
payment of any principal or interest on any Pledged Note) at a time when no
Default has occurred and is continuing or would result therefrom, such Dividend
or payment may be paid directly to the applicable Pledgor. If any such Default
or Event of Default has occurred and is continuing, then any such Dividend or
payment shall be paid directly to the Administrative Agent for the benefit of
the Secured Parties.
SECTION 2.5. CONTINUING SECURITY INTEREST. This Pledge Agreement shall
create a continuing security interest in the Collateral and shall
(a) remain in full force and effect until the Termination Date;
(b) be binding upon each Pledgor and its successors, transferees and
assigns; and
(c) inure, together with the rights and remedies of the Administrative
Agent hereunder, to the benefit of the Administrative Agent and each other
Secured Party.
Without limiting CLAUSE (c), any Lender may assign or otherwise transfer (in
whole or in part) any Note or Loan held by it to any other Person or entity, and
such other Person or entity shall thereupon become vested with all the rights
and benefits in respect thereof granted to such Lender under any Loan Document
(including this Pledge Agreement) or otherwise, subject,
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however, to any contrary provisions in such assignment or transfer,
and to the provisions of Section 11.11 and Article X of the Credit Agreement.
Upon (i) the sale, transfer or other disposition of Collateral in accordance
with the Credit Agreement, (ii) the issuance of shares in connection with the
Initial public offering of Cayenta pursuant to the terms of the applicable
underwriting agreement and the delivery of a certificate to the Administrative
Agent stating that no Default has occurred and is continuing or would result
from the initial public offering or (iii) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (x) such Collateral (in the case of clause (i)), (y) any Collateral
owned by any member of the Cayenta Group (in the case of clause (ii)) or (z) all
Collateral (in the case of clause (iii)), and at such time the Administrative
Agent will, at each Pledgor's sole expense, deliver to the applicable Pledgor,
without any representations, warranties or recourse of any kind whatsoever, all
certificates and instruments previously delivered to the Administrative Agent
representing or evidencing all Pledged Interests, together with all other
Collateral held by the Administrative Agent hereunder, and execute and deliver
to the applicable Pledgor such documents as a Pledgor shall reasonably request
to evidence such termination.
SECTION 2.6. SECURITY INTEREST ABSOLUTE. All rights of the Administrative
Agent and the security interests granted to the Administrative Agent hereunder,
and all obligations of each Pledgor hereunder, shall be joint and several and
shall be absolute and unconditional, irrespective of
(a) any lack of validity or enforceability of the Credit Agreement or
any other Loan Document;
(b) the failure of any Secured Party
(i) to assert any claim or demand or to enforce any right or
remedy against any Obligor or any other Person under the provisions of
the Credit Agreement, any other Loan Document or otherwise, or
(ii) to exercise any right or remedy against any other guarantor
of, or collateral securing, any Secured Obligations;
(c) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations or any other
extension, compromise or renewal of any Secured Obligation;
(d) any reduction, limitation, impairment or termination of any
Secured Obligations for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and each
Pledgor hereby waives any right to or claim of) any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality, irregularity, compromise, unenforceability of, or
any other event or occurrence affecting, any Secured Obligations or
otherwise;
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(e) any amendment to, rescission, waiver, or other modification of, or
any consent to departure from, any of the terms of the Credit Agreement or
any other Loan Document;
(f) any addition, exchange, release, surrender or non-perfection of
any collateral (including the Collateral), or any amendment to or waiver or
release of or addition to or consent to departure from any guaranty, for
any of the Secured Obligations; or
(g) any other circumstances which might otherwise constitute a defense
available to, or a legal or equitable discharge of, any Obligor, any surety
or any guarantor.
SECTION 2.7. POSTPONEMENT OF SUBROGATION, ETC. Each Pledgor agrees that
it will not exercise any rights which it may acquire by reason of any payment
made hereunder, whether by way of subrogation, reimbursement or otherwise, until
following the Termination Date. Any amount paid prior to the Termination Date
shall be held in trust for the benefit of the Secured Parties and shall
immediately be paid to the Administrative Agent for the benefit of the Secured
Parties and credited and applied against the Secured Obligations, whether
matured or unmatured, in accordance with the terms of the Credit Agreement;
PROVIDED, HOWEVER, that if
(a) any Pledgor has made payment to the Secured Parties of all or any
part of the Secured Obligations; and
(b) the Termination Date has occurred;
then each Secured Party agrees that, at such Pledgor's request, the
Administrative Agent, on behalf of the Secured Parties, will execute and deliver
to such Pledgor appropriate documents (without recourse and without
representation or warranty) necessary to evidence the transfer by subrogation to
such Pledgor of an interest in the Secured Obligations resulting from such
payment by such Pledgor. In furtherance of the foregoing, at all times prior to
the Termination Date, each Pledgor shall refrain from taking any action or
commencing any proceeding against any Borrower or any other Obligor (or its
successors or assigns, whether in connection with a bankruptcy proceeding or
otherwise) to recover any amounts in respect of payments made under this Pledge
Agreement to any Secured Party. Notwithstanding the foregoing, to the extent
necessary to toll the statute of limitations, such Pledgor may take such action
required to preserve any rights it has by way of rights of subrogation as
consented to by the Administrative Agent in its reasonable discretion.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. REPRESENTATIONS AND WARRANTIES, ETC. In order to induce the
Secured Parties to enter into the Credit Agreement and to make Credit Extensions
thereunder, each Pledgor represents and warrants to each Secured Party as set
forth in this Article.
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SECTION 3.1.1. OWNERSHIP, NO LIENS, ETC. Each Pledgor is the legal and
beneficial owner of, and has good and marketable title to (and has full right
and authority to pledge and assign) its Collateral, free and clear of all Liens,
options and other charges, except any Lien granted pursuant hereto in favor of
the Secured Parties.
SECTION 3.1.2. VALID SECURITY INTEREST. The execution and delivery of this
Pledge Agreement, together with (a)(i) in the case of Collateral in the form of
a Certificated Interest, the delivery of such Collateral to the Administrative
Agent together with undated stock powers executed in blank by the Pledgor, (ii)
in the case of Collateral in the form of an uncertificated security, the
registration with the Pledged Interest Issuer of such uncertificated security,
or (iii) in the case of Collateral in the form of Pledged Notes, delivery of
such Collateral and an allonge to such Collateral to the Administrative Agent,
or (b) in the case of other than Certificated Interests, the filing of U.C.C.
financing statements in the filing offices listed on Attachment 2 hereto, is
effective to create a valid, perfected, first priority security interest in such
Collateral and all proceeds thereof, securing the Secured Obligations. No
further action is necessary to perfect or protect such security interest in the
Collateral and the proceeds thereof, subject to Section 9-306 of the U.C.C.
SECTION 3.1.3. AS TO PLEDGED INTERESTS. In the case of
(a) any Pledged Interests (other than Pledged Notes) constituting
Collateral,
(i) all of such Pledged Interests are duly authorized, and
validly issued, fully paid, and non-assessable, and constitute that
percentage of the issued and outstanding shares of Capital Stock,
Partnership Interests, LLC Interests and other ownership interest of
each Pledged Interest Issuer set forth on Attachment 1 hereto; and
(ii)the Pledgor has delivered to the Administrative Agent true
and complete copies of the partnership, membership, operating or
ownership agreements, as applicable, for each Pledged Interest Issuer
that is an LLC or a Partnership, which agreements are currently in
full force and effect and have not been amended or modified except as
disclosed to the Administrative Agent in writing; and
(b) in the case of each Pledged Note, all of such Pledged Notes have
been duly authorized, executed, endorsed, issued and delivered, and are the
legal, valid and binding obligation of the issuers thereof, and are not in
default.
SECTION 3.1.4. LOCATION OF PLEDGOR. The jurisdictions in which the
Pledgor is located for purposes of Sections 9-103 and 9-104 of the U.C.C. are
set forth in ATTACHMENT 2 hereto.
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SECTION 3.1.5. NATURE OF PLEDGED INTERESTS. No LLC Interests or
Partnership Interests are Certificated Interests.
ARTICLE IV
COVENANTS
SECTION 4.1. COVENANTS. Each Pledgor covenants and agrees that, at all
times prior to the Termination Date, it will perform, comply with and be bound
by the obligations set forth in this Article.
SECTION 4.1.1. PROTECT COLLATERAL; FURTHER ASSURANCES, ETC. Each Pledgor
covenants and agrees that it will not sell, assign, transfer, pledge, or
encumber in any other manner the Collateral (except in favor of the
Administrative Agent hereunder). Each Pledgor will warrant and defend the right
and title herein granted unto the Administrative Agent in and to the Collateral
(and all right, title, and interest represented by the Collateral) against the
claims and demands of all other Persons. Each Pledgor agrees that from time to
time, at the expense of such Pledgor, it will promptly execute and deliver all
further instruments, and take all further action, that may be necessary or
desirable, or that the Administrative Agent may reasonably request, in order to
perfect and protect any security interest granted or purported to be granted
hereby or to enable the Administrative Agent to exercise and enforce its rights
and remedies hereunder with respect to any Collateral. The Pledgor will not,
without thirty (30) days' prior written notice to the Administrative Agent, (i)
change its name or structure so as to make any financing or other statement
filed pursuant to this Pledge Agreement become seriously misleading or (ii)
change the jurisdiction in which it is located to other than those specified in
SECTION 3.1.4. Each Pledgor will pledge hereunder, immediately upon its
acquisition (directly or indirectly) thereof, any and all additional
Indebtedness owed to such Pledgor pursuant to any note with an Obligor. Each
Pledgor further covenants and agrees as follows:
(a) If any Pledgor shall become entitled to receive or shall receive
any stock or other certificate (including any certificate representing a
Dividend or a Distribution in connection with any reclassification,
increase or reduction of capital or any certificate issued in connection
with any reorganization), option or rights, whether in addition to, in
substitution of, as a conversion of, or in exchange for any portion of the
Collateral (or otherwise in respect thereof), such Pledgor shall accept the
same as the agent of the Administrative Agent, hold the same in trust for
the Administrative Agent and deliver the same forthwith to the
Administrative Agent in the exact form received, duly endorsed (in blank)
by such Pledgor to the Administrative Agent, if required, together with an
undated stock power or other necessary instrument of transfer covering such
certificate duly executed in blank by such Pledgor, to be held by the
Administrative Agent, subject to the terms of this Pledge Agreement, as
additional security for the Secured Obligations. In addition, any sums
paid upon or in respect of the Collateral upon the liquidation or
dissolution of any Pledged Interest Issuer shall be held by the
Administrative Agent as additional security for the Secured Obligations.
If any sums of money or property so paid
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or distributed in respect of any Collateral shall be received by any
Pledgor, then such Pledgor shall, until such money or property is paid
or delivered to the Administrative Agent, hold such money or property in
trust for the Administrative Agent (on behalf of the Secured Parties),
segregated from other funds of such Pledgor, as additional collateral
securing the Secured Obligations.
(b) Except as otherwise expressly permitted by the Credit Agreement,
without the prior written consent of the Administrative Agent, no Pledgor
will (i) consent to any material modification, extension or alteration of
the terms of any membership or operating agreement of the LLCs or the
Partnerships or (ii) accept a surrender of any membership or operating
agreement of any of the LLCs or the Partnerships, as applicable, or waive
any breach of or default under any such agreement by any other party
thereto.
(c) Each Pledgor will advise the Administrative Agent promptly, in
reasonable detail (i) of any Lien or claim made or asserted against any
material part of the Collateral, (ii) of any material change in the
composition of the Collateral, and (iii) of the occurrence of any other
event relating specifically to such Pledgor or its assets which could
reasonably be expected to have a material adverse effect on the aggregate
value of the Collateral or on the security interests created hereunder.
SECTION 4.1.2. REGISTRATION OF PLEDGED INTERESTS, ETC. Concurrently with
the execution and delivery of this Pledge Agreement, each Pledgor shall execute
and deliver to the applicable Pledged Interest Issuer instructions to register,
substantially in the form of EXHIBIT A hereto, and cause each Pledged Interest
Issuer to execute and deliver to the Administrative Agent the Initial
Transaction Statement, substantially in the form of EXHIBIT B hereto, confirming
that each Pledged Interest Issuer (in which such Pledgor owns a Pledged Interest
(other than in the case of a Certificated Interest or a Pledged Note)) has
registered the pledge by such Pledgor effected by this Pledge Agreement on its
books. In addition, the Pledgor agrees that it shall cause each issuer of
Certificated Interests to execute and deliver to the Administrative Agent an
acknowledgment in a form satisfactory to the Administrative Agent.
SECTION 4.1.3. STOCK POWERS, ETC. Each Pledgor agrees that all
Certificated Interests constituting Collateral delivered by such Pledgor
pursuant to this Pledge Agreement will be accompanied by duly executed undated
blank stock powers, or other equivalent instruments of transfer acceptable to
the Administrative Agent, as is necessary under all applicable laws to perfect
the Lien in favor of the Secured Parties on such Collateral. Each Pledgor will,
from time to time upon the request of the Administrative Agent, promptly deliver
to the Administrative Agent such stock powers, instruments, and similar
documents, satisfactory in form and substance to the Administrative Agent, with
respect to the Collateral as the Administrative Agent may reasonably request and
will, from time to time upon the request of the Administrative Agent after the
occurrence, and during the continuance, of any Event of Default, promptly
transfer any Pledged Interests or other shares of Capital Stock or other
ownership interests constituting Collateral into the name of any nominee
designated by the Administrative Agent.
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SECTION 4.1.4. CONTINUOUS PLEDGE. Each Pledgor will, at all times, keep
pledged to the Administrative Agent pursuant hereto all Pledged Interests and
all other shares of Capital Stock or other ownership interests constituting
Collateral, all Dividends and Distributions with respect thereto (provided that
if no Default described in Section 9.1(i) of the Credit Agreement or Event of
Default shall have occurred or be continuing, such Dividends and Distributions
may be used for working capital or other purposes), all Pledged Notes, all
interest, principal and other proceeds received by the Administrative Agent with
respect to the Pledged Notes, and all other Collateral and other securities,
instruments, proceeds, and rights from time to time received by or distributable
to such Pledgor in respect of any Collateral and will not permit any Pledged
Interest Issuer to issue any Capital Stock or other ownership interests or any
options, warrants or other rights to subscribe for or purchase Capital Stock
(other than as permitted by the Credit Agreement) which shall not have been
immediately duly pledged hereunder on a first priority perfected basis.
SECTION 4.1.5. VOTING RIGHTS; DIVIDENDS, ETC. Each Pledgor agrees:
(a) after any Default of the nature referred to in Section 9.1(i) of
the Credit Agreement or an Event of Default shall have occurred and be
continuing, promptly upon receipt of notice thereof by such Pledgor and
without any request therefor by the Administrative Agent, such Pledgor will
deliver (properly endorsed where required hereby or requested by the
Administrative Agent) to the Administrative Agent all Dividends,
Distributions, all other cash payments, and all proceeds of the Collateral,
all of which shall be held by the Administrative Agent for the benefit of
the Secured Parties as additional Collateral for use in accordance with
SECTION 6.4; and
(b) after any Event of Default shall have occurred and be continuing
and the Administrative Agent has notified any Pledgor of the Administrative
Agent's intention to exercise its voting power under this Section.
(i) the Administrative Agent may exercise (to the exclusion of
each Pledgor) the voting power and all other incidental rights of
ownership with respect to any Pledged Interests or other shares of
Capital Stock or other ownership interests constituting Collateral and
each Pledgor hereby grants the Administrative Agent an irrevocable
proxy, exercisable under such circumstances, to vote the Pledged
Interests and such other Collateral; and
(ii) promptly to deliver to the Administrative Agent such
additional proxies and other documents requested by the Administrative
Agent as may be necessary to allow the Administrative Agent to
exercise such voting power.
All Dividends, Distributions, cash payments and proceeds which may at any time
and from time to time be held by any Pledgor but which such Pledgor is then
obligated to deliver to the Administrative Agent, shall, until delivery to the
Administrative Agent, be held by such Pledgor
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separate and apart from its other property in trust for the Secured Parties.
The Administrative Agent agrees that unless an Event of Default shall have
occurred and be continuing and the Administrative Agent shall have given the
notice referred to in CLAUSE (b), such Pledgor shall have the exclusive
voting power with respect to any shares of Capital Stock or other ownership
interests (including any of the Pledged Interests) constituting Collateral
and the Administrative Agent shall, upon the written request of such Pledgor,
promptly deliver such proxies and other documents, if any, as shall be
reasonably requested by such Pledgor which are necessary to allow such
Pledgor to exercise voting power with respect to any such share of Capital
Stock or other ownership interests (including any of the Pledged Interests)
constituting Collateral; PROVIDED, HOWEVER, that no vote shall be cast, or
consent, waiver, or ratification given, or action taken by any Pledgor that
would impair any Collateral or be inconsistent with or violate any provision
of the Credit Agreement, any other Loan Document or any Interest Rate Hedging
Agreement.
SECTION 4.1.6. ADDITIONAL UNDERTAKINGS. No Pledgor will, without the
prior written consent of the Administrative Agent, take or omit to take any
action the taking or the omission of which could result in any impairment or
alteration of any instrument constituting Collateral. In furtherance of the
foregoing, each Pledgor agrees that it will not, without the prior written
consent of the Administrative Agent (which consent shall not be unreasonably
withheld):
(a) enter into any agreement amending, supplementing, or waiving any
provision of any Pledged Note (including any underlying instrument pursuant
to which such Pledged Note is issued) or compromising or releasing or
extending the time for payment of any obligation of the maker thereof; or
(b) take or omit to take any action the taking or the omission of
which would result in any impairment or alteration of any obligation of the
maker of any Pledged Note or other instrument constituting Collateral.
SECTION 4.1.7. PLEDGOR REMAINS LIABLE. Anything herein to the contrary
notwithstanding,
(a) each Pledgor shall remain liable to perform all of its duties and
obligations as an owner of the Pledged Interests, to the same extent as if
this Pledge Agreement had not been executed;
(b) the exercise by the Administrative Agent or any other Secured
Party of any of its rights hereunder shall not release any Pledgor from any
of its duties or obligations as owner of the Pledged Interests; and
(c) neither the Administrative Agent nor any other Secured Party
shall have any obligation or liability as an owner of any Pledged Interest
as applicable, by reason of this Pledge Agreement.
12
ARTICLE V
THE Administrative Agent
SECTION 5.1. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT. Each Pledgor
hereby irrevocably appoints the Administrative Agent as such Pledgor's
attorney-in-fact, with full authority in the place and stead of such Pledgor and
in the name of such Pledgor or otherwise, from time to time in the
Administrative Agent's discretion, after the occurrence and during the
continuance of a Default of the nature referred to in Section 9.1(i) of the
Credit Agreement or any other Event of Default, to take any action and to
execute any instrument which such Administrative Agent may deem necessary or
advisable to accomplish the purposes of this Pledge Agreement, including without
limitation:
(a) to ask, demand, collect, ▇▇▇ for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other instruments,
documents and chattel paper, in connection with CLAUSE (a); and
(c) to file any claims or take any action or institute any proceedings
which such Administrative Agent may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of
such Administrative Agent with respect to any of the Collateral.
Each Pledgor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.
SECTION 5.2. ADMINISTRATIVE AGENT MAY PERFORM. If any Pledgor fails to
perform any agreement contained herein, the Administrative Agent may itself
perform, or cause performance of, such agreement, and the reasonable expenses of
the Administrative Agent incurred in connection therewith shall be jointly and
severally payable by the Pledgors pursuant to SECTION 6.4.
SECTION 5.3. ADMINISTRATIVE AGENT HAS NO DUTY. The powers conferred on the
Administrative Agent hereunder are solely to protect its interests (on behalf of
the Secured Parties) in the Collateral and shall not impose any duty on it to
exercise any such powers. Except for reasonable care of any Collateral in their
possession and the accounting for moneys actually received by it hereunder, the
Administrative Agent shall have no duty as to any Collateral or responsibility
for
(a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Pledged
Interests, whether or not the Administrative Agent has or are deemed to
have knowledge of such matters, or
13
(b) taking any necessary steps to preserve rights against prior
parties or any other rights pertaining to any Collateral.
SECTION 5.4. REASONABLE CARE. Other than the exercise of reasonable care
in the custody and preservation of the Collateral, the Administrative Agent
shall have no duty with respect thereto. The Administrative Agent shall be
deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Administrative Agent accords its own
property. The Administrative Agent shall not be liable or responsible for any
loss or damage to any of the Collateral, or for any diminution in the value
thereof, by reason of the act or omission of any agent or bailee selected by the
Administrative Agent in good faith.
ARTICLE VI
REMEDIES
SECTION 6.1. CERTAIN REMEDIES. If any Event of Default shall have
occurred and be continuing:
(a)The Administrative Agent may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party on default
under the U.C.C. (whether or not the U.C.C. applies to the affected
Collateral) and also may, without notice except as specified below, sell
the Collateral or any part thereof in one or more parcels at public or
private sale, at the Administrative Agent's offices or elsewhere, for cash,
on credit or for future delivery, and upon such other terms as the
Administrative Agent may deem commercially reasonable. Each Pledgor agrees
that, to the extent notice of sale shall be required by law, at least ten
days' prior notice to any Pledgor of the time and place of any public sale
or the time after which any private sale is to be made shall constitute
reasonable notification. The Administrative Agent shall not be obligated
to make any sale of Collateral regardless of notice of sale having been
given. The Administrative Agent may adjourn any public or private sale
from time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to
which it was so adjourned.
(b) The Administrative Agent may
(i) transfer all or any part of the Collateral into the name of
the Administrative Agent or its nominee, with or without disclosing
that such Collateral is subject to the Lien hereunder,
(ii) notify the parties obligated on any of the Collateral to
make payment to the Administrative Agent of any amount due or to
become due thereunder,
14
(iii) enforce collection of any of the Collateral by suit or
otherwise, and surrender, release or exchange all or any part thereof,
or compromise or extend or renew for any period (whether or not longer
than the original period) any obligations of any nature of any party
with respect thereto,
(iv) endorse any checks, drafts, or other writings in any
Pledgor's name to allow collection of the Collateral,
(v) take control of any proceeds of the Collateral,
(vi) execute (in the name, place and stead of any Pledgor)
endorsements, assignments, stock powers and other instruments of
conveyance or transfer with respect to all or any of the Collateral,
(vii) accelerate any Pledged Note which may be accelerated in
accordance with its terms and take any other action to collect upon
any Pledged Note (including, without limitation, to make any demand
for payment thereon), and
(viii) to vote all or any part of the Pledged Interests (whether
or not transferred into the name of the Administrative Agent) and give
all consents, waivers and ratifications in respect of the Collateral
(including, without limitation, under all operating agreements,
partnership agreements or other agreements relating to the Collateral)
and otherwise act with respect thereto as if it were the outright
owner thereof.
SECTION 6.2. SECURITIES LAWS. If the Administrative Agent shall determine
to exercise its right to sell all or any of the Collateral pursuant to SECTION
6.1, each Pledgor agrees that, upon request of either Administrative Agent, such
Pledgor will, at such Pledgor's own expense:
(a) execute and deliver, and cause each issuer of the Collateral
contemplated to be sold and the directors and officers thereof to execute
and deliver, all such instruments and documents, and do or cause to be done
all such other acts and things, as may be necessary or, in the opinion of
the Administrative Agent, advisable to register such Collateral under the
provisions of the Securities Act of 1933, as from time to time amended (the
"SECURITIES ACT"), and comparable legislation in other jurisdictions, and
to cause the registration statement relating thereto to become effective
and to remain effective for such period as prospectuses are required by law
to be furnished, and to make all amendments and supplements thereto and to
the related prospectus which, in the opinion of the Administrative Agent,
are necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto and comparable legislation, rules and
regulations in other jurisdictions;
15
(b) use its best efforts to qualify the Collateral under the state
securities or "Blue Sky" laws and to obtain all necessary governmental
approvals for the sale of the Collateral, as requested by the
Administrative Agent;
(c) cause each such Pledged Interest Issuer to make available to its
security holders, as soon as practicable, an earnings statement that will
satisfy the provisions of Section 11(a) of the Securities Act and
comparable legislation in other jurisdictions; and
(d) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Collateral or any part thereof valid and
binding and in compliance with applicable law.
Each Pledgor further acknowledges the impossibility of ascertaining the amount
of damages that would be suffered by the Administrative Agent and the Secured
Parties by reason of the failure by such Pledgor to perform any of the covenants
contained in this Section and, consequently, jointly and severally, agrees that,
if any Pledgor shall fail to perform any of such covenants, the Pledgors shall
pay, as liquidated damages and not as a penalty, an amount equal to the value
(as determined by the Administrative Agent) of the Collateral on the date the
Administrative Agent shall demand compliance with this Section. Notwithstanding
the provisions of this Section 6.2, the Administrative Agent shall not be
obligated to register any of the Collateral under the Securities Act in
connection with the exercise of remedies hereunder and may elect, in its sole
discretion, to sell Collateral or any part thereof by private sale in such
manner and under such circumstances as the Administrative Agent may deem
necessary or advisable in order that such sale be effected without such
registration.
SECTION 6.3. COMPLIANCE WITH RESTRICTIONS. Each Pledgor agrees that in
any sale of any of the Collateral whenever an Event of Default shall have
occurred and be continuing, the Administrative Agent are hereby authorized to
comply with any limitation or restriction in connection with such sale as it may
be advised by counsel is necessary in order to avoid any violation of applicable
law (including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to Persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any governmental regulatory authority or official,
and each Pledgor further agrees that such compliance shall not result in such
sale being considered or deemed not to have been made in a commercially
reasonable manner, nor shall the Administrative Agent or any other Secured Party
be liable or accountable to any Pledgor for any discount allowed by the reason
of the fact that such Collateral is sold in compliance with any such limitation
or restriction.
SECTION 6.4. APPLICATION OF PROCEEDS. All cash proceeds received by the
Administrative Agent in respect of any sale of, collection from, or other
realization upon, all or
16
any part of the Collateral may, in the discretion of the Administrative
Agent, be held by the Administrative Agent as additional collateral security
for, or then or at any time thereafter be applied in whole or in part by the
Administrative Agent against all or any part of the Secured Obligations as
follows:
(i) first, to the payment of all Obligations owing to the
Administrative Agent pursuant to Section 11.3 of the Credit Agreement
and SECTION 6.5;
(ii) second, after payment in full of the amounts specified in
CLAUSE (i), to the ratable payment of all other Obligations owing to
the Secured Parties, with such amounts applied first to fees and
expenses, then to accrued and unpaid interest, then to the outstanding
principal amount of the Loans, then to Letter of Credit Outstandings
and then to Interest Rate Hedging Obligations; and
(iii) third, after payment in full of the amounts specified in
CLAUSES (i) and (ii), and following the Termination Date, to the
Pledgors or any other Person lawfully entitled to receive such
surplus.
SECTION 6.5. INDEMNITY AND EXPENSES. Each Pledgor hereby jointly and
severally agrees to indemnify and hold harmless the Administrative Agent and the
Secured Parties from and against any and all claims, losses, and liabilities
arising out of or resulting from this Pledge Agreement (including enforcement of
this Pledge Agreement), except claims, losses, or liabilities resulting from the
Administrative Agent's or a Secured Party's gross negligence or wilful
misconduct. Upon demand, each Pledgor jointly and severally agrees that it will
pay to the Administrative Agent the amount of any and all reasonable expenses,
including the reasonable fees and disbursements of its counsel and of any
experts, which the Administrative Agent or any other Secured Party may incur in
connection with:
(a) the administration of this Pledge Agreement, the Credit Agreement
and any other Loan Document;
(b) the custody, preservation, use, or operation of, or the sale of,
collection from, or other realization upon, any of the Collateral;
(c) the exercise or enforcement of any of the rights of the
Administrative Agent hereunder; or
(d) the failure by any Pledgor to perform or observe any of the
provisions hereof.
The provisions of this SECTION 6.5 shall survive the Termination Date.
17
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. LOAN DOCUMENT. This Pledge Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof, including Article XI thereof.
SECTION 7.2. PROTECTION OF COLLATERAL. The Administrative Agent may from
time to time, at their option, perform any act which any Pledgor agrees
hereunder to perform and which such Pledgor shall fail to perform after being
requested in writing so to perform (it being understood that no such request
need be given after the occurrence and during the continuance of an Event of
Default) and the Administrative Agent may from time to time take any other
action which the Administrative Agent reasonably deems necessary for the
maintenance, preservation or protection of any of the Collateral or of their
security interest therein.
SECTION 7.3. BINDING ON SUCCESSORS, TRANSFEREES AND ASSIGNS; ASSIGNMENT.
This Pledge Agreement shall be jointly and several binding upon each Pledgor and
its successors, transferees and assigns and shall inure to the benefit of and be
enforceable by each Secured Party and their respective successors, transferees
and assigns; PROVIDED, HOWEVER, that no Pledgor may assign any of its
obligations hereunder without the prior written consent of all Lenders.
SECTION 7.4. AMENDMENTS, ETC. No amendment to or waiver of any provision
of this Pledge Agreement, nor consent to any departure by any Pledgor herefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Administrative Agent (on behalf of the Lenders or the Required Lenders,
as the case may be) and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
SECTION 7.5. NOTICES. All notices and other communications provided for
hereunder shall be in writing (including facsimile communication) and, mailed or
telecopied or delivered to each Pledgor, in care of the Borrower at the address
specified in the Credit Agreement. All such notices and other communications,
when mailed and properly addressed with postage prepaid or if properly addressed
and sent by pre-paid courier service, shall be deemed given when received; any
such notice or communication, if transmitted by telecopier, shall be deemed
given when transmitted and electronically confirmed.
SECTION 7.6. ADDITIONAL SUBSIDIARY PLEDGORS. Upon the execution and
delivery by any other Person of an instrument in the form of Annex I hereto,
such Person shall become a "Pledgor" hereunder with the same force and effect as
if originally named as a "Pledgor" herein. The execution and delivery of any
such instrument shall not require the consent of any other Pledgor hereunder.
