Exhibit 10.15
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of August 28, 2000
among
▇▇▇▇▇▇ PHARMACEUTICALS, INC.,
as Borrower,
THE FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTIES HERETO
as Lenders,
▇▇ ▇▇▇▇▇ SECURITIES CORPORATION,
as Arranger and Book Runner,
and
SOCIETE GENERALE,
as Administrative Agent
FIRST UNION NATIONAL BANK,
as Syndication Agent,
and
SUMMIT BANK,
as Documentation Agent
TABLE OF CONTENTS
Page
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EXHIBITS AND SCHEDULES
Exhibit A - Form of Assignment and Acceptance
Exhibit B-1 - Form of Revolving Loan Note
Exhibit B-2 - Form of Term Loan Note
Exhibit B-3 - Form of Swing Loan Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Form of Notice of Continuation/Conversion
Exhibit E - List of Closing Documents
Exhibit F - Form of Officer's Certificate
Exhibit G - Form of Compliance Certificate
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EXECUTION COPY
AMENDED AND RESTATED CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT dated as of August 28, 2000
(as amended, supplemented or modified from time to time, this "Agreement") is
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entered into among ▇▇▇▇▇▇ PHARMACEUTICALS, INC., a Nevada Corporation (the
"Borrower"), the financial institutions from time to time party hereto, whether
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by execution of this Agreement or an Assignment and Acceptance (the "Lenders"),
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▇▇ ▇▇▇▇▇ SECURITIES CORPORATION, in its capacity as arranger and book runner (in
such capacity, the "Arranger"), SOCIETE GENERALE ("SG"), in its capacity as
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administrative agent for the Lenders (in such capacity, the "Administrative
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Agent"), FIRST UNION NATIONAL BANK, in its capacity as syndication agent for the
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Lenders (in such capacity, the "Syndication Agent"), and SUMMIT BANK, in its
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capacity as documentation agent for the Lenders (in such capacity, the
"Documentation Agent"). This Agreement amends and restates the Credit Agreement
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dated as of July 5, 2000 among the Borrower, the Lenders, the Arranger, the
Administrative Agent and the Syndication Agent.
ARTICLE I
DEFINITIONS
1.01. Certain Defined Terms. The following terms used in this
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Agreement shall have the following meanings, applicable both to the singular and
the plural forms of the terms defined:
"Accommodation Obligation" means any Contractual Obligation,
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contingent or otherwise, of any Person with respect to any Indebtedness,
obligation or liability of another, if the primary purpose or intent thereof by
the Person incurring the Accommodation Obligation is to provide assurance to the
obligee of such Indebtedness, obligation or liability of another Person that
such Indebtedness, obligation or liability will be paid or discharged, or that
any agreements relating thereto will be complied with, or that the holders
thereof will be protected (in whole or in part) against loss in respect thereof
including, without limitation, direct and indirect guarantees, endorsements
(except for collection or deposit in the ordinary course of business), notes co-
made or discounted, recourse agreements, take-or-pay agreements, keep-well
agreements, agreements to purchase or repurchase such Indebtedness, obligation
or liability or to provide any security therefor or to provide funds for the
payment or discharge thereof, agreements to maintain solvency, assets, level of
income, or other financial condition, and agreements to make payment other than
for value received.
"Acquisition" means, collectively, the Tender Offer and, on and after
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the Merger Effective Date, the Merger.
"Administrative Agent" has the meaning ascribed to such term in the
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preamble hereto.
"Administrative Agent's Account" means the Administrative Agent's
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account, account number ▇▇▇▇▇▇▇ (re: ▇▇▇▇▇▇ Pharmaceuticals), maintained at the
office of Societe Generale, 1221 Avenue of the Americas, New York, New York, ABA
#▇▇▇▇▇▇▇▇▇, or such other account as the Administrative Agent may from time to
time specify in writing to the Borrower and the Lenders.
"Administrative Agent's Fee Letter" means the letter dated July 5,
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2000 between the Administrative Agent and the Borrower.
"ANCIRC" means ANCIRC, a New York partnership jointly owned by
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Circasub Inc., an indirect Subsidiary of the Borrower, and SR Six, Inc., a
subsidiary of Andrx Corporation.
"Affiliate" means, as applied to any specified Person, any other
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Person that directly or indirectly controls, is controlled by, or is under
common control with, such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling",
"controlled by" and "under common control with"), as applied to any specified
Person, means the possession, directly or indirectly, of the power to vote ten
percent (10%) or more of the Securities having voting power for the election of
directors of such specified Person or otherwise to direct or cause the direction
of the management and policies of such specified Person, whether through the
ownership of voting Securities or by contract or otherwise.
"Agents" means, collectively, the Administrative Agent, the
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Syndication Agent, the Documentation Agent and the Arranger.
"Agreement" has the meaning ascribed to such term in the preamble
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hereto.
"Applicable Base Rate Margin" means initially a rate equal to 0.375%
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per annum during the period from the Closing Date until the Six Month Date.
Thereafter, such rate will reset quarterly as set forth below on the first day
of the month following receipt by the Administrative Agent of the financial
statements delivered in accordance with Section 7.01(a), commencing with the Six
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Month Date, based upon the Leverage Ratio for the applicable Financial Covenant
Period, calculated as of the last day of such period; provided, however, if the
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calculation of the Leverage Ratio based upon the unaudited financial statements
of the Borrower and its Subsidiaries for the fourth fiscal quarter of any Fiscal
Year varies from the calculation of the Leverage Ratio based upon the audited
financial statements of the Borrower and its Subsidiaries for such Fiscal Year,
such rate will be reset (as set forth below) retroactively to the first day of
the month following receipt by the Administrative Agent of the unaudited
financial statements for such fourth fiscal quarter:
If the Leverage Applicable Base
Ratio is: Rate Margin
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Equal to or greater than 3.5 1.250%
Less than 3.5 but equal to or greater than 3.0 0.875%
Less than 3.0 but equal to or greater than 2.5 0.625%
Less than 2.5 but equal to or greater than 2.0 0.375%
Less than 2.0 but equal to or greater than 1.5 0.250%
Less than 1.5 0.125%
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"Applicable Eurodollar Rate Margin" means initially a rate equal to
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1.375% per annum during the period from the Closing Date until the Six Month
Date. Thereafter, such rate will reset quarterly as set forth below on the
first day of the month following receipt by the Administrative Agent of the
financial statements delivered in accordance with Section 7.01(a), commencing
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with the Six Month Date, based upon the Leverage Ratio for the applicable
Financial Covenant Period, calculated as of the last day of the period;
provided, however, if the calculation of the Leverage Ratio based upon the
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unaudited financial statements of the Borrower and its Subsidiaries for the
fourth fiscal quarter of any Fiscal Year varies from the calculation of the
Leverage Ratio based upon the audited financial statements of the Borrower and
its Subsidiaries for such Fiscal Year, such rate will be reset (as set forth
below) retroactively to the first day of the month following receipt by the
Administrative Agent of the unaudited financial statements for such fourth
fiscal quarter:
If the Leverage Applicable Eurodollar
Ratio is: Rate Margin
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Equal to or greater than 3.5 2.250%
Less than 3.5 but equal to or greater than 3.0 1.875%
Less than 3.0 but equal to or greater than 2.5 1.625%
Less than 2.5 but equal to or greater than 2.0 1.375%
Less than 2.0 but equal to or greater than 1.5 1.250%
Less than 1.5 1.125%
"Applicable Lending Office" means, with respect to a particular
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Lender, its Eurodollar Lending Office in respect of provisions relating to
Eurodollar Rate Loans and its Domestic Lending Office in respect of provisions
relating to Base Rate Loans.
"Approved Fund" means any fund that invests in bank loans.
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"Arranger" has the meaning ascribed to such term in the preamble
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hereto.
"Asset Sale" means any sale, conveyance, transfer, lease or other
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disposition of property of any Loan Party to any Person other than another Loan
Party.
"Assignment and Acceptance" means an Assignment and Acceptance
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substantially in the form of Exhibit A attached hereto and made a part hereof
(with blanks appropriately completed) delivered to the Administrative Agent in
connection with an assignment of a Lender's interest under this Agreement in
accordance with the provisions of Section 13.01.
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"Attributable Debt" means with respect to a Sale and Leaseback
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Transaction, at the time of determination, the present value (discounted at the
rate of interest implicit in such transaction, determined in accordance with
GAAP) of the obligation of the lessee for net rental payments during the
remaining term of the lease included in such Sale and Leaseback
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Transaction (including any period for which such lease has been extended or may,
at the option of the lessor, be extended).
"Availability" means, at any particular time, the amount by which the
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Maximum Revolving Credit Amount at such time exceeds the Revolving Credit
Obligations at such time; provided, however, that during the period from the
Closing Date to the Business Day immediately preceding the Schein Redemption
Date, the Availability shall be reduced by $55,000,000.
"Aventis" means Aventis, S.A., a company formed under the laws of
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France, formerly known as ▇▇▇▇▇-▇▇▇▇▇▇▇ ▇▇▇▇▇, and its affiliates.
"Base Rate" means, on any date, a fluctuating interest rate per annum
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equal to the higher of:
(a) the rate of interest then most recently established by SG in
New York, New York as its base rate for Dollars loaned in the United States, in
effect on such date; and
(b) the Federal Funds Rate in effect on such date plus 1/2 of 1%.
The Base Rate is not necessarily intended to be the lowest rate of interest
determined by SG in connection with extensions of credit.
"Base Rate Loans" means all Loans which bear interest at a rate
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determined by reference to the Base Rate as provided in Section 4.01(a).
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"Bankruptcy Code" means Title 11 of the United States Code (11 U.S.C.
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(S)(S) 101 et seq.), as amended from time to time, and any successor statute.
"Benefit Plan" means a defined benefit plan as defined in Section
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3(35) of ERISA (other than a Multiemployer Plan) which is subject to Title IV of
ERISA or Section 412 of the Code in respect of which any Loan Party or any ERISA
Affiliate is, or within the immediately preceding six (6) years was, an
"employer" as defined in Section 3(5) of ERISA.
"Board of Directors" means the board of directors or equivalent
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governing body of a Person (or the general partner of such Person, as the case
may be,) or any committee thereof duly authorized to act on behalf of such board
of directors or equivalent governing body.
"Borrower" has the meaning ascribed to such term in the preamble
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hereto.
"Borrowing" means a borrowing consisting of Loans of the same Type
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made on the same day by the Lenders.
"Business" means the development, licensing, manufacturing ,
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marketing, distribution and sale of pharmaceutical products.
"Business Day" means a day, in the applicable local time, which is not
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a Saturday or Sunday or a legal holiday and on which banks are not required or
permitted by law or other
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governmental action to close (i) in New York, New York, (ii) in the case of
Eurodollar Rate Loans, in London, England and (iii) in the case of Letter of
Credit transactions for the Issuing Bank, in the place where its office for
issuance and administration of the pertinent Letter of Credit is located.
"Capital Expenditures" means, for any period being measured hereunder,
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the aggregate of all expenditures (whether paid in cash or other assets or
accrued as a liability (but without duplication)) during such period that, in
conformity with GAAP, are required to be included in or reflected by a Loan
Party's fixed asset account as reflected in its balance sheet; provided,
however, that Capital Expenditures shall include, whether or not such a
designation would be in conformity with GAAP, (A) that portion of Capital Leases
which is capitalized on the balance sheet of such Loan Party and (B)
expenditures for Equipment which is purchased simultaneously with the trade-in
of existing Equipment owned by such Loan Party to the extent that the gross
purchase price of the purchased Equipment exceeds the fair value of the
Equipment being traded in at such time.
"Capital Lease" means, as applied to any Person, any lease of any
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property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Capital Stock" means, with respect to any Person, any capital stock
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of such Person, regardless of class or designation, and all warrants, options,
purchase rights, conversion or exchange rights, voting rights, calls or claims
of any character with respect thereto.
"Cash Capital Expenditures" means, for any period, that portion of
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Capital Expenditures which is paid in cash.
"Cash Equivalents" shall mean (i) marketable direct obligations issued
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or unconditionally guaranteed by the United States Government or issued by an
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one (1) year after the date of acquisition thereof;
(ii) marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within ninety (90) days after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's Corporation or ▇▇▇▇▇'▇
Investors Service, Inc. (or, if at any time neither Standard & Poor's
Corporation nor ▇▇▇▇▇'▇ Investors Service, Inc. shall be rating such
obligations, then from other nationally recognized rating services) and not
listed in Credit Watch published by Standard & Poor's Corporation; (iii)
commercial paper, other than commercial paper issued by the Borrower or any of
its Affiliates, maturing no more than ninety (90) days after the date of
creation thereof and, at the time of acquisition, having a rating of at least
A-1 or P-1 from either Standard & Poor's Corporation or ▇▇▇▇▇'▇ Investors
Service, Inc. (or, if at any time neither Standard & Poor's Corporation nor
▇▇▇▇▇'▇ Investors Service, Inc. shall be rating such obligations, then the
highest rating from other nationally recognized rating services) (iv) domestic
and Eurodollar certificates of deposit or time deposits or bankers' acceptances
maturing within ninety (90) days after the date of acquisition thereof issued by
any commercial bank organized under the laws of the United States of America or
any state thereof or the District of Columbia or European Economic Community or
Canada having combined capital and surplus of
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not less than $250,000,000; (v) bankers' acceptances maturing no more than
ninety (90) days after the date of creation thereof and, at the time of
acquisition, having a rating of at least A-1 or P-1 from either Standard &
Poor's Corporation or ▇▇▇▇▇'▇ Investors Service, Inc. (or, if at any time
neither Standard & Poor's Corporation nor ▇▇▇▇▇'▇ Investors Service, Inc. shall
be rating such obligation, then the highest rating from other nationally
recognized rating services); (vi) corporate securities maturing no more than one
(1) year after the date of acquisition thereof and, at the time of acquisition,
having one of the two highest ratings obtainable from either Standard & Poor's
Corporation of ▇▇▇▇▇'▇ Investors Service, Inc. (or, if at any time neither
Standard & Poor's Corporation nor ▇▇▇▇▇'▇ Investors Service, Inc. shall be
rating such obligations, then one of the two highest ratings from other
nationally recognized rating services); (vii) repurchase agreements with respect
to United States government securities, with contract periods not to exceed
thirty (30) days; and (viii) money market mutual funds that invest primarily in
the instruments set forth in the foregoing clauses of this definition.
"CERCLA" means the Comprehensive Environmental Response, Compensation
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and Liability Act of 1980, 42 U.S.C. (S)(S) 9601 et seq., any amendments
thereto, any successor statutes, and any regulations promulgated thereunder.
"Change of Control" means the occurrence of one or more of the
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following events:
(a) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act) is or becomes the beneficial owner (as defined in Rules 13d-3 and
13d-5 under the Securities Exchange Act), directly or indirectly, of more than
40% of the total voting power of the Equity Interests of the Borrower;
(b) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all, or substantially all, the assets of
the Borrower and its Subsidiaries taken as a whole to any "person" or group of
"persons" for purposes of Section 13(d) of the Securities Exchange Act (other
than to any Wholly Owned Subsidiary of the Borrower); or
(c) the adoption of a plan of liquidation of the Borrower.
"Chief Financial Officer" means the chief financial officer, chief
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accounting officer or vice president of finance of the Borrower.
"Claim" means any claim or demand, by any Person, of whatsoever kind
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or nature for any alleged Liabilities and Costs, whether based in contract,
tort, implied or express warranty, strict liability, criminal or civil statute,
Permit, ordinance or regulation, common law or otherwise.
"Closing Date" means the date on which all of the conditions precedent
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in Sections 5.01 and 5.02 have been satisfied or waived pursuant to Section
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13.09.
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"Code" means the Internal Revenue Code of 1986, as amended from time
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to time, and any successor statute and any regulations or guidelines promulgated
thereunder.
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"Commercial Letter of Credit" means any documentary letter of credit
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issued by an Issuing Bank pursuant to Section 2.04 for the account of the
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Borrower, which is drawable upon presentation of documents evidencing the sale
or shipment of goods purchased by the Borrower or any of its Subsidiaries in the
ordinary course of their business.
"Commission" means the Securities and Exchange Commission and any
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Person succeeding to the functions thereof.
"Commitment" means, with respect to any Lender, such Lender's
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Revolving Loan Commitment and Term Loan Commitment, and as modified from time to
time pursuant to the terms of this Agreement or to give effect to any applicable
Assignment and Acceptance, and "Commitments" means the aggregate principal
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amount of the Commitments of all the Lenders, the maximum amount of which shall
not exceed $700,000,000.
"Commitment Termination Date" means the day which is the earliest of
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(A) July 6, 2005, (B) the termination of the Commitments pursuant to Section
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11.02(a) and (C) the date of termination in whole of the Revolving Credit
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Commitments pursuant to Section 3.01(a)(ii).
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"Compliance Certificate" has the meaning ascribed to such term in
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Section 7.01(c).
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"Contaminant" means any waste, pollutant (as that term is defined in
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42 U.S.C. 9601(33) or in 33 U.S.C. 1362(13)), hazardous substance (as that term
is defined in 42 U.S.C. 9601(14)), hazardous chemical (as that term is defined
by 29 CFR Section 1910.1200(c)), toxic substance, hazardous waste (as that term
is defined in 42 U.S.C. 6901), radioactive material, special waste, petroleum,
including crude oil or any petroleum-derived substance, waste, or breakdown or
decomposition product thereof, or any constituent of any such substance or
waste, including, but not limited to polychlorinated biphenyls, and asbestos.
"Contractual Obligation" means, as applied to any Person, any
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provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, security agreement, pledge agreement, guaranty, contract,
undertaking, agreement or instrument to which that Person is a party or by which
it or any of its properties is bound, or to which it or any of its properties is
subject.
"Contribution Agreement" means the Contribution Agreement dated as of
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July 5, 2000 among the Borrower and the Guarantors, as such agreement may be
further amended, supplemented or otherwise modified from time to time.
"Current Assets" means, as at any date of determination, the total
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assets of the Borrower and its Subsidiaries on a consolidated basis which may
properly be classified as current assets in conformity with GAAP.
"Current Liabilities" means, as at any date of determination, the
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current liabilities of the Borrower and its Subsidiaries on a consolidated basis
which may properly be classified as current liabilities in conformity with GAAP.
"Customary Permitted Liens" means
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(a) Liens (other than Environmental Liens and Liens in favor of the
PBGC) with respect to the payment of taxes, assessments or governmental charges
or claims, in all cases which are not yet due or are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves or
other appropriate provisions are being maintained in accordance with GAAP;
(b) statutory Liens of landlords and Liens of suppliers, mechanics,
carriers, materialmen, warehousemen or workmen and other Liens imposed by law
created in the ordinary course of business in all cases for amounts not yet due
or which are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves or other appropriate provisions are being
maintained in accordance with GAAP;
(c) Liens (other than Environmental Liens and any Lien in favor of
the PBGC) incurred or deposits made in the ordinary course of business in
connection with worker's compensation, unemployment insurance or other types of
social security benefits or to secure the performance of bids, tenders, sales,
leases, contracts (other than for the repayment of borrowed money), surety,
appeal and performance bonds, in all cases for amounts not yet due or which are
being contested in good faith by appropriate proceedings and with respect to
which adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP; and
(d) zoning restrictions, easements, licenses, reservations,
covenants, rights-of-way, utility easements, building restrictions and other
similar charges or encumbrances on the use of real property which do not
materially interfere with the ordinary conduct of the business of the Loan
Parties and which do not materially adversely affect the value of the real
property.
"Debt" means, as applied to any Person at any time, all indebtedness,
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obligations or other liabilities of such Person (i) for borrowed money or
evidenced by debt securities, debentures, acceptances, notes or other similar
instruments, (ii) under profit payment agreements or in respect of obligations
to redeem, repurchase or exchange any Securities of such Person or to pay
dividends in respect of any stock, (iii) reimbursement obligations with respect
to letters of credit issued for such Person's account (to the extent not
accounted for in clause (i) above), (iv) to pay the deferred purchase price of
property or services, except accounts payable and accrued expenses arising in
the ordinary course of business, or (v) in respect of Capital Leases.
"Default" means an event which, with the giving of notice or the lapse
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of time, or both, would constitute an Event of Default.
"Default Rate" has the meaning ascribed to such term in Section
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4.01(d).
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"Disclosure Letter" means the Disclosure Letter dated as of July 5,
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2000 from the Borrower to the Administrative Agent and the Lenders.
"DOL" means the United States Department of Labor and any Person
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succeeding to the functions thereof.
"Dollars" and "$" mean the lawful money of the United States.
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"Domestic Lending Office" means, with respect to any Lender, such
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Lender's office, located in the United States, specified as the "Domestic
Lending Office" under its name on the signature pages hereof or on the
Assignment and Acceptance by which it became a Lender or such other United
States office of such Lender as it may from time to time specify by written
notice to the Borrower and the Administrative Agent.
"EBITDA" means, for any Financial Covenant Period, (i) the Net Income,
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plus the following amounts (without duplication) to the extent deducted in
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calculating such Net Income: (A) depreciation and amortization expense, (B)
interest expense, (C) the provision for income taxes (including federal, state,
local and foreign income taxes), (D) extraordinary or unusual losses, (E) non-
cash portion of nonrecurring losses and charges, (F) other non-operating, non-
cash losses and (G) cash expenditures arising in connection with the
transactions contemplated by the Transaction Documents in an aggregate amount
not to exceed $85,000,000; minus (ii) the following amounts (without
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duplication) for such Financial Covenant Period to the extent included in the
calculation of such Net Income: (A) the amount of extraordinary gains, (B)
interest income and (C) other non-operating, non-cash income; each item in
clauses (i) and (ii) calculated pursuant to GAAP for such period.
"Eligible Assignee" means (A) any of the following Persons approved by
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the Administrative Agent and, unless a Default has occurred and is continuing,
the Borrower, each such approval not to be unreasonably withheld or delayed: (i)
a commercial bank organized under the laws of the United States or any state
thereof; (ii) a savings and loan association or savings bank organized under the
laws of the United States or any state thereof; (iii) a commercial bank
organized under the laws of any other country or a political subdivision
thereof; provided that (x) such bank is acting through a branch or agency
located in the United States or (y) such bank is organized under the laws of a
country that is a member of the Organization for Economic Cooperation and
Development or a political subdivision of such a country; and (iv) any other
entity which is an "accredited investor" (as defined in Regulation D under the
Securities Act) which extends credit or buys loans as one of its businesses,
including, but not limited to, insurance companies, mutual funds and lease
financing companies; and (B) any Lender and any Affiliate or Approved Fund of
any Lender; provided that no Affiliate of the Borrower and no member of the
pharmaceutical industry or other competitor of the Borrower or any of its
Subsidiaries shall be an Eligible Assignee.
"Environmental, Health or Safety Requirement of Law" means
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Requirements of Law derived from or relating to federal, state and local laws,
regulations, ordinances or orders relating to or addressing the environment,
health or safety, including but not limited to any law, regulation, ordinance or
order relating to the use, handling, or disposal of any Contaminant, any law,
regulation, ordinance or order relating to Remedial Action, and any law,
regulation, ordinance or order relating to workplace or worker safety and
health, as such Requirements of Law are promulgated by the specifically
authorized agency responsible for administering such Requirements of Law.
"Environmental Lien" means a Lien in favor of any Governmental
------------------
Authority for (i) any liability under any applicable Environmental, Health or
Safety Requirement of Law or (ii) damages arising from, or costs incurred by
such Governmental Authority in response to, a Release or threatened Release of a
Contaminant into the indoor or outdoor environment.
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"Environmental Property Transfer Act" means any applicable Requirement
-----------------------------------
of Law triggered by the transfer, sale, lease, mortgage or closure of any
Property, that conditions, restricts, prohibits or requires any notification or
disclosure for environmental reasons.
"Equipment" means a Person's present and future (i) equipment and
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fixtures, including, without limitation, machinery, manufacturing, distribution,
selling, computer system, data processing and office equipment, assembly
systems, tools, molds, dies, fixtures, appliances, furniture, furnishings,
vehicles, vessels, aircraft, aircraft engines, and trade fixtures, (ii) other
tangible personal property, and (iii) any and all accessions, parts and
appurtenances attached to any of the foregoing or used in connection therewith,
and any substitutions therefor and replacements, products and proceeds thereof.
"Equity Interests" means, with respect to any Person, any Capital
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Stock issued by such Person, regardless of class or designation, any limited or
general partnership interest in such Person, or any limited liability membership
interest in such Person, regardless of designation.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
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amended from time to time, and any successor statute.
"ERISA Affiliate" means any (i) corporation which is a member of the
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same controlled group of corporations (within the meaning of Section 414(b) of
the Code) as any Loan Party, (ii) partnership, trade or business (whether or not
incorporated) which is under common control (within the meaning of Section
414(c) of the Code) with any Loan Party, and (iii) "affiliated service group"
(as defined in Section 414(m) of the Code).
"Eurodollar Affiliate" means, with respect to each Lender, the
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Affiliate of such Lender (if any) set forth below such Lender's name under the
heading "Eurodollar Affiliate" on the signature pages hereof or on the
Assignment and Acceptance by which it became a Lender or such Affiliate of a
Lender as it may from time to time specify by written notice to the Borrower and
the Administrative Agent.
"Eurodollar Interest Payment Date" means (i) with respect to any
--------------------------------
Eurodollar Rate Loan, the last day of each Eurodollar Interest Period applicable
to such Loan and (ii) with respect to any Eurodollar Rate Loan having a
Eurodollar Interest Period in excess of three (3) calendar months, the last day
of each calendar quarter during such Eurodollar Interest Period.
"Eurodollar Interest Period" has the meaning set forth in Section
-------------------------- -------
4.02(b).
-------
"Eurodollar Lending Office" means, with respect to any Lender, the
-------------------------
office or offices of such Lender (if any) set forth below such Lender's name
under the heading "Eurodollar Lending Office" on the signature pages hereof or
on the Assignment and Acceptance by which it became a Lender or such office or
offices of such Lender as it may from time to time specify by written notice to
the Borrower and the Administrative Agent.
"Eurodollar Rate" means, with respect to any Eurodollar Interest
---------------
Period applicable to a Borrowing of Eurodollar Rate Loans, an interest rate per
annum obtained by dividing (i) the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any
successor page) as the London interbank offered rate
10
for deposits in U.S. dollars at approximately 11:00 a.m. (London time) on the
Interest Rate Determination Date for such Eurodollar Interest Period for a
period equal to such Eurodollar Interest Period (provided that, if for any
reason such rate is not available, the term "Eurodollar Rate" shall mean, for
any Interest Period for all Eurodollar Rate Advances comprising part of the same
Borrowing, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Reuters Screen LIBO Page as the London interbank
offered rate for deposits in Dollars at approximately 11:00 A.M. (London time)
two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates), by (ii) a percentage equal to 100% minus the
Eurodollar Reserve Percentage. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the Eurodollar
Reserve Percentage.
"Eurodollar Rate Loans" means those Loans outstanding which bear
---------------------
interest at a rate determined by reference to the Eurodollar Rate as provided in
Section 4.01(a).
---------------
"Eurodollar Reserve Percentage" means, for any day, that percentage
-----------------------------
which is in effect on such day, as prescribed by the Federal Reserve Board for
determining the maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement) for a member bank
of the Federal Reserve System in New York, New York with deposits exceeding five
billion Dollars in respect of "Eurocurrency Liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which the
interest rate on Eurodollar Rate Loans is determined or any category of
extensions of credit or other assets which includes loans by a non-United States
office of any bank to United States residents).
"Event of Default" means any of the occurrences set forth in Section
---------------- -------
11.01 after the expiration of any applicable grace period and the giving of any
-----
applicable notice, in each case as expressly provided in Section 11.01.
-------------
"Excess Cash Flow" means, for any Fiscal Year other than the Fiscal
----------------
Year ending December 31, 2000, EBITDA for such Fiscal Year, minus cash interest
-----
paid during such Fiscal Year, minus Cash Capital Expenditures made during such
-----
Fiscal Year, minus principal payments made on Funded Debt (excluding Revolving
-----
Loans) during such Fiscal Year, minus taxes paid in cash during such Fiscal
-----
Year, plus the decrease or minus the increase in Working Capital during such
---- -----
Fiscal Year.
"Excluded Sale Proceeds" means (i) proceeds from Asset Sales described
----------------------
in clauses (i), (ii), (iii), (vi) and (viii) of Section 9.02, , (ii) proceeds
------------
from a sale, transfer and other disposition described in clause (iv), (v) or
(vii) of Section 9.02 to the extent such proceeds are reinvested within 180 days
------------
following such sale, transfer or other disposition in Property used by a Loan
Party in the ordinary course of its business, and (iii) proceeds as described in
Section 1.01 of the Disclosure Letter.
"Excluded Securities Proceeds" means (i) proceeds from the issuance of
----------------------------
debt that are used to refinance outstanding indebtedness of the Borrower and
(ii) proceeds from
11
Attributable Debt, purchase money Indebtedness, Capital Leases and trade
payables, in each case to the extent such Indebtedness is permitted under
Section 9.01.
------------
"FDA" shall mean the Food and Drug Administration.
---
"Federal Funds Rate" means, for any period, a fluctuating interest
------------------
rate per annum equal for each day during such period to the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day in New York, New York, for the next preceding
Business Day) in New York, New York by the Federal Reserve Bank of New York, or
if such rate is not so published for any day which is a Business Day in New
York, New York, the average of the quotations for such day on such transactions
received by the Administrative Agent from three federal funds brokers of
recognized standing selected by the Administrative Agent.
"Federal Reserve Board" means the Board of Governors of the Federal
---------------------
Reserve System or any Governmental Authority succeeding to its functions.
"Financial Covenant Period" means, in determining compliance with the
-------------------------
financial covenants hereunder, (i) with respect to the fiscal quarter ending
December 31, 2000, the financial information for such fiscal quarter multiplied
by four; (ii) with respect to the fiscal quarter ending March 31, 2001, the
financial information for the fiscal quarters ending December 31, 2000 and March
31, 2001 multiplied by two; (iii) with respect to the fiscal quarter ending June
30, 2001, the financial information for the fiscal quarters ending December 31,
2000, March 31, 2001 and June 30, 2001 multiplied by four-thirds; and (iv) with
respect to each fiscal quarter ending thereafter, the financial information for
the immediately preceding four fiscal quarters ending on the last day of such
fiscal quarter.
"Fiscal Year" means the fiscal year of the Borrower and its
-----------
Subsidiaries ending on December 31 of each calendar year.
"Fixed Charge Coverage Ratio" means, for any Financial Covenant
---------------------------
Period, the ratio of (i) EBITDA less Cash Capital Expenditures made during such
----
period to (ii) Interest Expense plus the regularly scheduled installments of
----
Funded Debt payable during such period.
"Floating Rate Note Indenture" means the Indenture dated December 24,
----------------------------
1997 between Schein and The Bank of New York, as trustee for the issuance of
Schein's Floating Rate Notes.
"Floating Rate Notes" means the Floating Rate Notes due 2004 issued by
-------------------
Schein pursuant to the Floating Rate Note Indenture.
"Forfeiture Proceeding" means any action, proceeding or investigation
---------------------
affecting any of the Loan Parties before any court, governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, or
the receipt of notice by any such party that any of them is a suspect in or a
target of any governmental inquiry or investigation, which may result in an
indictment of any of them or the seizure or forfeiture of any of their property.
12
"Funded Debt" means Debt which matures more than one year from the
-----------
date of its creation or matures within one year from such date but is renewable
or extendible, at the option of the debtor, to a date more than one year from
such date or arises under a revolving credit or similar agreement which
obligates the lender or lenders to extend credit during a period of more than
one year from such date including, without limitation, all amounts of Funded
Debt required to be paid or prepaid within one year from the date of
determination.
"Funding Date" means the date of the funding of a Loan.
------------
"GAAP" means generally accepted accounting principles set forth in the
----
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and the Financial Accounting Standards
Board or in such other statements by such other entity as may be in general use
by significant segments of the accounting profession as in effect from time to
time.
"Governing Documents" means, (a) with respect to any corporation, (i)
-------------------
the articles/certificate of incorporation (or the equivalent organizational
documents) of such corporation, (ii) the by-laws (or the equivalent governing
documents) of the corporation and (iii) any document setting forth the
designation, amount and/or relative rights, limitations and preferences of any
class or series of such corporation's Capital Stock; and (b) with respect to any
general partnership, (i) the partnership agreement (or the equivalent
organizational documents) of such partnership and (ii) any document setting
forth the designation, amount and/or relative rights, limitations and
preferences of any of the partnership interests; and (c) with respect to any
limited partnership, (i) the partnership agreement (or the equivalent
organizational documents) of such partnership, (ii) a certificate of limited
partnership (or the equivalent organizational documents) and (iii) any document
setting forth the designation, amount and/or relative rights, limitations and
preferences of any of the partnership interests; and (d) with respect to any
limited liability company, (i) the certificate of limited liability (or
equivalent filings) of such limited liability company, (ii) the operating
agreement (or the equivalent organizational documents) of such limited liability
company, and (iii) any document setting forth the designation, amount and/or
relative rights, limitations and preferences of any of such company's membership
interests.
"Governmental Authority" means any nation or government, any federal,
----------------------
state, local or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guaranties" means, collectively, the Guaranties, substantially in the
----------
form of the Guaranties referred to in the List of Closing Documents, executed by
the Guarantors in favor of the Administrative Agent and the Lenders, as such
Guaranties may be amended, supplemented or otherwise modified from time to time.
"Guarantors" means, collectively, (i) from the Closing Date until the
----------
Merger Effective Date, the Initial Guarantors, (ii) on and after the Merger
Effective Date, the Initial Guarantors, Schein and the Specified Schein
Subsidiaries and (iii) Subsidiaries that execute a Guaranty and an
Acknowledgment of New Loan Party from time to time hereafter.
13
"Holder" means any Person entitled to enforce any of the Obligations,
------
whether or not such Person holds any evidence of Indebtedness, including,
without limitation, the Administrative Agent and each Lender.
"Indebtedness" means, as applied to any Person at any time and without
------------
duplication, (a) all indebtedness, obligations or other liabilities of such
Person (i) for borrowed money or evidenced by debt securities, debentures,
acceptances, notes or other similar instruments, and any accrued interest, fees
and charges relating thereto, (ii) under profit payment agreements or in respect
of obligations to redeem, repurchase or exchange any Securities of such Person
or to pay dividends in respect of any stock, (iii) with respect to letters of
credit issued for such Person's account, (iv) to pay the deferred purchase price
of property or services, except accounts payable and accrued expenses arising in
the ordinary course of business, (v) in respect of Capital Leases or (vi) which
are Accommodation Obligations of the type referred to in clauses (i) through (v)
above; (b) all indebtedness, obligations or other liabilities of such Person or
others secured by a Lien (other than a Customary Permitted Lien) on any property
of such Person, whether or not such indebtedness, obligations or liabilities are
assumed by such Person (but only to the extent of the fair market value of such
property in the case of indebtedness, obligations or liabilities that are not
assumed by such Person), all as of such time; (c) all indebtedness, obligations
or other liabilities of such Person in respect of Interest Rate Contracts and
foreign exchange contracts, net of liabilities owed to such Person by the
counterparties thereon; (d) all preferred stock subject (upon the occurrence of
any contingency or otherwise) to mandatory redemption; and (e) all contingent
Contractual Obligations with respect to any of the foregoing.
"Indemnified Matters" has the meaning ascribed to such term in Section
------------------- -------
13.05.
-----
"Indemnitees" has the meaning ascribed to such term in Section 13.05.
----------- -------------
"Initial Guarantors" means ▇▇▇▇▇▇ Laboratories, Inc., a Nevada
------------------
corporation, ▇▇▇▇▇▇ Laboratories, Inc. - New York, a New York corporation,
▇▇▇▇▇▇ Laboratories, Inc. - Utah, a Delaware corporation, ▇▇▇▇▇▇ Pharma, Inc., a
Delaware corporation, The Rugby Group, Inc., a New York corporation, Rugby
Laboratories, Inc., a New York corporation, and Royce Laboratories, Inc., a
Florida corporation.
"Interest Coverage Ratio" means, with respect to any Financial
-----------------------
Covenant Period, the ratio of (i) EBITDA to (ii) Interest Expense.