The rights and obligations of each Pledgor hereunder shall remain in full force
and effect notwithstanding the addition of any new Pledgor as a party to this
Pledge Agreement.
18
SECTION 7.7. NO WAIVER; REMEDIES. No failure on the part of any Secured
Party to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right . The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
SECTION 7.8. CAPTIONS. Section captions used in this Pledge Agreement are
for convenience of reference only, and shall not affect the construction of this
Pledge Agreement.
SECTION 7.9. SEVERABILITY. Wherever possible each provision of this
Pledge Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Pledge Agreement shall
be prohibited by or invalid under such law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Pledge
Agreement.
SECTION 7.10. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS PLEDGE AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). THIS PLEDGE AGREEMENT
AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE
PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY PRIOR
AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.
SECTION 7.12. FORUM SELECTION AND CONSENT TO JURISDICTION. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS PLEDGE
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE SECURED PARTIES
OR ANY PLEDGOR SHALL BE BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF
NEW YORK, NEW YORK COUNTY OR IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY PROPERTY MAY BE BROUGHT, AT THE ADMINISTRATIVE AGENT'S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH PROPERTY MAY BE FOUND.
EACH PLEDGOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK, NEW YORK COUNTY AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT
RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION.
19
EACH PLEDGOR IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
NEW YORK. EACH PLEDGOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH
COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY PLEDGOR HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO
JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF
OR ITS PROPERTY, SUCH PLEDGOR HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN
RESPECT OF ITS OBLIGATIONS UNDER THIS PLEDGE AGREEMENT AND THE OTHER LOAN
DOCUMENTS.
SECTION 7.13. WAIVER OF JURY TRIAL. EACH PLEDGOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS PLEDGE AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS
OF THE SECURED PARTIES OR SUCH PLEDGOR. EACH PLEDGOR ACKNOWLEDGES AND AGREES
THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE SECURED PARTIES ENTERING
INTO THE CREDIT AGREEMENT.
SECTION 7.14. COUNTERPARTS. This Pledge Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.
20
IN WITNESS WHEREOF, the Pledgor has caused this Pledge Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
Assist Cornerstone Technologies, Inc.
Atlantic Aerospace Electronics Corporation
Cayenta Operating Company
Cayenta, Inc.
DBA Systems, Inc.
Delfin Systems
Diversified Control Systems, Inc.
Eldyne, Inc.
Horizons Technology, Inc.
▇.▇. Systems, Inc.
Linkabit Wireless, Inc.
Mergeco, Inc.
Pulse Sciences, Inc.
System Resources Corporation
Titan Food Pasteurization Corp.
Titan Medical Sterilization Corp.
Titan Scan Corp.
Titan Systems Corporation
Titan Unidyne Corporation
Titan Wireless, Inc.
Tomotherapeutics, Inc.
Validity Corporation
VisiCom Laboratories, Inc.
Microlithics Corporation
Microlithics Corporation
All By:
-----------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
S-1
CREDIT SUISSE FIRST BOSTON, as Administrative Agent
By:
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
By:
------------------------
Name:
Title:
S-2
ANNEX I to
the Subsidiary Pledge Agreement
SUPPLEMENT, dated as of ________________, ____ (this "SUPPLEMENT"), to the
Subsidiary Pledge Agreement, dated as of ___________ __, 20__ (together with all
amendments, supplements, restatements and other modifications, if any, from time
to time thereafter made thereto, the "PLEDGE AGREEMENT"), among the initial
signatories thereto and each other Person (such capitalized term, and other
terms used in this Supplement, to have the meanings set forth in Article I of
the Pledge Agreement) which from time to time thereafter became a party thereto
pursuant to Section 7.6 thereof (each, individually, a "PLEDGOR", and,
collectively, the "PLEDGORS"), in favor of the Secured Parties (as defined in
the Pledge Agreement).
W I T N E S S E T H:
WHEREAS, pursuant to the provisions of Section 7.6 of the Pledge Agreement,
the undersigned is becoming a Pledgor under the Pledge Agreement; and
WHEREAS, the undersigned Pledgor desires to become a "Pledgor" under the
Pledge Agreement in order to induce the Secured Parties to continue to extend
Credit Extensions under the Credit Agreement;
NOW, THEREFORE, in consideration of the premises, and for other
consideration (the receipt and sufficiency of which is hereby acknowledged), the
undersigned agrees, for the benefit of each Secured Party, as follows.
SECTION 1. In accordance with the terms of the Pledge Agreement, by its
signature below the undersigned hereby irrevocably agrees to become a Pledgor
under the Pledge Agreement with the same force and effect as if it were an
original signatory thereto and the undersigned Pledgor, hereby (a) agrees to be
bound by and comply with all of the terms and provisions of the Pledge Agreement
applicable to it as a Pledgor and (b) represents and warrants that the
representations and warranties made by it as a Pledgor thereunder are true and
correct as of the date hereof. In furtherance of the foregoing, each reference
to a "Pledgor" in the Pledge Agreement shall be deemed to include the
undersigned Pledgor.
SECTION 2. The undersigned Pledgor hereby represents and warrants that
this Supplement has been duly authorized, executed and delivered by it and that
this Supplement and the Pledge Agreement constitute the legal, valid and binding
obligation of the undersigned Pledgor, enforceable against it in accordance with
its terms.
SECTION 3. Except as expressly supplemented hereby, the Pledge Agreement
shall remain in full force and effect in accordance with its terms.
SECTION 4. In the event any one or more of the provisions contained in
this Supplement should be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein and in the Pledge Agreement shall not in any way be affected or impaired.
SECTION 5. THIS SUPPLEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 6. This Supplement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF ADDITIONAL SUBSIDIARY PLEDGOR]
By:
----------------------------------
Name:
Title:
ACCEPTED BY:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By:
------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
EXHIBIT A
to SUBSIDIARY
Pledge Agreement
INSTRUCTION TO REGISTER PLEDGE
___________ __, ____
[ ]
Attention: ________________
Ladies and Gentlemen:
The undersigned, a [member] [partner] [shareholder] of ___________, a
[___________ limited liability company] [a ________ partnership] [a __________
corporation] (the "COMPANY"), hereby instructs the Company to register on the
books of the Company the pledge of the undersigned's [membership] [partnership]
interest in favor of Credit Suisse First Boston, as administrative agent (the
"ADMINISTRATIVE AGENT"), pursuant to the Subsidiary Pledge Agreement, dated as
of February 23, 2000, made by, among others, the undersigned in favor of the
Administrative Agent.
Very truly yours,
[NAME OF PLEDGOR]
By:______________________
Name:
Title:
cc: Credit Suisse First Boston
EXHIBIT B
to SUBSIDIARY
Pledge Agreement
INITIAL TRANSACTION STATEMENT
___________ __, ____
To: Credit Suisse First Boston
Attention:
This statement is to advise you that a pledge of the following
uncertificated securities has been registered in the name of Credit Suisse First
Boston, as Administrative Agent (the "ADMINISTRATIVE AGENT"), as follows:
1. Uncertificated Securities:
The entire [limited liability company] [partnership] interests of
[NAME OF PLEDGOR] in the undersigned [limited liability company]
[________ partnership] [corporation].
2. Registered Owner:
[NAME OF PLEDGOR]
3. Pledged in favor of:
Credit Suisse First Boston,
as the Administrative Agent
4. There are no liens or restrictions of the undersigned [limited
liability company] [________ partnership] [corporation] and no adverse
claims to which the uncertificated securities are or may be subject
known to the undersigned [limited liability company] [________
partnership] [corporation], other than in favor of Credit Suisse First
Boston, in its capacity as the Administrative Agent.
5. The pledge was registered on _______ __, ____.
6. No transfer of the uncertificated securities shall be made without the
prior written consent of the Administrative Agent.
THIS STATEMENT IS MERELY A RECORD OF THE RIGHTS OF THE ADDRESSEE AS OF THE
TIME OF ITS ISSUANCE. DELIVERY OF THIS STATEMENT, OF ITSELF, CONFERS NO RIGHTS
ON THE RECIPIENT. THIS STATEMENT IS NEITHER A NEGOTIABLE INSTRUMENT NOR A
SECURITY.
Very truly yours,
[NAME OF PLEDGED INTEREST ISSUER]
By:___________________________________
Name:
Title:
ATTACHMENT 1
to SUBSIDIARY
Pledge Agreement
EXHIBIT G-1
BORROWER SECURITY AGREEMENT
This SECURITY AGREEMENT (as amended, restated, supplemented or
otherwise modified from time to time, this "SECURITY AGREEMENT"), dated as of
February 23, 2000, is made by THE TITAN CORPORATION, a Delaware corporation (the
"GRANTOR") in favor of CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as
administrative agent (the "ADMINISTRATIVE AGENT") for each of the Secured
Parties.
W I T N E S S E T H :
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among the Grantor, the various financial
institutions as are or may become parties thereto (the "LENDERS"), the
Administrative Agent, First Union Securities, Inc., as Syndication Agent, and
The Bank of Nova Scotia, as Documentation Agent, the Lenders and the Issuers
have extended Commitments to make Credit Extensions to the Grantor;
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
the Grantor is required to execute and deliver this Security Agreement; and
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Security Agreement;
NOW THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, and in order to induce the Lenders
and the Issuers to make Credit Extensions (including the initial Credit
Extension) to the Grantor pursuant to the Credit Agreement, the Grantor agrees,
for the benefit of each Secured Party, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. CERTAIN TERMS. The following terms (whether or not
underscored) when used in this Security Agreement, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE.
"CHATTEL PAPER" has the meaning provided in the U.C.C.
"COLLATERAL" is defined in SECTION 2.1.
"COLLATERAL ACCOUNT" is defined in CLAUSE (b) of SECTION 4.1.2(b).
"COMPUTER HARDWARE AND SOFTWARE COLLATERAL" means:
(a) all computer and other electronic data processing hardware,
integrated computer systems, central processing units, memory units,
display terminals, printers, features, computer elements, card readers,
tape drives, hard and soft disk drives, cables, electrical supply hardware,
generators, power equalizers, accessories and all peripheral devices and
other related computer hardware;
(b) all software programs (including both source code, object code and
all related applications and data files), whether now owned, licensed or
leased or hereafter acquired by the Grantor, designed for use on the
computers and electronic data processing hardware described in CLAUSE (a)
above;
(c) all firmware associated therewith;
(d) all documentation (including flow charts, logic diagrams, manuals,
guides and specifications) with respect to such hardware, software and
firmware described in the preceding CLAUSES (a) through (c); and
(e) all rights with respect to all of the foregoing, including any and
all copyrights, licenses, options, warranties, service contracts, program
services, test rights, maintenance rights, support rights, improvement
rights, renewal rights and indemnifications and any substitutions,
replacements, additions or model conversions of any of the foregoing.
"CONTRACTS" means all agreements between the Grantor and one or more
additional parties.
"CONTRACT RIGHTS" means all rights of the Grantor (including, without
limitation, all rights to payment) under each Contract.
"COPYRIGHT COLLATERAL" means all copyrights (including all copyrights
for semi-conductor chip product mask works) of the Grantor, whether statutory or
common law, registered or unregistered, now or hereafter in force throughout the
world including all of the Grantor's right, title and interest in and to all
copyrights registered in the United States Copyright Office or anywhere else in
the world and also including the copyrights referred to in ITEM A of SCHEDULE
2
IV attached hereto, and all applications for registration thereof, whether
pending or in preparation, all copyright licenses, including each copyright
license referred to in ITEM B of SCHEDULE IV attached hereto, the right to
▇▇▇ for past, present and future infringements of any thereof, all rights
corresponding thereto throughout the world, all extensions and renewals of
any thereof and all proceeds of the foregoing, including licenses, royalties,
income, payments, claims, damages and proceeds of suit.
"CREDIT AGREEMENT" is defined in the FIRST RECITAL.
"DEPOSIT ACCOUNTS" has the meaning provided in the U.C.C. and, in any
event, includes, without limitation, any demand, time, savings, passbook or like
account maintained with a depositary institution, including those Deposit
Accounts set forth in ITEM G of SCHEDULE I hereto.
"DOCUMENTS" has the meaning provided in the U.C.C.
"EQUIPMENT" has the meaning provided in the U.C.C. and, in any event,
includes, without limitation, all equipment in all of its forms of the Grantor,
wherever located, including all parts thereof and all accessions, additions,
attachments, improvements, substitutions and replacements thereto and therefor
and all accessories related thereto.
"GENERAL INTANGIBLES" has the meaning provided in the U.C.C. and, in
any event, includes, without limitation, with respect to the Grantor, all
contracts, agreements, instruments and indentures in any form, and portions
thereof, to which the Grantor is a party or under which the Grantor has any
right, title or interest or to which the Grantor or any property of the Grantor
is subject, as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (i) all rights of the Grantor
to receive moneys due and to become due to it thereunder or in connection
therewith, (ii) all rights of the Grantor to damages arising thereunder and
(iii) all rights of the Grantor to perform and to exercise all remedies
thereunder.
"GOODS" has the meaning provided in the U.C.C.
"GRANTOR" is defined in the PREAMBLE.
"INSTRUMENT" has the meaning provided in the U.C.C.
"INTELLECTUAL PROPERTY COLLATERAL" means, collectively, the Computer
Hardware and Software Collateral, the Copyright Collateral, the Patent
Collateral, the Trademark Collateral and the Trade Secrets Collateral.
"INTEREST RATE HEDGING AGREEMENTS" means interest rate swap
agreements, interest rate cap agreements and interest rate collar agreements,
and all other agreements or arrangements designed to protect the Grantor against
fluctuations in interest rates, entered into between the
3
Grantor and a Lender or an Affiliate of a Lender, for the purpose of hedging
interest rate risk with respect to the Obligations.
"INTEREST RATE HEDGING OBLIGATIONS" means all liabilities of the
Grantor under Interest Rate Hedging Agreements.
"INVENTORY" has the meaning provided in the U.C.C. and, in any event,
includes, without limitation, all inventory in all of its forms of the Grantor,
wherever located, including
(i) all raw materials and work in process therefor, finished
goods thereof, and materials used or consumed in the manufacture or
production thereof,
(ii) all goods in which the Grantor has an interest in mass or a
joint or other interest or right of any kind (including goods in which
the Grantor has an interest or right as consignee), and
(iii) all goods which are returned to or repossessed by the
Grantor, and all accessions thereto, products thereof and documents
therefor.
"INVESTMENT PROPERTY"has the meaning provided in the U.C.C.
"LENDER" and "LENDERS" are defined in the FIRST RECITAL.
"PATENT COLLATERAL" means:
(a) all letters patent and applications for letters patent throughout
the world, including all patent applications in preparation for filing
anywhere in the world and including each patent and patent application
referred to in ITEM A of SCHEDULE II attached hereto;
(b) all reissues, divisions, continuations, continuations-in-part,
extensions, renewals and reexaminations of any of the items described in
CLAUSE (A);
(c) all patent licenses, including each patent license referred to in
ITEM B of SCHEDULE II attached hereto; and
(d) all proceeds of, and rights associated with, the foregoing
(including license royalties and proceeds of infringement suits), the right
to ▇▇▇ third parties for past, present or future infringements of any
patent or patent application, including any patent or patent application
referred to in ITEM A of SCHEDULE II attached hereto, and for breach or
enforcement of any patent license, including any patent license referred to
in ITEM B of SCHEDULE II attached hereto, and all rights corresponding
thereto throughout the world.
4
"RECEIVABLES" means "accounts" (as such term is defined in the
U.C.C.), including but not limited to rights to payments for goods sold or
leased or services rendered, whether now existing or hereafter arising,
including, without limitation, rights evidenced by an account, note, contract,
security agreement, chattel paper, or other evidence of indebtedness or
security, together with (a) all security pledged, assigned, hypothecated or
granted to or held by the Grantor to secure the foregoing, (b) all of the
Grantor's right, title and interest in and to any goods, the sale of which gave
rise thereto, (c) all guarantees, endorsements and indemnifications on, or of,
any of the foregoing, (d) all powers of attorney for the execution of any
evidence of indebtedness or security or other writing in connection therewith,
(e) all books, records, ledger cards, and invoices relating thereto, (f) all
evidences of the filing of financing statements and other statements and the
registration of other instruments in connection therewith and amendments
thereto, notices to other creditors or secured parties, and certificates from
filing or other registration officers, (g) all credit information, reports and
memoranda relating thereto and (h) all other writings related in any way to the
foregoing.
"SECURED OBLIGATIONS" is defined in SECTION 2.2.
"SECURITIES ACCOUNT" has the meaning provided in the U.C.C., including
without limitation those Securities Accounts listed in ITEM H of SCHEDULE I
hereto.
"SECURITY AGREEMENT" is defined in the PREAMBLE.
"TERMINATION DATE" means the date on which all Obligations have
indefeasibly been paid in full in cash, all Commitments have been fully
terminated and all Letters of Credit have been canceled or otherwise terminated.
"TRADEMARK COLLATERAL" means:
(a) all trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade styles, service marks,
certification marks, collective marks, logos, other source of business
identifiers, prints and labels on which any of the foregoing have appeared
or appear, designs and general intangibles of a like nature (all of the
foregoing items in this CLAUSE (a) being collectively called a
"TRADEMARK"), now existing anywhere in the world or hereafter adopted or
acquired, whether currently in use or not, all registrations and recordings
thereof and all applications in connection therewith, whether pending or in
preparation for filing, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any
office or agency of the United States of America or any State thereof or
any foreign country, including those referred to in ITEM A of SCHEDULE III
attached hereto;
(b) all Trademark licenses, including each Trademark license referred
to in ITEM B of SCHEDULE III attached hereto;
5
(c) all reissues, extensions or renewals of any of the items
described in CLAUSES (A) and (B);
(d) all of the goodwill of the business connected with the use of,
and symbolized by the items described in, CLAUSES (a) and (b); and
(e) all proceeds of, and rights associated with, the foregoing,
including any claim by the Grantor against third parties for past, present
or future infringement or dilution of any Trademark, Trademark registration
or Trademark license, including any Trademark, Trademark registration or
Trademark license referred to in ITEM A and ITEM B of SCHEDULE III attached
hereto, or for any injury to the goodwill associated with the use of any
such Trademark or for breach or enforcement of any Trademark license.
"TRADE SECRETS COLLATERAL" means all common law and statutory trade
secrets and all other confidential or proprietary or useful information and all
know-how obtained by or used in or contemplated at any time for use in the
business of the Grantor (all of the foregoing being collectively called a "TRADE
SECRET"), whether or not such Trade Secret has been reduced to a writing or
other tangible form, including all documents and things embodying, incorporating
or referring in any way to such Trade Secret, all Trade Secret licenses,
including each Trade Secret license referred to in SCHEDULE V attached hereto,
and including the right to ▇▇▇ for and to enjoin and to collect damages for the
actual or threatened misappropriation of any Trade Secret and for the breach or
enforcement of any such Trade Secret license.
"U.C.C." means the Uniform Commercial Code, as in effect from time to
time in the State of New York.
SECTION 1.2. CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Security Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
SECTION 1.3. U.C.C. DEFINITIONS. Unless otherwise defined herein or
in the Credit Agreement or the context otherwise requires, terms for which
meanings are provided in the U.C.C. are used in this Security Agreement,
including its preamble and recitals, with such meanings.
ARTICLE II
SECURITY INTEREST
SECTION 2.1. GRANT OF SECURITY. The Grantor hereby assigns and
pledges to the Administrative Agent for its benefit and the ratable benefit of
each of the Secured Parties, and hereby grants to the Administrative Agent for
the ratable benefit of each of the Secured Parties, to secure the Secured
Obligations, a security interest in all of the following, whether now or
6
hereafter existing or acquired by the Grantor (the "COLLATERAL"):
(a) the Collateral Account;
(b) all Computer Hardware and Software Collateral;
(c) all Contracts, together with any Contract Rights arising
thereunder;
(d) all Deposit Accounts;
(e) all Equipment;
(f) all Intellectual Property Collateral;
(g) all Inventory;
(h) all Investment Property;
(i) all Receivables;
(j) all Securities Accounts;
(k) all other Goods, Chattel Paper, Documents, Instruments, and
General Intangibles (including tax refunds) of the Grantor now or
hereafter existing,
(l) all books, records, writings, data bases, information and other
property relating to, used or useful in connection with, evidencing,
embodying, incorporating or referring to, any of the foregoing in this
SECTION 2.1;
(m) all of the Grantor's other property and rights of every kind and
description and interests therein; and
(n) all products, offspring, rents, issues, profits, returns, income
and proceeds of and from any and all of the foregoing Collateral (including
proceeds which constitute property of the types described in CLAUSES (a)
through (m) and, to the extent not otherwise included, all payments under
insurance which the Grantor is entitled to receive (whether or not the
Administrative Agent is the loss payee thereof), or any indemnity, warranty
or guaranty, payable by reason of loss or damage to or otherwise with
respect to any of the foregoing Collateral.
Notwithstanding anything herein to the contrary, in no event shall the
Collateral include, and the Grantor shall not be deemed to have granted a
security interest in, any of the Grantor's rights or interests in any license,
contract or agreement to which the Grantor is a party or any of its rights
7
or interests thereunder to the extent, but only to the extent, that such a
grant would, under the express terms of such license, contract or agreement
or otherwise, result in a breach of the terms of, or constitute a default
under such license, contract or agreement (other than to the extent that any
such term would be rendered ineffective pursuant to Section 9-318(4) of the
Uniform Commercial Code of any relevant jurisdiction or any other applicable
law (including the Bankruptcy Code) or principles of equity); PROVIDED, that
immediately upon the ineffectiveness, waiver, lapse or termination of any
such provision, the Collateral shall include, and the Grantor shall have
granted a security interest in, all such rights and interests as if such
provision had never been in effect.
SECTION 2.2. SECURITY FOR OBLIGATIONS. This Security Agreement
secures the payment of all Obligations of the Grantor now or hereafter existing
under the Credit Agreement, each other Loan Document and each Interest Rate
Hedging Agreement, whether for principal, interest, costs, fees, expenses,
Interest Rate Hedging Obligations or otherwise, with all such obligations being
collectively referred to as the "SECURED OBLIGATIONS".
SECTION 2.3. CONTINUING SECURITY INTEREST; TRANSFER OF NOTES. This
Security Agreement shall create a continuing security interest in the Collateral
and shall
(a) remain in full force and effect until the Termination Date;
(b) be binding upon the Grantor and its successors, transferees and
assigns; and
(c) inure, together with the rights and remedies of the Administrative
Agent hereunder, to the benefit of the Administrative Agent and each other
Secured Party.
Without limiting the generality of the foregoing CLAUSE (c), any Lender may
assign or otherwise transfer (in whole or in part) any Note or Credit Extension
held by it to any other Person or entity, and such other Person or entity shall
thereupon become vested with all the rights and benefits in respect thereof
granted to such Lender under any Loan Document (including this Security
Agreement) or otherwise, subject, however, to any contrary provisions in such
assignment or transfer, and to the provisions of Section 11.11 and Article X of
the Credit Agreement. Upon (i) the sale, transfer or other disposition of
Collateral in accordance with the Credit Agreement or (ii) the occurrence of the
Termination Date, the security interests granted herein shall automatically
terminate with respect to (x) such Collateral (in the case of clause (i)) or (y)
all Collateral (in the case of clause (ii)), and at such time the Administrative
Agent will, at the Grantor's sole expense, execute and deliver to the Grantor
(without any representations, warranties or recourse to the Administrative
Agent), such documents as the Grantor shall reasonably request to evidence such
termination.
SECTION 2.4. GRANTOR REMAINS LIABLE. Anything herein to the contrary
notwithstanding
8
(a) the Grantor shall remain liable under the contracts and agreements
included in the Collateral to the extent set forth therein, and shall
perform all of its duties and obligations under such contracts and
agreements to the same extent as if this Security Agreement had not been
executed;
(b) the exercise by the Administrative Agent of any of its rights
hereunder shall not release the Grantor from any of its duties or
obligations under any such contracts or agreements included in the
Collateral; and
(c) neither the Administrative Agent nor any other Secured Party shall
have any obligation or liability under any such contracts or agreements
included in the Collateral by reason of this Security Agreement, nor shall
the Administrative Agent or any other Secured Party be obligated to perform
any of the obligations or duties of the Grantor thereunder or to take any
action to collect or enforce any claim for payment assigned hereunder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. REPRESENTATIONS AND WARRANTIES. The Grantor represents and
warrants to each Secured Party as set forth in this Section.
SECTION 3.1.1. LOCATION OF COLLATERAL, ETC. All of the Equipment and
Inventory of the Grantor is located at the places specified in ITEM A and ITEM
B, respectively, of SCHEDULE I hereto. None of the Equipment and Inventory has,
within the four months preceding the date of this Security Agreement, been
located at any place other than the places specified in ITEM A and ITEM B,
respectively, of SCHEDULE I hereto except as set forth in a footnote thereto.
The place(s) of business and chief executive office of the Grantor and the
office(s) where the Grantor keeps its records concerning the Receivables, and
all originals of all Chattel Paper which evidence Receivables, are located at
the address set forth in ITEM C of SCHEDULE I hereto. The Grantor has no trade
names other than those set forth in ITEM D of SCHEDULE I hereto. During the
four months preceding the date hereof, the Grantor has not been known by any
legal name different from the one set forth on the signature page hereto, nor
has the Grantor been the subject of any merger or other corporate
reorganization, except as set forth in ITEM E of SCHEDULE I hereto. If the
Collateral includes any Inventory located in the State of California, the
Grantor is not a "retail merchant" within the meaning of Section 9102 of the
Uniform Commercial Code - Secured Transactions of the State of California. All
Receivables evidenced by a promissory note or other Instrument, negotiable
Document or Chattel Paper have been duly endorsed and accompanied by duly
executed instruments of transfer or assignment, all in form and substance
satisfactory to the Administrative Agent and delivered and pledged to the
Administrative Agent pursuant to SECTION 4.1.7.
9
SECTION 3.1.2. OWNERSHIP, NO LIENS, ETC. The Grantor owns its Collateral
free and clear of any Lien, security interest, charge or encumbrance except for
the security interest created by this Security Agreement and except as permitted
by the Credit Agreement. No effective financing statement or other instrument
similar in effect covering all or any part of the Collateral is on file in any
recording office, except such as may have been filed in favor of the
Administrative Agent relating to this Security Agreement or as have been filed
in connection with Liens permitted pursuant to Section 8.3 of the Credit
Agreement.
SECTION 3.1.3. POSSESSION AND CONTROL. The Grantor has exclusive
possession and control of its Equipment and Inventory.
SECTION 3.1.4. NEGOTIABLE DOCUMENTS, INSTRUMENTS AND CHATTEL PAPER. The
Grantor has, contemporaneously herewith, delivered to the Administrative Agent
possession of all originals of all negotiable Documents, Instruments and Chattel
Paper currently owned or held by the Grantor (duly endorsed in blank, if
requested by the Administrative Agent).
SECTION 3.1.5. INTELLECTUAL PROPERTY COLLATERAL. With respect to any
Intellectual Property Collateral the loss, impairment or infringement of which
might have a Material Adverse Effect:
(a) such Intellectual Property Collateral is subsisting and has not
been adjudged invalid or unenforceable, in whole or in part;
(b) such Intellectual Property Collateral is valid and enforceable;
(c) the Grantor has made all necessary filings and recordations to
protect its interest in such Intellectual Property Collateral, including
recordations of all of its interests in the Patent Collateral and Trademark
Collateral in the United States Patent and Trademark Office and in
corresponding offices throughout the world and its claims to the Copyright
Collateral in the United States Copyright Office and in corresponding
offices throughout the world;
(d) other than as previously disclosed to the Administrative Agent,
the Grantor is the exclusive owner of the entire and unencumbered right,
title and interest in and to such Intellectual Property Collateral and no
claim has been made that the use of such Intellectual Property Collateral
does or may violate the asserted rights of any third party; and
(e) the Grantor has performed and will continue to perform all acts
and has paid and will continue to pay all required fees and taxes to
maintain each and every item of Intellectual Property Collateral in full
force and effect throughout the world, as applicable, unless the Grantor
(i) has reasonably and in good faith determined that any of the
Intellectual Property Collateral is of negligible economic value to the
Grantor, or (ii)
10
has a valid business purpose to do otherwise.
The Grantor owns directly or is entitled to use by license or otherwise, all
patents, Trademarks, Trade Secrets, copyrights, mask works, licenses,
technology, know-how, processes and rights with respect to any of the foregoing
used in, necessary for or of importance to the conduct of the Grantor's
business.
SECTION 3.1.6. VALIDITY, PRIORITY, ETC. Assuming the proper filing of one
or more financing statements identifying the Collateral with the proper local,
state and/or federal authorities, the security interests in the Collateral
granted to the Administrative Agent hereunder constitute valid and continuing
first priority perfected security interests in the Collateral, securing payment
of the Secured Obligations, to the extent such security interests may be
perfected by the filing of financing statements (except to the extent that any
Lien permitted under the Credit Agreement is prior to the liens granted to the
Administrative Agent hereunder).
SECTION 3.1.7. AUTHORIZATION, APPROVAL, ETC. Except as have been obtained
or made and are in full force and effect, no authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required either
(a) for the grant by the Grantor of the security interest granted
hereby or for the execution, delivery and performance of this Security
Agreement by the Grantor; or
(b) for the perfection of or the exercise by the Administrative Agent
of its rights and remedies hereunder.
SECTION 3.1.8. COMPLIANCE WITH LAWS. The Grantor is in compliance with
the requirements of all applicable laws (including the provisions of the Fair
Labor Standards Act), rules, regulations and orders of every governmental
authority, the non-compliance with which might have a Material Adverse Effect or
which might materially adversely affect the value of the Collateral or the worth
of the Collateral as collateral security.
ARTICLE IV
COVENANTS
SECTION 4.1. CERTAIN COVENANTS. The Grantor covenants and agrees that
until the Termination Date has occurred, the Grantor will perform, comply with
and be bound by the obligations set forth in this Article.
SECTION 4.1.1. AS TO EQUIPMENT AND INVENTORY. The Grantor hereby agrees
that it shall
(a) keep all the Equipment and Inventory (other than Inventory sold in
the
11
ordinary course of business, or except as otherwise provided in the
Credit Agreement or any of the other Loan Documents) at the places therefor
specified in SECTION 3.1.1 or, upon 30 days' prior written notice to the
Administrative Agent, at such other places in a jurisdiction where all
representations and warranties set forth in ARTICLE III shall be true and
correct, and all action required pursuant to the FIRST SENTENCE of SECTION
4.1.7 shall have been taken with respect to the Equipment and Inventory
(collectively, "SPECIFIED LOCATIONS"); PROVIDED, HOWEVER, that the Grantor
may move and/or maintain certain items of Equipment at locations other than
at Specified Locations so long as the value of Collateral of this type of
the Grantor and similar Collateral (as defined in the Subsidiary Security
Agreement) of the Guarantors, shall not exceed $2,000,000 at any time;
(b) cause the Equipment to be maintained and preserved in the same
condition, repair and working order as when new, ordinary wear and tear
excepted, and in accordance with any manufacturer's manual or good business
practice; and forthwith, or in the case of any loss or damage to any of the
Equipment, as quickly as practicable after the occurrence thereof, make or
cause to be made all repairs, replacements, and other improvements in
connection therewith which are necessary or desirable to such end; and
promptly furnish to the Administrative Agent a statement respecting any
material loss or damage to any of the Equipment; and
(c) pay promptly when due all property and other taxes, assessments
and governmental charges or levies imposed upon, and all claims (including
claims for labor, materials and supplies) against, the Equipment and
Inventory, except to the extent the validity thereof is being contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP have been set aside.
SECTION 4.1.2. AS TO RECEIVABLES AND CONTRACTS.
(a) The Grantor shall keep its place(s) of business and chief
executive office and the office(s) where it keeps its records concerning
the Receivables, and all originals of all Chattel Paper which evidences
Receivables, located at the address(es) set forth in ITEM C of SCHEDULE I
hereto, or, upon 30 days' prior written notice to the Administrative Agent,
at such other locations in a jurisdiction where all actions required by the
first sentence of SECTION 4.1.7 shall have been taken with respect to the
Receivables; not change its name except upon 30 days' prior written notice
to the Administrative Agent; hold and preserve such records and Chattel
Paper; and permit representatives of the Administrative Agent at any time
during normal business hours to inspect (upon reasonable prior written
notice so long as no Event of Default shall have occurred or be continuing)
and make abstracts from such records and Chattel Paper. In addition, the
Grantor shall give the Administrative Agent a supplement to SCHEDULE I
hereto on each date a Compliance Certificate is required to be delivered to
the Administrative Agent under the Credit Agreement, which shall set forth
any changes to the information set forth in SECTION 3.1.1.
12
(b) Upon written notice by the Administrative Agent to the Grantor
pursuant to this clause, all proceeds of Collateral received by the Grantor
shall be delivered in kind to the Administrative Agent for deposit to a
deposit account (the "COLLATERAL ACCOUNT") of the Grantor maintained with
the Administrative Agent, and the Grantor shall not commingle any such
proceeds, and shall hold separate and apart from all other property, all
such proceeds in express trust for the benefit of the Administrative Agent
until delivery thereof is made to the Administrative Agent. The
Administrative Agent will not give the notice referred to in the preceding
sentence unless there shall have occurred and be continuing a Default of
the nature set forth in Section 9.1(i) of the Credit Agreement or an Event
of Default.
(c) The Administrative Agent shall have the right to apply any amount
in the Collateral Account to the payment of any Secured Obligations which
are due and payable or payable upon demand, or to the payment of any
Secured Obligations at any time that an Event of Default shall exist.
(d) The Grantor will not enter into any government contract which
prohibits assignment to the Administrative Agent of all payments due or to
become due under each of such contractions, other than contracts for which
the government has determined that a prohibition on assignment of claims is
in the government's interest.
(e)The Grantor shall not cause the aggregate value of Receivables or
Contracts or Contract Rights and the value of similar Receivables and
Contracts (as defined in the Subsidiary Security Agreement) as to which a
Lien in favor of the Administrative Agent cannot be granted hereunder
pursuant to the final paragraph of SECTION 2.1, or pursuant to the
Subsidiary Security Agreement, to exceed $5,000,000 at any time.
SECTION 4.1.3. AS TO COLLATERAL.
(a) Until the occurrence and continuance of a Default of the nature
set forth in Section 9.1(i) of the Credit Agreement or an Event of Default,
and such time as the Administrative Agent shall notify the Grantor of the
revocation of such power and authority the Grantor (i) may in the ordinary
course of its business (except as otherwise permitted under the Credit
Agreement), at its own expense, sell, lease or furnish under the contracts
of service any of the Inventory normally held by the Grantor for such
purpose, and use and consume, in the ordinary course of its business
(except as otherwise permitted under the Credit Agreement), any raw
materials, work in process or materials normally held by the Grantor for
such purpose,(ii) will, at its own expense, endeavor to collect, as and
when due, all amounts due with respect to any of the Collateral, including
the taking of such action with respect to such collection as the
Administrative Agent may reasonably request following the occurrence of a
Default of the nature set forth in Section 9.1(i) of the Credit Agreement
or an Event of Default or, in the absence of such request, as the Grantor
may deem advisable, and (iii) may grant, in the ordinary course of business
13
(except as otherwise permitted under the Credit Agreement), to any party
obligated on any of the Collateral, any rebate, refund or allowance to
which such party may be lawfully entitled, and may accept, in connection
therewith, the return of goods, the sale or lease of which shall have given
rise to such Collateral. The Administrative Agent, however, may, at any
time following a Default of the nature set forth in Section 9.1(i) of the
Credit Agreement or an Event of Default, whether before or after any
revocation of such power and authority or the maturity of any of the
Secured Obligations, notify any parties obligated on any of the Collateral
to make payment to the Administrative Agent of any amounts due or to become
due thereunder and enforce collection of any of the Collateral by suit or
otherwise and surrender, release, or exchange all or any part thereof, or
compromise or extend or renew for any period (whether or not longer than
the original period) any indebtedness thereunder or evidenced thereby.
Upon request of the Administrative Agent following a Default of the nature
set forth in Section 9.1(i) of the Credit Agreement or an Event of Default,
the Grantor will, at its own expense, notify any parties obligated on any
of the Collateral to make payment to the Administrative Agent of any
amounts due or to become due thereunder.
(b) The Administrative Agent is authorized to endorse, in the name of
the Grantor, any item, howsoever received by the Administrative Agent,
representing any payment on or other proceeds of any of the Collateral.
SECTION 4.1.4. AS TO INTELLECTUAL PROPERTY COLLATERAL. The Grantor
covenants and agrees to comply with the following provisions as such provisions
relate to any Intellectual Property Collateral of the Grantor:
(a)The Grantor shall not do any act, or omit to do any act, whereby
any of the Patent Collateral may lapse or become abandoned or dedicated to
the public or unenforceable, unless the Grantor shall either (i) reasonably
and in good faith determine that any of the Patent Collateral is of
negligible economic value to the Grantor, or (ii) have a valid business
purpose to do otherwise.
(b)The Grantor shall not, and the Grantor shall not permit any of its
licensees to:
(i) fail to continue to use any of the Trademark Collateral in
order to maintain all of the Trademark Collateral in full force free
from any claim of abandonment for non-use,
(ii) fail to maintain as in the past the quality of products and
services offered under all of the Trademark Collateral,
(iii) fail to employ all of the Trademark Collateral registered
with any Federal or state or foreign authority with an appropriate
notice of such registration,
14
(iv) adopt or use any other Trademark which is confusingly
similar or a colorable imitation of any of the Trademark Collateral,
(v) use any of the Trademark Collateral registered with any
Federal or state or foreign authority except for the uses for which
registration or application for registration of all of the Trademark
Collateral has been made, and
(vi) do or permit any act or knowingly omit to do any act whereby
any of the Trademark Collateral may lapse or become invalid or
unenforceable,
unless the Grantor shall either (i) reasonably and in good faith determine
that any of the Trademark Collateral is of negligible economic value to the
Grantor, or (ii) have a valid business purpose to do otherwise.
(c) The Grantor shall not do or permit any act or knowingly omit to do
any act whereby any of the Copyright Collateral or any of the Trade Secrets
Collateral may lapse or become invalid or unenforceable or placed in the
public domain except upon expiration of the end of an unrenewable term of a
registration thereof, unless the Grantor shall either (i) reasonably and
in good faith determine that any of the Copyright Collateral or any of the
Trade Secrets Collateral is of negligible economic value to the Grantor, or
(ii) have a valid business purpose to do otherwise.
(d) The Grantor shall notify the Administrative Agent immediately if
it knows, or has reason to know, that any application or registration
relating to any material item of the Intellectual Property Collateral may
become abandoned or dedicated to the public or placed in the public domain
or invalid or unenforceable, or of any adverse determination or development
(including the institution of, or any such determination or development in,
any proceeding in the United States Patent and Trademark Office, the United
States Copyright Office or any foreign counterpart thereof or any court)
regarding the Grantor's ownership of any of the Intellectual Property
Collateral, its right to register the same or to keep and maintain and
enforce the same.
(e) In no event shall the Grantor or any of its agents, employees,
designees or licensees file an application for the registration of any
Intellectual Property Collateral with the United States Patent and
Trademark Office, the United States Copyright Office or any similar office
or agency in any other country or any political subdivision thereof, unless
it promptly upon such filing informs the Administrative Agent, and upon
request of the Administrative Agent, executes and delivers any and all
agreements, instruments, documents and papers as the Administrative Agent
may reasonably request to evidence the Administrative Agent's security
interest in such Intellectual Property Collateral and the goodwill and
general intangibles of the Grantor relating thereto or represented thereby.
15
(f) The Grantor shall take all necessary steps, including in any
proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or any similar office or agency in any other
country or any political subdivision thereof, to maintain and pursue any
application (and to obtain the relevant registration) filed with respect
to, and to maintain any registration of, the Intellectual Property
Collateral, including the filing of applications for renewal, affidavits of
use, affidavits of incontestability and opposition, interference and
cancellation proceedings and the payment of fees and taxes (except to the
extent that dedication, abandonment or invalidation is permitted under the
foregoing CLAUSES (a), (b) and (c)).
(g) The Grantor shall, contemporaneously herewith, execute and deliver
to the Administrative Agent a Patent Security Agreement, a Trademark
Security Agreement and a Copyright Security Agreement in the forms of
EXHIBIT A, EXHIBIT B and EXHIBIT C hereto, respectively, and shall execute
and deliver to the Administrative Agent any other document required to
acknowledge or register or perfect the Administrative Agent's interest in
any part of the Intellectual Property Collateral.
SECTION 4.1.5. INSURANCE. The Grantor will maintain or cause to be
maintained with responsible insurance companies insurance with respect to its
business and properties (including the Equipment and Inventory) against such
casualties and contingencies and of such types and in such amounts as is
required pursuant to the Credit Agreement and will, upon the request of the
Administrative Agent, furnish a certificate of a reputable insurance broker
setting forth the nature and extent of all insurance maintained by the Grantor
in accordance with this Section. Without limiting the foregoing, the Grantor
further agrees as follows:
(a) Each policy for property insurance shall show the Administrative
Agent as loss payee.
(b) Each policy for liability insurance shall show the Administrative
Agent as an additional insured.
(c) Each insurance policy shall provide that at least 30 days' prior
written notice of cancellation or of lapse shall be given to the
Administrative Agent by the insured (or at least 10 days' prior written
notice of cancellation shall be given with respect to failure to pay the
premium).
(d) The Grantor shall, if so requested by the Administrative Agent,
deliver to the Administrative Agent a copy of each insurance policy.
16
SECTION 4.1.6. TRANSFERS AND OTHER LIENS. The Grantor shall not:
(a) sell, assign (by operation of law or otherwise) or otherwise
dispose of any of the Collateral, except as permitted by the Credit
Agreement; or
(b) create or suffer to exist any Lien or other charge or encumbrance
upon or with respect to any of the Collateral to secure Indebtedness of any
Person or entity, except for the security interest created by this Security
Agreement and except as permitted by the Credit Agreement.
SECTION 4.1.7. FURTHER ASSURANCES, ETC. The Grantor agrees that, from
time to time at its own expense, it will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
necessary or desirable (provided that it is reasonable), or that the
Administrative Agent may reasonably request, in order to perfect, preserve and
protect any security interest granted or purported to be granted hereby or to
enable the Administrative Agent to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of
the foregoing, the Grantor will
(a) ▇▇▇▇ conspicuously each Document (evidencing title) included in
the Inventory, each Chattel Paper included in the Receivables and each
Contract and, at the request of the Administrative Agent, upon the
occurrence and during the continuance of an Event of Default each of its
records pertaining to the Collateral with a legend, in form and substance
satisfactory to the Administrative Agent, indicating that such Document,
Chattel Paper, Contract or Collateral is subject to the security interest
granted hereby;
(b) if any Receivable shall be evidenced by a promissory note or other
Instrument, negotiable Document or Chattel Paper, deliver and pledge to the
Administrative Agent hereunder such promissory note, instrument, negotiable
Document or Chattel Paper duly endorsed and accompanied by duly executed
Instruments of transfer or assignment, all in form and substance
satisfactory to the Administrative Agent;
(c) execute and file such financing or continuation statements, or
amendments thereto, and such other instruments or notices as may be
necessary or desirable (provided that it is reasonable), or as the
Administrative Agent may reasonably request, in order to perfect and
preserve the security interests and other rights granted or purported to be
granted to the Administrative Agent hereby;
(d) promptly execute and file any of notice or other required form
under or pursuant to the federal assignment of claims statute, 31 U.S.C.
Section 3727, any successor or amended version thereof or any regulation
promulgated under or pursuant to any version thereof, as the Administrative
Agent may reasonably request; and
(e) furnish to the Administrative Agent, from time to time at the
Administrative
17
Agent's request, statements and schedules further identifying and
describing the Collateral and such other reports in connection with the
Collateral as the Administrative Agent may reasonably request, all in
reasonable detail.
With respect to the foregoing and the grant of the security interest hereunder,
the Grantor hereby authorizes the Administrative Agent to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Collateral without the signature of the Grantor where permitted
by law. A carbon, photographic or other reproduction of this Security Agreement
or any financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.
ARTICLE V
THE ADMINISTRATIVE AGENT
SECTION 5.1. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT. The
Grantor hereby irrevocably appoints the Administrative Agent the Grantor's
attorney-in-fact, with full authority in the place and stead of the Grantor
and in the name of the Grantor or otherwise, from time to time in the
Administrative Agent's discretion, following the occurrence and continuation
of a Default of the nature set forth in Section 9.1(i) of the Credit
Agreement or an Event of Default, to take any action and to execute any
instrument which the Administrative Agent may deem necessary or advisable to
accomplish the purposes of this Security Agreement, including:
(a) to ask, demand, collect, ▇▇▇ for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other Instruments,
Documents and Chattel Paper, in connection with CLAUSE (a) above;
(c) to file any claims or take any action or institute any proceedings
which the Administrative Agent may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of
the Administrative Agent with respect to any of the Collateral; and
(d) to perform the affirmative obligations of the Grantor hereunder
(including all obligations of the Grantor pursuant to SECTION 4.1.7).
The Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.
SECTION 5.2. ADMINISTRATIVE AGENT MAY PERFORM. If any Grantor fails to
perform any
18
agreement contained herein, the Administrative Agent may itself perform, or
cause performance of, such agreement, and the expenses of the Administrative
Agent incurred in connection therewith shall be payable by the Grantor
pursuant to SECTION 6.2.
SECTION 5.3. ADMINISTRATIVE AGENT HAS NO DUTY. In addition to, and not in
limitation of, SECTION 2.4, the powers conferred on the Administrative Agent
hereunder are solely to protect its interest (on behalf of the Secured Parties)
in the Collateral and shall not impose any duty on it to exercise any such
powers. Except for reasonable care of any Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Administrative
Agent shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral.
SECTION 5.4. REASONABLE CARE. Other than the exercise of reasonable care
in the custody and preservation of the Collateral, the Administrative Agent
shall have no duty with respect thereto. The Administrative Agent shall be
deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Administrative Agent accords its own
property. The Administrative Agent shall not be liable or responsible for any
loss or damage to any of the Collateral, or for any diminution in the value
thereof, by reason of the act or omission of any agent or bailee selected by the
Administrative Agent in good faith.
ARTICLE VI
REMEDIES
SECTION 6.1. CERTAIN REMEDIES. If any Event of Default shall have
occurred and be continuing:
(a) The Administrative Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for herein or
otherwise available to it, all the rights and remedies of a secured party
on default under the U.C.C. (whether or not the U.C.C. applies to the
affected Collateral) and also may
(i) require the Grantor to, and the Grantor hereby agrees that it
will, at its expense and upon request of the Administrative Agent
forthwith, assemble all or part of the Collateral as directed by the
Administrative Agent and make it available to the Administrative Agent
at a place to be designated by the Administrative Agent which is
reasonably convenient to both parties,
(ii) without notice except as specified below, sell the
Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Administrative Agent's offices or
elsewhere, for cash, on credit or for future
19
delivery, and upon such other terms as the Administrative Agent may
deem commercially reasonable. The Grantor agrees that, to the
extent notice of sale shall be required by law, at least ten days'
prior notice to the Grantor of the time and place of any public
sale or the time after which any private sale is to be made shall
constitute reasonable notification. The Administrative Agent shall
not be obligated to make any sale of Collateral regardless of
notice of sale having been given. The Administrative Agent may
adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale
may, without further notice, be made at the time and place to which
it was so adjourned,
(iii) withdraw all monies, securities and Instruments in the
Collateral Account for application to the Obligations, and
(iv) license or sublicense, whether on an exclusive or
nonexclusive basis, any Trademark Collateral, Patent Collateral or
Copyright Collateral included in the Intellectual Property Collateral
for such term and on such conditions and in such manner as the
Administrative Agent shall in its sole judgment determine (taking into
account such provisions as may be necessary to protect and preserve
the validity or enforceability of such Trademark Collateral, Patent
Collateral or Copyright Collateral included in the Intellectual
Property Collateral).
(b) All cash proceeds received by the Administrative Agent in respect
of any sale of, collection from, or other realization upon all or any part
of the Collateral may, in the discretion of the Administrative Agent, be
held by the Administrative Agent as collateral for, and/or then or at any
time thereafter applied (after payment of any amounts payable to the
Administrative Agent pursuant to SECTION 6.2) in whole or in part by the
Administrative Agent for the ratable benefit of the Secured Parties
against, all or any part of the Secured Obligations in such order as the
Administrative Agent shall elect. Any surplus of such cash or cash
proceeds held by the Administrative Agent and remaining after payment in
full in cash of all the Secured Obligations shall be paid over to the
applicable Grantor or to whomsoever may be lawfully entitled to receive
such surplus.
SECTION 6.2. INDEMNITY AND EXPENSES.
(a) The Grantor agrees to indemnify the Administrative Agent and the
other Secured Parties from and against any and all claims, losses and
liabilities arising out of or resulting from this Security Agreement
(including enforcement of this Security Agreement), except claims, losses
or liabilities resulting from the gross negligence or wilful misconduct of
the Administrative Agent or the other Secured Parties.
(b) The Grantor will upon demand pay to the Administrative Agent and
the other
20
Secured Parties the amount of any and all reasonable expenses, including
the reasonable fees and disbursements of its counsel and of any experts
and agents, which the Administrative Agent may incur in connection with
(i) the administration of this Security Agreement,
(ii) the custody, preservation, use or operation of, or the sale
of, collection from, or other realization upon, any of the Collateral,
and
(iii) the exercise or enforcement of any of the rights of the
Administrative Agent or the Secured Parties hereunder, or
(iv) the failure by any Grantor to perform or observe any of the
provisions hereof.
The provisions of this SECTION 6.2 shall survive the Termination Date.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. LOAN DOCUMENT. This Security Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof including Article XI thereof.
SECTION 7.2. AMENDMENTS; ETC. No amendment to or waiver of any provision
of this Security Agreement nor consent to any departure by any Grantor here
from, shall in any event be effective unless the same shall be in writing and
signed by the Administrative Agent (on behalf of the Lenders or the Required
Lenders, as the case may be), and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
SECTION 7.3. NOTICES. All notices and other communications provided for
hereunder shall be in writing (including facsimile communication) and, if to any
Grantor, mailed or telecopied or delivered to it, addressed to it at the address
specified in the Credit Agreement, if to either Administrative Agent, mailed or
telecopied or delivered to it, addressed to it at the address of such
Administrative Agent specified in the Credit Agreement. All such notices and
other communications, when mailed and properly addressed with postage prepaid or
if properly addressed and sent by pre-paid courier service, shall be deemed
given when received; any such notice or communication, if transmitted by
telecopier, shall be deemed given when transmitted and electronically confirmed.
21
SECTION 7.4. CAPTIONS. Section captions used in this Security Agreement
are for convenience of reference only, and shall not affect the construction of
this Security Agreement.
SECTION 7.5. SEVERABILITY. Wherever possible each provision of this
Security Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Security Agreement
shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Security Agreement.
SECTION 7.6. COUNTERPARTS. This Security Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed an
original and all of which shall constitute together but one and the same
agreement.
SECTION 7.7. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS SECURITY
AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS
5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK),
EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY INTEREST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. THIS
SECURITY AGREEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE
UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF
AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.
22
IN WITNESS WHEREOF, the Grantor has caused this Security Agreement to
be duly executed and delivered by its officer thereunto duly authorized as of
the date first above written.
THE TITAN CORPORATION, as Grantor
By
---------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
CREDIT SUISSE FIRST BOSTON, as
Administrative Agent
By
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
By
---------------------------------
Name:
Title:
S-1
SCHEDULE I
to Security Agreement
Item A. LOCATION OF EQUIPMENT
DESCRIPTION LOCATION
Item B. LOCATION OF INVENTORY
DESCRIPTION LOCATION
Item C. LOCATION OF LOCK BOXES
CONTACT
BANK NAME AND ADDRESS ACCOUNT NUMBER PERSON
Item D. PLACE(S) OF BUSINESS AND CHIEF EXECUTIVE OFFICE
Item E. TRADE NAMES
Item F. MERGER OR OTHER CORPORATE REORGANIZATION
Item G. LOCATION OF DEPOSIT ACCOUNTS
CONTACT
BANK NAME AND ADDRESS ACCOUNT NUMBER PERSON
Item H. LOCATION OF SECURITIES ACCOUNTS
CONTACT
BANK NAME AND ADDRESS ACCOUNT NUMBER PERSON
SCHEDULE II
to Security Agreement
Item A. PATENTS
ISSUED PATENTS
*COUNTRY PATENT NO. ISSUE DATE INVENTOR(S) TITLE
PENDING PATENT APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE INVENTOR(S) TITLE
PATENT APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE INVENTOR(S) TITLE
Item B. PATENT LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
SCHEDULE III
to Security Agreement
Item A. TRADEMARKS
REGISTERED TRADEMARKS
*COUNTRY TRADEMARK REGISTRATION NO. REGISTRATION DATE
PENDING TRADEMARK APPLICATIONS
*COUNTRY TRADEMARK SERIAL NO. FILING DATE
TRADEMARK APPLICATIONS IN PREPARATION
EXPECTED PRODUCTS/
*COUNTRY TRADEMARK DOCKET NO. FILING DATE SERVICES
Item B. TRADEMARK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION
TERRITORY TRADEMARK LICENSOR LICENSEE DATE DATE
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
SCHEDULE IV
to Security Agreement
Item A. COPYRIGHTS/MASK WORKS
REGISTERED COPYRIGHTS/MASK WORKS
*COUNTRY REGISTRATION NO. REGISTRATION DATE AUTHOR(S)
TITLE
COPYRIGHT/MASK WORK PENDING REGISTRATION APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE AUTHOR(S) TITLE
COPYRIGHT/MASK WORK REGISTRATION APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE AUTHOR(S) TITLE
Item B. COPYRIGHT/MASK WORK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
SCHEDULE V
to Security Agreement
TRADE SECRET OR KNOW-HOW LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT A
to Security Agreement
PATENT SECURITY AGREEMENT
This PATENT SECURITY AGREEMENT (this "AGREEMENT"), dated as of February 23,
2000, is made between THE TITAN CORPORATION, a Delaware corporation (the
"GRANTOR"), and CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as
Administrative Agent (the "ADMINISTRATIVE AGENT") for each of the Secured
Parties;
W I T N E S S E T H :
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among the Grantor, the various financial
institutions as are or may become parties thereto (the "LENDERS"), CSFB, as
Administrative Agent for the Lenders (the "ADMINISTRATIVE AGENT"), First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Grantor;
WHEREAS, in connection with the Credit Agreement, the Grantor has executed
and delivered a Borrower Security Agreement, dated as of February 23, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"SECURITY AGREEMENT";
WHEREAS, as a condition precedent to the making of the Credit Extensions
(including the initial Credit Extension) under the Credit Agreement, the Grantor
is required to execute and deliver this Agreement; and
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which is
hereby acknowledged, and in order to induce the Lenders and the Issuers to make
Credit Extensions (including the initial Credit Extension) to the Grantor
pursuant to the Credit Agreement, the Grantor agrees, for the benefit of each
Secured Party, as follows.
SECTION 1. DEFINITIONS. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
SECTION 2. GRANT OF SECURITY INTEREST. For good and valuable
consideration, the receipt
A-1
and sufficiency of which are hereby acknowledged, to secure all of the
Secured Obligations, the Grantor does hereby mortgage, pledge and hypothecate
to the Administrative Agent, and grant to the Administrative Agent a security
interest in, for its benefit and the benefit of each Secured Party, all of
the following property (the "PATENT COLLATERAL"), whether now owned or
hereafter acquired or existing by it:
(a) all letters patent and applications for letters patent throughout
the world, including all patent applications in preparation for filing
anywhere in the world and including each patent and patent application
referred to in ITEM A of ATTACHMENT 1 attached hereto;
(b) all reissues, divisions, continuations, continuations-in-part,
extensions, renewals and reexaminations of any of the items described in
CLAUSE (a);
(c) all patent licenses, including each patent license referred to in
ITEM B of ATTACHMENT 1 attached hereto; and
(d) all proceeds of, and rights associated with, the foregoing
(including license royalties and proceeds of infringement suits), the right
to ▇▇▇ third parties for past, present or future infringements of any
patent or patent application, including any patent or patent application
referred to in ITEM A of ATTACHMENT 1 attached hereto, and for breach or
enforcement of any patent license, including any patent license referred to
in ITEM B of ATTACHMENT 1 attached hereto, and all rights corresponding
thereto throughout the world.
SECTION 3. SECURITY AGREEMENT. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Administrative Agent in the Patent Collateral with the United States Patent
and Trademark Office and corresponding offices in other countries of the world.
The security interest granted hereby has been granted as a supplement to, and
not in limitation of, the security interest granted to the Administrative Agent
for its benefit and the benefit of each Secured Party under the Security
Agreement. The Security Agreement (and all rights and remedies of the
Administrative Agent and each Secured Party thereunder) shall remain in full
force and effect in accordance with its terms.
SECTION 4. RELEASE OF SECURITY INTEREST. Upon the Termination Date, the
Administrative Agent shall, at the Grantor's expense, execute and deliver to the
Grantor all Instruments and other Documents as may be necessary or proper to
release the lien on and security interest in the Patent Collateral which has
been granted hereunder.
SECTION 5. ACKNOWLEDGMENT. The Grantor does hereby
further acknowledge and affirm that the rights and remedies of the
Administrative Agent with respect to the security interest in the Patent
Collateral granted hereby are more fully set forth in the Security Agreement,
the terms and provisions of which (including the remedies provided for therein)
are incorporated by reference herein as if fully set forth herein.
A-2
SECTION 6. LOAN DOCUMENT, ETC. This Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions of the Credit Agreement.
SECTION 7. COUNTERPARTS. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
A-3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
THE TITAN CORPORATION
By
----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By
----------------------------------
Name:
Title:
By
----------------------------------
Name:
Title:
A-4
ATTACHMENT 1
to Patent Security Agreement
Item A. PATENTS
ISSUED PATENTS
*COUNTRY PATENT NO. ISSUE DATE INVENTOR(S) TITLE
PENDING PATENT APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE INVENTOR(S) TITLE
PATENT APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE INVENTOR(S) TITLE
Item B. PATENT LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT B
to Security Agreement
TRADEMARK SECURITY AGREEMENT
This TRADEMARK SECURITY AGREEMENT (this "AGREEMENT"), dated as of February
23, 2000, is made between THE TITAN CORPORATION, a Delaware corporation (the
"GRANTOR"), and CREDIT SUISSE FIRST BOSTON ("CSFB"), as Administrative Agent
(the "ADMINISTRATIVE AGENT") for each of the Secured Parties;
W I T N E S S E T H :
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among the Grantor, the various financial
institutions as are or may become parties thereto (the "LENDERS"), CSFB, as
Administrative Agent for the Lenders (the "ADMINISTRATIVE AGENT"), First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Grantor;
WHEREAS, in connection with the Credit Agreement, the Grantor has executed
and delivered a Borrower Security Agreement, dated as of February 23, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"SECURITY AGREEMENT";
WHEREAS, as a condition precedent to the making of the Credit Extensions
(including the initial Credit Extension) under the Credit Agreement, the Grantor
is required to execute and deliver this Agreement; and
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which is
hereby acknowledged, and in order to induce the Lenders and the Issuers to make
Credit Extensions (including the initial Credit Extension) to the Grantor
pursuant to the Credit Agreement, the Grantor agrees, for the benefit of each
Secured Party, as follows.