"Interest Expense" means, for any period being measured hereunder,
----------------
total interest expense for such period, whether paid or accrued (including the
interest component of Capital Leases) of the Borrower and its Subsidiaries on a
consolidated basis, as determined in conformity with GAAP.
"Interest Rate Contracts" means interest rate exchange, swap, collar,
-----------------------
cap, hedging or similar agreements.
"Interest Rate Determination Date" has the meaning ascribed to such
--------------------------------
term in Section 4.02(c).
---------------
14
"Investment" means, with respect to any Person, (i) any purchase or
----------
other acquisition by that Person of Securities, or of a beneficial interest in
Securities, issued by any other Person, (ii) any purchase by that Person of all
or substantially all of the assets of a business conducted by another Person,
and (iii) any direct or indirect loan, advance (other than prepaid expenses,
accounts receivable, advances to employees and similar items made or incurred in
the ordinary course of business) or capital contribution by that Person to any
other Person, including all Indebtedness to such Person arising from a sale of
property by such Person other than in the ordinary course of its business. The
amount of any Investment shall be the original cost of such Investment, plus the
cost of all additions thereto less the amount of any return of capital or
principal to the extent such return is in cash with respect to such Investment
without any adjustments for increases or decreases in value or write-ups, write-
downs or write-offs with respect to such Investment.
"IRS" means the Internal Revenue Service and any Person succeeding to
---
the functions thereof.
"Issue" means, with respect to any Letter of Credit, either issue, or
-----
extend the expiry of, or renew, or increase the amount of, such Letter of
Credit, and the term "Issued" or "Issuance" shall have a corresponding meaning.
------ --------
"Issuing Bank" means SG and any successor or assignee thereof.
------------
"Lender" has the meaning ascribed to such term in the preamble hereto.
------
"Letter of Credit" means any Commercial Letter of Credit or Standby
----------------
Letter of Credit.
"Letter of Credit Fee" means the fees described in Section 4.03(b).
-------------------- ---------------
"Letter of Credit Obligations" means, at any particular time, the sum
----------------------------
of (i) all outstanding Reimbursement Obligations, plus (ii) the aggregate
----
undrawn face amount of all outstanding Letters of Credit, plus (iii) the
----
aggregate face amount of all Letters of Credit requested by the Borrower but not
yet issued (unless the request for an unissued Letter of Credit has been denied
pursuant to Section 2.04(c)).
---------------
"Letter of Credit Reimbursement Agreement" means, with respect to a
----------------------------------------
Letter of Credit, such form of application therefor and form of reimbursement
agreement therefor (whether in a single or several documents, taken together) as
the Issuing Bank from which the Letter of Credit is requested may employ in the
ordinary course of business for its own account, with such modifications thereto
as may be agreed upon by the Issuing Bank and the Borrower and as are not
materially adverse (in the reasonable judgment of the Issuing Bank) to the
interests of the Lenders; provided, however, in the event of any conflict
-------- -------
between the terms hereof and of any Letter of Credit Reimbursement Agreement,
the terms hereof shall control.
"Leverage Ratio" means, for any Financial Covenant Period, the ratio
--------------
of (i) the outstanding Funded Debt for the Borrower and its Subsidiaries at the
end of such period, to (ii) EBITDA for such period.
15
"Liabilities and Costs" means all liabilities, obligations,
---------------------
responsibilities, losses, damages, personal injury, death costs, punitive
damages, economic damages, consequential damages, treble damages, intentional,
willful or wanton injury, damage or threat to the environment, natural resources
or public health or welfare, costs and expenses (including, without limitation,
attorney, expert and consulting fees and costs of investigation, feasibility
studies or Remedial Action), fines, penalties and monetary sanctions, interest,
direct or indirect, known or unknown, absolute or contingent, past, present or
future.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
----
assignment, conditional sale agreement, deposit arrangement, security interest,
encumbrance, lien (statutory or other), preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever in
respect of any property of a Person, whether granted voluntarily or imposed by
law, and includes the interest of a lessor under a Capital Lease or under any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement or similar notice (other
than a financing statement filed by a "true" lessor pursuant to (S) 9-408 of the
Uniform Commercial Code), naming the owner of such property as debtor, under the
Uniform Commercial Code or other comparable law of any jurisdiction.
"List of Closing Documents" shall mean the List of Closing Documents
-------------------------
attached hereto and made a part hereof as Exhibit E.
---------
"Loan Documents" means this Agreement, the Notes, the Administrative
--------------
Agent's Fee Letter, the Guaranties, the Contribution Agreement, the Letter of
Credit Reimbursement Agreements, any Interest Rate Contracts to which any Lender
or any Affiliate of a Lender is a party, any foreign exchange contracts to which
any Lender or any Affiliate of a Lender is a party, and all other instruments,
agreements and written Contractual Obligations between any Loan Party and the
Administrative Agent, the Issuing Bank or any Lender delivered to either the
Administrative Agent, the Issuing Bank or such Lender pursuant to or in
connection with the transactions contemplated hereby.
"Loan Party" means the Borrower and each of the Guarantors.
----------
"Loans" means all Revolving Loans, Term Loans and Swing Loans.
-----
"Margin Stock" means "margin stock" as such term is defined in
------------
Regulation U.
"Material Adverse Effect" means (i) a material adverse effect on the
-----------------------
Acquisition, (ii) a material adverse effect upon the condition (financial or
otherwise), operations, assets, business, properties, performance or prospects
of the Borrower and its Subsidiaries and Schein and its Subsidiaries, taken as a
whole, (iii) a material adverse effect on the ability of the Loan Parties to
perform their respective payment obligations under the Loan Documents, or (iv) a
material adverse effect on the ability of the Lenders or the Administrative
Agent to enforce the Loan Documents.
"Maturity Date" means July 6, 2005.
-------------
16
"Maximum Revolving Credit Amount" means, at any particular time, the
-------------------------------
Revolving Loan Commitments at such time.
"Merger" means the merger to be consummated pursuant to the Merger
------
Agreement.
"Merger Agreement" means the Agreement and Plan of Merger, dated as of
----------------
May 24, 2000, among the Borrower, WS Acquisition Corp. and Schein.
"Merger Documents" means, collectively, the Merger Agreement and each
----------------
of the other agreements, notes, guarantees, consents, instruments, certificates
and opinions delivered by the Borrower or any other Person in connection with
the Merger.
"Merger Effective Date" means the date on which the Merger is
---------------------
consummated.
"Multiemployer Plan" means an employee benefit plan as defined in
------------------
Section 4001(a)(3) of ERISA which is, or within the immediately preceding six
(6) years was, contributed to by either the Borrower or any ERISA Affiliate.
"Net Cash Proceeds" means with respect to any Asset Sale or issuance
-----------------
of Securities, an amount equal to the gross cash proceeds of such Asset Sale or
issuance, net of (i) attorneys' fees, accountants' fees, brokerage, consultant
and other customary fees, underwriting commissions and other fees and expenses
actually incurred in connection therewith, (ii) taxes paid or reasonably
estimated to be payable as a result thereof and (iii) the amount of any
Indebtedness secured by a Lien on the asset being sold that has been repaid with
the proceeds of such Asset Sale.
"Net Income" means, for any period being measured hereunder, the net
----------
earnings (or loss) after taxes of the Borrower and its Subsidiaries on a
consolidated basis for such period taken as a single accounting period
determined in conformity with GAAP.
"Net Worth" means, as at any time of determination, the total assets
---------
of the Borrower and its Subsidiaries on a consolidated basis less total
----
liabilities of the Borrower and its Subsidiaries on a consolidated basis, each
determined in accordance with GAAP.
"Notes" means the Revolving Loan Notes, the Term Loan Notes and the
-----
Swing Loan Notes.
"Notice of Borrowing" means a notice substantially in the form of
-------------------
Exhibit C attached hereto and made a part hereof.
---------
"Notice of Continuation/Conversion" means a notice substantially in
---------------------------------
the form of Exhibit D.
---------
"Obligations" means all Loans, advances, debts, liabilities,
-----------
obligations, covenants and duties owing by any Loan Party to any of the Agents,
the Issuing Bank, any Lender, any Affiliate of any of the Agents, the Issuing
Bank or any Lender, or any Person entitled to indemnification pursuant to
Section 13.05 of this Agreement, of any kind or nature, present or
-------------
17
future, whether or not evidenced by any note, guaranty or other instrument,
whether arising by reason of an extension of credit, opening or amendment of a
Letter of Credit or payment of a draft drawn thereunder, arising under this
Agreement, the Notes or any other Loan Document, whether or not for the payment
of money, whether arising by reason of an extension of credit, loan, guaranty,
indemnification, Interest Rate Contract, foreign exchange contract or in any
other manner, whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired. The term includes, without limitation,
all interest, charges, expenses, fees, attorneys' fees and disbursements and any
other sum chargeable to the Loan Parties under this Agreement, the Notes or any
other Loan Document.
"Officer's Certificate" means, with respect to any Person, a
---------------------
certificate executed on behalf of such Person by (i) the chairman or vice-
chairman of such Person's board of directors or (ii) such Person's president,
any of its vice-presidents, its chief financial officer, chief accounting
officer, vice president of finance or its treasurer.
"Operating Lease" means, as applied to any Person, any lease of any
---------------
property (whether real, personal or mixed) by that Person as lessee which is not
a Capital Lease.
"Other Taxes" has the meaning ascribed to such term in Section
----------- -------
3.03(b).
-------
"PBGC" means the Pension Benefit Guaranty Corporation or any Person
----
succeeding to the functions thereof.
"Permits" means any permit, approval, authorization, license,
-------
variance, or permission required from a Governmental Authority under an
applicable Requirement of Law.
"Permitted Existing Indebtedness" means the Indebtedness identified as
-------------------------------
such in Section 1.01(A) of the Disclosure Letter.
"Permitted Existing Investments" means the Investments identified as
------------------------------
such in Section 1.01(B) of the Disclosure Letter.
"Permitted Existing Liens" means the Liens on assets of any Loan Party
------------------------
identified as such in Section 1.01(C) of the Disclosure Letter.
"Person" means any natural person, corporation, limited partnership,
------
general partnership, joint stock company, joint venture, association, company,
trust, bank, trust company, land trust, business trust, limited liability
company or other organization, whether or not a legal entity, and any
Governmental Authority.
"Plan" means an employee benefit plan defined in Section 3(3) of ERISA
----
(other than a Multiemployer Plan) in respect of which the Borrower or any ERISA
Affiliate is, or within the immediately preceding six (6) years was, an
"employer" as defined in Section 3(5) of ERISA.
"Process Agent" has the meaning ascribed to such term in Section
------------- -------
13.20(a).
--------
18
"Property" means any and all interests in any kind of property or
--------
asset, whether real, personal or mixed, whether tangible or intangible.
"Pro Rata Share" means, with respect to any Lender, the percentage
--------------
obtained by dividing (i) with respect to a Revolving Loan Lender, such Lender's
--------
Revolving Loan Commitment (or, if after the Revolving Termination Date, the
outstanding balances of such Lender's Revolving Loans) by the aggregate amount
--
of all Revolving Loan Lenders' Revolving Loan Commitments (or, if after the
Revolving Termination Date, the outstanding balances of all Revolving Loans);
(ii) with respect to a Term Loan Lender, the outstanding amount of such Term
Loan Lender's Term Loans by the aggregate outstanding amount of all Term Loans;
--
and (iii) with respect to all Lenders, each Lender's Revolving Loan Commitment
(or, if after the Revolving Termination Date, the outstanding balance of such
Lender's Revolving Loans), plus such Lender's outstanding Term Loans by the sum
---- --
of all the Lenders' Revolving Loan Commitments (or, if after the Revolving
Termination Date, the outstanding balance of all Revolving Loans) plus the
----
outstanding Term Loans.
"RCRA" means the Resource Conservation and Recovery Act of 1986, 42
----
U.S.C. (S)(S) 6901 et seq., any amendments thereto, any successor statutes, and
-- ---
any regulations promulgated thereunder.
"Register" has the meaning ascribed to such term in Section 13.01(c).
-------- ----------------
"Regulation U" means Regulation U of the Federal Reserve Board as in
------------
effect from time to time.
"Regulation X" means Regulation X of the Federal Reserve Board as in
------------
effect from time to time.
"Reimbursement Date" is defined in Section 2.04(d)(i)(A).
------------------ ---------------------
"Reimbursement Obligations" means, as to the Borrower, the aggregate
-------------------------
reimbursement or repayment obligations of the Borrower with respect to amounts
drawn under Letters of Credit.
"Release" means release, spill, emission, leaking, pumping, injection,
-------
deposit, disposal, discharge, dispersal, leaching or migration into the indoor
or outdoor environment or into or out of any Property, including the movement of
Contaminants through or in the air, soil, surface water, groundwater or
Property.
"Remedial Action" means any action required to (i) clean up, remove,
---------------
treat or in any other way address Contaminants in the indoor or outdoor
environment; (ii) prevent the Release or threat of Release or minimize the
further Release of Contaminants so they do not migrate or endanger or threaten
to endanger public health or welfare or the indoor or outdoor environment; or
(iii) perform pre-remedial studies and investigations and post-remedial
monitoring and care.
19
"Rental Payments" means, for any period, the aggregate amount of all
---------------
rents paid or accrued under all Operating Leases for Equipment of any Loan Party
as lessee (net of sublease income), all as determined on a combined basis in
conformity with GAAP.
"Replacement Event" means, with respect to any Lender, the appointment
-----------------
of, or the taking of possession by, a receiver, custodian, conservator, trustee
or liquidator of such Lender, or the declaration by the appropriate regulatory
authority that such Lender is insolvent.
"Replacement Lender" means a financial institution which is an
------------------
Eligible Assignee or is otherwise reasonably acceptable to the Administrative
Agent and which is not a Loan Party or an Affiliate of a Loan Party.
"Reportable Event" has the meaning ascribed to such term in Section
----------------
4043 of ERISA or regulations promulgated thereunder, other than an event which
is not subject to the thirty (30) day notice requirement of such regulations.
"Requirements of Law" means, as to any Person, the charter and by-laws
-------------------
or other organizational or governing documents of such Person, and any law, rule
or regulation, or determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is subject
including, without limitation, the Securities Act, the Securities Exchange Act,
Regulations U and X, ERISA, the Fair Labor Standards Act and any certificate of
occupancy, zoning ordinance, building, environmental or land use requirement or
Permit or environmental, labor, employment, occupational safety or health law,
rule or regulation.
"Requisite Lenders" means Lenders whose Pro Rata Shares, in the
-----------------
aggregate, are greater than 50.1%; provided, however, that, in the event that
-------- -------
the Commitments have been terminated pursuant to the terms of this Agreement,
"Requisite Lenders" means Lenders whose aggregate ratable shares (stated as a
-----------------
percentage) of the aggregate outstanding amount of the Obligations are greater
than 50.1%.
"Restricted Junior Payment" means (i) any dividend or other
-------------------------
distribution, direct or indirect, on account of any shares of any class of
capital stock of, partnership interest of or other equity interest of, a Loan
Party now or hereafter outstanding, except a dividend payable solely in shares
of that class of stock or in any junior class of stock to the holders of that
class, (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of capital stock of, partnership interest of or other equity interest
of, a Loan Party now or hereafter outstanding, (iii) any payment or prepayment
of principal of, premium, if any, or interest, fees or other charges on or with
respect to, and any redemption, purchase, retirement, defeasance, sinking fund
or similar payment and any claim for rescission with respect to, any
subordinated indebtedness and (iv) any payment made to redeem, purchase,
repurchase or retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of any class of capital stock of,
partnership interest of or other equity interest of, a Loan Party now or
hereafter outstanding.
"Revolving Credit Obligations" means, at any particular time, the sum
----------------------------
of (i) the outstanding principal amount of the Swing Loans at such time, plus
(ii) the outstanding principal
20
amount of the Revolving Loans at such time, plus (iii) Letter of Credit
Obligations outstanding at such time.
"Revolving Loan" has the meaning ascribed to such term in Section
-------------- -------
2.01(a).
-------
"Revolving Loan Commitment" means, with respect to any Lender, the
-------------------------
obligation of such Lender to make Revolving Loans pursuant to the terms and
conditions of this Agreement, and which shall not exceed the principal amount
set forth opposite such Lender's name under the heading "Revolving Loan
Commitment" on the signature pages hereof or the signature page of the
Assignment and Acceptance by which it became (or becomes) a Lender, as modified
from time to time pursuant to the terms of this Agreement or to give effect to
any applicable Assignment and Acceptance, and "Revolving Loan Commitments" means
--------------------------
the aggregate principal amount of the Revolving Loan Commitments of all the
Lenders, the maximum amount of which shall not exceed a principal amount of
$200,000,000.
"Revolving Loan Lender" means a Lender who has a Revolving Loan
---------------------
Commitment.
"Revolving Loan Notes" has the meaning assigned thereto in Section
-------------------- -------
2.05(a)(i).
----------
"Schein" means Schein Pharmaceutical, Inc., a Delaware corporation.
------
"Schein Parties" means (i) Schein and the Specified Schein
--------------
Subsidiaries during the period from the Closing Date to the Merger Effective
Date and (ii) Steris Laboratories, Inc., a Delaware corporation, and Marsam
Pharmaceuticals, Inc., a Delaware corporation.
"Schein Payment Date" means the date which is the earlier of (i) the
-------------------
Schein Redemption Date and (ii) the seventieth day following the Closing Date.
"Schein Redemption Date" means the date on which Schein redeems its
----------------------
Floating Rate Notes.
"Securities" means any stock, shares, voting trust certificates,
----------
bonds, debentures, notes or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or any certificates of
interest, shares, or participations in temporary or interim certificates for the
purchase or acquisition of, or any right to subscribe to, purchase or acquire
any of the foregoing, but shall not include any evidence of the Obligations.
"Securities Act" means the Securities Act of 1933, as amended from
--------------
time to time, and any successor statute.
"Securities Exchange Act" means the Securities Exchange Act of 1934,
-----------------------
as amended from time to time, and any successor statute.
"Senior Note Indenture" means the Senior Indenture dated May 18, 1998
---------------------
between the Borrower and First Union National Bank, as Trustee for the issuance
of the Borrower's Senior Notes.