SECTION 1. DEFINITIONS. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
B-1
SECTION 2. GRANT OF SECURITY INTEREST. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
to secure all of the Secured Obligations, the Grantor does hereby mortgage,
pledge and hypothecate to the Administrative Agent, and grant to the
Administrative Agent a security interest in, for its benefit and the benefit
of each Secured Party, all of the following property (the "TRADEMARK
COLLATERAL"), whether now owned or hereafter acquired or existing by it:
(a) all trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade styles, service marks,
certification marks, collective marks, logos, other source of business
identifiers, prints and labels on which any of the foregoing have appeared
or appear, designs and general intangibles of a like nature (all of the
foregoing items in this CLAUSE (a) being collectively called a
"TRADEMARK"), now existing anywhere in the world or hereafter adopted or
acquired, whether currently in use or not, all registrations and recordings
thereof and all applications in connection therewith, whether pending or in
preparation for filing, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any
office or agency of the United States of America or any State thereof or
any foreign country, including those referred to in ITEM A of ATTACHMENT 1
attached hereto;
(b) all Trademark licenses, including each Trademark license referred
to in ITEM B of ATTACHMENT 1 attached hereto;
(c) all reissues, extensions or renewals of any of the items
described in CLAUSES (a) and (b);
(d) all of the goodwill of the business connected with the use of,
and symbolized by the items described in, CLAUSES (a) and (b); and
(e) all proceeds of, and rights associated with, the foregoing,
including any claim by the Grantor against third parties for past, present
or future infringement or dilution of any Trademark, Trademark registration
or Trademark license, including any Trademark, Trademark registration or
Trademark license referred to in ITEM A and ITEM B of ATTACHMENT 1 attached
hereto, or for any injury to the goodwill associated with the use of any
such Trademark or for breach or enforcement of any Trademark license.
SECTION 3. SECURITY AGREEMENT. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Administrative Agent in the Trademark Collateral with the United States
Patent and Trademark Office and corresponding offices in other countries of the
world. The security interest granted hereby has been granted as a supplement
to, and not in limitation of, the security interest granted to the
Administrative Agent for its benefit and the benefit of each Secured Party under
the Security Agreement. The Security
B-2
Agreement (and all rights and remedies of the Administrative Agent and each
Secured Party thereunder) shall remain in full force and effect in accordance
with its terms.
SECTION 4. RELEASE OF SECURITY INTEREST. Upon the Termination Date, the
Administrative Agent shall, at the Grantor's expense, execute and deliver to the
Grantor all Instruments and other Documents as may be necessary or proper to
release the lien on and security interest in the Trademark Collateral which has
been granted hereunder.
SECTION 5. ACKNOWLEDGMENT. The Grantor does hereby
further acknowledge and affirm that the rights and remedies of the
Administrative Agent with respect to the security interest in the Trademark
Collateral granted hereby are more fully set forth in the Security Agreement,
the terms and provisions of which (including the remedies provided for therein)
are incorporated by reference herein as if fully set forth herein.
SECTION 6. LOAN DOCUMENT, ETC. This Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions of the Credit Agreement.
SECTION 7. COUNTERPARTS. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
B-3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
THE TITAN CORPORATION
By
----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By
----------------------------------
Name:
Title:
By
----------------------------------
Name:
Title:
B-4
ATTACHMENT 1
to Trademark
Security Agreement
Item A. TRADEMARKS
REGISTERED TRADEMARKS
*COUNTRY TRADEMARK REGISTRATION NO. REGISTRATION DATE
PENDING TRADEMARK APPLICATIONS
*COUNTRY TRADEMARK SERIAL NO. FILING DATE
TRADEMARK APPLICATIONS IN PREPARATION
EXPECTED PRODUCTS/
*COUNTRY TRADEMARK DOCKET NO. FILING DATE SERVICES
Item B. TRADEMARK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION
TERRITORY TRADEMARK LICENSOR LICENSEE DATE DATE
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT C
to Security Agreement
COPYRIGHT SECURITY AGREEMENT
This COPYRIGHT SECURITY AGREEMENT (this "Agreement"), dated as of February
23, 2000, is made between THE TITAN CORPORATION, a Delaware corporation (the
"GRANTOR"), and CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as
Administrative Agent (the "ADMINISTRATIVE AGENT") for each of the Secured
Parties;
W I T N E S S E T H :
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among the Grantor, the various financial
institutions as are or may become parties thereto (the "LENDERS"), CSFB, as
Administrative Agent for the Lenders (the "ADMINISTRATIVE AGENT"), First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Grantor;
WHEREAS, in connection with the Credit Agreement, the Grantor has executed
and delivered a Borrower Security Agreement, dated as of February 23, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"SECURITY AGREEMENT";
WHEREAS, as a condition precedent to the making of the Credit Extensions
(including the initial Credit Extension) under the Credit Agreement, the Grantor
is required to execute and deliver this Agreement; and
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which is
hereby acknowledged, and in order to induce the Lenders and the Issuers to make
Credit Extensions (including the initial Credit Extension) to the Grantor
pursuant to the Credit Agreement, the Grantor agrees, for the benefit of each
Secured Party, as follows.
SECTION 1. DEFINITIONS. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
SECTION 2. GRANT OF SECURITY INTEREST. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
to secure all of the Secured Obligations, the
C-1
Grantor does hereby mortgage, pledge and hypothecate to the Administrative
Agent, and grant to the Administrative Agent a security interest in, for its
benefit and the benefit of each Secured Party, all of the following property
(the "COPYRIGHT COLLATERAL"), whether now owned or hereafter acquired or
existing by it, being all copyrights (including all copyrights for
semi-conductor chip product mask works) of the Grantor, whether statutory or
common law, registered or unregistered, now or hereafter in force throughout
the world including all of the Grantor's right, title and interest in and to
all copyrights registered in the United States Copyright Office or anywhere
else in the world and also including the copyrights referred to in ITEM A of
ATTACHMENT 1 attached hereto, and all applications for registration thereof,
whether pending or in preparation, all copyright licenses, including each
copyright license referred to in ITEM B of ATTACHMENT 1 attached hereto, the
right to ▇▇▇ for past, present and future infringements of any thereof, all
rights corresponding thereto throughout the world, all extensions and
renewals of any thereof and all proceeds of the foregoing, including
licenses, royalties, income, payments, claims, damages and proceeds of suit.
SECTION 3. SECURITY AGREEMENT. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Administrative Agent in the Copyright Collateral with the United States
Copyright Office and corresponding offices in other countries of the world. The
security interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Administrative Agent for its
benefit and the benefit of each Secured Party under the Security Agreement. The
Security Agreement (and all rights and remedies of the Administrative Agent and
each Secured Party thereunder) shall remain in full force and effect in
accordance with its terms.
SECTION 4. RELEASE OF SECURITY INTEREST. Upon the Termination Date, the
Administrative Agent shall, at the Grantor's expense, execute and deliver to the
Grantor all Instruments and other Documents as may be necessary or proper to
release the lien on and security interest in the Copyright Collateral which has
been granted hereunder.
SECTION 5. ACKNOWLEDGMENT. The Grantor does hereby further acknowledge
and affirm that the rights and remedies of the Administrative Agent with
respect to the security interest in the Copyright Collateral granted hereby
are more fully set forth in the Security Agreement, the terms and provisions
of which (including the remedies provided for therein) are incorporated by
reference herein as if fully set forth herein.
SECTION 6. LOAN DOCUMENT, ETC. This Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions of the Credit Agreement.
SECTION 7. COUNTERPARTS. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
C-2
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
THE TITAN CORPORATION
By
----------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By
----------------------------------
Name:
Title:
By
----------------------------------
Name:
Title:
C-3
ATTACHMENT 1
to Copyright
Security Agreement
Item A. COPYRIGHTS/MASK WORKS
REGISTERED COPYRIGHTS/MASK WORKS
*COUNTRY REGISTRATION NO. REGISTRATION DATE AUTHOR(S)
TITLE
COPYRIGHT/MASK WORK PENDING REGISTRATION APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE AUTHOR(S) TITLE
COPYRIGHT/MASK WORK REGISTRATION APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE AUTHOR(S) TITLE
Item B. COPYRIGHT/MASK WORK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT G-2
SUBSIDIARY SECURITY AGREEMENT
This SECURITY AGREEMENT (as amended, restated, supplemented, or
otherwise modified from time to time, this "SECURITY AGREEMENT"), dated as of
February 23, 2000, is made by each Subsidiary (as defined in the Credit
Agreement referred to below) of the Borrower (as defined below), now or after
the date hereof (including pursuant to SECTION 7.4) a signatory hereto (each,
individually, a "GRANTOR," and collectively, the "GRANTORS"), in favor of CREDIT
SUISSE FIRST ("CSFB"), as administrative agent (together with any successor(s)
thereto in such capacity, the "ADMINISTRATIVE AGENT") for each of the Secured
Parties.
W I T N E S S E T H :
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), the various financial institutions as are or may
become parties thereto (the "LENDERS"), the Administrative Agent and First Union
Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Borrower;
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
each Grantor is required to execute and deliver this Security Agreement;
WHEREAS, each Grantor is a Subsidiary of the Borrower;
WHEREAS, each Grantor has duly authorized the execution, delivery and
performance of this Security Agreement; and
WHEREAS, it is in the best interests of each Grantor to execute this
Security Agreement inasmuch as such Grantor will derive substantial direct and
indirect benefits from the Credit Extensions made from time to time to the
Borrower by the Lenders and the Issuers pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, and in order to induce the Lenders
and the Issuers to make Credit Extensions (including the initial Credit
Extension) to the Borrower pursuant to the Credit
1
Agreement, each Grantor jointly and severally agrees, for the benefit of each
Secured Party, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. CERTAIN TERMS. The following terms (whether or not
underscored) when used in this Security Agreement, including its preamble and
recitals, shall have the following meanings (such definitions to be equally
applicable to the singular and plural forms thereof):
"ADMINISTRATIVE AGENT" is defined in the PREAMBLE.
"BORROWER" is defined in the FIRST RECITAL.
"CHATTEL PAPER" has the meaning provided in the U.C.C.
"COLLATERAL" is defined in SECTION 2.1.
"COLLATERAL ACCOUNT" is defined in CLAUSE (b) of SECTION 4.1.2(b).
"CONTRACTS" means all agreements between any Grantor and one or more
additional parties.
"CONTRACT RIGHTS" means all rights of any Grantor (including, without
limitation, all rights to payment) under each Contract.
"COMPUTER HARDWARE AND SOFTWARE COLLATERAL" means:
(a) all computer and other electronic data processing
hardware, integrated computer systems, central processing units, memory
units, display terminals, printers, features, computer elements, card
readers, tape drives, hard and soft disk drives, cables, electrical
supply hardware, generators, power equalizers, accessories and all
peripheral devices and other related computer hardware;
(b) all software programs (including both source code, object
code and all related applications and data files), whether now owned,
licensed or leased or hereafter acquired by any Grantor, designed for
use on the computers and electronic data processing hardware described
in CLAUSE (a) above;
(c) all firmware associated therewith;
2
(d) all documentation (including flow charts, logic diagrams,
manuals, guides and specifications) with respect to such hardware,
software and firmware described in the preceding CLAUSES (a) through
(c); and
(e) all rights with respect to all of the foregoing, including
any and all copyrights, licenses, options, warranties, service
contracts, program services, test rights, maintenance rights, support
rights, improvement rights, renewal rights and indemnifications and any
substitutions, replacements, additions or model conversions of any of
the foregoing.
"COPYRIGHT COLLATERAL" means all copyrights (including all copyrights
for semi-conductor chip product mask works) of each Grantor, whether statutory
or common law, registered or unregistered, now or hereafter in force throughout
the world including all of such Grantor's right, title and interest in and to
all copyrights registered in the United States Copyright Office or anywhere else
in the world and also including the copyrights referred to in ITEM A of SCHEDULE
IV attached hereto, and all applications for registration thereof, whether
pending or in preparation, all copyright licenses, including each copyright
license referred to in ITEM B of SCHEDULE IV attached hereto, the right to ▇▇▇
for past, present and future infringements of any thereof, all rights
corresponding thereto throughout the world, all extensions and renewals of any
thereof and all proceeds of the foregoing, including licenses, royalties,
income, payments, claims, damages and proceeds of suit.
"CREDIT AGREEMENT" is defined in the FIRST RECITAL.
"DEPOSIT ACCOUNTS" has the meaning provided in the U.C.C. and, in any
event, includes, without limitation, any demand, time, savings, passbook or like
account maintained with a depositary institution, including those Deposit
Accounts set forth in ITEM G of SCHEDULE I hereto.
"DOCUMENTS" has the meaning provided in the U.C.C.
"EQUIPMENT" has the meaning provided in the U.C.C. and, in any event,
includes, without limitation, all equipment in all of its forms of the Grantors,
wherever located, including all parts thereof and all accessions, additions,
attachments, improvements, substitutions and replacements thereto and therefor
and all accessories related thereto.
"GENERAL INTANGIBLES" has the meaning provided in the U.C.C. and, in
any event, includes, without limitation, with respect to the Grantors, all
contracts, agreements, instruments and indentures in any form, and portions
thereof, to which any Grantor is a party or under which any Grantor has any
right, title or interest or to which any Grantor or any property of any Grantor
is subject, as the same may from time to time be amended, supplemented or
otherwise modified, including, without limitation, (i) all rights of any Grantor
to receive moneys due and to become due to it thereunder or in connection
therewith, (ii) all rights of any Grantor to damages arising thereunder and
(iii) all rights of any Grantor to perform and to exercise all remedies
thereunder.
3
"GOODS" has the meaning provided in the U.C.C.
"GRANTOR" and "GRANTORS" are defined in the PREAMBLE.
"INSTRUMENT" has the meaning provided in the U.C.C.
"INTELLECTUAL PROPERTY COLLATERAL" means, collectively, the Computer
Hardware and Software Collateral, the Copyright Collateral, the Patent
Collateral, the Trademark Collateral and the Trade Secrets Collateral.
"INTEREST RATE HEDGING AGREEMENTS" means interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, and all other
agreements or arrangements designed to protect the Grantors against fluctuations
in interest rates, entered into between any Grantor and a Lender or an Affiliate
of a Lender, for the purpose of hedging interest rate risk with respect to the
Obligations.
"INTEREST RATE HEDGING OBLIGATIONS" means all liabilities of the
Grantors under Interest Rate Hedging Agreements.
"INVENTORY" has the meaning provided in the U.C.C. and, in any event,
includes, without limitation, all inventory in all of its forms of the Grantors,
wherever located, including
(i) all raw materials and work in process therefor,
finished goods thereof, and materials used or consumed in the
manufacture or production thereof,
(ii) all goods in which any Grantor has an interest
in mass or a joint or other interest or right of any kind
(including goods in which such Grantor has an interest or
right as consignee), and
(iii) all goods which are returned to or repossessed
by any Grantor, and all accessions thereto, products thereof
and documents therefor.
"INVESTMENT PROPERTY" has the meaning provided in the U.C.C.
"LENDERS" is defined in the FIRST RECITAL.
"PATENT COLLATERAL" means:
(a) all letters patent and applications for letters patent
throughout the world, including all patent applications in preparation
for filing anywhere in the world and including each patent and patent
application referred to in ITEM A of SCHEDULE II attached hereto;
4
(b) all reissues, divisions, continuations,
continuations-in-part, extensions, renewals and reexaminations of any
of the items described in CLAUSE (a);
(c) all patent licenses, including each patent license
referred to in ITEM B of SCHEDULE II attached hereto; and
(d) all proceeds of, and rights associated with, the foregoing
(including license royalties and proceeds of infringement suits), the
right to ▇▇▇ third parties for past, present or future infringements of
any patent or patent application, including any patent or patent
application referred to in ITEM A of SCHEDULE II attached hereto, and
for breach or enforcement of any patent license, including any patent
license referred to in ITEM B of SCHEDULE II attached hereto, and all
rights corresponding thereto throughout the world.
"RECEIVABLES" means "accounts" (as such term is defined in the U.C.C.),
including but not limited to rights to payments for goods sold or leased or
services rendered, whether now existing or hereafter arising, including, without
limitation, rights evidenced by an account, note, contract, security agreement,
chattel paper, or other evidence of indebtedness or security, together with (a)
all security pledged, assigned, hypothecated or granted to or held by any
Grantor to secure the foregoing, (b) all of any Grantor's right, title and
interest in and to any goods, the sale of which gave rise thereto, (c) all
guarantees, endorsements and indemnifications on, or of, any of the foregoing,
(d) all powers of attorney for the execution of any evidence of indebtedness or
security or other writing in connection therewith, (e) all books, records,
ledger cards, and invoices relating thereto, (f) all evidences of the filing of
financing statements and other statements and the registration of other
instruments in connection therewith and amendments thereto, notices to other
creditors or secured parties, and certificates from filing or other registration
officers, (g) all credit information, reports and memoranda relating thereto and
(h) all other writings related in any way to the foregoing.
"RELATED CONTRACTS" is defined in CLAUSE (c) of SECTION 2.1.
"SECURED OBLIGATIONS" is defined in SECTION 2.2.
"SECURITIES ACCOUNT" has the meaning provided in the U.C.C., including
without limitation those Securities Accounts listed in ITEM H of SCHEDULE I
hereto.
"SECURITY AGREEMENT" is defined in the PREAMBLE.
"TERMINATION DATE" means the date on which all Obligations have
indefeasibly been paid in full in cash, all Commitments have been fully
terminated and the Letter of Credit has been canceled or otherwise terminated.
5
"TRADEMARK COLLATERAL" means:
(a) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service
marks, certification marks, collective marks, logos, other source of
business identifiers, prints and labels on which any of the foregoing
have appeared or appear, designs and general intangibles of a like
nature (all of the foregoing items in this CLAUSE (a) being
collectively called a "TRADEMARK"), now existing anywhere in the world
or hereafter adopted or acquired, whether currently in use or not, all
registrations and recordings thereof and all applications in connection
therewith, whether pending or in preparation for filing, including
registrations, recordings and applications in the United States Patent
and Trademark Office or in any office or agency of the United States of
America or any State thereof or any foreign country, including those
referred to in ITEM A of SCHEDULE III attached hereto;
(b) all Trademark licenses, including each Trademark license
referred to in ITEM B of SCHEDULE III attached hereto;
(c) all reissues, extensions or renewals of any of the items
described in CLAUSES (a) and (b);
(d) all of the goodwill of the business connected with the use
of, and symbolized by the items described in, CLAUSES (a) and (b); and
(e) all proceeds of, and rights associated with, the
foregoing, including any claim by any Grantor against third parties for
past, present or future infringement or dilution of any Trademark,
Trademark registration or Trademark license, including any Trademark,
Trademark registration or Trademark license referred to in ITEM A and
ITEM B of SCHEDULE III attached hereto, or for any injury to the
goodwill associated with the use of any such Trademark or for breach or
enforcement of any Trademark license.
"TRADE SECRETS COLLATERAL" means all common law and statutory trade
secrets and all other confidential or proprietary or useful information and all
know-how obtained by or used in or contemplated at any time for use in the
business of any Grantor (all of the foregoing being collectively called a "TRADE
SECRET"), whether or not such Trade Secret has been reduced to a writing or
other tangible form, including all documents and things embodying, incorporating
or referring in any way to such Trade Secret, all Trade Secret licenses,
including each Trade Secret license referred to in SCHEDULE V attached hereto,
and including the right to ▇▇▇ for and to enjoin and to collect damages for the
actual or threatened misappropriation of any Trade Secret and for the breach or
enforcement of any such Trade Secret license.
"U.C.C." means the Uniform Commercial Code, as in effect from time to
time in the State of New York.
6
SECTION 1.2. CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Security Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement.
SECTION 1.3. U.C.C. DEFINITIONS. Unless otherwise defined herein or in
the Credit Agreement or the context otherwise requires, terms for which meanings
are provided in the U.C.C. are used in this Security Agreement, including its
preamble and recitals, with such meanings.
ARTICLE II
SECURITY INTEREST
SECTION 2.1. GRANT OF SECURITY. Each Grantor hereby assigns and pledges
to the Administrative Agent for its benefit and the ratable benefit of each of
the Secured Parties, and hereby grants to the Administrative Agent for the
ratable benefit of each of the Secured Parties, to secure the Secured
Obligations, a security interest in all of the following, whether now or
hereafter existing or acquired by such Grantor (the "COLLATERAL"):
(a) the Collateral Account;
(b) all Computer Hardware and Software Collateral;
(c) all Contracts, together with any Contract Rights arising
thereunder;
(d) all Deposit Accounts;
(e) all Equipment;
(f) all Intellectual Property Collateral;
(g) all Inventory;
(h) all Investment Property;
(i) all Receivables;
(j) all Securities Accounts;
(k) all other Goods, Chattel Paper, Documents, Instruments,
and General Intangibles of such Grantor;
7
(l) all books, records, writings, data bases, information and
other property relating to, used or useful in connection with,
evidencing, embodying, incorporating or referring to, any of the
foregoing in this SECTION 2.1;
(m) all of such Grantor's other property and rights of every
kind and description and interests therein; and
(n) all products, offspring, rents, issues, profits, returns,
income and proceeds of and from any and all of the foregoing Collateral
(including proceeds which constitute property of the types described in
CLAUSES (a), (b), (c), (d), (e), (f), (g), (h) and (i) and, to the
extent not otherwise included, all payments under insurance which such
Grantor is entitled to receive (whether or not the Administrative Agent
is the loss payee thereof), or any indemnity, warranty or guaranty,
payable by reason of loss or damage to or otherwise with respect to any
of the foregoing Collateral).
Notwithstanding anything herein to the contrary, in no event shall the
Collateral include, and no Grantor shall be deemed to have granted a security
interest in, any of such Grantor's rights or interests in any license, contract
or agreement to which such Grantor is a party or any of its rights or interests
thereunder to the extent, but only to the extent, that such a grant would, under
the express terms of such license, contract or agreement or otherwise, result in
a breach of the terms of, or constitute a default under such license, contract
or agreement (other than to the extent that any such term would be rendered
ineffective pursuant to Section 9-318(4) of the Uniform Commercial Code of any
relevant jurisdiction or any other applicable law (including the Bankruptcy
Code) or principles of equity); PROVIDED, that immediately upon the
ineffectiveness, waiver, lapse or termination of any such provision, the
Collateral shall include, and such Grantor shall have granted a security
interest in, all such rights and interests as if such provision had never been
in effect.
SECTION 2.2. SECURITY FOR OBLIGATIONS. This Security Agreement secures
the payment of (i) all Obligations of the Borrower now or hereafter existing
under the Credit Agreement, each other Loan Document to which the Borrower is or
may become a party, and each Interest Rate Hedging Agreement, whether for
principal, interest, costs, fees, expenses, Interest Rate Hedging Obligations or
otherwise, and (ii) all obligations of each Grantor and each other Obligor now
or hereafter existing under this Security Agreement and each other Loan Document
to which such Grantor or such other Obligor is or may become a party, and each
Interest Rate Hedging Agreement, with all such obligations of the Borrower and
such Grantor and such other Obligor being collectively referred to as the
"SECURED OBLIGATIONS".
SECTION 2.3. CONTINUING SECURITY INTEREST; TRANSFER OF NOTES. This
Security Agreement shall create a continuing security interest in the
Collateral and shall
(a) remain in full force and effect until the Termination
Date;
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(b) be binding upon each Grantor and its successors,
transferees and assigns; and
(c) inure, together with the rights and remedies of the
Administrative Agent hereunder, to the benefit of the Administrative
Agent and each other Secured Party.
Without limiting the generality of the foregoing CLAUSE (c), any Lender may
assign or otherwise transfer (in whole or in part) any Note or Credit Extension
held by it to any other Person or entity, and such other Person or entity shall
thereupon become vested with all the rights and benefits in respect thereof
granted to such Lender under any Loan Document (including this Security
Agreement) or otherwise, subject, however, to any contrary provisions in such
assignment or transfer, and to the provisions of Section 11.11 and Article X of
the Credit Agreement. Upon (i) the sale, transfer or other disposition of
Collateral in accordance with the Credit Agreement, (ii) the issuance of shares
in connection with the initial public offering of Cayenta pursuant to the terms
of the applicable underwriting agreement and the delivery of a certificate to
the Administrative Agent stating that no Default has occurred and is continuing
or would result from the initial public offering or (iii) the occurrence of the
Termination Date, the security interests granted herein shall automatically
terminate with respect to (x) such Collateral (in the case of clause (i)), (y)
any Collateral owned by any member of the Cayenta Group (in the case of clause
(ii)) or (z) all Collateral (in the case of clause (iii)), and at such time the
Administrative Agent will, at each Grantor's sole expense, execute and deliver
to the applicable Grantor (without any representations, warranties or recourse
to either Administrative Agent), such documents as such Grantor shall reasonably
request to evidence such termination.
SECTION 2.4. GRANTOR REMAINS LIABLE. Anything herein to the contrary
notwithstanding
(a) each Grantor shall remain liable under the contracts and
agreements included in the Collateral to the extent set forth therein,
and shall perform all of its duties and obligations under such
contracts and agreements to the same extent as if this Security
Agreement had not been executed;
(b) the exercise by the Administrative Agent of any of its
rights hereunder shall not release any Grantor from any of its duties
or obligations under any such contracts or agreements included in the
Collateral; and
(c) neither Administrative Agent nor any other Secured Party
shall have any obligation or liability under any such contracts or
agreements included in the Collateral by reason of this Security
Agreement, nor shall the Administrative Agent or any other Secured
Party be obligated to perform any of the obligations or duties of any
Grantor thereunder or to take any action to collect or enforce any
claim for payment assigned hereunder.
9
SECTION 2.5. SECURITY INTEREST ABSOLUTE. All rights of the
Administrative Agent and the security interests granted to the Administrative
Agent hereunder, and all obligations of each Grantor hereunder, shall be
absolute and unconditional, irrespective of
(a) any lack of validity or enforceability of the Credit Agreement or
any other Loan Document;
(b) the failure of any Secured Party
(i) to assert any claim or demand or to enforce any right or
remedy against any Obligor or any other Person under the provisions of
the Credit Agreement, any other Loan Document or otherwise, or
(ii) to exercise any right or remedy against any other
guarantor of, or collateral securing, any Secured Obligations;
(c) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations or any other extension,
compromise or renewal of any Secured Obligation;
(d) any reduction, limitation, impairment or termination of any Secured
Obligations for any reason, including any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to (and each Grantor hereby
waives any right to or claim of) any defense or setoff, counterclaim, recoupment
or termination whatsoever by reason of the invalidity, illegality, irregularity,
compromise, unenforceability of, or any other event or occurrence affecting, any
Secured Obligations or otherwise;
(e) any amendment to, rescission, waiver, or other modification of, or
any consent to departure from, any of the terms of the Credit Agreement or any
other Loan Document;
(f) any addition, exchange, release, surrender or non-perfection of any
collateral (including the Collateral), or any amendment to or waiver or release
of or addition to or consent to departure from any guaranty, for any of the
Secured Obligations; or
(g) any other circumstances which might otherwise constitute a defense
available to, or a legal or equitable discharge of, any Obligor, any surety or
any guarantor.
SECTION 2.6. POSTPONEMENT OF SUBROGATION, ETC. Each Grantor agrees that
it will not exercise any rights which it may acquire by way of rights of
subrogation under this Security Agreement, by any payment made hereunder,
whether by way of subrogation, reimbursement or otherwise, until following the
Termination Date. Any amount paid to any Grantor on account of any such
subrogation rights prior to the Termination Date shall be held in trust for the
benefit of the Secured Parties and shall immediately be paid to the
Administrative Agent for the benefit of
10
the Secured Parties and credited and applied against the Obligations, whether
matured or unmatured, in accordance with the terms of the Credit Agreement;
PROVIDED, HOWEVER, that if
(a) any Grantor has made payment to the Secured Parties of all
or any part of the Obligations; and
(b) the Termination Date has occurred;
then each Secured Party agrees that, at such Grantor's request, the
Administrative Agent, on behalf of the Secured Parties, will execute and deliver
to such Grantor appropriate documents (without recourse and without
representation or warranty) necessary to evidence the transfer by subrogation to
such Grantor of an interest in the Obligations resulting from such payment by
such Grantor. In furtherance of the foregoing, at all times prior to the
Termination Date, each Grantor shall refrain from taking any action or
commencing any proceeding against any Borrower or any other Obligor (or its
successors or assigns, whether in connection with a bankruptcy proceeding or
otherwise) to recover any amounts in the respect of payments made under this
Security Agreement to any Secured Party. Notwithstanding the foregoing, to the
extent necessary to toll the statute of limitations, such Grantor may take such
action required to preserve any rights it has by way of rights of subrogation as
consented to by the Administrative Agent in its reasonable discretion.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. REPRESENTATIONS AND WARRANTIES. Each Grantor represents
and warrants to each Secured Party (a) as to all matters contained in Article VI
of the Credit Agreement insofar as the representations and warranties contained
therein are applicable to such Grantor and its properties, each such
representation and warranty set forth in such Article (insofar as applicable as
aforesaid) and all other terms of the Credit Agreement to which reference is
made therein, together with all related definitions and ancillary provisions,
being hereby incorporated into this Security Agreement by reference as though
specifically set forth in this Section and (b) insofar as the representations
and warranties contained herein are applicable to such Grantor and its
properties, as set forth in this Article.
SECTION 3.1.1. LOCATION OF COLLATERAL, ETC. All of the Equipment and
Inventory of such Grantor is located at the places specified in ITEM A and ITEM
B, respectively, of SCHEDULE I hereto. None of the Equipment and Inventory has,
within the four months preceding the date of this Security Agreement, been
located at any place other than the places specified in ITEM A and ITEM B,
respectively, of SCHEDULE I hereto except as set forth in a footnote thereto.
The place(s) of business and chief executive office of such Grantor and the
office(s) where such Grantor keeps its records concerning the Receivables, and
all originals of all Chattel Paper which evidence Receivables, are located at
the address set forth in ITEM D of SCHEDULE I hereto. Such Grantor has
11
no trade names other than those set forth in ITEM E of SCHEDULE I hereto. During
the four months preceding the date hereof, such Grantor has not been known by
any legal name different from the one set forth on the signature page hereto,
nor has such Grantor been the subject of any merger or other corporate
reorganization, except as set forth in ITEM F of SCHEDULE I hereto. If the
Collateral includes any Inventory located in the State of California, such
Grantor is not a "retail merchant" within the meaning of Section 9102 of the
Uniform Commercial Code - Secured Transactions of the State of California. All
Receivables evidenced by a promissory note or other Instrument, negotiable
Document or Chattel Paper have been duly endorsed and accompanied by duly
executed instruments of transfer or assignment, all in form and substance
satisfactory to the Administrative Agent and delivered and pledged to the
Administrative Agent pursuant to SECTION 4.1.7
SECTION 3.1.2. OWNERSHIP, NO LIENS, ETC. Such Grantor owns its
Collateral free and clear of any Lien, security interest, charge or encumbrance
except for the security interest created by this Security Agreement and except
as permitted by the Credit Agreement. No effective financing statement or other
instrument similar in effect covering all or any part of the Collateral is on
file in any recording office, except such as may have been filed in favor of the
Administrative Agent relating to this Security Agreement or as have been filed
in connection with Liens permitted pursuant to Section 7.2.3 of the Credit
Agreement.
SECTION 3.1.3. POSSESSION AND CONTROL. Such Grantor has exclusive
possession and control of its Equipment and Inventory.
SECTION 3.1.4. NEGOTIABLE DOCUMENTS, INSTRUMENTS AND CHATTEL PAPER.
Such Grantor has, contemporaneously herewith, delivered to the Administrative
Agent possession of all originals of all negotiable Documents, Instruments and
Chattel Paper currently owned or held by such Grantor (duly endorsed in blank,
if requested by the Administrative Agent).
SECTION 3.1.5. INTELLECTUAL PROPERTY COLLATERAL. With respect to any
Intellectual Property Collateral the loss, impairment or infringement of which
might have a Material Adverse Effect:
(a) such Intellectual Property Collateral is subsisting and
has not been adjudged invalid or unenforceable, in whole or in part;
(b) such Intellectual Property Collateral is valid and
enforceable;
(c) such Grantor has made all necessary filings and
recordations to protect its interest in such Intellectual Property
Collateral, including recordations of all of its interests in the
Patent Collateral and Trademark Collateral in the United States Patent
and Trademark Office and in corresponding offices throughout the world
and its claims to the Copyright Collateral in the United States
Copyright Office and in corresponding offices throughout the world;
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(d) other than as previously disclosed to the Administrative
Agent, such Grantor is the exclusive owner of the entire and
unencumbered right, title and interest in and to such Intellectual
Property Collateral and no claim has been made that the use of such
Intellectual Property Collateral does or may violate the asserted
rights of any third party; and
(e) such Grantor has performed and will continue to perform
all acts and has paid and will continue to pay all required fees and
taxes to maintain each and every item of Intellectual Property
Collateral in full force and effect throughout the world, as
applicable, unless such Grantor (i) has reasonably and in good faith
determined that any of the Intellectual Property Collateral is of
negligible economic value to such Grantor, or (i) has a valid business
purpose to do otherwise.
Such Grantor owns directly or is entitled to use by license or otherwise, all
patents, Trademarks, Trade Secrets, copyrights, mask works, licenses,
technology, know-how, processes and rights with respect to any of the foregoing
used in, necessary for or of importance to the conduct of such Grantor's
business.
SECTION 3.1.6. VALIDITY, PRIORITY, ETC. Assuming the proper filing of
one or more financing statements identifying the Collateral with the proper
local, state and/or federal authorities, the security interests in the
Collateral granted to the Administrative Agent hereunder constitute valid and
continuing first priority perfected security interests in the Collateral,
securing payment of the Secured Obligations, to the extent such security
interests may be perfected by the filing of financing statements (except to the
extent that any Lien permitted under the Credit Agreement is prior to the liens
granted to the Administrative Agent hereunder).
SECTION 3.1.7. AUTHORIZATION, APPROVAL, ETC. Except as have been
obtained or made and are in full force and effect, no authorization, approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body is required either
(a) for the grant by such Grantor of the security interest
granted hereby or for the execution, delivery and performance of this
Security Agreement by such Grantor; or
(b) for the perfection of or the exercise by the
Administrative Agent of its rights and remedies hereunder.
SECTION 3.1.8. COMPLIANCE WITH LAWS. Such Grantor is in compliance with
the requirements of all applicable laws (including the provisions of the Fair
Labor Standards Act), rules, regulations and orders of every governmental
authority, the non-compliance with which might have a Material Adverse Effect or
which might materially adversely affect the value of the Collateral or the worth
of the Collateral as collateral security.
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ARTICLE IV
COVENANTS
SECTION 4.1. CERTAIN COVENANTS. Each Grantor covenants and agrees that,
so long as any portion of the Secured Obligations shall remain unpaid, any
Letters of Credit shall be outstanding or any Lender or Issuer shall have any
outstanding Commitment, such Grantor will, unless the Required Lenders shall
otherwise consent in writing, perform, comply with and be bound by (a) all of
the agreements, covenants and obligations contained in Article VII of the Credit
Agreement which are applicable to such Grantor or its properties, each such
agreement, covenant and obligation contained in such Article and all other terms
of the Credit Agreement to which reference is made herein, together with all
related definitions and ancillary provisions, being hereby incorporated into
this Security Agreement by reference as though specifically set forth in this
Section and (b) the obligations set forth in this Article.
SECTION 4.1.1. AS TO EQUIPMENT AND INVENTORY. Such Grantor hereby
agrees that it shall
(a) keep all the Equipment and Inventory (other than Inventory
sold in the ordinary course of business, or except as otherwise
provided in the Credit Agreement or any of the other Loan Documents) at
the places therefor specified in SECTION 3.1.1 or, upon 30 days' prior
written notice to the Administrative Agent, at such other places in a
jurisdiction where all representations and warranties set forth in
ARTICLE III shall be true and correct, and all action required pursuant
to the FIRST SENTENCE of SECTION 4.1.7 shall have been taken with
respect to the Equipment and Inventory (collectively, "SPECIFIED
LOCATIONS"); PROVIDED, HOWEVER, that such Grantor may move and/or
maintain certain items of Equipment at locations other than at
Specified Locations, so long as the value of Collateral of this type of
such Grantor and each other Grantor and similar Collateral (as defined
in the Borrower Security Agreement) of the Borrower shall not exceed
$2,000,000 at any time;
(b) cause the Equipment to be maintained and preserved in the
same condition, repair and working order as when new, ordinary wear and
tear excepted, and in accordance with any manufacturer's manual or good
business practice; and forthwith, or in the case of any loss or damage
to any of the Equipment, as quickly as practicable after the occurrence
thereof, make or cause to be made all repairs, replacements, and other
improvements in connection therewith which are necessary or desirable
to such end; and promptly furnish to the Administrative Agent a
statement respecting any material loss or damage to any of the
Equipment; and
(c) pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all
claims (including claims for labor, materials and supplies) against,
the Equipment and Inventory, except to the extent the
14
validity thereof is being contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP
have been set aside.
SECTION 4.1.2. AS TO RECEIVABLES AND RELATED CONTRACTS.
(a) Such Grantor shall keep its place(s) of business and chief
executive office and the office(s) where it keeps its records
concerning the Receivables, and all originals of all Chattel Paper
which evidences Receivables, located at the address(es) set forth in
ITEM D of SCHEDULE I hereto, or, upon 30 days' prior written notice to
the Administrative Agent, at such other locations in a jurisdiction
where all actions required by the first sentence of SECTION 4.1.7 shall
have been taken with respect to the Receivables; not change its name
except upon 30 days' prior written notice to the Administrative Agent;
hold and preserve such records and Chattel Paper; and permit
representatives of the Administrative Agent at any time during normal
business hours to inspect (upon reasonable prior written notice so long
as no Event of Default shall have occurred and be continuing) and make
abstracts from such records and Chattel Paper. In addition, the Grantor
shall give the Administrative Agent a supplement to SCHEDULE I hereto
on each date a Compliance Certificate is required to be delivered to
the Administrative Agent under the Credit Agreement, which shall set
forth any changes to the information set forth in SECTION 3.1.1.
(b) Upon written notice by the Administrative Agent to such
Grantor pursuant to this clause, all proceeds of Collateral received by
such Grantor shall be delivered in kind to the Administrative Agent for
deposit to a deposit account (the "COLLATERAL ACCOUNT") of such Grantor
maintained with the Administrative Agent, and such Grantor shall not
commingle any such proceeds, and shall hold separate and apart from all
other property, all such proceeds in express trust for the benefit of
the Administrative Agent until delivery thereof is made to the
Administrative Agent. The Administrative Agent will not give the notice
referred to in the preceding sentence unless there shall have occurred
and be continuing a Default of the nature set forth in Section 9.1(i)
of the Credit Agreement or an Event of Default.
(c) The Administrative Agent shall have the right to apply any
amount in the Collateral Account to the payment of any Secured
Obligations which are due and payable or payable upon demand, or to the
payment of any Secured Obligations at any time that an Event of Default
shall exist.
(d) Such Grantor shall not enter into any government contract
which prohibits assignment ot the Administrative Agent of any payments
due or to become due thereunder or under any other government contract,
other than contracts for which the government has determined that a
prohibition on assignment of claims is in the government's interest.
15
(e) Such Grantor shall not cause the aggregate value of
Receivables or Contracts or Contract Rights and the value of similar
Receivables and Contracts (as defined in the Borrower Security
Agreement) as to which a Lien in favor of the Administrative Agent
cannot be granted hereunder pursuant to the final paragraph of SECTION
2.1 (including Liens granted by other Grantors), or pursuant to the
Borrower Security Agreement to exceed $5,000,000 at any time.
SECTION 4.1.3. AS TO COLLATERAL.
(a) Until the occurrence and continuance of a Default of the
nature set forth in Section 9.1(i) of the Credit Agreement or an Event
of Default, and such time as the Administrative Agent shall notify such
Grantor of the revocation of such power and authority such Grantor (i)
may in the ordinary course of its business (except as otherwise
permitted under the Credit Agreement), at its own expense, sell, lease
or furnish under the contracts of service any of the Inventory normally
held by such Grantor for such purpose, and use and consume, in the
ordinary course of its business (except as otherwise permitted under
the Credit Agreement), any raw materials, work in process or materials
normally held by such Grantor for such purpose, (ii) will, at its own
expense, endeavor to collect, as and when due, all amounts due with
respect to any of the Collateral, including the taking of such action
with respect to such collection as the Administrative Agent may
reasonably request following the occurrence of a Default of the nature
set forth in Section 9.1(i) of the Credit Agreement or an Event of
Default or, in the absence of such request, as such Grantor may deem
advisable, and (iii) may grant, in the ordinary course of business
(except as otherwise permitted under the Credit Agreement), to any
party obligated on any of the Collateral, any rebate, refund or
allowance to which such party may be lawfully entitled, and may accept,
in connection therewith, the return of goods, the sale or lease of
which shall have given rise to such Collateral. The Administrative
Agent, however, may, at any time following a Default of the nature set
forth in Section 9.1(i) of the Credit Agreement or an Event of Default,
whether before or after any revocation of such power and authority or
the maturity of any of the Secured Obligations, notify any parties
obligated on any of the Collateral to make payment to the
Administrative Agent of any amounts due or to become due thereunder and
enforce collection of any of the Collateral by suit or otherwise and
surrender, release, or exchange all or any part thereof, or compromise
or extend or renew for any period (whether or not longer than the
original period) any indebtedness thereunder or evidenced thereby. Upon
request of the Administrative Agent following a Default of the nature
set forth in Section 9.1(i) of the Credit Agreement or an Event of
Default, such Grantor will, at its own expense, notify any parties
obligated on any of the Collateral to make payment to the
Administrative Agent of any amounts due or to become due thereunder.
(b) The Administrative Agent is authorized to endorse, in the
name of such Grantor, any item, howsoever received by the
Administrative Agent, representing any payment on or other proceeds of
any of the Collateral.
16
SECTION 4.1.4. AS TO INTELLECTUAL PROPERTY COLLATERAL. Each Grantor
covenants and agrees to comply with the following provisions as such provisions
relate to any Intellectual Property Collateral of such Grantor that:
(a) Such Grantor shall not do any act, or omit to do any act,
whereby any of the Patent Collateral may lapse or become abandoned or
dedicated to the public or unenforceable, unless such Grantor shall
either (i) reasonably and in good faith determine that any of the
Patent Collateral is of negligible economic value to such Grantor, or
(ii) have a valid business purpose to do otherwise,.
(b) Such Grantor shall not, and such Grantor shall not permit
any of its licensees to:
(i) fail to continue to use any of the Trademark
Collateral in order to maintain all of the Trademark
Collateral in full force free from any claim of abandonment
for non-use,
(ii) fail to maintain as in the past the quality of
products and services offered under all of the Trademark
Collateral,
(iii) fail to employ all of the Trademark Collateral
registered with any Federal or state or foreign authority with
an appropriate notice of such registration,
(iv) adopt or use any other Trademark which is
confusingly similar or a colorable imitation of any of the
Trademark Collateral,
(v) use any of the Trademark Collateral registered
with any Federal or state or foreign authority except for the
uses for which registration or application for registration of
all of the Trademark Collateral has been made, and
(vi) do or permit any act or knowingly omit to do any
act whereby any of the Trademark Collateral may lapse or
become invalid or unenforceable,
unless such Grantor shall either (i) reasonably and in good faith
determine that any of the Trademark Collateral is of negligible
economic value to such Grantor, or (ii) have a valid business purpose
to do otherwise,
(c) Such Grantor shall not do or permit any act or knowingly
omit to do any act whereby any of the Copyright Collateral or any of
the Trade Secrets Collateral may lapse or become invalid or
unenforceable or placed in the public domain except upon expiration of
the end of an unrenewable term of a registration thereof, unless such
Grantor shall either (i) reasonably and in good faith determine that
any of the Copyright Collateral or any of the Trade Secrets Collateral
is of negligible economic value to such Grantor, or (ii) have a valid
business purpose to do otherwise.
17
(d) Such Grantor shall notify the Administrative Agent
immediately if it knows, or has reason to know, that any application or
registration relating to any material item of the Intellectual Property
Collateral may become abandoned or dedicated to the public or placed in
the public domain or invalid or unenforceable, or of any adverse
determination or development (including the institution of, or any such
determination or development in, any proceeding in the United States
Patent and Trademark Office, the United States Copyright Office or any
foreign counterpart thereof or any court) regarding such Grantor's
ownership of any of the Intellectual Property Collateral, its right to
register the same or to keep and maintain and enforce the same.
(e) In no event shall such Grantor or any of its agents,
employees, designees or licensees file an application for the
registration of any Intellectual Property Collateral with the United
States Patent and Trademark Office, the United States Copyright Office
or any similar office or agency in any other country or any political
subdivision thereof, unless it promptly upon such filing informs the
Administrative Agent, and upon request of the Administrative Agent,
executes and delivers any and all agreements, instruments, documents
and papers as the Administrative Agent may reasonably request to
evidence the Administrative Agent's security interest in such
Intellectual Property Collateral and the goodwill and general
intangibles of such Grantor relating thereto or represented thereby.
(f) Such Grantor shall take all necessary steps, including in
any proceeding before the United States Patent and Trademark Office,
the United States Copyright Office or any similar office or agency in
any other country or any political subdivision thereof, to maintain and
pursue any application (and to obtain the relevant registration) filed
with respect to, and to maintain any registration of, the Intellectual
Property Collateral, including the filing of applications for renewal,
affidavits of use, affidavits of incontestability and opposition,
interference and cancellation proceedings and the payment of fees and
taxes (except to the extent that dedication, abandonment or
invalidation is permitted under the foregoing CLAUSES (a), (b) and
(c)).
(g) Such Grantor shall, contemporaneously herewith, execute
and deliver to the Administrative Agent a Patent Security Agreement, a
Trademark Security Agreement and a Copyright Security Agreement in the
forms of EXHIBIT A, EXHIBIT B and EXHIBIT C hereto, respectively, and
shall execute and deliver to the Administrative Agent any other
document required to acknowledge or register or perfect the
Administrative Agent's interest in any part of the Intellectual
Property Collateral.
SECTION 4.1.5. INSURANCE. Such Grantor will maintain or cause to be
maintained with responsible insurance companies insurance with respect to its
business and properties (including the Equipment and Inventory) against such
casualties and contingencies and of such types and in such amounts as is
required pursuant to the Credit Agreement and will, upon the request of the
Administrative Agent, furnish a certificate of a reputable insurance broker
setting forth the nature
18
and extent of all insurance maintained by such Grantor in accordance with this
Section. Without limiting the foregoing, such Grantor further agrees as follows:
(a) Each policy for property insurance shall show the
Administrative Agent as loss payee.
(b) Each policy for liability insurance shall show the
Administrative Agent as an additional insured.
(c) Each insurance policy shall provide that at least 30 days'
prior written notice of cancellation or of lapse shall be given to the
Administrative Agent by the insured (or at least 10 days' prior written
notice of cancellation shall be given with respect to failure to pay
the premium).
(d) Such Grantor shall, if so requested by the Administrative
Agent, deliver to the Administrative Agent a copy of each insurance
policy.
SECTION 4.1.6. TRANSFERS AND OTHER LIENS. Such Grantor shall not:
(a) sell, assign (by operation of law or otherwise) or
otherwise dispose of any of the Collateral, except as permitted by the
Credit Agreement; or
(b) create or suffer to exist any Lien or other charge or
encumbrance upon or with respect to any of the Collateral to secure
Indebtedness of any Person or entity, except for the security interest
created by this Security Agreement and except as permitted by the
Credit Agreement.
SECTION 4.1.7. FURTHER ASSURANCES, ETC. Such Grantor agrees that, from
time to time at its own expense, it will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
necessary or desirable (provided that it is reasonable), or that the
Administrative Agent may reasonably request, in order to perfect, preserve and
protect any security interest granted or purported to be granted hereby or to
enable the Administrative Agent to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of the
foregoing, such Grantor will
(a) ▇▇▇▇ conspicuously each Document (evidencing title)
included in the Inventory, each Chattel Paper included in the
Receivables and each Related Contract and, at the request of the
Administrative Agent, and upon the occurrence and during the
continuance of an Event of Default, each of its records pertaining to
the Collateral with a legend, in form and substance satisfactory to the
Administrative Agent, indicating that such Document, Chattel Paper,
Related Contract or Collateral is subject to the security interest
granted hereby;
19
(b) if any Receivable shall be evidenced by a promissory note
or other Instrument, negotiable Document or Chattel Paper, deliver and
pledge to the Administrative Agent hereunder such promissory note,
Instrument, negotiable Document or Chattel Paper duly endorsed and
accompanied by duly executed Instruments of transfer or assignment, all
in form and substance satisfactory to the Administrative Agent;
(c) execute and file such financing or continuation
statements, or amendments thereto, and such other Instruments or
notices as may be necessary or desirable (provided that it is
reasonable), or as the Administrative Agent may reasonably request, in
order to perfect and preserve the security interests and other rights
granted or purported to be granted to the Administrative Agent hereby;
(d) promptly execute and file any notice or other required
form under or pursuant to the federal assignment of claims statute, 31
U.S.C. Section 3726, any successor or amended version thereof or any
regulation promulgated under or pursuant to any version thereof, as the
Administrative Agent may reasonably request; and
(e) furnish to the Administrative Agent, from time to time at
the Administrative Agent's request, statements and schedules further
identifying and describing the Collateral and such other reports in
connection with the Collateral as the Administrative Agent may
reasonably request, all in reasonable detail.
With respect to the foregoing and the grant of the security interest hereunder,
such Grantor hereby authorizes the Administrative Agent to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Collateral without the signature of such Grantor where permitted
by law. A carbon, photographic or other reproduction of this Security Agreement
or any financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.
ARTICLE V
THE AGENT
SECTION 5.1. ADMINISTRATIVE AGENT APPOINTED ATTORNEY-IN-FACT. Each
Grantor hereby irrevocably appoints the Administrative Agent such Grantor's
attorney-in-fact, with full authority in the place and stead of such Grantor and
in the name of such Grantor or otherwise, from time to time in the
Administrative Agent's discretion, following the occurrence and continuation of
a Default of the nature set forth in Section 9.1(i) of the Credit Agreement or
an Event of Default, to take any action and to execute any instrument which the
Administrative Agent may deem necessary or advisable to accomplish the purposes
of this Security Agreement, including:
20
(a) to ask, demand, collect, ▇▇▇ for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other
Instruments, Documents and Chattel Paper, in connection with CLAUSE (a)
above;
(c) to file any claims or take any action or institute any
proceedings which the Administrative Agent may deem necessary or
desirable for the collection of any of the Collateral or otherwise to
enforce the rights of the Administrative Agent with respect to any of
the Collateral; and
(d) to perform the affirmative obligations of such Grantor
hereunder (including all obligations of such Grantor pursuant to
SECTION 4.1.7).
Such Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.
SECTION 5.2. ADMINISTRATIVE AGENT MAY PERFORM. If any Grantor fails to
perform any agreement contained herein, the Administrative Agent may itself
perform, or cause performance of, such agreement, and the expenses of the
Administrative Agent incurred in connection therewith shall be payable by such
Grantor pursuant to SECTION 6.2.
SECTION 5.3. ADMINISTRATIVE AGENT HAS NO DUTY. In addition to, and not
in limitation of, SECTION 2.4, the powers conferred on the Administrative Agent
hereunder are solely to protect its interest (on behalf of the Secured Parties)
in the Collateral and shall not impose any duty on it to exercise any such
powers. Except for reasonable care of any Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Administrative
Agent shall have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral.
SECTION 5.4. REASONABLE CARE. Other than the exercise of reasonable
care in the custody and preservation of the Collateral, the Administrative Agent
shall have no duty with respect thereto. The Administrative Agent shall be
deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment
substantially equal to that which the Administrative Agent accords its own
property. The Administrative Agent shall not be liable or responsible for any
loss or damage to any of the Collateral, or for any diminution in the value
thereof, by reason of the act or omission of any agent or bailee selected by the
Administrative Agent in good faith.
21
ARTICLE VI
REMEDIES
SECTION 6.1. CERTAIN REMEDIES. If any Event of Default shall have
occurred and be continuing:
(a) The Administrative Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party on default under the U.C.C. (whether or not the U.C.C.
applies to the affected Collateral) and also may
(i) require each Grantor to, and such Grantor hereby
agrees that it will, at its expense and upon request of the
Administrative Agent forthwith, assemble all or part of the
Collateral as directed by the Administrative Agent and make it
available to the Administrative Agent at a place to be
designated by the Administrative Agent which is reasonably
convenient to both parties, and
(ii) without notice except as specified below, sell
the Collateral or any part thereof in one or more parcels at
public or private sale, at any of the Administrative Agent's
offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Administrative
Agent may deem commercially reasonable. Each Grantor agrees
that, to the extent notice of sale shall be required by law,
at least ten days' prior notice to such Grantor of the time
and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable
notification. The Administrative Agent shall not be obligated
to make any sale of Collateral regardless of notice of sale
having been given. The Administrative Agent may adjourn any
public or private sale from time to time by announcement at
the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was
so adjourned.
(iii) withdraw all monies, securities and Instruments
in the Collateral Account for application to the Obligations,
and
(iv) license or sublicense, whether on an exclusive
or nonexclusive basis, any Trademark Collateral, Patent
Collateral or Copyright Collateral included in the
Intellectual Property Collateral for such term and on such
conditions and in such manner as the Administrative Agent
shall in its sole judgment determine (taking into account such
provisions as may be necessary to protect and preserve the
validity or enforceability of such Trademark Collateral,
Patent Collateral or Copyright Collateral).
(b) All cash proceeds received by the Administrative Agent in
respect of any sale of, collection from, or other realization upon all
or any part of the Collateral may, in the
22
discretion of the Administrative Agent, be held by the Administrative
Agent as collateral for, and/or then or at any time thereafter applied
(after payment of any amounts payable to the Administrative Agent
pursuant to SECTION 6.2) in whole or in part by the Administrative
Agent for the ratable benefit of the Secured Parties against, all or
any part of the Secured Obligations in such order as the Administrative
Agent shall elect. Any surplus of such cash or cash proceeds held by
the Administrative Agent and remaining after payment in full in cash of
all the Secured Obligations shall be paid over to the applicable
Grantor or to whomsoever may be lawfully entitled to receive such
surplus.
SECTION 6.2. INDEMNITY AND EXPENSES.
(a) Each Grantor jointly and severally agrees to indemnify the
Administrative Agent and the other Secured Parties from and against any
and all claims, losses and liabilities arising out of or resulting from
this Security Agreement (including enforcement of this Security
Agreement), except claims, losses or liabilities resulting from the
gross negligence or wilful misconduct of the Administrative Agent or
the other Secured Parties.
(b) Each Grantor will upon demand pay to the Administrative
Agent and the other Secured Parties the amount of any and all
reasonable expenses, including the reasonable fees and disbursements of
its counsel and of any experts and agents, which the Administrative
Agent may incur in connection with
(i) the administration of this Security Agreement,
(ii) the custody, preservation, use or operation of,
or the sale of, collection from, or other realization upon,
any of the Collateral, and
(iii) the exercise or enforcement of any of the
rights of the Administrative Agent or the Secured Parties
hereunder, or (iv) the failure by any Grantor to perform or
observe any of the provisions hereof.
The provisions of this SECTION 6.2 shall survive the Termination Date.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. LOAN DOCUMENT. This Security Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof including Article XI thereof.
23
SECTION 7.2. AMENDMENTS; ETC. No amendment to or waiver of any
provision of this Security Agreement nor consent to any departure by any Grantor
here from, shall in any event be effective unless the same shall be in writing
and signed by the Administrative Agent (on behalf of the Lenders or the Required
Lenders, as the case may be), and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
SECTION 7.3. NOTICES. All notices and other communications provided for
hereunder shall be in writing (including facsimile communication) and, if to any
Grantor, mailed or telecopied or delivered to it, addressed to it, care of the
Borrower at the address for the Borrower specified in the Credit Agreement, if
to either Administrative Agent, mailed or telecopied or delivered to it,
addressed to it at the address of such Administrative Agent specified in the
Credit Agreement. All such notices and other communications, when mailed and
properly addressed with postage prepaid or if properly addressed and sent by
pre-paid courier service, shall be deemed given when received; any such notice
or communication, if transmitted by telecopier, shall be deemed given when
transmitted and electronically confirmed.
SECTION 7.4. ADDITIONAL SUBSIDIARY GRANTORS. Upon the execution and
delivery by any other Person of an instrument in the form of Annex I hereto,
such Person shall become a "Guarantor" hereunder with the same force and effect
as if originally named as a "Guarantor" herein. The execution and delivery of
any such instrument shall not require the consent of any other Guarantor
hereunder. The rights and obligations of each Guarantor hereunder shall remain
in full force and effect notwithstanding the addition of any new Guarantor as a
party to this Guaranty.
SECTION 7.5. CAPTIONS. Section captions used in this Security Agreement
are for convenience of reference only, and shall not affect the construction of
this Security Agreement.
SECTION 7.6. SEVERABILITY. Wherever possible each provision of this
Security Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Security Agreement
shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Security Agreement.
SECTION 7.7. COUNTERPARTS. This Security Agreement may be executed by
the parties hereto in several counterparts, each of which shall be deemed an
original and all of which shall constitute together but one and the same
agreement.
SECTION 7.8. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS SECURITY
AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS
5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK),
EXCEPT TO
24
THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY INTEREST HEREUNDER,
OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. THIS SECURITY
AGREEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING AMONG
THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY
PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.
SECTION 7.9. FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE SECURED
PARTIES OR ANY GRANTOR SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS
OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK LOCATED IN NEW YORK COUNTY IN THE STATE OF NEW YORK;
PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR
OTHER PROPERTY MAY BE BROUGHT, AT EITHER THE AGENT'S OPTION, IN THE COURTS OF
ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH
GRANTOR HEREBY IRREVOCABLY APPOINTS CSC UNITED STATES CORPORATION COMPANY (THE
"PROCESS AGENT"), WITH AN OFFICE ON THE DATE HEREOF AT ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, AS ITS AGENT TO RECEIVE, ON ITS BEHALF AND ON BEHALF OF
ITS PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY OTHER
PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. SUCH SERVICE MAY
BE MADE BY MAILING OR DELIVERING A COPY OF SUCH PROCESS TO SUCH GRANTOR IN CARE
OF THE PROCESS AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND EACH GRANTOR
HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT SUCH
SERVICE ON ITS BEHALF. EACH GRANTOR IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF NEW YORK ADDRESSED TO SUCH GRANTOR, CARE OF THE BORROWER,
AT THE ADDRESS FOR NOTICES SPECIFIED IN THE CREDIT AGREEMENT. EACH GRANTOR
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK, NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS
SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED
THEREBY IN CONNECTION WITH SUCH LITIGATION. EACH GRANTOR IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS BY
25
REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE
STATE OF NEW YORK. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT SUCH GRANTOR HAS OR HEREAFTER MAY ACQUIRE
ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH GRANTOR
HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS
SECURITY AGREEMENT.
SECTION 7.10. WAIVER OF JURY TRIAL. THE SECURED PARTIES AND EACH
GRANTOR HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS SECURITY AGREEMENT, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR
ACTIONS OF THE SECURED PARTIES OR EACH GRANTOR. EACH GRANTOR ACKNOWLEDGES AND
AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION
(AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY)
AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE SECURED PARTIES
ENTERING INTO THE CREDIT AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
26
IN WITNESS WHEREOF, each Grantor has caused this Security Agreement to
be duly executed and delivered by its officer thereunto duly authorized as of
the date first above written.
Assist Cornerstone Technologies, Inc.
Atlantic Aerospace Electronics Corporation
Cayenta Operating Company
Cayenta, Inc.
DBA Systems, Inc.