21
"Senior Notes" means the Senior Notes due 2008 issued by the Borrower
------------
pursuant to the Senior Note Indenture.
"Six Month Date" means January 8, 2001.
--------------
"Solvent", when used with respect to any Person, means that at the
-------
time of determination:
(a) the fair market value of its assets is in excess of the total
amount of its liabilities (including, without limitation, contingent
liabilities); and
(b) the present fair saleable value of its assets is greater than
its probable liability on its existing debts as such debts become absolute and
matured; and
(c) it is then able and expects to be able to pay its debts
(including, without limitation, contingent debts and other commitments) as they
mature; and
(d) it has capital sufficient to carry on its business as conducted
and as proposed to be conducted.
"Specified Schein Subsidiaries" means Danbury Pharmacal, Inc., a
-----------------------------
Delaware corporation, and Danbury Pharmacal Puerto Rico, Inc., a Delaware
corporation.
"Standby Letter of Credit" means any letter of credit issued by an
------------------------
Issuing Bank pursuant to Section 2.04 for the account of the Borrower, which is
------------
not a Commercial Letter of Credit.
"Strategic Partner" means any agreement or arrangement with one or
-----------------
more other Persons to develop, license, manufacture, market, sell or distribute
products in lines of businesses that do not violate Section 9.07.
------------
"Subsidiary" means any corporation or other entity of which securities
----------
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned or controlled by such Person, one or more of
the other subsidiaries of such Person or any combination thereof.
"Swing Loan" has the meaning assigned thereto in Section 2.03(a).
---------- ---------------
"Swing Loan Lender" means SG, in its individual capacity, or, in the
-----------------
event SG is not the Administrative Agent, the Administrative Agent (or any
Affiliate of the Administrative Agent designated by the Administrative Agent),
in its individual capacity.
"Swing Loan Note" means one or more notes evidencing the Borrower's
---------------
Obligation to repay the Swing Loans.
"Taxes" has the meaning ascribed to such term in Section 3.03(a).
----- ---------------
22
"Tender Offer" means the Offer to Purchase for Cash, dated June 6,
------------
2000, made by WS Acquisition Corp., a Delaware corporation and wholly-owned
Subsidiary of the Borrower.
"Tender Offer Documents" means, collectively, the Tender Offer and
----------------------
each of the other agreements, notes, guarantees, consents, instruments,
certificates and opinions delivered by the Borrower or any other Person in
connection with the Tender Transaction.
"Tender Transaction" means the consummation of the transactions
------------------
contemplated by the Tender Offer.
"Term Loan" has the meaning ascribed to such term in Section
--------- -------
2.02(a)(i).
----------
"Term Loan Commitment" means, with respect to any Lender, the
--------------------
obligation of such Lender to make Term Loans pursuant to the terms and
conditions of this Agreement, and which shall not exceed the principal amount
set forth opposite such Lender's name under the heading "Term Loan Commitment"
on the signature pages hereof or the signature page of the Assignment and
Acceptance by which it became (or becomes) a Lender, as modified from time to
time pursuant to the terms of this Agreement or to give effect to any applicable
Assignment and Acceptance, and "Term Loan Commitments" means the aggregate
---------------------
principal amount of the Term Loan Commitments of all the Lenders, the maximum
amount of which shall not exceed $500,000,000.
"Term Loan Lender" means a Lender who has a Term Loan Commitment.
----------------
"Term Loan Notes" has the meaning assigned thereto in Section
--------------- -------
2.05(a)(ii).
-----------
"Termination Event" means (i) any Reportable Event with respect to any
-----------------
Benefit Plan, (ii) the withdrawal of the Borrower or an ERISA Affiliate from a
Benefit Plan during a plan year in which it was a "substantial employer" as
defined in Section 4001(a)(2) of ERISA, (iii) the occurrence of an obligation
arising under Section 4041 of ERISA of the Borrower or an ERISA Affiliate to
provide affected parties with a written notice of an intent to terminate a
Benefit Plan in a distress termination described in Section 4041(c) of ERISA,
(iv) the institution by the PBGC of proceedings to terminate any Benefit Plan,
(v) any event or condition which constitutes grounds under Section 4042 of ERISA
for the appointment of a Trustee to administer a Benefit Plan, or (vi) the
partial or complete withdrawal of the Borrower or any ERISA Affiliate from a
Multiemployer Plan.
"Transaction Documents" means, collectively, the Loan Documents, the
---------------------
Tender Offer Documents and, on and after the Merger Effective Date, the Merger
Documents.
"Type" means, with respect to any Loan, its nature as a Eurodollar
----
Rate Loan or a Base Rate Loan.
"Uniform Commercial Code" means the Uniform Commercial Code as enacted
-----------------------
in the State of New York, as it may be amended from time to time.
23
"Unused Commitment Fee" shall have the meaning ascribed to such term
---------------------
in Section 4.03(a).
---------------
"Voting Securities" means with respect to any Person, Securities with
-----------------
respect to any class or classes of capital stock of such Person entitling the
holders thereof ordinarily to vote in the election of the members of the board
of directors of such Person.
"Working Capital" means, as at any date of determination, an amount
---------------
equal to Current Assets minus Current Liabilities.
-----
"Wholly Owned Subsidiary" means a Subsidiary of the Borrower all the
-----------------------
Equity Interests of which are owned by the Borrower or another Wholly Owned
Subsidiary.
1.02. Computation of Time Periods. In this Agreement, in the
---------------------------
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding". Periods of days referred to in this Agreement shall be
counted in calendar days unless Business Days are expressly prescribed. Any
period determined hereunder by reference to a month or months or year or years
shall end on the day in the relevant calendar month in the relevant year, if
applicable, immediately preceding the date numerically corresponding to the
first day of such period, provided that if such period commences on the last day
--------
of a calendar month (or on a day for which there is no numerically corresponding
day in the calendar month during which such period is to end), such period
shall, unless otherwise expressly required by the other provisions of this
Agreement, end on the last day of the calendar month.
1.03. Accounting Terms. For purposes of this Agreement, all
----------------
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP.
1.04. Other Terms. Terms not otherwise defined herein which are
-----------
defined in, or used in, Article 9 of the Uniform Commercial Code shall have the
respective meanings assigned to such terms in Article 9 of the Uniform
Commercial Code.
ARTICLE II
AMOUNTS AND TERMS OF LOANS
2.01. Revolving Loan Facility.
-----------------------
(a) Availability. Subject to the terms and conditions set forth in
------------
this Agreement, each Revolving Loan Lender hereby severally agrees to make
revolving loans (each individually, a "Revolving Loan" and, collectively, the
--------------
"Revolving Loans") to the Borrower from time to time during the period from the
---------------
Closing Date to the Business Day immediately preceding the Commitment
Termination Date, in an amount not to exceed such Lender's Pro Rata Share of the
Availability at such time; provided, however, that on the Closing Date, the
-------- -------
Availability shall be limited to $100,000,000. Each Base Rate Loan shall be for
a minimum amount of Five Million Dollars ($5,000,000) and in integral multiples
of One Million Dollars ($1,000,000) in excess of that amount. Each Eurodollar
Rate Loan shall be for a minimum
24
amount of Five Million Dollars ($5,000,000) and in integral multiples of One
Million Dollars ($1,000,000) in excess of that amount. All Revolving Loans
comprising the same Borrowing under this Agreement shall be made by the Lenders
simultaneously and proportionately to their then respective Pro Rata Shares, it
being understood that no Revolving Loan Lender shall be responsible for any
failure by any other Revolving Loan Lender to perform its obligation to make a
Revolving Loan hereunder nor shall the Revolving Loan Commitment of any
Revolving Loan Lender be increased or decreased as a result of any such failure.
Subject to the provisions of this Agreement, the Borrower may repay any
outstanding Revolving Loan made to it on any day which is a Business Day and any
amounts so repaid may be reborrowed in accordance with the provisions of this
Section 2.01(a).
---------------
(b) Notice of Borrowing. When the Borrower desires to borrow under
-------------------
this Section 2.01, the Borrower shall deliver to the Administrative Agent a
------------
Notice of Borrowing, signed by it, no later than 1:00 p.m. (New York time) (i)
on the proposed Funding Date, in the case of a Borrowing of Base Rate Loans, and
(ii) at least three (3) Business Days in advance of the proposed Funding Date,
in the case of a Borrowing of Eurodollar Rate Loans; provided that no Borrowing
of Eurodollar Rate Loans shall be made on the Closing Date. Such Notice of
Borrowing shall specify (i) the proposed Funding Date (which shall be a Business
Day), (ii) the amount of the proposed Borrowing, (iii) whether the proposed
Borrowing will be of Base Rate Loans or Eurodollar Rate Loans, and (iv) in the
case of Eurodollar Rate Loans, the requested Eurodollar Interest Period. In lieu
of delivering such a Notice of Borrowing, the Borrower may give the
Administrative Agent telephonic notice of any proposed Borrowing by the time
required under this Section 2.01(b) if it confirms such notice by delivery of
---------------
the Notice of Borrowing to the Administrative Agent promptly, but in no event
later than 5:00 p.m. (New York time) on the same day. Any Notice of Borrowing
(or telephonic notice in lieu thereof) given pursuant to this Section 2.01(b)
---------------
shall be irrevocable.
(c) Making of Revolving Loans. (i) Promptly after receipt of a
-------------------------
Notice of Borrowing under Section 2.01(b) (or telephonic notice in lieu
---------------
thereof), the Administrative Agent shall notify each Lender by facsimile, or
other similar form of transmission, of the proposed Borrowing. Each Lender shall
deposit an amount equal to its Pro Rata Share of the amount requested by the
Borrower to be made as Revolving Loans in the Administrative Agent's Account at
its office in New York, New York, in immediately available funds, not later than
3:00 p.m. (New York time) on any Funding Date applicable thereto. Subject to the
fulfillment of the conditions precedent set forth in Section 5.02, the
------------
Administrative Agent shall make the proceeds of such amounts received by it
available to the Borrower at the Administrative Agent's office in New York, New
York on such Funding Date (or on the date received if later than such Funding
Date). The failure of any Lender to deposit the amount described above with the
Administrative Agent on the applicable Funding Date shall not relieve any other
Lender of its obligations hereunder to make its Revolving Loan on such Funding
Date.
(ii) Unless the Administrative Agent shall have been notified by any
Lender no later than 3:00 p.m. (New York time) on the applicable Funding Date in
respect of any Borrowing of Revolving Loans that such Lender does not intend to
fund its Revolving Loan requested to be made on such Funding Date, the
Administrative Agent may assume that such Lender has funded its Revolving Loan
and is depositing the proceeds thereof with the Administrative Agent on the
Funding Date, and the Administrative Agent in its sole discretion
25
may, but shall not be obligated to, disburse a corresponding amount to the
Borrower on the Funding Date. If the Revolving Loan proceeds corresponding to
that amount are advanced to the Borrower by the Administrative Agent but are not
in fact deposited with the Administrative Agent by such Lender on or prior to
the applicable Funding Date, such Lender agrees to pay, and in addition the
Borrower agrees to repay, to the Administrative Agent forthwith on demand such
corresponding amount, together with interest thereon, for each day from the date
such amount is disbursed to or for the benefit of the Borrower until the date
such amount is paid or repaid to the Administrative Agent, (A) in the case of
the Borrower, at the interest rate applicable to such Borrowing and (B) in the
case of such Lender, at the Federal Funds rate for the first Business Day, and
thereafter at the interest rate applicable to such Borrowing. If such Lender
shall pay to the Administrative Agent the corresponding amount, the amount so
paid shall constitute such Lender's Revolving Loan, and if both such Lender and
the Borrower shall pay and repay such corresponding amount, the Administrative
Agent shall promptly pay to the Borrower such corresponding amount. This Section
-------
2.01(c)(ii) does not relieve any Lender of its obligation to make its Revolving
-----------
Loan on any Funding Date; nor does this Section relieve the Borrower of its
obligation to pay or repay any Lender funding its Revolving Loan pursuant to
this Section interest on such Revolving Loan from such Funding Date until the
date on which such Revolving Loan is repaid in full.
(d) Repayment of Revolving Loans. The Revolving Loan Commitments
----------------------------
shall terminate, and all outstanding Revolving Loans shall be paid in full, on
the Commitment Termination Date.
2.02. Term Loan Facility.
------------------
(a) Amount of Loans. Subject to the terms and conditions set forth
---------------
in this Agreement, each Term Loan Lender hereby severally agrees to make a Term
Loan (each individually, a "Term Loan" and, collectively, the "Term Loans") to
--------- ----------
the Borrower on the Closing Date in an amount not to exceed such Term Loan
Lender's Term Loan Commitment. All Term Loans shall be made by the Term Loan
Lenders simultaneously and proportionately to their then respective Pro Rata
Shares, it being understood that no Term Loan Lender shall be responsible for
any failure by any other Term Loan Lender to perform its obligation to make a
Term Loan hereunder nor shall the Commitment of any Term Loan Lender be
increased or decreased as a result of any such failure.
(b) Notice of Borrowing. The Borrower shall deliver to the
-------------------
Administrative Agent a Notice of Borrowing, signed by it, no later than 1:00
p.m. (New York time) on the Business Day immediately preceding the proposed
Closing Date. Such Notice of Borrowing shall specify (i) the proposed Funding
Date (which shall be a Business Day and the Closing Date) and (ii) the amount of
the proposed Borrowing with respect to the Term Loans. All Term Loans shall be
Base Rate Loans on the Closing Date but after the Closing Date may be converted
to Eurodollar Rate Loans pursuant to Section 4.01(c). Any Notice of Borrowing
---------------
given pursuant to this Section 2.02(b) shall be irrevocable.
----------------
(c) Making of Term Loans. Promptly after receipt of the Notice of
--------------------
Borrowing under Section 2.02(b), the Administrative Agent shall notify each Term
---------------
Loan Lender by telecopy, or other similar form of transmission, of the proposed
Borrowing. Each Term Loan
26
Lender shall deposit an amount equal to its Pro Rata Share of the amount
requested by the Borrower specified in such Notice of Borrowing to be made as
Term Loans in the Administrative Agent's Account at its office in New York, New
York, in immediately available funds, not later than 3:00 p.m. (New York time)
on the Closing Date. Subject to the fulfillment of the conditions precedent set
forth in Sections 5.01 and 5.02, the Administrative Agent shall make the
------------- ----
proceeds of such amounts received by it available to the Borrower at the
Administrative Agent's office in New York, New York on the Closing Date. The
failure of any Term Loan Lender to deposit the amount described above with the
Administrative Agent on the Closing Date shall not relieve any other Term Loan
Lender of its obligations hereunder to make its Term Loan on the Closing Date.
(d) Repayment of Term Loans. (i) The principal amount of the Term
-----------------------
Loans shall be payable in quarterly installments on the first day of January,
April, July and October in each year, commencing on October 1, 2000 and ending
on the Maturity Date, in the amounts set forth below:
October 1, 2000 $15,000,000
January 1, 2001 $15,000,000
April 1, 2001 $15,000,000
July 1, 2001 $15,000,000
October 1, 2001 $20,000,000
January 1, 2002 $20,000,000
April 1, 2002 $20,000,000
July 1, 2002 $20,000,000
October 1, 2002 $25,000,000
January 1, 2003 $25,000,000
April 1, 2003 $25,000,000
July 1, 2003 $25,000,000
October 1, 2003 $30,000,000
January 1, 2004 $30,000,000
April 1, 2004 $30,000,000
July 1, 2004 $30,000,000
October 1, 2004 $35,000,000
January 1, 2005 $35,000,000
April 1, 2005 $35,000,000
Maturity Date $35,000,000
provided, however, that the last installment shall be in the amount necessary to
-------- -------
repay in full the outstanding principal amount of the Term Loans.
2.03. Swing Loans. (a) Swing Loans. Subject to the terms and
----------- -----------
conditions set forth herein, the Swing Loan Lender may, in its sole discretion,
make loans (the "Swing Loans") to the Borrower, from time to time after the
-----------
Closing Date and prior to the Commitment Termination Date, up to an aggregate
principal amount at any one time outstanding which shall not exceed an amount
equal to $5,000,000. The Swing Loan Lender shall have no duty to make or to
continue to make Swing Loans. All Swing Loans shall be payable on demand with
accrued interest thereon and shall otherwise be subject to all the terms and
conditions applicable to Revolving Loans, except that (x) Swing Loans shall not
have a minimum amount requirement
27
and (y) all interest on the Swing Loans made by the Swing Loan Lender shall be
payable to the Swing Loan Lender solely for its own account.
(b) Notice of Borrowing. When the Borrower desires to borrow under
-------------------
this Section 2.03, it shall deliver to the Administrative Agent an irrevocable
------------
Notice of Borrowing, signed by it, no later than 3:00 p.m. (New York time) on
the day of the proposed Borrowing of a Swing Loan. Such Notice of Borrowing
shall specify (i) the date of the proposed Borrowing (which shall be a Business
Day), (ii) the amount of the proposed Borrowing and (iii) instructions for the
disbursement of the proceeds of the proposed Borrowing. In lieu of delivering
such a Notice of Borrowing, the Borrower shall give the Administrative Agent
irrevocable telephonic notice of any proposed Borrowing by 3:00 p.m. (New York
time) on the day of the proposed Borrowing, and shall confirm such notice by
delivery of the Notice of Borrowing by facsimile to the Administrative Agent
promptly, but in no event later than 4:00 p.m. (New York time) on the same day.
All Swing Loans shall be Base Rate Loans.
(c) Making of Swing Loans. The Swing Loan Lender shall deposit the
---------------------
amount it intends to fund, if any, in respect of the Swing Loans requested by
the Borrower with the Administrative Agent at its office in New York, New York
not later than 3:00 p.m. (New York time) in immediately available funds on the
date of the proposed Borrowing applicable thereto. The Swing Loan Lender shall
not make any Swing Loan during the period commencing on the first Business Day
after it receives written notice from the Requisite Lenders that one or more of
the conditions precedent contained in Section 5.02 shall not on such date be
------------
satisfied, and ending when such conditions are satisfied, and the Swing Loan
Lender shall not otherwise be required to determine that, or take notice
whether, the conditions precedent set forth in Section 5.02 hereof have been
------------
satisfied in connection with the making of any Swing Loan. Subject to the
preceding sentence, the Administrative Agent shall make such proceeds available
to the Borrower at the Administrative Agent's office in New York, New York on
the date of the proposed Borrowing and shall disburse such proceeds to the
Borrower in accordance with the Borrower's disbursement instructions set forth
in the applicable Notice of Borrowing.