Delfin Systems
Diversified Control Systems, Inc.
Eldyne, Inc.
Horizons Technology, Inc.
▇.▇. Systems, Inc.
Linkabit Wireless, Inc.
Mergeco, Inc.
Pulse Sciences, Inc.
System Resources Corporation
Titan Food Pasteurization Corp.
Titan Medical Sterilization Corp.
Titan Scan Corp.
Titan Systems Corporation
Titan Unidyne Corporation
Titan Wireless, Inc.
Tomotherapeutics, Inc.
Validity Corporation
VisiCom Laboratories, Inc.
Microlithics Corporation
All By:
----------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
S-1
CREDIT SUISSE FIRST BOSTON, as
Administrative Agent
By
---------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
By
---------------------------------------------------
Name:
Title:
S-2
ANNEX I to
the Subsidiary Security Agreement
SUPPLEMENT, dated as of
________________, ____ (this "SUPPLEMENT"),
to the Subsidiary Security Agreement, dated
as of __________ __, 2000 (together with all
amendments, supplements, restatements and
other modifications, if any, from time to
time thereafter made thereto, the "SECURITY
AGREEMENT"), among the initial signatories
thereto and each other Person (such
capitalized term, and other terms used in
this Supplement, to have the meanings set
forth in Article I of the Security
Agreement) which from time to time
thereafter became a party thereto pursuant
to Section 7.4 thereof (each, individually,
a "GRANTOR", and, collectively, the
"GRANTORS"), in favor of the Secured
Parties.
W I T N E S S E T H:
WHEREAS, pursuant to the provisions of Section 7.4 of the Security
Agreement, the undersigned is becoming a Grantor under the Security Agreement;
and
WHEREAS, the undersigned Grantor desires to become a "Grantor" under
the Security Agreement in order to induce the Secured Parties to continue to
extend Credit Extensions under the Credit Agreement;
NOW, THEREFORE, in consideration of the premises, and for other
consideration (the receipt and sufficiency of which is hereby acknowledged), the
undersigned agrees, for the benefit of each Secured Party, as follows.
SECTION 1. In accordance with the terms of the Security Agreement, by
its signature below the undersigned hereby irrevocably agrees to become a
Grantor under the Security Agreement with the same force and effect as if it
were an original signatory thereto and the undersigned Grantor, hereby (a)
agrees to be bound by and comply with all of the terms and provisions of the
Security Agreement applicable to it as a Grantor and (b) represents and warrants
that the representations and warranties made by it as a Grantor thereunder are
true and correct as of the date hereof. In furtherance of the foregoing, each
reference to a "Grantor" in the Security Agreement shall be deemed to include
the undersigned Grantor.
SECTION 2. The undersigned Grantor hereby represents and warrants that
this Supplement has been duly authorized, executed and delivered by it and that
this Supplement and the Security Agreement constitute the legal, valid and
binding obligation of the undersigned Grantor, enforceable against it in
accordance with its terms.
SECTION 3. Except as expressly supplemented hereby, the Security
Agreement shall remain in full force and effect in accordance with its terms.
SECTION 4. In the event any one or more of the provisions contained in
this Supplement should be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein and in the Security Agreement shall not in any way be affected or
impaired.
SECTION 5. THIS SUPPLEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 6. This Supplement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF ADDITIONAL SUBSIDIARY
GRANTOR]
By:
--------------------------------------
Name:
Title:
ACCEPTED BY:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
SCHEDULE I
to Security Agreement
([NAME OF GRANTOR])
Item A. LOCATION OF EQUIPMENT
DESCRIPTION LOCATION
Item B. LOCATION OF INVENTORY
DESCRIPTION LOCATION
Item C. LOCATION OF LOCK BOXES
CONTACT
BANK NAME AND ADDRESS ACCOUNT NUMBER PERSON
Item D. PLACE(S) OF BUSINESS AND CHIEF EXECUTIVE OFFICE
Item E. TRADE NAMES
Item F. MERGER OR OTHER CORPORATE REORGANIZATION
Item G. LOCATION OF DEPOSIT ACCOUNTS
CONTACT
BANK NAME AND ADDRESS ACCOUNT NUMBER PERSON
Item H. LOCATION OF SECURITIES ACCOUNTS
CONTACT
BANK NAME AND ADDRESS ACCOUNT NUMBER PERSON
SCHEDULE II
to Security Agreement
([NAME OF GRANTOR])
Item A. PATENTS
ISSUED PATENTS
*COUNTRY PATENT NO. ISSUE DATE INVENTOR(S) TITLE
PENDING PATENT APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE INVENTOR(S) TITLE
Patent Applications in Preparation
EXPECTED
*COUNTRY DOCKET NO. FILING DATE INVENTOR(S) TITLE
Item B. PATENT LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
SCHEDULE III
to Security Agreement
([NAME OF GRANTOR])
Item A. TRADEMARKS
REGISTERED TRADEMARKS
*COUNTRY TRADEMARK REGISTRATION NO. REGISTRATION DATE
PENDING TRADEMARK APPLICATIONS
*COUNTRY TRADEMARK SERIAL NO. FILING DATE
TRADEMARK APPLICATIONS IN PREPARATION
EXPECTED PRODUCTS/
*COUNTRY TRADEMARK DOCKET NO. FILING DATE SERVICES
Item B. TRADEMARK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION
TERRITORY TRADEMARK LICENSOR LICENSEE DATE DATE
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
SCHEDULE IV
to Security Agreement
([NAME OF GRANTOR])
Item A. COPYRIGHTS/MASK WORKS
REGISTERED COPYRIGHTS/MASK WORKS
*COUNTRY REGISTRATION NO. REGISTRATION DATE AUTHOR(S)
TITLE
COPYRIGHT/MASK WORK PENDING REGISTRATION APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE AUTHOR(S) TITLE
COPYRIGHT/MASK WORK REGISTRATION APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE AUTHOR(S) TITLE
Item B. COPYRIGHT/MASK WORK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
SCHEDULE V
to Security Agreement
([NAME OF GRANTOR])
TRADE SECRET OR KNOW-HOW LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT A
to Security Agreement
PATENT SECURITY AGREEMENT
This PATENT SECURITY AGREEMENT (this "AGREEMENT"), dated as of February
23, 2000, is made between ___________________, a ____________ (the "GRANTOR"),
and CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as Administrative Agent
for each of the Secured Parties;
W I T N E S S E T H :
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), the various financial institutions as are or may
become parties thereto (the "LENDERS"), CSFB, as Administrative Agent, First
Union Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Borrower;
WHEREAS, in connection with the Credit Agreement, the Grantor has
executed and delivered a Subsidiary Security Agreement, dated as of February 23,
2000 (as amended, restated, supplemented or otherwise modified from time to
time, the "SECURITY AGREEMENT");
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
the Grantor is required to execute and deliver this Agreement;
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement; and
WHEREAS, it is in the best interests of the Grantor to execute this
Agreement inasmuch as the Grantor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders and the Issuers pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to induce the Lenders and the Issuers to
make Credit Extensions (including the initial Credit Extension) to the Borrower
pursuant to the Credit Agreement, the Grantor agrees, for the benefit of each
Secured Party, as follows.
A-1
SECTION 1. DEFINITIONS. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
SECTION 2. GRANT OF SECURITY INTEREST. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, to
secure all of the Secured Obligations, the Grantor does hereby mortgage, pledge
and hypothecate to the Administrative Agent, and grant to the Administrative
Agent a security interest in, for its benefit and the benefit of each Secured
Party, all of the following property (the "PATENT COLLATERAL"), whether now
owned or hereafter acquired or existing by it:
(a) all letters patent and applications for letters patent
throughout the world, including all patent applications in preparation
for filing anywhere in the world and including each patent and patent
application referred to in ITEM A of ATTACHMENT 1 attached hereto;
(b) all reissues, divisions, continuations,
continuations-in-part, extensions, renewals and reexaminations of any
of the items described in CLAUSE (a);
(c) all patent licenses, including each patent license
referred to in ITEM B of ATTACHMENT 1 attached hereto; and
(d) all proceeds of, and rights associated with, the foregoing
(including license royalties and proceeds of infringement suits), the
right to ▇▇▇ third parties for past, present or future infringements of
any patent or patent application, including any patent or patent
application referred to in ITEM A of ATTACHMENT 1 attached hereto, and
for breach or enforcement of any patent license, including any patent
license referred to in ITEM B of ATTACHMENT 1 attached hereto, and all
rights corresponding thereto throughout the world.
SECTION 3. SECURITY AGREEMENT. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Administrative Agent in the Patent Collateral with the United States Patent
and Trademark Office and corresponding offices in other countries of the world.
The security interest granted hereby has been granted as a supplement to, and
not in limitation of, the security interest granted to the Administrative Agent
for its benefit and the benefit of each Secured Party under the Security
Agreement. The Security Agreement (and all rights and remedies of the
Administrative Agent and each Secured Party thereunder) shall remain in full
force and effect in accordance with its terms.
SECTION 4. RELEASE OF SECURITY INTEREST. Upon the Termination Date, the
Administrative Agent shall, at the Grantor's expense, execute and deliver to the
Grantor all instruments and other documents as may be necessary or proper to
release the lien on and security interest in the Patent Collateral which has
been granted hereunder.
A-2
SECTION 5. ACKNOWLEDGMENT. The Grantor does hereby further acknowledge
and affirm that the rights and remedies of the Administrative Agent with respect
to the security interest in the Patent Collateral granted hereby are more fully
set forth in the Security Agreement, the terms and provisions of which
(including the remedies provided for therein) are incorporated by reference
herein as if fully set forth herein.
SECTION 6. LOAN DOCUMENT, ETC. This Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions of the Credit Agreement.
SECTION 7. COUNTERPARTS. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
A-3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF GRANTOR]
By
--------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, as
Administrative Agent
By
--------------------------------------
Name:
Title:
By
--------------------------------------
Name:
Title:
A-4
ATTACHMENT 1
to Patent Security Agreement
Item A. PATENTS
ISSUED PATENTS
*COUNTRY PATENT NO. ISSUE DATE INVENTOR(S) TITLE
PENDING PATENT APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE INVENTOR(S) TITLE
PATENT APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE INVENTOR(S) TITLE
Item B. PATENT LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
A-5
EXHIBIT B
to Security Agreement
TRADEMARK SECURITY AGREEMENT
This TRADEMARK SECURITY AGREEMENT (this "AGREEMENT"), dated as of
February 23, 2000, is made between _____________________, a ___________
__________ (the "GRANTOR"), and CREDIT SUISSE FIRST BOSTON ("CSFB"), as
Administrative Agent (the "ADMINISTRATIVE AGENT") for each of the Secured
Parties;
W I T N E S S E T H :
WHEREAS, pursuant to a Credit Agreement, dated as of February 23, 2000
(as amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among THE TITAN CORPORATION, a Delaware corporation, (the
"BORROWER"), the various financial institutions as are or may become parties
thereto (the "LENDERS"), CSFB, as Administrative Agent, First Union Securities,
Inc., as Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent,
the Lenders and the Issuers have extended Commitments to make Credit Extensions
to the Borrower;
WHEREAS, in connection with the Credit Agreement, the Grantor has
executed and delivered a Subsidiary Security Agreement, dated as of February 23,
2000 (as amended, restated, supplemented or otherwise modified from time to
time, the "SECURITY AGREEMENT");
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
the Grantor is required to execute and deliver this Agreement;
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement; and
WHEREAS, it is in the best interests of the Grantor to execute this
Agreement inasmuch as the Grantor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders and the Issuers pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to induce the Lenders and the Issuers to
make Credit Extensions (including the initial Credit Extension) to the Borrower
pursuant to the Credit Agreement, the Grantor agrees, for the benefit of each
Secured Party, as follows.
B-1
SECTION 1. DEFINITIONS. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
SECTION 2. GRANT OF SECURITY INTEREST. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, to
secure all of the Secured Obligations, the Grantor does hereby mortgage, pledge
and hypothecate to the Administrative Agent, and grant to the Administrative
Agent a security interest in, for its benefit and the benefit of each Secured
Party, all of the following property (the "TRADEMARK COLLATERAL"), whether now
owned or hereafter acquired or existing by it:
(a) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service
marks, certification marks, collective marks, logos, other source of
business identifiers, prints and labels on which any of the foregoing
have appeared or appear, designs and general intangibles of a like
nature (all of the foregoing items in this CLAUSE (A) being
collectively called a "TRADEMARK"), now existing anywhere in the world
or hereafter adopted or acquired, whether currently in use or not, all
registrations and recordings thereof and all applications in connection
therewith, whether pending or in preparation for filing, including
registrations, recordings and applications in the United States Patent
and Trademark Office or in any office or agency of the United States of
America or any State thereof or any foreign country, including those
referred to in ITEM A of ATTACHMENT 1 attached hereto;
(b) all Trademark licenses, including each Trademark license
referred to in ITEM B of ATTACHMENT 1 attached hereto;
(c) all reissues, extensions or renewals of any of the items
described in CLAUSES (A) and (B);
(d) all of the goodwill of the business connected with the use
of, and symbolized by the items described in, CLAUSES (A) and (B); and
(e) all proceeds of, and rights associated with, the
foregoing, including any claim by the Grantor against third parties for
past, present or future infringement or dilution of any Trademark,
Trademark registration or Trademark license, including any Trademark,
Trademark registration or Trademark license referred to in ITEM A and
ITEM B of ATTACHMENT 1 attached hereto, or for any injury to the
goodwill associated with the use of any such Trademark or for breach or
enforcement of any Trademark license.
SECTION 3. SECURITY AGREEMENT. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Administrative Agent in the Trademark Collateral with the United States
Patent and Trademark Office and corresponding
B-2
offices in other countries of the world. The security interest granted hereby
has been granted as a supplement to, and not in limitation of, the security
interest granted to the Administrative Agent for its benefit and the benefit of
each Secured Party under the Security Agreement. The Security Agreement (and all
rights and remedies of the Administrative Agent and each Secured Party
thereunder) shall remain in full force and effect in accordance with its terms.
SECTION 4. RELEASE OF SECURITY INTEREST. Upon the Termination Date, the
Administrative Agent shall, at the Grantor's expense, execute and deliver to the
Grantor all instruments and other documents as may be necessary or proper to
release the lien on and security interest in the Trademark Collateral which has
been granted hereunder.
SECTION 5. ACKNOWLEDGMENT. The Grantor does hereby further acknowledge
and affirm that the rights and remedies of the Administrative Agent with respect
to the security interest in the Trademark Collateral granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which
(including the remedies provided for therein) are incorporated by reference
herein as if fully set forth herein.
SECTION 6. LOAN DOCUMENT, ETC. This Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions of the Credit Agreement.
SECTION 7. COUNTERPARTS. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
B-3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF GRANTOR]
By
--------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, as
Administrative Agent
By
--------------------------------------
Name:
Title:
By
--------------------------------------
Name:
Title:
B-4
ATTACHMENT 1
to Trademark
Security Agreement
Item A. TRADEMARKS
REGISTERED TRADEMARKS
*COUNTRY TRADEMARK REGISTRATION NO. REGISTRATION DATE
PENDING TRADEMARK APPLICATIONS
*COUNTRY TRADEMARK SERIAL NO. FILING DATE
TRADEMARK APPLICATIONS IN PREPARATION
EXPECTED PRODUCTS/
*COUNTRY TRADEMARK DOCKET NO. FILING DATE SERVICES
Item B. TRADEMARK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION
TERRITORY TRADEMARK LICENSOR LICENSEE DATE DATE
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT C
to Security Agreement
COPYRIGHT SECURITY AGREEMENT
This COPYRIGHT SECURITY AGREEMENT (this "AGREEMENT"), dated as of
February 23, 2000, is made between _____________________, a __________ (the
"GRANTOR"), and CREDIT SUISSE FIRST BOSTON ("CSFB"), in its capacity as
Administrative Agent (the "ADMINISTRATIVE AGENT") for each of the Secured
Parties;
W I T N E S S E T H :
WHEREAS, pursuant to a Credit Agreement, dated as of February 23, 2000
(as amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among THE TITAN CORPORATION, a Delaware corporation (the
"BORROWER"), the various financial institutions as are or may become parties
thereto (the "LENDERS"), CSFB, as Administrative Agent, First Union Securities,
Inc., as Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent,
the Lenders and the Issuers have extended Commitments to make Credit Extensions
to the Borrower;
WHEREAS, in connection with the Credit Agreement, the Grantor has
executed and delivered a Subsidiary Security Agreement, dated as of February 23,
2000 (as amended, restated, supplemented or otherwise modified from time to
time, the "SECURITY AGREEMENT");
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
the Grantor is required to execute and deliver this Agreement;
WHEREAS, the Grantor has duly authorized the execution, delivery and
performance of this Agreement; and
WHEREAS, it is in the best interests of the Grantor to execute this
Agreement inasmuch as the Grantor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders and the Issuers pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to induce the Lenders and the Issuers to
make Credit Extensions (including the initial Credit Extension) to the Borrower
pursuant to the Credit Agreement, the Grantor agrees, for the benefit of each
Secured Party, as follows.
C-1
SECTION 1. DEFINITIONS. Unless otherwise defined herein or the context
otherwise requires, terms used in this Agreement, including its preamble and
recitals, have the meanings provided (or incorporated by reference) in the
Security Agreement.
SECTION 2. GRANT OF SECURITY INTEREST. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, to
secure all of the Secured Obligations, the Grantor does hereby mortgage, pledge
and hypothecate to the Administrative Agent, and grant to the Administrative
Agent a security interest in, for its benefit and the benefit of each Secured
Party, all of the following property (the "COPYRIGHT COLLATERAL"), whether now
owned or hereafter acquired or existing by it, being all copyrights (including
all copyrights for semi-conductor chip product mask works) of the Grantor,
whether statutory or common law, registered or unregistered, now or hereafter in
force throughout the world including all of the Grantor's right, title and
interest in and to all copyrights registered in the United States Copyright
Office or anywhere else in the world and also including the copyrights referred
to in ITEM A of ATTACHMENT 1 attached hereto, and all applications for
registration thereof, whether pending or in preparation, all copyright licenses,
including each copyright license referred to in ITEM B of ATTACHMENT 1 attached
hereto, the right to ▇▇▇ for past, present and future infringements of any
thereof, all rights corresponding thereto throughout the world, all extensions
and renewals of any thereof and all proceeds of the foregoing, including
licenses, royalties, income, payments, claims, damages and proceeds of suit.
SECTION 3. SECURITY AGREEMENT. This Agreement has been executed and
delivered by the Grantor for the purpose of registering the security interest of
the Administrative Agent in the Copyright Collateral with the United States
Copyright Office and corresponding offices in other countries of the world. The
security interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Administrative Agent for its
benefit and the benefit of each Secured Party under the Security Agreement. The
Security Agreement (and all rights and remedies of the Administrative Agent and
each Secured Party thereunder) shall remain in full force and effect in
accordance with its terms.
SECTION 4. RELEASE OF SECURITY INTEREST. Upon the Termination Date, the
Administrative Agent shall, at the Grantor's expense, execute and deliver to the
Grantor all instruments and other documents as may be necessary or proper to
release the lien on and security interest in the Copyright Collateral which has
been granted hereunder.
SECTION 5. ACKNOWLEDGMENT. The Grantor does hereby further acknowledge
and affirm that the rights and remedies of the Administrative Agent with respect
to the security interest in the Copyright Collateral granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which
(including the remedies provided for therein) are incorporated by reference
herein as if fully set forth herein.
SECTION 6. LOAN DOCUMENT, ETC. This Agreement is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be
C-2
construed, administered and applied in accordance with the terms and provisions
of the Credit Agreement.
SECTION 7. COUNTERPARTS. This Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
C-3
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF GRANTOR]
By
--------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON, as
Administrative Agent
By
--------------------------------------
Name:
Title:
By
--------------------------------------
Name:
Title:
C-4
ATTACHMENT 1
to Copyright
Security Agreement
Item A. COPYRIGHTS/MASK WORKS
REGISTERED COPYRIGHTS/MASK WORKS
*COUNTRY REGISTRATION NO. REGISTRATION DATE AUTHOR(S) TITLE
COPYRIGHT/MASK WORK PENDING REGISTRATION APPLICATIONS
*COUNTRY SERIAL NO. FILING DATE AUTHOR(S) TITLE
COPYRIGHT/MASK WORK REGISTRATION APPLICATIONS IN PREPARATION
EXPECTED
*COUNTRY DOCKET NO. FILING DATE AUTHOR(S) TITLE
Item B. COPYRIGHT/MASK WORK LICENSES
*COUNTRY OR EFFECTIVE EXPIRATION SUBJECT
TERRITORY LICENSOR LICENSEE DATE DATE MATTER
--------
* List items related to the United States first for ease of recordation.
List items related to other countries next, grouped by country and in
alphabetical order by country name.
EXHIBIT H
DESCRIPTION OF OPINION OF OBLIGORS' COUNSEL
The opinions of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius, LLP and ▇▇▇▇▇▇ Godward LLP, counsel to
the Obligors, which are called for by Section 5.1(n) of the Senior Secured
Credit Agreement dated as of February 23, 2000 (the "Credit Agreement"), among
The Titan Corporation, as Borrower, the Lenders from time to time party thereto,
Credit Suisse First Boston, as Administrative Agent, First Union Securities,
Inc., as Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent,
shall be dated the Closing Date and addressed to Credit Suisse First Boston, as
Administrative Agent, and the Lenders and shall be satisfactory in scope and
form to the Administrative Agent and its counsel. Capitalized terms not defined
herein shall have the meanings assigned to such terms in the Credit Agreement.
The opinion shall be to the effect that:
1. Each Obligor is a corporation (or other entity) duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation or formation, has full power and authority and is duly
authorized to conduct the activities in which it is now engaged, and is
duly licensed or qualified and is in good standing as a foreign
corporation (or other entity) in each jurisdiction in which the
character of the properties owned or leased by it or the nature of the
business transacted by it makes such licensing or qualification
necessary.
2. Each Obligor has corporate (or other) power and authority and is duly
authorized to enter into and perform its obligations under the Loan
Documents.
3. The Loan Documents have been duly authorized, executed and delivered by
each Obligor and constitute the valid and binding contracts and
agreements of each Obligor, enforceable in accordance with their
respective terms, except as enforceability thereof may be limited by
(i) bankruptcy, insolvency, fraudulent conveyance or similar laws
affecting the enforcement of creditors' rights generally, and (ii)
equitable principles of general applicability (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
4. No approval, consent or withholding of objection on the part of, or
filing, registration or qualification with, any governmental body,
Federal, state or local, is necessary in connection with the lawful
execution, delivery and performance of the Loan Documents.
5. The execution and delivery by the Obligors of the Loan Documents and
the performance by the Obligors of the transactions contemplated
thereby do not and will not (a) violate, conflict with or result in any
default under (i) any order, writ, injunction or decree of any court or
governmental authority or agency binding upon the Obligors or to which
the Obligors are subject, (ii) the Organic Documents of the Obligors or
(iii) any material contractual obligation of the Obligors or the HIGH
TIDES Documents or (b) result in the creation or imposition of any Lien
upon any of the assets or properties of the Obligors (other than Liens
created pursuant to the Collateral Documents).
6. Neither the execution, delivery or performance by any of the Obligors
of the Loan Documents nor the compliance by the Obligors with the terms
and provisions thereof will contravene any provision of any applicable
laws, rules and regulations (including, without limitation, Regulations
T, U and X of the Federal Reserve Board).
7. The delivery to the Administrative Agent of the certificates
representing the Pledged Interests (as defined in the Borrower Pledge
Agreement and the Subsidiary Pledge Agreement), together with the
execution of each of the Borrower Pledge Agreement and the Subsidiary
Pledge Agreement, is effective to create in favor of the Administrative
Agent on behalf of the Lenders a valid and perfected security interest
in the Pledged Interests to secure the Obligations. No interest of any
other creditor of any of the Obligors is equal or prior to the security
interest of the Administrative Agent on behalf of the Lenders in the
Pledged Interests.
8. The provisions of the Borrower Security Agreement and the Subsidiary
Security Agreement (collectively, the "Security Agreements") are
effective to create, in favor of the Administrative Agent for the
benefit of the Lenders to secure the Obligations, a valid security
interest in each Obligor's rights in that portion of the Collateral (as
defined in the Security Agreements) pledged by it which is subject to
Article 9 of the UCC.
9. The UCC-1 financing statements executed in connection with the Security
Agreements (the "Financing Statements") are in appropriate form for
filing in each of the filing offices identified on Schedule __ (the
"Filing Offices") under the UCC, and the description (including the
exhibits attached thereto) of the property in which a security interest
is granted pursuant to the respective Collateral Documents is a
sufficient description of the property in which such security interest
is created, to the extent a security interest in such property is
governed by the UCC of the applicable jurisdiction. To the extent that
the filing of a financing statement can be
effective to perfect a security interest in the Collateral under the
UCC, the security interest in favor of the Administrative Agent for the
benefit of the Lenders in that portion of the Collateral described in
the Financing Statements will be perfected upon the filing of the
Financing Statements in the respective Filing Offices.
10. To the extent that the federal trademark laws of the United States are
applicable, the interest of the Administrative Agent created pursuant
to the provisions of the Security Agreements in the United States
registered trademarks and trademark applications set forth on Schedule
III to the Security Agreements (the "Trademarks") shall be effective
against subsequent purchasers of such Trademarks upon recordation of
the Trademark Security Agreements in the United States Patent and
Trademark Office within three months of the date hereof.
11. To the extent that the federal copyright laws of the United States are
applicable, the interest of the Administrative Agent created pursuant
to the provisions of the Security Agreements in the United States
registered copyrights set forth on Schedule IV to the Security
Agreements (the "Copyrights") shall be effective against subsequent
"transfers of copyright ownership" (as that term is defined in ▇▇▇▇▇▇▇
▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Copyright Act, 17 U.S.C. Section 101) upon
recordation of the Copyright Security Agreements in the United States
Copyright Office within one month of the date hereof.
12. To the extent that the federal patent laws of the United States are
applicable, the interest of the Administrative Agent created pursuant
to the provisions of the Security Agreements in the United States
patents and patent applications set forth on Schedule II to the
Security Agreements (the "Patents") shall be effective against
subsequent purchasers or mortgagees of such Patents upon recordation of
the Patent Security Agreement in the United States Patent and Trademark
Office within three months of the date hereof.
13. None of the Obligors is, after giving effect to the transactions
contemplated by the Loan Documents and the application of the net
proceeds from the making of the Loans under the Credit Agreement (i) an
"investment company" required to register as such under the Investment
Company Act of 1940, as amended, or (ii) 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.
14. There are no actions, suits or proceedings pending or threatened which
could reasonably be expected to have a Material Adverse Effect.
The opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius, LLP shall cover such other
matters relating to the Loan Documents as the Administrative Agent or
its counsel may reasonably request. With respect to matters of fact on
which such opinion is based, such counsel shall be entitled to rely on
appropriate certificates of public officials and officers of the
Obligors.
EXHIBIT I
SUBSIDIARY GUARANTY
This SUBSIDIARY GUARANTY (as amended, restated, supplemented, or
otherwise modified from time to time, this GUARANTY"), dated as of February 23,
2000, is made by each U.S. Subsidiary of THE TITAN CORPORATION, a Delaware
corporation (the "BORROWER"), now or after the date hereof (including pursuant
to SECTION 5.5) a party to this Guaranty (individually referred to as a
"GUARANTOR" and collectively referred to as the "GUARANTORS") in favor of each
of the Secured Parties, including CREDIT SUISSE FIRST BOSTON, in its capacity as
the Administrative Agent.
W I T N E S S E T H:
WHEREAS, pursuant to a Senior Secured Credit Agreement, dated as of
February 23, 2000 (as amended, restated, supplemented, or otherwise modified
from time to time, the "CREDIT AGREEMENT"), among the Borrower, the various
financial institutions as are, or may from time to time become, parties thereto
(collectively referred to as the "LENDERS"), the Administrative Agent, First
Union Securities, Inc., as Syndication Agent, and The Bank of Nova Scotia, as
Documentation Agent, the Lenders and the Issuers have extended Commitments to
make Credit Extensions to the Borrower;
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
each Guarantor is required to execute and deliver this Guaranty;
WHEREAS, each Guarantor has duly authorized the execution,
delivery and performance
of this Guaranty; and
WHEREAS, it is in the best interests of each Guarantor to execute this
Guaranty inasmuch as such Guarantor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrower by
the Lenders and the Issuers pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to induce the Lenders and the Issuers to
make Credit Extensions (including the initial Credit Extension) to the Borrower,
each Guarantor jointly and severally agrees, for the benefit of each Secured
Party, as follows:
1
ARTICLE I
DEFINITIONS
SECTION 1.1. CERTAIN TERMS. The following terms (whether or not
underscored) when used in this Guaranty, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof):
"BORROWER" is defined in the PREAMBLE.
"CREDIT AGREEMENT" is defined in the FIRST RECITAL.
"GUARANTOR" and "GUARANTORS" is defined in the PREAMBLE.
"GUARANTY" is defined in the PREAMBLE.
"INTEREST RATE HEDGING AGREEMENTS" means interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, and all other
agreements or arrangements designed to protect a Guarantor against fluctuations
in interest rates, entered into between such Guarantor and a Lender or an
Affiliate of a Lender, for the purpose of hedging interest rate risk with
respect to the Obligations.
"LENDERS" is defined in the FIRST RECITAL.
"TERMINATION DATE" means the date on which all Obligations have
indefeasibly been paid in full, all Commitments have been fully
terminated and all Letters of Credit have been canceled or otherwise
terminated.
SECTION 1.2. CREDIT AGREEMENT DEFINITIONS. Unless otherwise defined
herein or the context otherwise requires, terms used in this Guaranty, including
its preamble and recitals, have the meanings provided in the Credit Agreement.
ARTICLE II
GUARANTY PROVISIONS
SECTION 2.1. GUARANTY. Each Guarantor hereby jointly and severally
absolutely, unconditionally and irrevocably
2
(a) guarantees the full and punctual payment when due, whether
at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise, of all Obligations of the Borrower and each other
Obligor now or hereafter existing, whether for principal, interest
(including interest accruing at the then applicable rate provided in
the Credit Agreement after the occurrence of any Default set forth in
Section 9.1(i) of the Credit Agreement, whether or not a claim for
post-filing or post-petition interest is allowed under applicable law
following the institution of a proceeding under bankruptcy, insolvency
or similar laws), fees, Reimbursement Obligations, Hedging Obligations,
expenses or otherwise (including all such amounts which would become
due but for the operation of the automatic stay under Section 362(a) of
the United States Bankruptcy Code, 11 U.S.C. Section 362(a), and the
operation of Sections 502(b) and 506(b) of the United States Bankruptcy
Code, 11 U.S.C. Section 502(b) and Section 506(b)); and
(b) indemnifies and holds harmless each Secured Party for any
and all costs and expenses (including reasonable attorneys' fees and
expenses) incurred by such Secured Party in enforcing any rights under
this Guaranty;
PROVIDED, HOWEVER, that each Guarantor shall only be liable under this Guaranty
for the maximum amount of such liability that can be hereby incurred without
rendering this Guaranty, as it relates to such Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer, and not
for any greater amount. This Guaranty constitutes a guaranty of payment when due
and not of collection, and each Guarantor specifically agrees that it shall not
be necessary or required that any Secured Party exercise any right, assert any
claim or demand or enforce any remedy whatsoever against the Borrower, any other
Obligor or any other Person before or as a condition to the obligations of such
Guarantor hereunder.
SECTION 2.2. REINSTATEMENT, ETC. Each Guarantor hereby jointly and
severally agrees that this Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time any payment (in whole or in part)
of any of the Obligations is invalidated, declared to be fraudulent or
preferential, set aside, rescinded or must otherwise be restored by any Secured
Party, upon the insolvency, bankruptcy, reorganization (or similar event) of the
Borrower, any other Obligor or otherwise, all as though such payment had not
been made.
SECTION 2.3. GUARANTY ABSOLUTE, ETC. This Guaranty shall in all
respects be a continuing, absolute, unconditional and irrevocable guaranty of
payment, and shall remain in full force and effect until the Termination Date
has occurred. Each Guarantor jointly and severally guarantees that the
Obligations of the Borrower and each other Obligor will be paid strictly in
accordance with the terms of the Credit Agreement, each other Loan Document and
any Interest Rate Hedging Agreement under which they arise, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of any Secured Party with respect
thereto. The liability of each Guarantor under this Guaranty shall be joint and
several, absolute, unconditional and irrevocable irrespective of:
3
(a) any lack of validity, legality or enforceability of the
Credit Agreement or any other Loan Document;
(b) the failure of any Secured Party
(i) to assert any claim or demand or to enforce any
right or remedy against the Borrower, any other Obligor or any
other Person (including any other guarantor) under the
provisions of the Credit Agreement, any other Loan Document,
any Interest Rate Hedging Agreement or otherwise, or
(ii) to exercise any right or remedy against any
other guarantor (including each Guarantor) of, or collateral
securing, any Obligations;
(c) any change in the time, manner or place of payment of, or
in any other term of, all or any part of the Obligations, or any
extension, compromise or renewal of any Obligation;
(d) any reduction, limitation, impairment or termination of
any Obligations for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to (and
each Guarantor hereby waives any right to or claim of) any defense or
setoff, counterclaim, recoupment or termination whatsoever by reason of
the invalidity, illegality, nongenuineness, irregularity, compromise,
unenforceability of, or any other event or occurrence affecting, any
Obligations or otherwise;
(e) any amendment to, rescission, waiver, or other
modification of, or any consent to or departure from, any of the terms
of the Credit Agreement, any other Loan Document or any Interest Rate
Hedging Agreement, including without limitation any increase in the
Obligations from the extension of additional credit to the Borrower or
otherwise;
(f) any addition, exchange, release, surrender or
non-perfection of any collateral, or any amendment to or waiver or
release or addition of, or consent to or departure from, any other
guaranty held by any Secured Party securing any of the Obligations;
(g) any change, restructuring or termination of the corporate
structure or existence of the Borrower or any other Obligor; or
(h) any other circumstance which might otherwise constitute a
defense available to, or a legal or equitable discharge of, the
Borrower, any other Obligor, any surety or any guarantor.
SECTION 2.4. SETOFF. Each Guarantor hereby irrevocably authorizes the
Administrative Agent and each other Secured Party, without the requirement that
any notice be
4
given to such Guarantor (such notice being expressly waived by each Guarantor),
upon the occurrence and during the continuance of any Default described in
SECTION 9.1(i) of the Credit Agreement as it relates to the Borrower or upon the
occurrence and during the continuance of any other Event of Default, to set-off
and appropriate and apply to the payment of the Obligations owing to the Secured
Parties (whether or not then due, and whether or not the Administrative Agent or
such other Secured Party has made any demand for payment of the Obligations),
any and all balances, claims, credits, deposits (general or special, time or
demand, provisional or final), accounts or money of such Guarantor then or
thereafter maintained with such Secured Party; PROVIDED, HOWEVER, that any such
appropriation and application shall be subject to the provisions of Section 4.8
of the Credit Agreement. Each Secured Party agrees to notify the applicable
Guarantor and the Administrative Agent after any such setoff and application
made by such Secured Party; PROVIDED, HOWEVER, that the failure to give such
notice shall not affect the validity of such setoff and application. The rights
of each Secured Party under this Section are in addition to other rights and
remedies (including other rights of setoff under applicable law or otherwise)
which such Secured Party may have.
SECTION 2.5. WAIVER, ETC.
(a) Each Guarantor hereby waives promptness, diligence, notice
of acceptance and any other notice with respect to any of the Obligations and
this Guaranty and any requirement that the Administrative Agent or any other
Secured Party protect, secure, perfect or insure any Lien, or any property
subject thereto, or exhaust any right or take any action against the Borrower,
any other Obligor or any other Person (including any other guarantor) or entity
or any collateral securing the Obligations, as the case may be.
(b) Each Guarantor hereby waives any right to revoke this
Guaranty, and acknowledges that this Guaranty is continuing in nature and
applies to all Obligations, whether
existing now or in the future.
(c) Each Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing arrangements
contemplated by the Loan Documents and that the waivers set forth in this
Section 2.5 are knowingly made in contemplation of such benefits.
(d) Each Guarantor assumes all responsibility for being and
keeping itself informed of the financial condition and assets of the Borrower,
and of all other circumstances bearing upon the risk of non-payment of the
Obligations and the nature, scope and extent of the risks the Guarantors assume
and incur hereunder, and agrees that the Secured Parties shall have no duty to
advise the Guarantors of information known to them regarding such circumstances
or risks.
(e) Each Guarantor hereby waives any right to enforce any
other remedy that the Secured Parties now have or may hereafter have against any
third party, any endorser or any other guarantor of all or any part of the
Obligations and any benefit of and any right to participate
5
in, any security or collateral given to or for the benefit of the Secured
Parties to secure payment of the Obligations.
(f) Each Guarantor hereby waives all claims (as such term is
defined in the United States Bankruptcy Code) it may at any time otherwise have
against the Borrower arising from any transaction whasoever, including, without
limitation, its rights to assert or enforce any such claims.
(g) Each Guarantor hereby waives, to the fullest extent
permitted by applicable law, without limiting the generality of the foregoing or
any other provision hereof, all rights and benefits which might otherwise be
available to the Subsidiary Guarantor under Sections 2809, 2810, 2815, 2819,
2821, 2839, 2845, 2848, 2849, 2850, 2899 and 3433 of the California Civil Code.
(h) Each Guarantor acknowledges and affirms that it
understands and is aware that if the Administrative Agent on behalf of the
Secured Parties elects to foreclose on any real property security nonjudicially,
any right of subrogation of such Guarantor against the Borrower may be impaired
or extinguished and that as a result of such impairment or extinguishment or
subrogation rights, the Guarantors might otherwise have a defense to a
deficiency judgment arising out of the operation of Section 580d of the
California Code of Civil Procedure and related principles of estoppel, and
waives any defense arising out of any such election by the Administrative Agent
on behalf of the Secured Parties, including, without limitation, the defense
arising out of the operation of Section 580d of the Code of Civil Procedure and
related principles of estoppel, even though such election operates to impair or
extinguish any right of reimbursement or subrogation or other right or remedy of
the Guarantors against the Company or any other party or any security.
SECTION 2.6. SUBROGATION. Each Guarantor agrees that it will not
exercise any rights that it may now have or hereafter acquire against the
Borrower that arise from the existence, payment, performance or enforcement of
such Guarantor's Obligations under this Guaranty or any other Loan Document,
including without limitation any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to participate in any
claim or remedy of the Administrative Agent or any beneficiary against the
Borrower or any Collateral, whether or not such claim, remedy or right arises at
equity or under contract, statute or common law, including without limitation
the right to take or receive from the Borrower, directly or indirectly, in cash
or other property or by set-off or in any other manner, payment or security on
account of such claim, remedy or right except as specifically otherwise provided
in the Loan Documents. Any amount paid to any Guarantor on account of any such
subrogation rights shall be held in trust for the benefit of the Secured Parties
and shall immediately be paid and turned over to the Administrative Agent for
the benefit of the Secured Parties in the exact form received by such Guarantor
(duly endorsed in favor of the Administrative Agent, if required), to be
credited and applied against the Obligations, whether matured or unmatured, in
accordance with SECTION 2.8; PROVIDED, HOWEVER, that if
6
(a) any Guarantor has made payment to the Secured Parties of
all or any part of the Obligations; and
(b) the Termination Date has occurred;
then at such Guarantor's request, the Administrative Agent, (on behalf of the
Secured Parties) will, at the expense of such Guarantor, execute and deliver to
such Guarantor appropriate documents (without recourse and without
representation or warranty) necessary to evidence the transfer by subrogation to
such Guarantor of an interest in the Obligations resulting from such payment by
such Guarantor. In furtherance of the foregoing, at all times prior to the
Termination Date, each Guarantor shall refrain from taking any action or
commencing any proceeding against the Borrower or any other Obligor (or its
successors or assigns, whether in connection with a bankruptcy proceeding or
otherwise) to recover any amounts in the respect of payments made under this
Guaranty to any Secured Party. Notwithstanding the foregoing, to the extent
necessary to toll the statute of limitations, such Guarantor may take such
action required to preserve any rights it has by way of rights of subrogation as
consented to by the Administrative Agent in its reasonable discretion.
SECTION 2.7. SUCCESSORS, TRANSFEREES AND ASSIGNS, ETC.
This Guaranty shall:
(a) be binding upon each Guarantor, and its
successors, transferees and assigns;
and
(b) inure to the benefit of and be enforceable by
the Administrative Agent and
each other Secured Party.
Without limiting the generality of CLAUSE (b), any Lender may assign or
otherwise transfer (in whole or in part) any Note, Credit Extension or
Commitment held by it to any other Person and such other Person shall thereupon
become vested with all rights and benefits in respect thereof granted to such
Lender under any Loan Document (including this Guaranty) or otherwise, in each
case as provided in Section 11.11 of the Credit Agreement.
SECTION 2.8. PAYMENTS; APPLICATION. Each Guarantor
hereby agrees with each Secured
Party as follows:
(a) Each Guarantor agrees that all payments made by such
Guarantor hereunder will be made in Dollars to the Administrative
Agent, without set-off, counterclaim or other defense and in accordance
with Sections 4.6 and 4.7 of the Credit Agreement, free and clear of
and without deduction for any Taxes, the Guarantor hereby agreeing to
comply with and be bound by the provisions of Sections 4.6 and 4.7 of
the Credit Agreement in respect of all payments made by it hereunder
and the provisions of which Sections are hereby incorporated into and
made a part of this Guaranty by this reference as if set forth herein;
PROVIDED, that references to the "Borrower" in such Sections shall be
7
deemed to be references to each Guarantor, and references to "this
Agreement" shall be deemed to be references to this Guaranty.
(b) All payments made hereunder shall be applied upon receipt
as follows:
(i) first, to the payment of all Obligations owing to
the Administrative Agent pursuant to Section 11.3 of the
Credit Agreement;
(ii) second, after payment in full of the amounts
specified in CLAUSE (b)(i), to the ratable payment of all
other Obligations owing to the Secured Parties, with such
amounts applied first to fees and expenses, then to accrued
and unpaid interest, then to the outstanding principal amount
of the Loans, then to Letter of Credit Outstandings and then
to Interest Rate Hedging Obligations; and
(iii) third, after payment in full of the amounts
specified in CLAUSES (b)(i) and (b)(ii), and following the
Termination Date, to such Guarantor or any other Person
lawfully entitled to receive such surplus.
SECTION 2.9. ACCELERATION OF GUARANTY. Each Guarantor hereby jointly
and severally agrees that, in the event of an Event of Default under Section
9.1(i) of the Credit Agreement, and if such Default shall occur at a time when
any of the Obligations may not then be due and payable, each Guarantor jointly
and severally agrees that it will pay to the Administrative Agent (for the
benefit of the Secured Parties) forthwith the full amount which would be payable
hereunder by each Guarantor if all such Obligations were then due and payable.
SECTION 2.10. RELEASE OF CAYENTA. Each member of the Cayenta Group
shall be automatically released from this Guaranty and shall no longer be a
"Guarantor" hereunder upon the occurrence of the following conditions precedent:
(a) the issuance of shares in connection with the initial public offering of
Cayenta pursuant to the terms of the applicable underwriting agreement and (b)
delivery of an officer's certificate to the Administrative Agent certifying that
no Default shall have occurred and then be continuing or would result from the
initial public offering.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. REPRESENTATIONS. In order to induce the Secured Parties to
enter into the Credit Agreement and make Credit Extensions thereunder, each
Guarantor represents and warrants to each Secured Party that the representations
and warranties contained in Article VI of the Credit Agreement, insofar as the
representations and warranties contained therein are applicable to it and its
properties, are true and correct (it being understood that such representations
and warranties not qualified by reference to materiality or Material Adverse
Effect shall be true and correct in all material respects), each such
representation and warranty set
8
forth in such Article (insofar as applicable as aforesaid) and all other terms
of the Credit Agreement to which reference is made therein, together with all
related definitions and ancillary provisions, being hereby incorporated into
this Guaranty by this reference as though specifically set forth in this
Article. Furthermore, each Guarantor represents that it has knowledge of the
Borrower's and each other Obligor's financial condition and affairs and that it
has adequate means to obtain from the Borrower and each other Obligor on an
ongoing basis information relating thereto and to the Borrower's and such
Obligor's ability to pay and perform the Obligations, and agrees to assume the
responsibility for keeping, and to keep, so informed for so long as this
Guaranty is in effect. Each Guarantor acknowledges and agrees that the Secured
Parties shall have no obligation to investigate the financial condition or
affairs of any Obligor for the benefit of such Guarantor nor to advise such
Guarantor of any fact respecting, or any change in, the financial condition or
affairs of the Borrower or any other Obligor that might become known to any
Secured Party at any time, whether or not such Secured Party knows or believes
or has reason to know or believe that any such fact or change is unknown to such
Guarantor, or might (or does) materially increase the risk of such Guarantor as
guarantor, or might (or would) affect the willingness of such Guarantor to
continue as a guarantor of the Obligations.
ARTICLE IV
COVENANTS, ETC.
SECTION 4.1. COVENANTS. Each Guarantor covenants and agrees that, at
all times prior to the Termination Date, it will perform, comply with and be
bound by all of the agreements, covenants and obligations contained in the
Credit Agreement (including Articles VII and VIII thereof) which are applicable
to such Guarantor or its properties, each such agreement, covenant and
obligation contained in the Credit Agreement and all other terms of the Credit
Agreement to which reference is made herein, together with all related
definitions and ancillary provisions, being hereby incorporated into this
Guaranty by this reference as though specifically set forth in this Article.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1. LOAN DOCUMENT. This Guaranty is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article XI thereof.
SECTION 5.2. BINDING ON SUCCESSORS, TRANSFEREES AND ASSIGNS;
ASSIGNMENT. In addition to, and not in limitation of, SECTION 2.7, this Guaranty
shall be jointly and severally binding upon each Guarantor and its successors,
transferees and assigns and shall inure to the benefit of and be enforceable by
each Secured Party and their respective successors, transferees
9
and assigns (to the full extent provided pursuant to SECTION 2.7); PROVIDED,
HOWEVER, that no Guarantor may (unless otherwise permitted under the terms of
the Credit Agreement) assign any of its obligations hereunder without the prior
written consent
of all Lenders.
SECTION 5.3. AMENDMENTS, ETC. No amendment to or waiver of any
provision of this Guaranty, nor consent to any departure by any Guarantor
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Administrative Agent (on behalf of the Lenders or the Required
Lenders, as the case may be, pursuant to Section 11.1 of the Credit Agreement)
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
SECTION 5.4. NOTICES. All notices and other communications provided for
hereunder shall be in writing (including facsimile communication) and, mailed or
telecopied or delivered to each Guarantor, in care of the Borrower at the
address or facsimile number of the Borrower specified in the Credit Agreement.
All such notices and other communications, when mailed and properly addressed
with postage prepaid or if properly addressed and sent by pre-paid courier
service, shall be deemed given when received; any such notice or communication,
if transmitted by facsimile, shall be deemed given when the confirmation of
transmission thereof is received by the transmitter.
SECTION 5.5. ADDITIONAL SUBSIDIARY GUARANTORS. Upon the execution and
delivery by any other Person of an instrument in the form of ANNEX I hereto,
such Person shall become a "Guarantor" hereunder with the same force and effect
as if originally named as a "Guarantor" herein. The execution and delivery of
any such instrument shall not require the consent of any other Guarantor
hereunder. The rights and obligations of each Guarantor hereunder shall remain
in full force and effect notwithstanding the addition of any new Guarantor as a
party to this Guaranty.
SECTION 5.6. NO WAIVER; REMEDIES. In addition to, and not in limitation
of, SECTION 2.3 and SECTION 2.5, no failure on the part of any Secured Party to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
SECTION 5.7. CAPTIONS. Section captions used in this Guaranty are for
convenience of reference only, and shall not affect the construction of this
Guaranty.
SECTION 5.8. SEVERABILITY. Wherever possible each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.
10
SECTION 5.9. GOVERNING LAW, ENTIRE AGREEMENT, ETC. THIS GUARANTY SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). THIS GUARANTY AND THE OTHER
LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE PARTIES HERETO WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN
OR ORAL, WITH RESPECT THERETO.
SECTION 5.10. FORUM SELECTION AND CONSENT TO Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
GUARANTY OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE SECURED PARTIES
OR ANY GUARANTOR SHALL BE BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF
NEW YORK, BOROUGH OF MANHATTAN OR IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY PROPERTY MAY BE BROUGHT, AT THE ADMINISTRATIVE AGENT'S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH PROPERTY MAY BE FOUND. EACH
GUARANTOR HEREBY IRREVOCABLY APPOINTS CSC UNITED STATES CORPORATION COMPANY (THE
"PROCESS AGENT"), WITH AN OFFICE ON THE DATE HEREOF AT ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, AS ITS AGENT TO RECEIVE, ON ITS BEHALF AND ON BEHALF OF
ITS PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY OTHER
PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. SUCH SERVICE MAY
BE MADE BY MAILING OR DELIVERING A COPY OF SUCH PROCESS TO SUCH GUARANTOR IN
CARE OF THE PROCESS AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND EACH
GUARANTOR HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT
SUCH SERVICE ON ITS BEHALF. EACH GUARANTOR IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR
WITHOUT THE STATE OF NEW YORK ADDRESSED TO SUCH GUARANTOR, CARE OF THE BORROWER,
AT THE ADDRESS FOR NOTICES SPECIFIED IN THE CREDIT AGREEMENT. EACH GUARANTOR
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE
AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION. EACH GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE
11
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT ANY GUARANTOR HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH
GUARANTOR HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS GUARANTY AND THE OTHER LOAN DOCUMENTS.
SECTION 5.11. WAIVER OF JURY TRIAL. EACH GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
THE SECURED PARTIES OR SUCH GUARANTOR. EACH GUARANTOR ACKNOWLEDGES AND AGREES
THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE SECURED PARTIES ENTERING
INTO THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 5.12. COUNTERPARTS. This Guaranty may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement.
12
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
Assist Cornerstone Technologies, Inc.
Atlantic Aerospace Electronics Corporation
Cayenta Operating Company
Cayenta, Inc.
DBA Systems, Inc.
Delfin Systems
Diversified Control Systems, Inc.
Eldyne, Inc.
Horizons Technology, Inc.
▇.▇. Systems, Inc.
Linkabit Wireless, Inc.
Mergeco, Inc.
Pulse Sciences, Inc.
System Resources Corporation
Titan Food Pasteurization Corp.
Titan Medical Sterilization Corp.
Titan Scan Corp.
Titan Systems Corporation
Titan Unidyne Corporation
Titan Wireless, Inc.
Tomotherapeutics, Inc.
Validity Corporation
VisiCom Laboratories, Inc.
Microlithics Corporation
All By:
------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
S-1
ANNEX I to
the Subsidiary Guaranty
SUPPLEMENT, dated as of ________________, ____ (this
"SUPPLEMENT"), to the Subsidiary Guaranty, dated as of _____
__, ____ (together with all amendments, supplements,
restatements and other modifications, if any, from time to
time thereafter made thereto, the "GUARANTY"), among the
initial signatories thereto and each other Person (such
capitalized term, and other terms used in this Supplement, to
have the meanings set forth in Article I of the Guaranty)
which from time to time thereafter became a party thereto
pursuant to Section 5.5 thereof (each, individually, a
"GUARANTOR", and, collectively, the "GUARANTORS"), in favor of
the Secured Parties (as defined in the Guaranty).
W I T N E S S E T H:
WHEREAS, pursuant to the provisions of Section 5.5 of the
Guaranty, the undersigned is
becoming a Guarantor under the Guaranty; and
WHEREAS, the undersigned Guarantor desires to become a "Guarantor"
under the Guaranty in order to induce the Secured Parties to continue to extend
Credit Extensions under the
Credit Agreement;
NOW, THEREFORE, in consideration of the premises, and for other
consideration (the receipt and sufficiency of which is hereby acknowledged), the
undersigned agrees, for the benefit of each Secured Party, as follows.
SECTION 1. In accordance with the terms of the Guaranty, by its
signature below the undersigned hereby irrevocably agrees to become a Guarantor
under the Guaranty with the same force and effect as if it were an original
signatory thereto, and the undersigned Guarantor hereby (a) agrees to be bound
by and comply with all of the terms and provisions of the Guaranty applicable to
it as a Guarantor and (b) represents and warrants that the representations and
warranties made by it as a Guarantor thereunder are true and correct as of the
date hereof. In furtherance of the foregoing, each reference to a "Guarantor" in
the Guaranty and each other Loan Document shall be deemed to include the
undersigned Guarantor.
SECTION 2. The undersigned Guarantor hereby represents and warrants
that this Supplement has been duly authorized, executed and delivered by it and
that this Supplement and
the Guaranty constitute the legal, valid and binding obligation of the
undersigned Guarantor, enforceable against it in accordance with its terms.
SECTION 3. Except as expressly supplemented hereby, the Guaranty shall
remain in full force and effect in accordance with its terms.
SECTION 4. In the event any one or more of the provisions contained in
this Supplement should be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein and in the Guaranty shall not in any way be affected or impaired.
SECTION 5. THIS SUPPLEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 6. This Supplement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the day and year first above written.
[NAME OF ADDITIONAL SUBSIDIARY
GUARANTOR]
By:
---------------------------
Name:
Title:
EXHIBIT J
INTERCOMPANY SUBORDINATION AGREEMENT
THIS INTERCOMPANY SUBORDINATION AGREEMENT (this "SUBORDINATION
AGREEMENT"), dated as of February 23, 2000, made by and among each of the
undersigned Persons (such capitalized term, and other terms used herein without
definition, to have the meanings ascribed thereto in SECTION 1 below) and such
other Persons that may from time to time become a party hereto pursuant to the
terms hereof or of the Credit Agreement referred to below (collectively, the
"SUBORDINATED CREDITORS"), and THE TITAN CORPORATION, a Delaware corporation
(the "BORROWER"), in favor of the Administrative Agent and each of the Secured
Parties.
W I T N E S S E T H:
WHEREAS, the Borrower has entered into a Senior Secured Credit
Agreement, dated as of February 23, 2000 (as amended, restated, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT"), among the
Borrower, the various financial institutions as are, or may from time to time
become, parties thereto (together with their successors, transferees and
assigns, the "LENDERS"), Credit Suisse First Boston, as administrative agent for
the Lenders (the "ADMINISTRATIVE AGENT"), First Union Securities, Inc., as
Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent, pursuant
to which the Lenders and the Issuers have agreed to make Credit Extensions on
the terms and subject to the conditions set forth therein;
WHEREAS, as a condition precedent to the making of the Credit
Extensions (including the initial Credit Extension) under the Credit Agreement,
the Subordinated Creditors and the Borrower are required to execute and deliver
this Subordination
Agreement;
WHEREAS, each Subordinated Creditor has duly authorized the execution,
delivery and performance of this Subordination Agreement; and
WHEREAS, it is in the best interests of each Subordinated Creditor to
execute this Subordination Agreement inasmuch as each Subordinated Creditor will
derive substantial direct and indirect benefits from the Credit Extensions made
from time to time to the Borrower by the Lenders pursuant to the Credit
Agreement.
NOW, THEREFORE, in consideration of the above premises and in order to
induce the Lenders and the Issuers to make Credit Extensions to the Borrower
pursuant to the Credit Agreement, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
-1-
AGREEMENT
SECTION 1. DEFINITIONS. Terms used but not defined herein have the
meanings given to them in the Credit Agreement. As used in this Subordination
Agreement, the following terms shall have the meanings specified below:
"ADMINISTRATIVE AGENT" is defined in the FIRST RECITAL.
"BORROWER" is defined in the PREAMBLE.
"CREDIT AGREEMENT" is defined in the FIRST RECITAL.
"INTERCOMPANY DEBT" means, on any date, any Indebtedness of the
Borrower related to or resulting from any loan or advance from, or any
non-equity investment by, or any management or similar fees payable to, or any
obligation to pay for goods or services to, any Subsidiary of the Borrower.
"LENDER" is defined in the FIRST RECITAL.
"SENIOR INDEBTEDNESS" is defined in CLAUSE (a) of SECTION
2.
"SUBORDINATED CREDITOR" is defined in the PREAMBLE.
"SUBORDINATION AGREEMENT" is defined in the PREAMBLE.
SECTION 2. AGREEMENT TO SUBORDINATE.
(a) Subject to the terms of the Credit Agreement, the
Borrower and each of the Subordinated Creditors agree that the
Intercompany Debt is and shall be subject, subordinate and rendered
junior, to the extent and in the manner hereinafter set forth, in right
of payment, to the prior payment in cash in full of all Obligations of
the Borrower under the Credit Agreement and the other Loan Documents
now existing or hereafter arising, whether for (i) principal, (ii)
interest (including, without limitation, interest accruing after the
filing of a petition initiating any proceeding referred to in CLAUSE
(a) of SECTION 3, whether or not allowed as a claim in such
proceeding), (iii) reasonable costs, (iv) reasonable fees (including,
without limitation, reasonable attorneys' fees and disbursements), (v)
reasonable expenses, and (vi) otherwise (the Obligations specified in
CLAUSES(a)(i) through (a)(vi) above are referred to collectively as the
"SENIOR INDEBTEDNESS"). For purposes of this Subordination Agreement,
the Senior Indebtedness shall not be deemed to have been paid in cash
in full until the Lenders shall have received full payment of the
Senior Indebtedness in cash, which
-2-
payment shall have been retained by the Lenders for a period of time in
excess of all applicable preference or other similar periods under
applicable bankruptcy, insolvency or creditors' rights laws. Each of
the Borrower and the Subordinated Creditors waive notice of acceptance
of this Subordination Agreement by the Lenders, and the Subordinated
Creditors waive notice of and consent to the making, amount and terms
of the Senior Indebtedness which may exist or be created from time to
time and any renewal, extension, amendment or modification thereof, and
any other lawful action which any Lender or Lenders in its and their
sole and absolute discretion may take or omit to take with respect
thereto. The provisions of this Section shall constitute a continuing
offer made for the benefit of and to all Lenders and each Lender is
hereby irrevocably authorized to enforce such provisions.
(b) In the event that the Borrower shall make, and/or any
Subordinated Creditor shall receive from any source whatsoever, any
payment on Intercompany Debt in contravention of this Subordination
Agreement or the terms of the Credit Agreement, then and in any such
event such payment shall be deemed to be the property of, segregated,
received and held in trust for the benefit of and shall be promptly
paid over and delivered to the Administrative Agent for the PRO RATA
benefit of the Lenders.
(c) The Borrower shall not make, and no Subordinated
Creditor shall receive or accept from any source whatsoever, any
payment in respect of any Intercompany Debt if any Default shall have
occurred and be continuing or would result therefrom, unless and until
(i) the Senior Indebtedness has been paid in cash in full, (ii) in the
case of a Default other than a Default of the nature set forth in
Section 9.1(i) of the Credit Agreement, such Default has been cured or
waived or (iii) the Administrative Agent has otherwise consented in
writing.
SECTION 3. IN FURTHERANCE OF SUBORDINATION.