(d) Repayment of Swing Loans. The Borrower shall repay the
------------------------
outstanding Swing Loans owing to the Swing Loan Lender (i) upon demand by the
Swing Loan Lender and (ii) on the Commitment Termination Date. In the event that
the Borrower fails to repay any Swing Loans, together with interest thereon, as
set forth in the first sentence of this paragraph, then, upon the request of the
Swing Loan Lender, each Revolving Loan Lender shall make Revolving Loans to the
Borrower (irrespective of the satisfaction of the conditions in Section 5.02 or
------------
the requirement to deliver a Notice of Borrowing in Section 2.01(b), which
---------------
conditions and requirement such Revolving Loan Lenders irrevocably waive) in an
amount equal to such Revolving Loan Lender's Pro Rata Share of the aggregate
amount of the Swing Loans then outstanding (net of that portion of such Swing
Loan, if any, owing to such Revolving Loan Lender in its capacity as a Swing
Loan Lender) after giving effect to any prepayments and repayments made by the
Borrower, and the Borrower hereby authorizes the Administrative Agent to apply
the proceeds of such Revolving Loans to the repayment of such Swing Loans. To
the extent the Administrative Agent receives any amounts in prepayment or
repayment of outstanding Revolving Loans prior to such request, the
Administrative Agent shall apply such amounts when received to the repayment of
the Swing Loans then outstanding. The failure of any Revolving Loan Lender to
make available to the Administrative Agent its Pro Rata Share of
28
such Revolving Loans shall not relieve any other Revolving Loan Lender of its
obligation hereunder to make available to the Administrative Agent such other
Revolving Loan Lender's Pro Rata Share of such Revolving Loans on the date of
such request.
2.04. Letters of Credit. Subject to the terms and conditions set
-----------------
forth herein, the Issuing Bank hereby agrees to Issue for the account of the
Borrower one or more Letters of Credit during the period from the Closing Date
to the date which is the fifth Business Day prior to the Commitment Termination
Date, subject to the following provisions:
(a) Types and Amounts. The Issuing Bank shall not have any
-----------------
obligation to Issue, and shall not Issue any Letter of Credit at any time:
(i) if the aggregate Letter of Credit Obligations with respect to
the Issuing Bank, after giving effect to the Issuance of the Letter of Credit
requested hereunder, shall exceed $50,000,000 or any limit imposed by law or
regulation upon the Issuing Bank;
(ii) if the Issuing Bank receives written notice (A) from the
Administrative Agent at or before 3:00 p.m. (New York time) on the date of the
proposed Issuance of such Letter of Credit that immediately after giving effect
to the Issuance of such Letter of Credit, (1) the Letter of Credit Obligations
at such time would exceed $50,000,000 or (2) the Revolving Credit Obligations at
such time would exceed the Maximum Revolving Credit Amount at such time, or (B)
from the Requisite Lenders at or before 1:00 p.m. (New York time) on the date of
the proposed Issuance of such Letter of Credit that one or more of the
conditions precedent contained in Article V, as applicable, would not on such
date be satisfied (or waived pursuant to Section 13.09), unless such conditions
-------------
are thereafter satisfied or waived and written notice of such satisfaction or
waiver is given to the Issuing Bank by the Administrative Agent (and the Issuing
Bank shall not otherwise be required to determine that, or take notice whether,
the conditions precedent set forth in Article V, as applicable, have been
satisfied or waived); or
(iii) if the Letter of Credit requested would have an expiration date
later than the earlier of (A) the date which occurs 180 days following the date
of Issuance with respect to a Commercial Letter of Credit or the date which
occurs 360 days following the date of Issuance with respect to a Standby Letter
of Credit or (B) five Business Days immediately preceding the Commitment
Termination Date; provided that any Letter of Credit may, by its terms, be
--------
renewable or automatically renew for successive periods of up to one year so
long as such Letter of Credit expires on or prior to the date referred to in
clause (B) above; or
(iv) which is in a currency other than Dollars.
(b) Conditions. In addition to being subject to the satisfaction
----------
of the conditions precedent contained in Article V, as applicable, the
obligation of the Issuing Bank to Issue any Letter of Credit is subject to the
satisfaction in full of the following conditions:
(i) if the Issuing Bank so requests, the Borrower shall have
executed and delivered to such Issuing Bank and the Administrative Agent a
Letter of Credit Reimbursement Agreement and such other documents and materials
as are customarily required for the issuance of similar Letters of Credit by the
Issuing Bank;
29
(ii) the terms of the proposed Letter of Credit shall be
satisfactory to the Issuing Bank in its reasonable credit judgment; and
(iii) no order, judgment or decree of any court, arbitrator or
Governmental Authority shall purport by its terms to enjoin or restrain the
Issuing Bank from Issuing the Letter of Credit and no law, rule or regulation
applicable to the Issuing Bank and no request or directive (whether or not
having the force of law and whether or not the failure to comply therewith would
be unlawful) from a Governmental Authority with jurisdiction over the Issuing
Bank shall prohibit or request that the Issuing Bank refrain from the Issuance
of letters of credit generally or the Issuance of such Letter of Credit.
(c) Issuance of Letters of Credit. The Borrower shall give the
-----------------------------
Issuing Bank and the Administrative Agent written notice that it is requesting
that the Issuing Bank Issue a Letter of Credit not later than 3:00 p.m. (New
York time) on the third Business Day preceding the requested date for Issuance
thereof, or such shorter notice as may be reasonably acceptable to such Issuing
Bank and the Administrative Agent. Such notice shall be irrevocable unless and
until such request is denied by the applicable Issuing Bank pursuant to the
terms hereof and shall specify (A) the stated amount of the Letter of Credit
requested, (B) the effective date (which shall be a Business Day) of Issuance of
such Letter of Credit, (C) the date on which such Letter of Credit is to expire,
(D) the Person for whose benefit such Letter of Credit is to be Issued, and (E)
other relevant terms of such Letter of Credit. Such Issuing Bank shall notify
the Administrative Agent immediately upon receipt of a written notice from the
Borrower requesting that a Letter of Credit be Issued and, upon the
Administrative Agent's request therefor, send a copy of such notice to the
Administrative Agent. The Issuing Bank shall give the Administrative Agent
written notice, or telephonic notice confirmed promptly thereafter in writing,
of the Issuance of a Letter of Credit (which notice the Administrative Agent
shall promptly transmit by telegram, telex, facsimile, telephone or similar
transmission to each Lender).
(d) Reimbursement Obligations; Duties of Issuing Bank. (i)
-------------------------------------------------
Notwithstanding any provisions to the contrary in any Letter of Credit
Reimbursement Agreement:
(A) the Borrower shall reimburse the Issuing Bank for amounts drawn
under each Letter of Credit, no later than the date (the "Reimbursement
-------------
Date") which is one Business Day after the Borrower receives notice from
----
the Issuing Bank that a draft has been presented under such Letter of
Credit; and
(B) all Reimbursement Obligations with respect to any Letter of
Credit shall bear interest at the rate applicable to Base Rate Loans in
accordance with Section 4.01(a) from the date of the relevant drawing under
---------------
such Letter of Credit until the Reimbursement Date and thereafter at the
rate applicable in accordance with Section 4.01(d).
---------------
(ii) The Issuing Bank shall give the Administrative Agent written
notice, or telephonic notice confirmed promptly thereafter in writing, of all
drawings under a Letter of Credit and the payment (or the failure to pay when
due) by the Borrower on account of a Reimbursement Obligation (which notice the
Administrative Agent shall promptly transmit by telegram, telex, facsimile or
similar transmission to each Lender).
30
(iii) No action taken or omitted, in good faith and without gross
negligence or willful misconduct, by the Issuing Bank under or in connection
with any Letter of Credit shall put the Issuing Bank under any resulting
liability to any Revolving Loan Lender, the Borrower or, so long as it is not
Issued in violation of Section 2.04(a), relieve any Revolving Loan Lender of its
---------------
obligations hereunder to the Issuing Bank. Solely as between the Issuing Bank
and the Revolving Loan Lenders, in determining whether to pay under any Letter
of Credit, the Issuing Bank shall have no obligation to the Revolving Loan
Lenders other than to confirm that any documents required to be delivered under
a respective Letter of Credit appear to have been delivered and that they appear
on their face to comply with the requirements of such Letter of Credit.
(e) Participations. (i) Immediately upon Issuance by the Issuing
--------------
Bank of any of Credit in accordance with the procedures set forth in this
Section 2.04, each Revolving Loan Lender shall be deemed to have irrevocably and
------------
unconditionally purchased and received from the Issuing Bank, without recourse
or warranty, an undivided interest and participation in such Letter of Credit to
the extent of such Revolving Loan Lender's Pro Rata Share, including, without
limitation, all obligations of the Borrower with respect thereto (other than
amounts owing to the Issuing Bank under Section 2.04(g)) and any security
---------------
therefor and guaranty pertaining thereto.
(ii) If the Issuing Bank makes any payment under any Letter of
Credit and the Borrower does not repay such amount to the Issuing Bank on the
Reimbursement Date, the Issuing Bank shall promptly notify the Administrative
Agent, which shall promptly notify each Revolving Loan Lender, and each
Revolving Loan Lender shall promptly and unconditionally pay to the
Administrative Agent for the account of the Issuing Bank, in immediately
available funds, the amount of such Revolving Loan Lender's Pro Rata Share of
such payment (net of that portion of such payment, if any, made by such
Revolving Loan Lender in its capacity as the Issuing Bank), and the
Administrative Agent shall promptly pay to the Issuing Bank such amounts
received by it, and any other amounts received by the Administrative Agent for
the Issuing Bank's account, pursuant to this Section 2.04(e). All such payments
---------------
shall constitute Revolving Loans made to the Borrower pursuant to Section 2.01
------------
(irrespective of the satisfaction of the conditions in Section 5.02 or the
------------
requirement in Section 2.01(b) to deliver a Notice of Borrowing, which
---------------
conditions and requirement, for the purpose of refunding any Reimbursement
Obligation owing to the Issuing Bank, the Revolving Loan Lenders irrevocably
waive). If a Revolving Loan Lender does not make its Pro Rata Share of the
amount of such payment available to the Administrative Agent, such Revolving
Loan Lender agrees to pay to the Administrative Agent for the account of the
Issuing Bank, forthwith on demand, such amount together with interest thereon,
for the first Business Day after the date such payment was first due at the
Federal Funds Rate, and thereafter at the interest rate then applicable to a
Base Rate Loan in accordance with Section 4.01(a). The failure of any such
---------------
Revolving Loan Lender to make available to the Administrative Agent for the
account of an Issuing Bank its Pro Rata Share of any such payment shall neither
relieve any other Revolving Loan Lender of its obligation hereunder to make
available to the Administrative Agent for the account of the Issuing Bank such
other Revolving Loan Lender's Pro Rata Share of any payment on the date such
payment is to be made nor increase the obligation of any other Revolving Loan
Lender to make such payment to the Administrative Agent. This Section does not
relieve the Borrower of its obligation to pay or repay any Revolving Loan Lender
funding its Pro Rata Share of such
31
payment pursuant to this Section interest on the amount of such payment from
such date such payment is to be made until the date on which payment is repaid
in full.
(iii) Whenever the Issuing Bank receives a payment on account of a
Reimbursement Obligation, including any interest thereon, as to which any
Revolving Loan Lender has made a Revolving Loan pursuant to clause (ii) of this
Section, the Issuing Bank shall promptly pay to the Administrative Agent such
payment in accordance with Section 3.02. Each such payment shall be made by the
------------
Issuing Bank or the Administrative Agent, as the case may be, on the Business
Day on which such Person receives the funds paid to such Person pursuant to the
preceding sentence, if received prior to 11:00 a.m. (New York time) on such
Business Day, and otherwise on the next succeeding Business Day.
(iv) Upon the request of any Lender, the Issuing Bank shall furnish
such Lender copies of any Letter of Credit or Letter of Credit Reimbursement
Agreement to which the Issuing Bank is party and such other documentation as
reasonably may be requested by such Lender.
(v) The obligations of a Revolving Loan Lender to make payments to
the Administrative Agent for the account of the Issuing Bank with respect to a
Letter of Credit shall be irrevocable, shall not be subject to any qualification
or exception whatsoever except willful misconduct or gross negligence of the
Issuing Bank, and shall be honored in accordance with this Article II
----------
(irrespective of the satisfaction of the conditions described in Article V, as
applicable, which conditions, for the purposes of refunding any Reimbursement
Obligation owed to the Issuing Bank, such Revolving Loan Lenders irrevocably
waive) under all circumstances, including, without limitation, any of the
following circumstances:
(A) any lack of validity or enforceability hereof or of any of the
other Loan Documents;
(B) the existence of any claim, setoff, defense or other right which
the Borrower may have at any time against a beneficiary named in a Letter of
Credit or any transferee of a beneficiary named in a Letter of Credit (or any
Person for whom any such transferee may be acting), the Administrative Agent,
the Issuing Bank, any Lender, or any other Person, whether in connection
herewith, with any Letter of Credit, the transactions contemplated herein or any
unrelated transactions (including any underlying transactions between the
account party and beneficiary named in any Letter of Credit);
(C) any draft, certificate or any other document presented under
the Letter of Credit having been determined to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect;
(D) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Loan Documents;
(E) any failure by the Issuing Bank to make any reports required
pursuant to Section 2.04(h) or the inaccuracy of any such report; or
---------------
(F) the occurrence of any Event of Default or Default.
32
(f) Payment of Reimbursement Obligations. (i) The Borrower
------------------------------------
unconditionally agrees to pay to the Issuing Bank, in Dollars, the amount of all
Reimbursement Obligations, interest and other reasonable amounts payable to the
Issuing Bank under or in connection with the Letters of Credit when such amounts
are due and payable, irrespective of any claim, setoff, defense or other right
which the Borrower may have at any time against the Issuing Bank or any other
Person.
(ii) In the event any payment by the Borrower received by the
Issuing Bank with respect to a Letter of Credit and distributed by the
Administrative Agent to the Lenders on account of their participation is
thereafter set aside, avoided or recovered from the Issuing Bank in connection
with any receivership, liquidation or bankruptcy proceeding, each such Lender
which received such distribution shall, upon demand by the Issuing Bank,
contribute such Lender's Pro Rata Share of the amount set aside, avoided or
recovered together with interest at the rate required to be paid by the Issuing
Bank upon the amount required to be repaid by it.
(g) Issuing Bank Charges. The Borrower shall pay to the Issuing
--------------------
Bank, solely for its own account, the standard charges assessed by the Issuing
Bank in connection with the issuance, administration, amendment and payment or
cancellation of Letters of Credit and such compensation in respect of such
Letters of Credit for the Borrower's account as may be agreed upon by the
Borrower and the Issuing Bank from time to time.
(h) Issuing Bank Reporting Requirements. The Issuing Bank shall,
-----------------------------------
no later than the tenth (10th) Business Day following the last day of each
calendar month, provide to the Administrative Agent and the Borrower a schedule
for Letters of Credit issued by it, in form and substance reasonably
satisfactory to the Administrative Agent and the Borrower, setting forth the
aggregate Letter of Credit Obligations outstanding to it at the end of each
month and any information requested by the Administrative Agent or the Borrower
relating to the date of issue, account party, amount, expiration date and
reference number of each Letter of Credit issued by it.
(i) Indemnification; Exoneration. (A) In addition to all other
----------------------------
amounts payable to the Issuing Bank, the Borrower hereby agrees to defend,
indemnify, and save the Administrative Agent, the Issuing Bank and each Lender
harmless from and against any and all claims, demands, liabilities, penalties,
damages, losses (other than loss of profits), costs, charges and expenses
(including reasonable attorneys' fees but excluding taxes) which the
Administrative Agent, the Issuing Bank or such Lender may incur or be subject to
as a consequence, direct or indirect, of (i) the Issuance of any Letter of
Credit other than as a result of the gross negligence or willful misconduct of
the Issuing Bank, as determined by a court of competent jurisdiction, or (ii)
the failure of the Issuing Bank issuing a Letter of Credit to honor a drawing
under such Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto government or
-- ---- -- -----
Governmental Authority.
(B) As between the Borrower on the one hand and the Administrative
Agent, the Lenders and the Issuing Bank on the other hand, the Borrower
assumes all risks of the acts and omissions of, or misuse of Letters of
Credit by, the respective beneficiaries of the Letters of Credit. In
furtherance and not in limitation of the foregoing, subject to the
provisions of the Letter of Credit Reimbursement Agreements, the
Administrative Agent,
33
the Issuing Bank and the Lenders shall not be responsible for (except to
the extent resulting from their gross negligence or willful misconduct, as
determined by a court of competent jurisdiction): (i) the form, validity,
legality, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for and
Issuance of the Letters of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or
forged; (ii) the validity, legality or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole
or in part, which may prove to be invalid or ineffective for any reason;
(iii) failure of the beneficiary of a Letter of Credit to comply duly with
conditions required in order to draw upon such Letter of Credit; (iv)
errors, omissions, interruptions or delays in transmission or delivery of
any messages, by mail, facsimile, cable, telegraph, telex or otherwise,
whether or not they be in cipher; (v) errors in interpretation of technical
terms; (vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit or
of the proceeds thereof; (vii) the misapplication by the beneficiary of a
Letter of Credit of the proceeds of any drawing under such Letter of
Credit; (viii) any litigation, proceeding or charges with respect to such
Letter of Credit; and (ix) any consequences arising from causes beyond the
control of the Administrative Agent, the Issuing Bank or the Lenders.
2.05. Promise to Pay; Evidence of Debt.
--------------------------------
(a) Promise to Pay. (i) The Borrower agrees to pay when due the
--------------
principal amount of each Revolving Loan which is made to the Borrower, and
further agrees to pay all unpaid interest accrued thereon, in accordance with
the terms of this Agreement and the promissory notes evidencing the Revolving
Loans owing to the Revolving Loan Lenders. The Borrower shall execute and
deliver to each Revolving Loan Lender a promissory note to evidence the
Revolving Loans owing to such Revolving Loan Lender and agrees to execute and
deliver to such Revolving Loan Lender and any assignee of such Revolving Loan
Lender such promissory notes as are necessary after giving effect to any
assignment thereof pursuant to Section 13.01, each substantially in the form of
-------------
Exhibit B-1 attached hereto and made a part hereof (all such promissory notes
-----------
and all amendments thereto, replacements thereof and substitutions therefor
being collectively referred to as the "Revolving Loan Notes"; and "Revolving
Loan Note" means any one of the Revolving Loan Notes).
(ii) The Borrower agrees to pay when due the principal amount of
each Term Loan which is made to the Borrower, and further agrees to pay all
unpaid interest accrued thereon, in accordance with the terms of this Agreement
and the promissory notes evidencing the Term Loans. The Borrower shall execute
and deliver to each Term Loan Lender a promissory note to evidence the Term Loan
owing to such Term Loan Lender and agrees to execute and deliver to such Term
Loan Lender and any assignee of such Term Loan Lender such promissory notes as
are necessary after giving effect to any assignment thereof pursuant to Section
-------
13.01, each substantially in the form of Exhibit B-2 attached hereto and made a
----- -----------
part hereof (all such promissory notes and all amendments thereto, replacements
thereof and substitutions therefor being collectively referred to as the "Term
Loan Notes"; and "Term Loan Note" means any one of the Term Loan Notes).
34
(iii) The Borrower agrees to pay when due the principal amount of
each Swing Loan which is made to the Borrower, and further agrees to pay all
unpaid interest accrued thereon, in accordance with the terms of this Agreement
and the promissory notes evidencing the Swing Loans owing to the Swing Loan
Lender. The Borrower shall execute and deliver to the Swing Loan Lender a
promissory note to evidence the Swing Loans owing to the Swing Loan Lender and
agrees to execute and deliver to the Swing Loan Lender and any assignee of the
Swing Loan Lender such promissory notes as are necessary after giving effect to
any assignment thereof pursuant to Section 13.01, each substantially in the form
-------------
of Exhibit B-3 attached hereto and made a part hereof (all such promissory notes
-----------
and all amendments thereto, replacements thereof and substitutions therefor
being collectively referred to as the "Swing Loan Notes"; and "Swing Loan Note"
means any one of the Swing Loan Notes).
2.06. Use of Proceeds of Loans. The proceeds of the Loans shall be
------------------------
used (i) to finance the cash portion of the Tender Offer, (ii) to refinance
certain existing indebtedness of Schein, (iii) to pay the fees and costs
associated with the transactions contemplated under the Transaction Documents,
and (iv) to finance working capital and other general corporate needs of the
Borrower and its Subsidiaries not prohibited hereunder.
2.07. Authorized Officers, Employees and Administrative Agents. On
--------------------------------------------------------
the Closing Date and from time to time thereafter, the Borrower shall deliver to
the Administrative Agent an Officer's Certificate setting forth the names of the
officers, employees and agents of the Borrower, in each case who are authorized
to request Loans on behalf of the Borrower and containing a specimen signature
of each such officer, employee or agent. The officers, employees and agents so
authorized shall also be authorized to act for the Borrower in respect of all
other matters relating to the Loan Documents. The Administrative Agent shall be
entitled to rely conclusively on each such officer's, employee's or agent's
authority to request such Loan until the Administrative Agent receives written
notice to the contrary. In addition, the Administrative Agent shall be entitled
to rely conclusively on any written notice sent to it by telecopy. The
Administrative Agent shall have no duty to verify the authenticity of the
signature appearing on, or any telecopy or facsimile of, any written Notice of
Borrowing or any other document, and, with respect to an oral request for such a
Loan, the Administrative Agent shall have no duty to verify the identity of any
person representing himself or herself as one of the officers, employees or
agents authorized to make such request or otherwise to act on behalf of the
Borrower. Neither the Administrative Agent nor any Lender shall incur any
liability to the Borrower or any other Person in acting upon any facsimile or
telephonic notice referred to above which the Administrative Agent believes to
have been given by a duly authorized officer or other person authorized to
borrow on behalf of the Borrower.
ARTICLE III
PAYMENTS AND PREPAYMENTS
3.01. Prepayments; Reductions in Revolving Loan Commitments.
-----------------------------------------------------
(a) Voluntary Prepayments/Reductions.
--------------------------------
35
(i) The Borrower may, at any time and from time to time, prepay the
Loans in whole or in part upon at least one (1) Business Day's (with respect to
Base Rate Loans) or three (3) Business Days' (with respect to Eurodollar Loans)
prior written notice to the Administrative Agent (which the Administrative Agent
shall promptly transmit to each Lender, it being agreed that the failure of the
Administrative Agent to give such notice shall not affect the Borrower's right
to prepay any Loan); provided, however, that any partial prepayment shall be in
minimum amounts of $1,000,000 and in multiples of $1,000,000 in excess thereof;
provided, further, that Eurodollar Rate Loans may only be prepaid, in whole or
in part, (A) on the expiration date of the then applicable Eurodollar Interest
Period or (B) otherwise upon payment of the amounts described in Section
-------
4.02(f). Any notice of prepayment given to the Administrative Agent under this
-------
Section 3.01(a)(i) shall specify the Loans to be prepaid, the date (which shall
------------------
be a Business Day) of prepayment, and the aggregate principal amount of the
prepayment. Any prepayment of Term Loans shall be applied pro rata to the
--- ----
remaining principal installments of such Loans. When notice of prepayment is
delivered as provided herein, the principal amount of the Loans specified in
such notice shall become due and payable on the prepayment date specified in
such notice.
(ii) The Borrower, upon at least three (3) Business Days' prior
notice to the Administrative Agent (which the Administrative Agent shall
promptly transmit to each Lender), shall have the right, at any time and from
time to time, to terminate in whole or permanently reduce ratably in part the
unused portions of the Revolving Loan Commitments, provided that the Borrower
shall have made whatever payment may be required to reduce the Revolving Credit
Obligations to an amount less than or equal to the Revolving Loan Commitments as
reduced or terminated on the date of such reduction. Any partial reduction of
the Revolving Loan Commitments shall be in an aggregate minimum amount of Five
Million Dollars ($5,000,000) and integral multiples of One Million Dollars
($1,000,000) in excess of that amount, and shall reduce the Revolving Loan
Commitment of each Revolving Loan Lender proportionately in accordance with such
Revolving Loan Lender's Pro Rata Share. Any notice of termination or reduction
given to the Administrative Agent under this Section 3.01(a)(ii) shall specify
-------------------
the date (which shall be a Business Day) of such termination or reduction and,
with respect to a partial reduction, the aggregate principal amount thereof.
When notice of termination or reduction is delivered as provided herein, the
principal amount of the Revolving Loans specified in the notice shall become due
and payable on the date specified in such notice.
(iii) The prepayments and payments in respect of reductions and
terminations described in clauses (i) and (ii) of this Section 3.01(a) may be
----------- ---- ---------------
made pursuant to such clauses at any time and from time to time without premium
or penalty (except as provided in Section 4.02(f)).
---------------
(b) Mandatory Prepayments/Reductions.
--------------------------------
(i) Promptly and in any event within five Business Days of receipt
by any Loan Party of Net Cash Proceeds (other than Excluded Sales Proceeds) on
account of one or more Asset Sales, such Loan Party shall make or cause to be
made a mandatory prepayment of the Term Loans in an amount equal to 50% of such
Net Cash Proceeds. Subject to Section 3.01(b)(v), each such prepayment shall be
------------------
applied pro rata to the remaining principal installments of the Term Loans.
--- ----
36
(ii) Promptly and in any event within five Business Days of receipt
by any Loan Party of any Net Cash Proceeds (other than Excluded Securities
Proceeds) from the issuance of any Securities evidencing debt obligations by
such Loan Party, such Loan Party shall make or cause to be made a mandatory
prepayment of the Term Loans in an amount equal to 50% of such Net Cash
Proceeds. Subject to Section 3.01(b)(v), each such prepayment shall be applied
------------------
pro rata to the remaining principal installments of the Term Loans.
--- ----
(iii) Promptly and in any event within five Business Days of receipt
by any Loan Party of any Net Cash Proceeds from the issuance of any Securities
evidencing equity interests by such Loan Party, such Loan Party shall make or
cause to be made a mandatory prepayment of the Term Loans in an amount equal to
25% of such Net Cash Proceeds. Subject to Section 3.01(b)(v), each such
------------------
prepayment shall be applied pro rata to the remaining principal installments of
--- ----
the Term Loans.
(iv) On the earlier of (A) the date the financial statements of the
Borrower and its Subsidiaries are delivered to the Administrative Agent pursuant
to Section 7.01(b) and (B) the 90th day following the last day of each Fiscal
---------------
Year, the Borrower shall make or cause to be made a mandatory prepayment of the
Term Loans in an amount equal to the lesser of 50% (if the Leverage Ratio of the
Borrower and its Subsidiaries on a consolidated basis for the twelve fiscal
month period ending on the last day of such Fiscal Year is greater than 2.25 to
1.00) of the Excess Cash Flow for such Fiscal Year or the aggregate principal
amount of the Term Loans outstanding as of the date of payment; provided,
--------
however, that a mandatory prepayment of the Term Loans in an amount equal to the
-------
lesser of 25% of the Excess Cash Flow for such Fiscal Year or the aggregate
principal amount of the Term Loans outstanding as of the date of payment shall
be required hereunder if the Leverage Ratio of the Borrower and its Subsidiaries
on a consolidated basis for the twelve fiscal month period ending on the last
day of such Fiscal Year is equal to or less than 2.25 to 1.00 but greater than
1.50 to 1.00, and no mandatory prepayment shall be required hereunder if the
Leverage Ratio of the Borrower and its Subsidiaries on a consolidated basis for
the twelve fiscal month period ending on the last of such Fiscal Year is equal
to or less than 1.50 to 1.00. Subject to Section 3.01(b)(v), each such
------------------
prepayment shall be applied pro rata to the remaining principal installments of
--- ----
the Term Loans.
(v) Nothing in this Section 3.01(b) shall be construed to
---------------
constitute the Lenders' consent to any transaction which is not expressly
permitted by Article IX.
----------
3.02. Payments. (a) Manner and Time of Payment. All payments of
-------- --------------------------
principal, interest, fees and other Obligations which are payable to the
Administrative Agent or any Lender shall be made without condition or deduction
for any counterclaim, defense, recoupment or set-off, in Dollars and in
immediately available funds, delivered to the Administrative Agent not later
than 1:00 p.m. (New York time) on the date due, by deposit of such funds to the
Administrative Agent's Account. The Administrative Agent shall thereafter cause
to be distributed to the Lenders their respective Pro Rata Shares of such
payments in accordance with the provisions of Section 3.02(b) if received prior
---------------
to 1:00 p.m. (New York time), and on the next succeeding Business Day, if
received thereafter, by the Administrative Agent.
37
(b) Apportionment of Payments. (i) Subject to the provisions of
Section 3.02(b)(ii), all payments of principal and interest in respect of
-------------------
outstanding Revolving Loans shall be applied by the Administrative Agent to the
ratable payment of the Revolving Loans owing to the Lenders, and all payments of
principal in respect of outstanding Term Loans shall be applied by the
Administrative Agent to the payment of such Term Loans owing to the respective
Term Loan Lenders in accordance with their respective Pro Rata Shares thereof.
(ii) After the occurrence of an Event of Default and while the same
is continuing, the Administrative Agent shall apply all payments and prepayments
of any Obligations in the following order:
(A) first, to pay principal of and interest on any Revolving Loans
-----
which the Administrative Agent may have advanced on behalf of any Lender
pursuant to Section 2.01(c)(ii) for which the Administrative Agent has not
-------------------
been reimbursed by such Lender or the Borrower;
(B) second, to pay Obligations in respect of any fees, expense
------
reimbursements or indemnities then due to the Agents (solely in their
capacity as Agents);
(C) third, to pay obligations in respect of any expense
-----
reimbursements or indemnities then due to any Lender; and
(D) fourth, to pay interest on the Loans;
------
(E) fifth, to pay the principal amount of the Loans then
-----
outstanding in accordance with each Lender's Pro Rata Share;
(F) sixth, to pay all other Obligations in such order as the
-----
Administrative Agent may determine in its sole discretion.
The order of priority set forth in this Section 3.02(b)(ii) and the related
-------------------
provisions of this Agreement are set forth solely to determine the rights and
priorities of the Administrative Agent and the Lenders as among themselves. If
sufficient funds are not available to fund all Obligations described in any of
the foregoing clauses (A) through (F), the available funds shall be allocated to
the Obligations described in such clause ratably.
(c) Payments on Non-Business Days. Whenever any payment to be made
-----------------------------
by the Borrower hereunder or under the Notes is stated to be due on a day which
is not a Business Day, the payment shall instead be due on the next succeeding
Business Day, and any such extension of time shall be included in the
computation of the payment of interest and fees hereunder.
3.03. Taxes. (a) Payments Free and Clear of Taxes. Any and all
----- --------------------------------
payments by the Borrower hereunder, under the Notes or under any other Loan
Document shall be made free and clear of and without deduction or withholding
for any and all present or future taxes, levies, imposts, duties, fees,
deductions, charges or withholdings, and all interest, penalties, additions to
tax and liabilities with respect thereto, excluding, in the case of each Lender
---------
and the Administrative Agent, taxes imposed on its income, capital, profits or
gains and franchise taxes imposed on it, in each case by (i) the United States
except withholding taxes contemplated
38
pursuant to Section 3.03(e)(ii)(C), (ii) the Governmental Authority of the
----------------------
jurisdiction in which such Lender's office is located or (iii) the Governmental
Authority in which such Person is organized, managed, controlled or doing
business, in each case including all political subdivisions thereof (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be
required by law to withhold or deduct any Taxes from or in respect of any sum
payable hereunder, under the Notes or under any other Loan Document to any
Lender or the Administrative Agent, (x) such sum payable shall be increased as
may be necessary so that after making all required withholdings or deductions
(including withholdings or deductions applicable to additional sums payable
under this Section 3.03) such Lender or the Administrative Agent (as the case
------------
may be) receives an amount equal to the sum it would have received had no such
withholdings or deductions been made, (y) the Borrower shall make such
withholdings or deductions, and (z) the Borrower shall pay the full amount
withheld or deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) Other Taxes. In addition, the Borrower agrees to pay any
-----------
present or future stamp, value-added or documentary taxes or any other excise or
property taxes, charges or similar levies which arise from and which relate
directly to (i) any payment made under any Loan Document or (ii) the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Notes or any other Loan Document (hereinafter referred to as "Other Taxes").
(c) Indemnification. The Borrower will indemnify each Lender and
---------------
the Administrative Agent against, and reimburse each on demand for, the full
amount of all Taxes and Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any Governmental Authority on amounts payable under this
Section 3.03 and any additional income or franchise taxes resulting therefrom)
------------
incurred or paid by such Lender or the Administrative Agent (as the case may be)
or any Affiliate of such Lender and any liability (including penalties,
interest, and out-of-pocket expenses paid to third parties) arising therefrom or
with respect thereto, whether or not such Taxes or Other Taxes were correctly or
lawfully payable. A certificate as to any amount payable to any Person under
this Section 3.03 submitted by such Person to the Borrower shall, absent
------------
manifest error, be final, conclusive and binding upon all parties hereto. This
indemnification shall be made within thirty (30) days from the date such Person
makes written demand therefor and within thirty (30) days after the receipt of
any refund of the Taxes or Other Taxes following final determination that the
Taxes or Other Taxes which gave rise to the indemnification were not required to
be paid, such Person shall repay the amount of such paid indemnity to the
Borrower.
(d) Receipts. Within thirty (30) days after the date of any payment
--------
of Taxes or Other Taxes by the Borrower, the Borrower will furnish to the
Administrative Agent, at its address referred to in Section 13.10, the original
-------------
or a certified copy of a receipt or other documentation reasonably satisfactory
to the Administrative Agent evidencing payment thereof. The Borrower will
furnish to the Administrative Agent upon the Administrative Agent's request from
time to time an Officer's Certificate stating that all Taxes and Other Taxes of
which it is aware that are due have been paid and that no additional Taxes or
Other Taxes of which it is aware are due.
39
(e) Foreign Bank Certifications. (i) Each Lender that is not
---------------------------
created or organized under the laws of the United States or a political
subdivision thereof shall deliver to the Borrower and the Administrative Agent
on or before the Closing Date or the date on which such Lender becomes a Lender
pursuant to Section 13.01 hereof a true and accurate certificate executed by a
-------------
duly authorized officer of such Lender to the effect that such Lender is
eligible to receive payments hereunder and under the Notes without deduction or
withholding of United States federal income tax (A) under the provisions of an
applicable tax treaty concluded by the United States (in which case the
certificate shall be accompanied by one duly completed copy of IRS Form W-8BEN
(or any successor or substitute form)), (B) under Sections 1442(c)(1) and
1442(a) of the Code (in which case the certificate shall be accompanied by one
duly completed copy of IRS Form W8ECI (or any successor or substitute form)) or
(C) under Section 871(h) or 881(c) of the Code (in which case the certificate
shall be accompanied by one duly completed copy of IRS Form W-8BEN (or any
successor or substitute form)).
(ii) Each such Lender further agrees to deliver to the Borrower and
the Administrative Agent from time to time, a true and accurate certificate
executed by a duly authorized officer of such Lender before or promptly upon the
occurrence of any event requiring a change in the most recent certificate
previously delivered by it to the Borrower and the Administrative Agent pursuant
to this Section 3.03(e). Each certificate required to be delivered pursuant to
---------------
this Section 3.03(e)(ii) shall certify as to one of the following:
-------------------
(A) that such Lender can continue to receive payments hereunder and
under the Notes without deduction or withholding of United States federal
income tax;
(B) that such Lender cannot continue to receive payments hereunder
and under the Notes without deduction or withholding of United States
federal income tax as specified therein but does not require additional
payments pursuant to Section 3.03(a) because it is entitled to recover the
---------------
full amount of any such deduction or withholding from a source other than
the Borrower;
(C) that such Lender is no longer capable of receiving payments
hereunder and under the Notes without deduction or withholding of United
States federal income tax as specified therein by reason of the adoption or
implementation of, or any change in, or in the interpretation or
administration of, any law or regulation (including the Code, regulations
thereunder or any applicable tax treaty) or any guideline or request from
any Governmental Authority or quasi-governmental authority after the later
of the Closing Date or the date on which a Lender became a Lender pursuant
to Section 13.01 and that it is not capable of recovering the full amount
-------------
of the same from a source other than the Borrower; or
(D) that such Lender is no longer capable of receiving payments
hereunder without deduction or withholding of United States federal income
tax as specified therein other than by reason of the adoption or
implementation of, or any change in, or in the interpretation or
administration of, any law or regulation (including the Code, regulations
thereunder or any applicable tax treaty) or any guideline or request from
any Governmental Authority or quasi-governmental authority after the later
of the Closing Date or the date on which a Lender became a Lender pursuant
to Section 13.01.