(a) Upon any distribution of all or any of the
assets of the Borrower in the
event of
(i) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other
similar case or proceeding in connection therewith, relative
to the Borrower, or to its creditors, as such, or to its
assets,
(ii) any liquidation, dissolution or other winding up
of the Borrower, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or
-3-
(iii) any assignment for the benefit of creditors or
any other marshaling of assets and liabilities of the
Borrower,
then, and in any such event, unless the Administrative Agent shall
otherwise agree in writing, the Lenders shall receive payment in cash
in full of all amounts due or to become due (whether or not the Senior
Indebtedness has been declared due and payable prior to the date on
which the Senior Indebtedness would otherwise have become due and
payable) on or in respect of all Senior Indebtedness (including,
without limitation, interest accruing after the filing of a petition
initiating any proceeding referred to above) before the Subordinated
Creditors or anyone claiming through or on their behalf (including any
receiver, trustee, or otherwise) are entitled to receive from any
source whatsoever any payment on account of principal of (or premium,
if any) or interest on or other amounts payable in respect of the
Intercompany Debt, and to that end, any payment or distribution of any
kind or character, whether in cash, property or securities, which may
be payable or deliverable in respect of the Intercompany Debt in any
such case, proceeding, dissolution, liquidation or other winding up or
event, shall be paid or delivered directly to the Administrative Agent
for the application (in the case of cash) to, or as collateral (in the
case of non-cash property or securities) for, the payment or prepayment
of the Senior Indebtedness until the Senior Indebtedness shall have
been paid in cash in full.
(b) If any proceeding, liquidation, dissolution or
winding up referred to in CLAUSE (A) above is commenced by or against
the Borrower,
(i) the Administrative Agent and the Lenders are
hereby irrevocably authorized and empowered (in their own
names or in the name of the Borrower or otherwise), but shall
have no obligation, to demand, ▇▇▇ for, collect and receive
every payment or distribution in respect of the Intercompany
Debt above and give acquittance therefor and to file claims
and proofs of claim and take such other action (including,
without limitation, voting the Intercompany Debt or enforcing
any security interest or other lien securing payment of the
Intercompany Debt) as the Lenders or the Administrative Agent
may reasonably deem necessary or advisable for the exercise or
enforcement of any of the rights or interests of the Lenders
or the Administrative Agent hereunder; PROVIDED that in the
event the Administrative Agent or the Lenders take such
action, the Administrative Agent or the Lenders shall apply
all proceeds FIRST, to the payment of the costs of enforcement
of this Subordination Agreement, and SECOND, to the payment of
the Senior Indebtedness in accordance with the terms thereof;
and
(ii) the Subordinated Creditors shall duly and
promptly take such action as the Lenders or the Administrative
Agent may request (A) to collect the Intercompany Debt for the
account of the Lenders and the Administrative Agent
-4-
and to file appropriate claims or proofs of claim in respect
of the Intercompany Debt, (B) to execute and deliver to the
Lenders or the Administrative Agent such powers of attorney,
assignments, or other instruments as the Lenders or the
Administrative Agent may reasonably request in order to enable
them to enforce any and all claims with respect to, and any
security interests and other liens securing payment of, the
Intercompany Debt and (C) to collect and receive any and all
payments or distributions which may be payable or deliverable
upon or with respect to the Intercompany Debt.
(c) All payments from any source whatsoever or
distributions of assets of the Borrower, whether in cash, property or
securities upon or with respect to the Intercompany Debt which are
received by the Subordinated Creditors contrary to the provisions of
this Subordination Agreement shall be received in trust for the PRO
RATA benefit of the Lenders, shall be segregated from other funds and
property held by the Subordinated Creditors and shall be forthwith paid
over to the Administrative Agent in the same form as so received (with
any necessary indorsement) to be applied, (in the case of cash) to, or
held as collateral (in the case of noncash property or securities) for,
the payment or prepayment of the Senior Indebtedness in accordance with
the terms thereof, whether matured or unmatured, in accordance with the
terms of this Subordination Agreement.
(d) The Lenders and the Administrative Agent are hereby
authorized to demand specific performance of this Subordination
Agreement, whether or not the Borrower or any Subordinated Creditor
shall have complied with any of the provisions hereof applicable to it,
at any time when the Subordinated Creditors or any one of them shall
have failed to comply with any of the provisions of this Subordination
Agreement applicable to it. The Subordinated Creditors hereby
irrevocably waive any defense (other than the defense of payment in
full of the Senior Indebtedness) based on the adequacy of a remedy at
law which might be asserted as a bar to such remedy of specific
performance.
SECTION 4. NO ENFORCEMENT OR COMMENCEMENT OF ANY PROCEEDINGS. Each
Subordinated Creditor agrees that, so long as any Senior Indebtedness shall
remain unpaid, or any Commitment shall be in effect, it will not accelerate the
maturity of the Intercompany Debt or commence, or join with any creditor other
than the Lenders in commencing any proceeding referred to in CLAUSE (a) of
SECTION 3.
SECTION 5. RIGHTS OF SUBROGATION. The Subordinated Creditors agree that
no payment or distribution to the Lenders or the Administrative Agent pursuant
to the provisions of this Subordination Agreement shall entitle the Subordinated
Creditors to exercise any rights of subrogation in respect thereof until all
Senior Indebtedness has been paid in cash in full and the Commitments have been
terminated. The Subordinated Creditors agree that the subordination provisions
contained herein shall not be affected by any action, or failure to act,
-5-
by the Administrative Agent or the Lenders which results, or may result, in
affecting, impairing or extinguishing any right of reimbursement or subrogation
or other right or remedy of the Subordinated Creditors against the Borrower.
Notwithstanding the foregoing, to the extent necessary to toll the statute of
limitations, the Subordinated Creditors may take such action required to
preserve any rights they have by way of rights of subrogation as consented to by
the Administrative Agent in its reasonable discretion.
SECTION 6. SUBORDINATION LEGEND; FURTHER ASSURANCES. The Subordinated
Creditors and the Borrower will cause each note and instrument (if any)
evidencing the Intercompany Debt to be endorsed with the following legend:
"The indebtedness evidenced by this instrument is subordinated
to the prior payment in cash in full of the Senior Indebtedness (as
defined in the Intercompany Subordination Agreement, dated as of
February 23, 2000) pursuant to, and to the extent provided in, the
Intercompany Subordination Agreement by the maker hereof and payee
named herein in favor of the Lenders and any person now or hereafter
designated as their agent."
Each of the Subordinated Creditors and the Borrower hereby agrees to ▇▇▇▇ its
books of account in such a manner as shall be effective to give proper notice of
the effect of this Subordination Agreement and will, in the case of any
Intercompany Debt which is not evidenced by any note or instrument, following
the occurrence and subject to the continuation of a Default, upon the
Administrative Agent's request, cause such Intercompany Debt to be evidenced by
an appropriate note or instrument or instruments endorsed with the above legend.
Each of the Subordinated Creditors and the Borrower will at its expense and at
any time and from time to time promptly execute and deliver all further
instruments and documents and take all further action that may be necessary or
that the Lenders or the Administrative Agent may reasonably request in order to
protect any right or interest granted or purported to be granted hereunder or to
enable the Lenders or the Administrative Agent to exercise and enforce their
rights and remedies hereunder.
SECTION 7. NO CHANGE IN OR DISPOSITION OF INTERCOMPANY DEBT. The
Subordinated Creditors will not, without the prior written consent of the
Administrative Agent:
(a) sell, assign to any Person other than a Subordinated
Creditor, transfer, endorse, pledge, encumber or otherwise dispose of
any of the Intercompany Debt, except in the case of Liens granted to
the Administrative Agent;
(b) permit the terms of any of the Intercompany Debt to
be changed in such a manner as to have a material adverse effect upon
the rights or interests of the Lenders or the Administrative Agent; or
-6-
(c) upon the occurrence and during the continuation of
any Default, take, or permit to be taken, any action to assert, collect
or enforce the Intercompany Debt or any part thereof.
SECTION 8. AGREEMENT BY THE BORROWER. The Borrower agrees that it will
not make any payment on any of the Intercompany Debt, or take any other action,
in contravention of the provisions of this Subordination Agreement or the other
Loan Documents.
SECTION 9. OBLIGATIONS HEREUNDER NOT AFFECTED. All rights and interest
of the Lenders and the Administrative Agent hereunder, and all agreements and
obligations of the Subordinated Creditors and the Borrower hereunder, shall
remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of any
document evidencing Senior Indebtedness;
(b) any change in the time, manner or place of payment
of, or any other term of, all or any of the Senior Indebtedness, or any
other amendment or waiver of or any consent to departure from any of
the documents evidencing or relating to the Senior Indebtedness;
(c) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to
departure from any guaranty or Loan Document, for all or any of the
Senior Indebtedness;
(d) any failure of any Lender or the Administrative Agent
to assert any claim or to enforce any right or remedy against any other
party hereto under the provisions of this Subordination Agreement, the
Credit Agreement or any other Loan Document other than this
Subordination Agreement;
(e) any reduction, limitation, impairment or termination
of the Senior Indebtedness for any reason (other than the defense of
payment in full of the Senior Indebtedness), including any claim of
waiver, release, surrender, alteration or compromise, and shall not be
subject to (and the Borrower and each Subordinated Creditor hereby
waive any right to or claim of) any defense (other than the defense of
payment in full of the Senior Indebtedness) or setoff, counterclaim,
recoupment or termination whatsoever by reason of invalidity,
illegality, nongenuineness, irregularity, compromise, unenforceability
of, or any other event or occurrence affecting, any Senior
Indebtedness; and
(f) any other circumstance which might otherwise
constitute a defense (other than the defense of payment in full of the
Senior Indebtedness) available to, or a
-7-
discharge of, the Borrower in respect of the Senior Indebtedness or the
Subordinated Creditors in respect of this Subordination Agreement.
This Subordination Agreement shall continue to be effective or be reinstated, as
the case may be, if at any time any payment of any of the Senior Indebtedness is
rescinded or must otherwise be returned by any Lender or the Administrative
Agent upon the insolvency, bankruptcy or reorganization of the Borrower or
otherwise, all as though such payment had not been made. The Subordinated
Creditors acknowledge and agree that the Lenders and the Administrative Agent
may in accordance with the terms of the Credit Agreement, without notice or
demand and without affecting or impairing the Subordinated Creditors'
obligations hereunder, from time to time (i) renew, compromise, extend,
increase, accelerate or otherwise change the time for payment of, or otherwise
change the terms of the Senior Indebtedness or any part thereof, including,
without limitation, to increase or decrease the rate of interest thereon or the
principal amount thereof; (ii) take or hold security for the payment of the
Senior Indebtedness and exchange, enforce, foreclose upon, waive and release any
such security; (iii) apply such security and direct the order or manner of sale
thereof as the Administrative Agent and the Lenders, in their sole discretion,
may determine; (iv) release and substitute one or more endorsers, warrantors,
borrowers or other obligors; and (v) exercise or refrain from exercising any
rights against the Borrower or any other Person.
SECTION 10. REPRESENTATIONS AND WARRANTIES. Each of the Subordinated
Creditors, in respect of itself and the Intercompany Debt owing to it, and the
Borrower, as the case may be, hereby represents and warrants as follows:
(a) the Subordinated Creditors own the Intercompany Debt
now outstanding free and clear of any Lien other than pursuant to any
general security agreement then in effect and in favor of the
Administrative Agent;
(b) this Subordination Agreement constitutes a legal,
valid and binding obligation of each Subordinated Creditor and the
Borrower, enforceable in accordance with its terms (subject to the
effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law)).
SECTION 11. AMENDMENTS, WAIVERS. No amendment or waiver of any
provision of this Subordination Agreement nor consent or any departure by the
Subordinated Creditors or the Borrower here from, shall in any event be
effective unless the same shall be in writing and signed by the Administrative
Agent and the other parties hereto, and then such waiver, amendment or consent
shall be effective only in the specific instance and for the specific purpose
for which given. Any waiver, forbearance, failure or delay by the Administrative
Agent or the Lenders in exercising, or the exercise or beginning of exercise by
the Administrative Agent or the Lenders of, any right, power or remedy,
simultaneous or later
-8-
shall not preclude the further, simultaneous or later exercise thereof, and
every right, power or remedy of the Administrative Agent and the Lenders shall
continue in full force and effect until such right, power or remedy is
specifically waived in a writing executed or authorized by such Lenders.
SECTION 12. EXPENSES. The Subordinated Creditors and the Borrower
jointly and severally agree to pay, upon demand, to the Administrative Agent or
the Lenders, as applicable, any and all reasonable costs and expenses,
including, without limitation, reasonable attorneys' fees and disbursements
which the Lenders or the Administrative Agent may incur in connection with the
exercise or enforcement of any of the rights or interest of the Lenders or the
Administrative Agent hereunder.
SECTION 13. ADDRESS FOR NOTICES. All notices and other communications
provided for hereunder shall be in writing (including facsimile communication)
and mailed or telecopied or delivered to either party hereto, if to the
Borrower, the Administrative Agent or any Lender, addressed to it at the address
of the Borrower or such Lender or the Administrative Agent (as the case may be)
listed in the Credit Agreement or in the Lender Assignment Agreement, as
applicable, and, if to other parties hereto, addressed to such parties in care
of the Borrower at the address specified in the Credit Agreement. All such
notices and other communications, when mailed and properly addressed with
postage prepaid or if properly addressed and sent by pre-paid courier service,
shall be deemed given when received; any such notice or communication, if
transmitted by facsimile, shall be deemed given when the confirmation of
transmission thereof is received by the transmitter.
SECTION 14. ENTIRE AGREEMENT; SEVERABILITY. This Subordination
Agreement contains the entire subordination agreement among the parties hereto
with respect to the subject matter hereof. If any of the provisions of this
Subordination Agreement shall be held invalid or unenforceable, this
Subordination Agreement shall be construed as if not containing those
provisions, and the rights and obligations of the parties hereto shall be
construed and enforced accordingly.
SECTION 15. CUMULATIVE RIGHTS. The rights, powers and remedies of the
Lenders and the Administrative Agent under this Subordination Agreement shall be
in addition to all rights, powers and remedies given to the Lenders and the
Administrative Agent by virtue of any contract, statute or rule of law, all of
which rights, powers and remedies shall be cumulative and may be exercised
successively or concurrently. The parties hereto expressly acknowledge and agree
that the Lenders and the Administrative Agent are intended, and by this
reference expressly made, third party beneficiaries of the provisions of this
Subordination Agreement.
SECTION 16. CONTINUING AGREEMENT; TRANSFER OF NOTES. This Subordination
Agreement is a continuing agreement of subordination and the Lenders may, from
time to time and without notice to the Subordinated Creditors, extend credit to
or make other financial
-9-
arrangements with the Borrower in reliance hereon. This Subordination Agreement
shall (a) remain in full force and effect until the Senior Indebtedness shall
have been paid in cash in full and all Commitments terminated, (b) be binding
upon the Subordinated Creditors, the Borrower and their respective successors,
transferees and assigns, and (c) inure to the benefit of and be enforceable by
the Administrative Agent and each Lender and their respective successors,
transferees and assigns. Without limiting the generality of the foregoing, any
Lender may, subject to the provisions of the Credit Agreement, assign or
otherwise transfer the Senior Indebtedness held by it to any other Person,
subject to Section 11.11 of the Credit Agreement and such other Person shall
thereupon become vested with all the rights in respect thereof granted to such
Lender herein or otherwise.
SECTION 17. GOVERNING LAW. THIS SUBORDINATION AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK).
SECTION 18. FORUM SELECTION AND CONSENT TO JURISDICTION. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
SUBORDINATION AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT OR ANY OF THE
LENDERS OR ANY SUBORDINATED CREDITOR OR THE BORROWER SHALL BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. THE BORROWER AND
EACH SUBORDINATED CREDITOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY
JUDGEMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. THE BORROWER
HEREBY IRREVOCABLY APPOINTS CSC UNITED STATES CORPORATION COMPANY (THE "PROCESS
AGENT"), WITH AN OFFICE ON THE DATE HEREOF AT ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, AS ITS AGENT TO RECEIVE, ON ITS BEHALF AND ON BEHALF OF ITS
PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY OTHER PROCESS
WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. SUCH SERVICE MAY BE MADE
BY MAILING OR DELIVERING A COPY OF SUCH PROCESS TO THE BORROWER IN CARE OF THE
PROCESS AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND THE BORROWER HEREBY
IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT SUCH SERVICE ON
ITS BEHALF. THE BORROWER AND EACH SUBORDINATED
-10-
CREDITOR IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK
AT THE ADDRESS FOR NOTICES OF SUCH PARTY SPECIFIED IN SECTION 13. THE BORROWER
AND EACH SUBORDINATED CREDITOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER OR SUCH SUBORDINATED
CREDITOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY
COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT
PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, EACH OF THE BORROWER AND EACH OF SUCH SUBORDINATED
CREDITORS HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS SUBORDINATION AGREEMENT.
SECTION 19. WAIVER OF JURY TRIAL. THE BORROWER AND EACH SUBORDINATED
CREDITOR AND, BY ACCEPTING THIS SUBORDINATION AGREEMENT AND THE BENEFITS
THEREOF, THE ADMINISTRATIVE AGENT AND ANY LENDER HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS SUBORDINATION AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE BORROWER OR SUCH
SUBORDINATED CREDITOR AND EACH SUCH PERSON ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDERS CONTINUING TO MAKE CREDIT
EXTENSIONS AND ENTERING INTO THE AMENDED AND RESTATED CREDIT AGREEMENT AND FOR
THE SUBORDINATED CREDITORS ENTERING INTO THIS SUBORDINATION AGREEMENT.
SECTION 20. EXECUTION IN COUNTERPARTS. This Subordination Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
agreement.
-11-
IN WITNESS WHEREOF, the parties have caused this Subordination
Agreement to be duly executed and delivered as of the date first above written.
The Titan Corporation
Assist Cornerstone Technologies, Inc.
Atlantic Aerospace Electronics Corporation
Cayenta Operating Company
Cayenta, Inc.
DBA Systems, Inc.
Delfin Systems
Diversified Control Systems, Inc.
Eldyne, Inc.
Horizons Technology, Inc.
▇.▇. Systems, Inc.
Linkabit Wireless, Inc.
Mergeco, Inc.
Pulse Sciences, Inc.
System Resources Corporation
Titan Food Pasteurization Corp.
Titan Medical Sterilization Corp.
Titan Scan Corp.
Titan Systems Corporation
Titan Unidyne Corporation
Titan Wireless, Inc.
Tomotherapeutics, Inc.
Validity Corporation
VisiCom Laboratories, Inc.
Microlithics Corporation
All By:
--------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
-12-
EXHIBIT K
LENDER ASSIGNMENT AGREEMENT
____,___ ____
To: The Titan Corporation,
as Borrower
Credit Suisse First Boston,
as Administrative Agent
THE TITAN CORPORATION
Gentlemen and Ladies:
We refer to clause (a)(iv) of Section 11.11 of the Senior Secured
Credit Agreement, dated as of February __, 2000 (as amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
among The Titan Corporation, a Delaware corporation (the "BORROWER"), the
various financial institutions as are or may become parties thereto
(collectively, the "LENDERS"), Credit Suisse First Boston, as administrative
agent for the Lenders (the "ADMINISTRATIVE AGENT"), First Union Securities,
Inc., as Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent.
Unless otherwise defined herein or the context otherwise requires, terms used
herein have the meanings provided in the Credit Agreement.
As of ____ __, ____ (the "ASSIGNMENT DATE"), [Name of Lender] (the
"ASSIGNOR") irrevocably sells, transfers, conveys and assigns, without recourse,
representation or warranty (except as expressly set forth herein), to [Name of
Assignee] (the "ASSIGNEE") and the Assignee irrevocably purchases from the
Assignor that portion of the Loans and Commitments of the Assignor as set forth
in SCHEDULE I hereto (the "ASSIGNED PORTION") so that after giving effect to the
foregoing assignment and delegation, the Assignor's and the Assignee's
Percentages for the purposes of the Credit Agreement and each other Loan
Document will be as set forth on SCHEDULE I hereto.
In addition, this agreement constitutes notice to each of you, pursuant
to clause (a)(iii) of Section 11.11 of the Credit Agreement, of the assignment
and delegation to the Assignee of the Assigned Portion of the Credit Extensions
and Commitments of the Assignor outstanding under the Credit Agreement as of the
Assignment Date.
From and after the Assignment Date, the Administrative Agent shall make
all payments in respect of the Assigned Portion (including payments of
principal, interest, fees and other amounts) to the Assignor for amounts which
have accrued to the Assignment Date and to the Assignee for amounts which have
accrued subsequent to the Assignment Date. The Assignor and the Assignee shall
make all appropriate adjustments in payments by the Administrative Agent for
periods prior to the Assignment Date or with respect to the making of this
assignment directly between themselves.
The Assignee hereby acknowledges and confirms that it has received a
copy of the Credit Agreement and the exhibits related thereto, together with
copies of the documents which were required to be delivered under the Credit
Agreement as a condition to the making of the Credit Extensions thereunder. The
Assignee further confirms and agrees that in becoming a Lender and in making its
Commitments and Credit Extensions under the Credit Agreement, such actions have
and will be made without recourse to, or representation or warranty by, the
Administrative Agent.
The Assignor represents and warrants that it is legally authorized to
enter into and deliver this agreement and represents that it is the legal and
beneficial owner of the Assigned Portion. Except as set forth in the previous
sentence, the Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made pursuant to or in connection with this agreement, or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
agreement, the Credit Agreement, any other Loan Document or any other instrument
or document furnished pursuant hereto or thereto, including the financial
condition of the Borrower or any of its Subsidiaries or the performance or
observance by any Lender of any of its obligations under the Credit Agreement,
any other Loan Document or any other instrument or document furnished pursuant
hereto or thereto. The Assignee represents and warrants that it is legally
authorized to enter into and deliver this agreement and confirms that it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 7.1 of the Credit Agreement
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this agreement. In addition,
the Assignee independently and without reliance upon the Assignor, the Agents or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, shall continue to make its own credit decisions in
taking or not taking action under the Credit Agreement, the other Loan Documents
and the other instruments and documents delivered in connection therewith.
Except as otherwise provided in the Credit Agreement, effective as of
the Assignment Date
(a) the Assignee
(i) shall be deemed automatically to have become a
party to the Credit Agreement and shall have all the rights
and obligations of a "Lender" under the
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Credit Agreement and the other Loan Documents as if it were an
original signatory thereto to the extent specified in the
second paragraph hereof;
(ii) agrees to be bound by the terms and conditions
set forth in the Credit Agreement and the other Loan Documents
as if it were an original signatory thereto; and
(b) the Assignor shall be released from its obligations under
the Credit Agreement and the other Loan Documents to the extent
specified in the second paragraph hereof.
[The parties hereto understand that no processing fee of the type
referred to in Section 11.11(a) of the Credit Agreement shall be due in
connection with this Assignment.]
[The Assignor and the Assignee hereby agree that the
[Assignor][Assignee] will pay to the Administrative Agent the processing fee
referred to in Section 11.11(a) of the Credit
Agreement.]
The Assignee hereby advises each of you that the Assignee's
administrative details with respect to the assigned Credit Extensions and
Commitments are on file with the Administrative Agent and requests the
Administrative Agent to acknowledge receipt of this document.
The Assignee agrees (for the benefit of the Assignor, the Borrower and
the Administrative Agent) to furnish, if required by clause (e) of Section 4.6
of the Credit Agreement, the applicable Internal Revenue Service forms or other
forms required thereunder no later than the date of acceptance hereof by the
Administrative Agent. In addition, the Assignee represents and warrants (for the
benefit of the Assignor, the Borrower and the Administrative Agent) that, under
applicable law and treaties in effect as of the date hereof, no United States
federal taxes will be required to be withheld by the Administrative Agent or the
Borrower with respect to any payments to be made to the Assignee in respect of
the Credit Agreement.
Notwithstanding any other provisions hereof, if the consents of the
Borrower and the Administrative Agent are required under Section 11.11(a) of the
Credit Agreement, the assignment and delegation contemplated in this agreement
shall not be effective unless such consents shall have been obtained and in any
event no such assignment and delegation shall be effective unless and until such
assignment has been recorded in the Register by the Administrative Agent.
This Agreement may be executed by the Assignor and Assignee in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute one and the same
agreement.
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IN WITNESS WHEREOF, each of the undersigned has executed and
delivered this Lender Assignment Agreement as of the date first written above.
[ASSIGNOR]
By:
------------------------------------
Name:
Title:
[ASSIGNEE]
By:
------------------------------------
Name:
Title:
ACCEPTED AND AGREED TO:
CREDIT SUISSE FIRST BOSTON,
as Administrative Agent
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
THE TITAN CORPORATION
By:
--------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
SCHEDULE I
LENDER INFORMATION
LENDER PERCENTAGE DOMESTIC OFFICE LIBOR OFFICE
------ ---------- --------------- ------------
[ASSIGNOR], [ ] Loans........................... % ON FILE WITH ON FILE WITH
as Assignor ADMINISTRATIVE ADMINISTRATIVE
AGENT AGENT
[ASSIGNEE], [ ] Loans........................... % [ ] [ ]
as Assignee Attn: [ ] Attn: [ ]
Tel.: [ ] Tel.: [ ]
Fax: [ ] Fax: [ ]
Wiring Instructions for the Assignee:
_____________________________________
_____________________________________
_____________________________________
_____________________________________
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EXHIBIT L
SOLVENCY CERTIFICATE
This Certificate (this "CERTIFICATE") is delivered pursuant to Section
5.1(j) of the Senior Secured Credit Agreement, dated as of February __, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among The Titan Corporation, a Delaware corporation (the
"BORROWER"), the various financial institutions as are, or may from time to time
become, parties thereto (together with their successors, transferees, and
assigns, the "LENDERS"), Credit Suisse First Boston, as administrative agent for
the Lenders (the "ADMINISTRATIVE AGENT"), First Union Securities, Inc., as
Syndication Agent, and The Bank of Nova Scotia, as Documentation Agent. Unless
otherwise defined herein, terms used herein have the meanings provided in the
Credit Agreement.
The undersigned hereby certifies that he is the [chief financial
Authorized Officer] [treasurer] [assistant treasurer] of the Borrower (in such
capacity, the "OFFICER") and that he is authorized to execute and deliver this
Certificate on behalf of the Borrower. The undersigned further certifies on
behalf of the Borrower, that:
(a) The Officer has continued to monitor the financial
condition and operations of the Borrower and its Subsidiaries, and the
Officer has knowledge of and has participated in the negotiation of the
transactions contemplated by the Credit Agreement and the other Loan
Documents.
(b) The Officer and his staff are familiar with the process
through which the consolidated financial statements of the Borrower and
its Subsidiaries were generated and prepared.
(c) The Officer is familiar with the process through which the
Pro Forma Financial Statements were generated and prepared. In making
the statements set forth in PARAGRAPH (f) hereof, the Officer has
considered the current and anticipated future capital requirements of
the Borrower and its Subsidiaries for the current and future conduct of
the businesses of the Borrower and its Subsidiaries.
(d) Based on the information reflected in the Pro Forma
Financial Statements and the Officer's involvement in the process of
collecting such information, the Officer has no reason to believe that
the Pro Forma Financial Statements and related financial statements are
not
(i) a fair and reasonable presentation of the PRO
FORMA financial condition and operations of the Borrower and
its Subsidiaries, as of the date hereof, on a going-concern
basis; and
(ii) a reasonable projection of the financial
position, results of operations and cash flows of the Borrower
and its Subsidiaries
in each case on the basis of the assumptions stated in the Pro Forma
Financial Statements, which assumptions the Officer believes to be
reasonable.
(e) Immediately following the consummation of the transactions
contemplated by the Credit Agreement and the other Loan Documents, the
Borrower will be able to pay its Debts (as defined below) as they
become due, will have assets which will have a "fair saleable value"
greater than its Debts as they become absolute and matured, and will
have assets which will have a fair value greater than the sum of all
its Debts.
(f) Both before and immediately after giving effect to each
transaction contemplated by the Credit Agreement and the other Loan
Documents, the Borrower does not have unreasonably small capital and it
is not engaged in businesses or transactions, and (to the best of my
knowledge) does not intend that it will be engaged in any businesses or
transactions, for which it has unreasonably small capital.
(g) Both before and immediately after giving effect to each
transaction contemplated by the Credit Agreement and the other Loan
Documents, the Borrower does not intend to incur, nor believe that it
has incurred, Debts beyond its ability to pay them as they mature.
(h) Both before and immediately after giving effect to each
transaction contemplated by the Credit Agreement and each other Loan
Document, the Borrower has not incurred any obligation under, or in
connection therewith, with actual intent to hinder, delay or defraud
either present or future creditors of the Borrower or any of its
Subsidiaries.
(i) For purposes hereof, "Debts" means all liabilities,
obligations, commitments and indebtedness of any and every kind and
nature (including all obligations to trade creditors), whether
heretofore or now owing, arising, due, or payable by the Borrower to
any person and howsoever evidenced, created, incurred, acquired, or
owing, whether primary, secondary, direct, contingent, fixed, or
otherwise (the foregoing to include, without limitation, all monetary
obligations arising under the Credit Agreement).
(j) The "fair saleable value" of the Borrower's assets and
investments means the amount which may be realized within a reasonable
time, either through collection or sale of such investments and other
assets at the regular market value, based upon the amount
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which could be obtained for the property in question within such period
by a capable and diligent business person from an interested buyer who
is willing to purchase under ordinary selling conditions. Although no
determination of the "fair saleable value" has been made, it is my
opinion that the asset amounts reflected upon the historic records of
the Borrower and its Subsidiaries do not exceed the "fair saleable
value."
(k) The Officer hereby acknowledges, on behalf of the
Borrower, that the Administrative Agent and each of the Lenders have
relied upon the statements contained herein and such statements are a
material inducement for the Administrative Agent and each of the
Lenders to enter into the Credit Agreement and the other Loan
Documents.
Notwithstanding anything to the contrary herein, the Officer (i) is
executing this Certificate on behalf of the Borrower solely in his
representative capacity and not in his individual capacity, and (ii) shall not
have any liability whatsoever for any statements, certifications or
representations made herein, other than liability arising directly out of his
intentional misconduct or gross negligence.
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IN WITNESS WHEREOF, the undersigned Authorized Officer has executed
this Certificate on this ____ day of February, 2000.
THE TITAN CORPORATION
By:
-----------------------------------
Name:
Title:
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