-------------
40
Any notice given by any Lender or other Person under this Section 3.03 shall be
------------
effective only if given within one year after such Lender or other Person
becomes aware or should have become aware of the events giving rise to such
notice.
3.04. Increased Capital. If any Lender determines that (i) the
-----------------
adoption or implementation after the date hereof of or any change after the date
hereof in or in the interpretation or administration of any law or regulation or
any guideline or request after the date hereof from any central bank or other
Governmental Authority or quasi-governmental authority exercising jurisdiction,
power or control over such Lender or banks or financial institutions generally
(whether or not having the force of law), compliance with which affects or would
affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and (ii) the amount of such
capital is increased by or based upon the making or maintenance by any Lender of
its Loans, any Lender's participation in or obligation to participate in the
Loans or other advances made hereunder or under the Notes or the existence of
any Lender's obligation to make Loans, then, in any such case, upon demand by
such Lender (with a copy of such demand to the Administrative Agent), the
Borrower agrees to pay to the Administrative Agent for the account of such
Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender or such corporation therefor. Such demand
shall be accompanied by a statement as to the amount of such compensation and
include a brief summary of the basis for such demand. Such statement shall be
conclusive and binding for all purposes, absent manifest error. Any notice given
by any Lender under this Section 3.04 shall be effective only if given within
------------
one year after such Lender becomes aware or should have become aware of the
events giving rise to such notice.
ARTICLE IV
INTEREST AND FEES
4.01. Interest on the Loans and other Obligations.
--------------------------------------------
(a) Rate of Interest. (i) All Revolving Loans, Term Loans and the
----------------
outstanding amount of all other Obligations (other than Swing Loans) shall bear
interest on the unpaid amount thereof from the date such Loans are made and such
other Obligations are due and payable until paid in full, except as otherwise
provided in Section 4.01(d), as follows:
---------------
(A) If a Base Rate Loan or such other Obligation, at a rate per
annum equal to the sum of (I) the Base Rate as in effect from time to time as
interest accrues, plus (II) the Applicable Base Rate Margin in effect at such
time; and
(B) If a Eurodollar Rate Loan, at a rate per annum equal to the sum
of (I) the Eurodollar Rate determined for the applicable Eurodollar Interest
Period, plus (II) the Applicable Eurodollar Rate Margin in effect from time to
time during such Eurodollar Interest Period.
(ii) All Swing Loans shall bear interest on the unpaid amount
thereof from the date such Loans are made until paid in full, except as
otherwise provided in Section
-------
41
4.01(d), at a rate per annum equal to the sum of (I) the Base Rate as in effect
-------
from time to time as interest accrues, plus (II) the Applicable Base Rate Margin
----
in effect at such time.
(iii) The applicable basis for determining the rate of interest on
the Loans shall be selected by the Borrower at the time a Notice of Borrowing or
a Notice of Conversion/Continuation is delivered by the Borrower to the
Administrative Agent; provided, however, the Borrower may not select the
-------- -------
Eurodollar Rate as the applicable basis for determining the rate of interest on
such a Loan if (x) such Loan is to be made on the Closing Date or (y) at the
time of such selection an Event of Default has occurred and is continuing. If on
any day any Loan is outstanding with respect to which notice has not been timely
delivered to the Administrative Agent in accordance with the terms hereof
specifying the basis for determining the rate of interest on that day, then for
that day interest on that Loan shall be determined by reference to the Base
Rate.
(b) Interest Payments. (i) Interest accrued on each Base Rate
-----------------
Loan shall be payable in arrears (A) on the first Business Day of each calendar
quarter, commencing on the first such day following the making of such Base Rate
Loan and (B) on the Maturity Date or such other date on which such Loans become
due and payable.
(ii) Interest accrued on each Eurodollar Rate Loan shall be payable
in arrears (A) on each Eurodollar Interest Payment Date applicable to such Loan
and (B) on the Maturity Date or such other date on which such Loans become due
and payable.
(iii) Interest accrued on the principal balance of all other
Obligations shall be payable in arrears (A) on the first Business Day of each
calendar month, commencing on the first such day following the incurrence of
such Obligation and (B) on the Maturity Date or such other date on which the
Loans become due and payable.
(c) Conversion or Continuation. (i) The Borrower shall have the
--------------------------
option (A) to convert at any time all or any part of the outstanding Base Rate
Loans (other than Swing Loans) to Eurodollar Rate Loans; (B) to convert all or
any part of outstanding Eurodollar Rate Loans having Eurodollar Interest Periods
which expire on the same date to Base Rate Loans on such expiration date; or (C)
to continue all or any part of outstanding Eurodollar Rate Loans having
Eurodollar Interest Periods which expire on the same date as Eurodollar Rate
Loans, and the succeeding Eurodollar Interest Period of such continued Loans
shall commence on such expiration date; provided, however, no such outstanding
-------- -------
Loan may be continued as, or be converted into, a Eurodollar Rate Loan (i) if
the continuation of, or the conversion into, would violate any of the provisions
of Section 4.02 or (ii) if an Event of Default or Default would occur or has
------------
occurred and is continuing. Any conversion into or continuation of Eurodollar
Rate Loans under this Section 4.01(c) shall be in a minimum amount of $5,000,000
---------------
and in integral multiples of $1,000,000 in excess of that amount.
(ii) To convert or continue a Loan under Section 4.01(c)(i), the
------------------
Borrower shall deliver a Notice of Conversion/Continuation to the Administrative
Agent no later than 1:00 p.m. (New York time) at least three (3) Business Days
in advance of the proposed conversion/continuation date. A Notice of
Conversion/Continuation shall specify (A) the proposed conversion/continuation
date (which shall be a Business Day), (B) the principal amount
42
of the Loan to be converted/continued, (C) whether such Loan shall be converted
and/or continued and (D) in the case of a conversion to, or continuation of, a
Eurodollar Rate Loan, the requested Eurodollar Interest Period. In lieu of
delivering a Notice of Conversion/Continuation, the Borrower may give the
Administrative Agent telephonic notice of any proposed conversion/continuation
by the time required under this Section 4.01(c)(ii), and such notice shall be
-------------------
confirmed in writing delivered to the Administrative Agent promptly (but in no
event later than 5:00 p.m. (New York time) on the same day). Promptly after
receipt of a Notice of Conversion/Continuation under this Section 4.01(c)(ii)
-------------------
(or telephonic notice in lieu thereof), the Administrative Agent shall notify
each Lender by telex or facsimile, or other similar form of transmission, of the
proposed conversion/continuation. Any Notice of Conversion/Continuation for
conversion to, or continuation of, a Loan (or telephonic notice in lieu thereof)
shall be irrevocable, and the Borrower shall be bound to convert or continue in
accordance therewith.
(d) Default Interest. Notwithstanding the rates of interest
----------------
specified in Section 4.01(a) or elsewhere herein, (i) upon the occurrence of any
---------------
Event of Default specified in Section 11.01(a) and for as long thereafter as
----------------
such Event of Default shall be continuing, the principal balance of all Loans
and of all other Obligations shall bear interest at a rate which is two percent
(2.0%) per annum in excess of the rate of interest applicable to such
Obligations from time to time, (ii) upon the occurrence of any other Event of
Default and for as long thereafter as such Event of Default shall be continuing,
the Requisite Lenders may elect that the principal balance of all Loans and of
all other Obligations bear interest during such period at a rate which is two
percent (2.0%) per annum in excess of the rate of interest applicable to such
Obligations from time to time and (iii) upon the occurrence of any Event of
Default and for as long thereafter as such Event of Default shall be continuing,
the Borrower shall convert all or any part of outstanding Eurodollar Rate Loans
to Base Rate Loans.
(e) Computation of Interest. Interest on (i) Base Rate Loans and
-----------------------
all other Obligations shall be computed on the basis of the actual number of
days elapsed in the period during which interest accrues and a year of 365/366
days and (ii) Eurodollar Rate Loans shall be computed on the basis of the actual
number of days elapsed in the period during which interest accrues and a year of
360 days. In computing interest on any Loan, the date of the making of the Loan
shall be included and the date of payment made in accordance with Section 3.02
------------
shall be excluded; provided, however, if a Loan is repaid on the same day on
-------- -------
which it is made, one (1) day's interest shall be paid on such Loan.
(f) Changes; Legal Restrictions. If after the date hereof any
---------------------------
Lender determines that the adoption or implementation of or any change in or in
the interpretation or administration of any law or regulation or any guideline
or request from any central bank or other Governmental Authority or quasi-
governmental authority exercising jurisdiction, power or control over any Lender
or over banks or financial institutions generally (whether or not having the
force of law), compliance with which, in each case after the date hereof:
(i) (x) subjects a Lender (or its Applicable Lending Office) to
charges (other than Taxes) of any kind which is applicable to the Commitments of
the Lenders to make Eurodollar Rate Loans, or (y) changes the basis of taxation
of, or subjects to tax, payments to a Lender of principal, fees, interest, or
any other amount payable hereunder with respect to any Loans; or
43
(ii) imposes, modifies, or holds applicable, any reserve (other than
reserves taken into account in calculating the Eurodollar Rate), special
deposit, compulsory loan, FDIC insurance or similar requirement against assets
held by, or deposits or other liabilities (including those pertaining to Letters
of Credit) in or for the account of, advances or loans by, commitments made, or
other credit extended by, or any other acquisition of funds by, a Lender or any
Applicable Lending Office or Eurodollar Affiliate of that Lender;
and the result of any of the foregoing is to increase the cost to that Lender of
making, renewing or maintaining the Loans or its Commitments or to reduce any
amount receivable thereunder; then, in any such case, within thirty (30) days
after written demand by such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to the Administrative Agent for
the account of such Lender, from time to time as specified by such Lender, such
amount or amounts as may be necessary to compensate such Lender or its
Eurodollar Affiliate for any such additional cost incurred or reduced amount
received. Such demand shall be accompanied by a statement as to the amount of
such compensation and include a summary of the basis for such demand. Such
statement shall be conclusive and binding for all purposes, absent manifest
error. Any notice given by any Lender under this Section 4.01(f) shall be
---------------
effective only if given within one year after such Lender becomes aware or
should have become aware of the events giving rise to such notice.
(g) Confirmation of Eurodollar Rate. Upon the request of the
-------------------------------
Borrower from time to time, the Administrative Agent shall promptly provide to
the Borrower such information with respect to the applicable Eurodollar Rate as
may be reasonably requested.
(h) Issuing Bank Fee. The Borrower shall pay to the Issuing Bank,
----------------
solely for its own account, with respect to each Letter of Credit issued by the
Issuing Bank, an additional fee in an amount equal to 0.25% per annum on the
undrawn face amount of such Letter of Credit, payable quarterly in arrears on
the first Business Day of each calendar quarter.
4.02. Special Provisions Governing Eurodollar Rate Loans. With
--------------------------------------------------
respect to Eurodollar Rate Loans:
(a) Amount of Advance. Each Eurodollar Rate Loan shall be for a
-----------------
minimum amount of $5,000,000 and in integral multiples of 1,000,000 in excess of
that amount.
(b) Determination of Eurodollar Interest Period. By giving notice
-------------------------------------------
as set forth in Section 2.01(b) or Section 2.02(b) (with respect to a Borrowing
----------------------------------
of Eurodollar Rate Loans) or Section 4.01(c) (with respect to a conversion into
---------------
or continuation of Eurodollar Rate Loans), the Borrower shall have the option,
subject to the other provisions of this Section 4.02, to select an interest
------------
period (a "Eurodollar Interest Period") to apply to the Loans described in such
--------------------------
notice, subject to the following provisions:
(i) The Borrower may only select, as to a particular Borrowing of
Eurodollar Rate Loans, a Eurodollar Interest Period of either one, two, three or
six months in duration;
(ii) In the case of immediately successive Eurodollar Interest
Periods applicable to a Borrowing of Eurodollar Rate Loans, each successive
Eurodollar Interest Period shall commence on the day on which the next preceding
Eurodollar Interest Period expires;
44
(iii) If any Eurodollar Interest Period would otherwise expire on a
day which is not a Business Day, such Eurodollar Interest Period shall be
extended to expire on the next succeeding Business Day if the next succeeding
Business Day occurs in the same calendar month, and if there shall be no
succeeding Business Day in such calendar month, such Eurodollar Interest Period
shall expire on the immediately preceding Business Day;
(iv) The Borrower may not select a Eurodollar Interest Period as to
any Loan if such Eurodollar Interest Period terminates later than the Maturity
Date;
(v) The Borrower may not select a Eurodollar Interest Period with
respect to any portion of principal of a Loan which extends beyond a date on
which the Borrower is required to make a scheduled payment of such portion of
principal; and
(vi) There shall be no more than fifteen (15) Eurodollar Interest
Periods in effect at any one time.
(c) Determination of Interest Rate. As soon as practicable on the
------------------------------
second Business Day prior to the first day of each Eurodollar Interest Period
(the "Interest Rate Determination Date"), the Administrative Agent shall
--------------------------------
determine (pursuant to the procedures set forth in the definition of
"Eurodollar Rate") the interest rate which shall apply to Eurodollar Rate Loans,
----------------
for which an interest rate is then being determined for the applicable
Eurodollar Interest Period and shall promptly give notice thereof (in writing or
by telephone confirmed in writing) to the Borrower and to each Lender. The
Administrative Agent's determination shall be presumed to be correct, absent
manifest error, and shall be binding upon the Borrower.
(d) Interest Rate Unascertainable, Inadequate or Unfair. In the
---------------------------------------------------
event that at least one (1) Business Day before the Interest Rate Determination
Date:
(i) the Administrative Agent reasonably determines that adequate
and fair means do not exist for ascertaining the applicable interest rates by
reference to which the Eurodollar Rate then being determined is to be fixed;
(ii) the Requisite Lenders advise the Administrative Agent that
Dollar deposits in the principal amounts of the Eurodollar Rate Loans comprising
such Borrowing are not generally available in the London interbank market for a
period equal to such Eurodollar Interest Period; or
(iii) the Requisite Lenders advise the Administrative Agent that the
Eurodollar Rate as determined by the Administrative Agent, after taking into
account the adjustments for reserves and increased costs provided for in Section
-------
4.01(f), will not adequately and fairly reflect the cost to such Lenders of
-------
funding Loans of such Type;
then the Administrative Agent shall forthwith give notice thereof to the
Borrower, whereupon (until the Administrative Agent notifies the Borrower that
the circumstances giving rise to such suspension no longer exist) the right of
the Borrower to elect to have Loans bear interest based upon the Eurodollar Rate
shall be suspended and each outstanding Loan of such Types shall be converted
into a Base Rate Loan on the last day of the then current Eurodollar Interest
Period therefor, and any Notice of Borrowing for which Revolving Loans have not
then been made shall
45
be deemed to be a request for Base Rate Loans, notwithstanding any prior
election by the Borrower to the contrary.
(e) Illegality. (i) If at any time any Lender determines (which
----------
determination shall, absent manifest error, be final and conclusive and binding
upon all parties) that the making or continuation of any Eurodollar Rate Loan
has become unlawful or impermissible by compliance by that Lender with any law,
governmental rule, regulation or order of any Governmental Authority (whether or
not having the force of law and whether or not failure to comply therewith would
be unlawful or would result in costs or penalties), then, and in any such event,
such Lender may give notice of that determination, in writing, to the Borrower
and the Administrative Agent, and the Administrative Agent shall promptly
transmit the notice to each other Lender.
(ii) When notice is given by a Lender under Section 4.02(e)(i), (A)
------------------
the Borrower's right to request from such Lender and such Lender's obligation,
if any, to make Eurodollar Rate Loans shall be immediately suspended, and such
Lender shall make a Base Rate Loan as part of any requested Borrowing of
Eurodollar Rate Loans and (B) if the affected Eurodollar Rate Loan or Loans are
then outstanding, the Borrower shall immediately, or if permitted by applicable
law, no later than the date permitted thereby, upon at least one (1) Business
Day's prior written notice to the Administrative Agent and the affected Lender,
convert each such Loan into a Base Rate Loan.
(iii) If at any time after a Lender gives notice under Section
-------
4.02(e)(i) such Lender determines that it may lawfully make Eurodollar Rate
----------
Loans, such Lender shall promptly give notice of that determination, in writing,
to the Borrower and the Administrative Agent, and the Administrative Agent shall
promptly transmit the notice to each other Lender. The Borrower's right to
request, and such Lender's obligation, if any, to make Eurodollar Rate Loans
shall thereupon be restored.
(f) Compensation. In addition to all amounts required to be paid
------------
by the Borrower pursuant to Section 4.01, the Borrower shall compensate each
------------
Lender, upon demand, for all losses, expenses and liabilities (including,
without limitation, any loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender to fund or
maintain such Lender's Eurodollar Rate Loans to the Borrower but excluding any
loss of the Applicable Eurodollar Rate Margin on the relevant Loans) which that
Lender may sustain (i) if for any reason a Borrowing, conversion into or
continuation of Eurodollar Rate Loans does not occur on a date specified
therefor in a Notice of Borrowing or a Notice of Conversion/ Continuation given
by the Borrower or in a telephonic request by it for borrowing or
conversion/continuation or a successive Eurodollar Interest Period does not
commence after notice therefor is given pursuant to Section 4.01(c), including,
---------------
without limitation, pursuant to Section 4.02(d), (ii) if for any reason any
---------------
Eurodollar Rate Loan is prepaid (including, without limitation, mandatorily
pursuant to Section 3.01) on a date which is not the last day of the applicable
------------
Eurodollar Interest Period, (iii) as a consequence of a required conversion of a
Eurodollar Rate Loan to a Base Rate Loan as a result of any of the events
indicated in Section 4.02(d) or (e) or (iv) as a consequence of any failure by
---------------------- ----
the Borrower to repay Eurodollar Rate Loans when required by the terms hereof.
The Lender making demand for such compensation shall deliver to the Borrower
concurrently with such demand a written statement in reasonable
46
detail as to such losses, expenses and liabilities, and this statement shall be
conclusive as to the amount of compensation due to that Lender, absent manifest
error.
(g) Affiliates Not Obligated. No Eurodollar Affiliate or other
------------------------
Affiliate of any Lender shall be deemed a party hereto or shall have any
liability or obligation hereunder.
4.03. Fees. (a) Unused Commitment Fee. The Borrower agrees to pay
---- ---------------------
to the Administrative Agent, for the account of the Lenders in accordance with
their Pro Rata Shares, during the period commencing on the Closing Date and
ending on the Commitment Termination Date, a fee (the "Unused Commitment Fee"),
accruing at the rate of three-eighths of one percent (0.375%) per annum on the
average amount by which the Revolving Loan Commitments exceed the Revolving
Credit Obligations minus the outstanding principal amount of the Swing Loans,
-----
such fee being payable quarterly, in arrears, on the first Business Day of each
calendar quarter and on the Commitment Termination Date, in each case in respect
of the quarter (or portion thereof) immediately preceding the date such payment
is required.
(b) Letter of Credit Fee. In addition to any charges paid pursuant
--------------------
to Section 2.04(g), the Borrower shall pay to the Agent, for the account of the
---------------
Revolving Loan Lenders in accordance with their respective Pro Rata Shares:
(i) with respect to each Commercial Letter of Credit issued by the
Issuing Bank, a fee at a per annum rate equal to 0.125% on the face amount of
such Letter of Credit, payable on the date such Letter of Credit is issued, and
0.125% on the face amount of such Letter of Credit, payable on the date the
Issuing Bank honors a draft drawn under such Letter of Credit;
(ii) with respect to each Standby Letter of Credit issued by the
Issuing Bank, a fee at a per annum rate equal to the Applicable Eurodollar Rate
Margin on the undrawn face amount of such Letter of Credit, payable quarterly in
arrears on the first Business Day of each calendar quarter; and
(iii) during the occurrence and continuation of (A) an Event of
Default specified in Section 11.01(a) and (B) any other Event of Default when
----------------
the Requisite Lenders elect that the principal balance of all Loans and all
other Obligations bear interest at a rate which is two percent (2%) per annum in
excess of the rate of interest otherwise applicable to the Loans and such
Obligations, an additional fee in an amount equal to two percent (2%) per annum
on the undrawn face amount of each Standby Letter of Credit, payable quarterly
in arrears on the first Business Day of each calendar quarter.
(c) Computation of Fees. All of the above fees payable on a per
-------------------
annum basis shall be computed on the basis of the actual number of days elapsed
in a year of 360 days. All such fees shall be payable in addition to, and not in
lieu of, interest, compensation, expense reimbursements, indemnification and
other Obligations.
47
ARTICLE V
CONDITIONS TO LOANS
5.01. Conditions Precedent to the Initial Loans. The obligation of
-----------------------------------------
each Lender on the Closing Date to make its initial Loans requested to be made
by it shall be subject to the satisfaction of all of the following conditions
precedent:
(a) Documents. The Administrative Agent (on behalf of itself and
---------
the Lenders) shall have received on or before the Closing Date all of the
following:
(i) this Agreement, the Notes, the Guaranties, the Contribution
Agreement, the Administrative Agent's Fee Letter and all other agreements,
documents, instruments, certificates, opinions and corporate resolutions
described in the List of Closing Documents, each duly executed where appropriate
and in form and substance satisfactory to the Lenders and in sufficient copies
for each of the Lenders;
(ii) a pro-forma consolidated balance sheet of the Borrower and its
---------
Subsidiaries as of the Closing Date, giving effect to the Tender Transaction,
certified by the Chief Financial Officer of the Borrower; and
(iii) such additional documentation as the Administrative Agent or
the Requisite Lenders may reasonably request.
(b) Acquisition Documents; Consummation of Acquisition. The
--------------------------------------------------
Administrative Agent shall have received, true and correct copies of each of the
Acquisition Documents, including all schedules and exhibits thereto and all
amendments, supplements and modifications thereto or otherwise delivered in
connection therewith together with all closing documents, opinions and
certificates executed in connection therewith (including a copy of the
Notification and Report Form in respect of the Acquisition furnished to the
Department of Justice and the Federal Trade Commission pursuant to the ▇▇▇▇-
▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976), all of which shall be in full
force and effect. The Acquisition Documents shall not have been materially
amended, supplemented or otherwise modified since the date thereof (except for
such material amendments, supplements or modifications that have been approved
by the Administrative Agent). The Acquisition Documents shall be accompanied by
an Officer's Certificate of the Borrower, dated the Closing Date, to such
effect. The Borrower and each other party to the Transaction Documents shall be
in material compliance with all the terms thereof, and the Administrative Agent
shall have received, with a copy for each Lender, an Officer's Certificate of
the Borrower certifying that the only condition to the consummation of the
Tender Transaction remaining to be satisfied (which condition shall be satisfied
substantially simultaneously with the making of the initial Loans) is the
delivery of funds sufficient to pay the consideration under the Tender Offer
Documents.
(c) No Legal Impediments. No law, regulation, order, judgment or
--------------------
decree of any Governmental Authority shall, and the Administrative Agent shall
not have received any notice that any action, suit, investigation, litigation or
proceeding is pending or overtly threatened in any court or before any
arbitrator or Governmental Authority which (i) purports to
48
enjoin, prohibit, restrain or otherwise affect (A) the making of the Loans on
the Closing Date, (B) the Acquisition or (C) the consummation of any transaction
contemplated pursuant to the Transaction Documents or (ii) would be reasonably
expected to impose or result in the imposition of a Material Adverse Effect.
(d) Consents. Each Loan Party shall have received all consents and
--------
authorizations required pursuant to any material Contractual Obligation with any
other Person and shall have obtained all consents and authorizations of, and
effected all notices to and filings with, any Governmental Authority, in each
case, as may be necessary to allow such Loan Party, lawfully and without risk of
rescission, (i) to execute, deliver and perform, in all material respects, its
obligations under each Transaction Document to which it is, or is to be, a party
and each other agreement or instrument to be executed and delivered by it
pursuant thereto or in connection therewith and (ii) to consummate the
transactions contemplated by the Transaction Documents.
(e) No Change in Condition. No Material Adverse Effect shall have
----------------------
occurred since December 31, 1999.
(f) No Default. No Default or Event of Default shall have occurred
----------
and be continuing or would result from the making of the Loans on the Closing
Date.
(g) Representations and Warranties. All of the representations and
------------------------------
warranties contained in Section 6.01 and in the other Loan Documents shall be
------------
true and complete in all material respects on and as of the Closing Date.
(h) Fees and Expenses Paid. There shall have been paid to the
----------------------
Administrative Agent, for the account of the Agents and the Lenders, all fees
due and payable on or before the Closing Date, and all expenses (including,
without limitation, legal fees and expenses) due and payable on or before the
Closing Date.
(i) Financial Information. The Administrative Agent shall have
---------------------
received, with copies for each Lender, each of the financial statements referred
to in Section 6.01(h), in form and substance satisfactory to the Administrative
---------------
Agent and the Lenders.
(j) Indebtedness. The Administrative Agent shall have received
------------
satisfactory evidence that the Borrower's existing Indebtedness (other than the
Permitted Existing Indebtedness listed in Section 1.01(A) of the Disclosure
Letter) has been satisfied and that Schein's existing Indebtedness has been
satisfied (or, in the case of the Floating Rate Notes, satisfactory provision
has been made for the payment thereof) and that Schein has not incurred or
assumed any indebtedness not otherwise acceptable to the Lenders.
5.02. Conditions Precedent to All Loans. The obligation of each
---------------------------------
Lender to make any Loan requested to be made by it on any Funding Date on or
after the Closing Date is subject to the following conditions precedent as of
each such date:
(a) Representations and Warranties. As of such date, both before
------------------------------
and after giving effect to the Loans to be made, all of the representations and
warranties contained in Section 6.01 and in the other Loan Documents shall be
------------
true and complete in all material respects
49
(except to the extent that such representations or warranties are made as of an
earlier date, in which case they shall be true and complete in all material
respects as of such earlier date).
(b) No Defaults. As of such date, no Default or Event of Default
-----------
shall have occurred and be continuing or would result from the making of the
requested Loan or the application of the proceeds therefrom.
Each request by the Borrower for a Loan, each submission by the Borrower of a
Notice of Borrowing, each acceptance by the Borrower of the proceeds of each
Loan made hereunder, shall constitute a representation and warranty by the
Borrower as of the Funding Date in respect of such Loan that all the conditions
contained in this Section 5.02 have been satisfied.
------------
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.01. Representations and Warranties of the Borrower. In order to
----------------------------------------------
induce the Lenders to enter into this Agreement and to make the Loans, the
Borrower hereby represents and warrants as follows:
(a) Organization; Powers. Each Loan Party (i) is a corporation duly
--------------------
organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and (ii) has all requisite power and authority to
own, operate and encumber its assets and to conduct its business as presently
contemplated.
(b) Authority. (i) Each Loan Party has the requisite power and
---------
authority to execute, deliver and perform each of the Transaction Documents and
the Merger Documents to which it is a party.
(ii) No other action or proceeding on the part of any Loan Party is
necessary to execute, deliver and perform each of the Transaction Documents and
the Merger Documents to which it is a party thereto or to consummate the
transactions contemplated thereby.
(iii) Each of the Transaction Documents to which any Loan Party is a
party has been duly executed and delivered by such Loan Party and constitutes
the legal, valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its terms, except as such enforceability may
be limited by (i) bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and (ii) general
principles of equity relating to enforceability (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(c) Ownership. Section 6.01(C) of the Disclosure Letter sets forth
---------
the ownership of the Borrower and its Subsidiaries as of the date hereof. Each
Loan Party has delivered to the Administrative Agent true and complete copies of
the Governing Documents for such Loan Party in effect as of the date hereof.
There exists no other agreement or understanding (written or oral) affecting in
any material respect the relative rights, obligations or liabilities of such
other than said Governing Documents so delivered and such Loan Party is in
compliance in all material respects with all of its Governing Documents.
50
(d) No Conflict. The execution, delivery and performance by each
-----------
Loan Party of each Loan Document to which it is a party and the consummation of
the transactions contemplated thereby do not and will not (i) conflict with the
Governing Documents of such Loan Party, (ii) violate any Requirements of Law
(including Regulation U) or any material Contractual Obligation of such Loan
Party or require the termination of any material Contractual Obligation by such
Loan Party, or (iii) result in or require the creation or imposition of any Lien
whatsoever upon any of the property or assets of such Loan Party. The execution,
delivery and performance by each Loan Party of each Transaction Document (other
than a Loan Document) to which it is a party and the consummation of the
transactions contemplated thereby do not and will not (i) conflict with the
Governing Documents of such Loan Party, (ii) except for the agreements set forth
in Section 6.01(d) of the Disclosure Letter and except the permits,
registrations and filings required to be made as a result of the Tender Offer
and Merger which permits, registrations and filings do not have nor are
reasonably likely to have a Material Adverse Effect, violate any Requirements of
Law or any material Contractual Obligation of such Loan Party or require the
termination of any material Contractual Obligation by such Loan Party, or (iii)
result in or require the creation or imposition of any Lien whatsoever upon any
of the property or assets of such Loan Party.
(e) Governmental Consents. Except as set forth in Section 6.01(e)
---------------------
of the Disclosure Letter and except the permits, registrations and filings
required to be made as a result of the Tender Offer and Merger which permits,
registrations and filings do not have nor are reasonably likely to have a
Material Adverse Effect, the execution, delivery and performance by each Loan
Party of each Transaction Document to which it is a party and the consummation
of the transactions contemplated thereby do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by any Governmental Authority, except consents and filings that have
been obtained or made.
(f) Governmental Regulation. No Loan Party is subject to regulation
-----------------------
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, or the Investment Company Act of 1940, or any other
federal or state statute or regulation which limits its ability to incur
indebtedness or its ability to consummate the transactions contemplated by the
Transaction Documents.
(g) Subsidiaries. As of the Closing Date, the Borrower has no
------------
Subsidiaries or interests in any joint venture or partnership of any other
Person other than the Subsidiaries and material joint ventures and partnerships
set forth on Section 6.01(C) of the Disclosure Letter.
(h) Financial Position of the Borrower. True and complete copies of
----------------------------------
the following financial statements have been delivered to the Administrative
Agent and the Lenders: (i) the audited consolidated balance sheets as at the end
of each fiscal year ended December 31, 1999, December 31, 1998 and December 31,
1997, and the related consolidated statements of income and cash flow for the
Borrower and its Subsidiaries, (ii) the unaudited consolidated balance sheet as
at March 31, 2000 and the unaudited pro forma condensed combined balance sheet
and statement of operations (after giving effect to the consummation of the
Tender Transaction) for such period then ended, (iii) the audited consolidated
balance sheets as at the end of each fiscal year ended December 31, 1999,
December 31, 1998 and December 31, 1997, and the related consolidated statements
of income and cash flow for Schein and its Subsidiaries,
51
and (iv) the unaudited consolidated balance sheet as at March 31, 2000. The
foregoing financial statements were prepared in conformity with GAAP, except,
with respect to interim financial statements, the absence of full footnote
disclosure and year-end audit adjustments and as otherwise noted therein, and
fairly present in all material respects the financial position, and the results
of operations and cash flows of the Borrower and its Subsidiaries and Schein and
its Subsidiaries, as applicable, for each of the periods covered thereby as at
the respective dates thereof subject, in the case of interim financial
statements, to normal year-end audit adjustments and the absence of footnote
disclosure. No Loan Party has any Accommodation Obligation, contingent liability
or liability for any Taxes, long-term leases or commitments, not reflected in
the foregoing financial statements which will have or is reasonably likely to
have a Material Adverse Effect.
(i) Projections. The Borrower has delivered to the Administrative
-----------
Agent and each Lender pursuant to Section 5.01(a) certain projected financial
---------------
statements of the Borrower and its Subsidiaries which have been prepared in good
faith and using accounting principles consistently applied.
(j) Litigation; Adverse Effects. Except as set forth in Sections
---------------------------
6.01(J) and 6.01(P) of the Disclosure Letter, there is no action, suit,
proceeding, investigation or arbitration before or by any Governmental Authority
or private arbitrator pending or, to the knowledge of each Loan Party, overtly
threatened against such Loan Party or any of its assets (i) challenging the
validity or the enforceability of any of the Loan Documents or transactions
contemplated thereby or (ii) which will or is reasonably likely to result in any
Material Adverse Effect. There is no material loss contingency within the
meaning of GAAP which has not been reflected in the financial statements of the
Borrower and its Subsidiaries and which will or is reasonably likely to result
in any Material Adverse Effect. No Loan Party is (A) in violation of any
applicable Requirements of Law which violation will have or is reasonably likely
to have a Material Adverse Effect or (B) subject to, or in default with respect
to, any final judgment, writ, injunction, restraining order or order of any
nature, decree, rule or regulation of any court or Governmental Authority which
will have or is reasonably likely to have a Material Adverse Effect.
(k) No Material Adverse Effect. Since December 31, 1999, there has
--------------------------
occurred no event which has had or is reasonably likely to have a Material
Adverse Effect.
(l) Payment of Taxes. All tax returns and material reports required
----------------
to be filed by the Borrower and Schein have been timely filed, and all taxes,
assessments, fees and other governmental charges shown on such returns have been
paid when due and payable, except such taxes, if any, as are reserved against in
accordance with GAAP and are being contested in good faith by appropriate
proceedings.
(m) Performance. No Loan Party has received notice, or has actual
-----------
knowledge, that (i) it is in default in the performance, observance or
fulfillment of any material (singularly or in the aggregate) Contractual
Obligations applicable to it or (ii) any material (singularly or in the
aggregate) condition exists which, with the giving of notice or the lapse of
time or both, would constitute a default with respect to any such Contractual
Obligation.
52
(n) Disclosure. The representations and warranties of each Loan
----------
Party contained in the Loan Documents and all certificates and other documents
delivered pursuant to the terms thereof, do not contain any untrue statement of
a material fact or omit to state a material fact necessary in order to make the
statements contained therein, in light of the circumstances under which they
were made, not misleading in any material respect. No Loan Party has
intentionally withheld any fact from the Administrative Agent or the Lenders
with regard to any matter which will have or is reasonably likely to have a
Material Adverse Effect.
(o) Requirements of Law. Each Loan Party is in compliance in all
-------------------
material respects with all Requirements of Law applicable to it and its
business.
(p) Environmental Matters. To each Loan Party's knowledge, upon
---------------------
inquiry and investigation completed by such Loan Party as diligently and as
thoroughly as would reasonably be required to determine any facts relevant to
the representations set forth herein, and except as set forth in Section 6.01(P)
of the Disclosure Letter hereto, (i) such Loan Party and its operations and
Property comply in all respects with all applicable Environmental, Health or
Safety Requirements of Law, except where noncompliance has not resulted or would
not be reasonably likely to have a Material Adverse Effect; (ii) such Loan Party
has obtained all environmental, health and safety Permits necessary for its
operations and Property and all such Permits are in good standing and such Loan
Party is in compliance with all terms and conditions of such Permits except such
as has not resulted or would not be reasonably likely to have a Material Adverse
Effect; (iii) no Loan Party nor its operations is subject to any order from or
written agreement with any Governmental Authority or private party or any
judicial or administrative proceeding or investigation respecting any
Environmental, Health or Safety Requirements of Law or any Release or threatened
Release of a Contaminant into the indoor or outdoor environment; (iv) no Loan
Party nor its operations is subject to any Remedial Action or other Liabilities
and Costs arising from the Release or threatened Release of a Contaminant into
the indoor or outdoor environment except such as has not resulted or would not
be reasonably likely to have a Material Adverse Effect; (v) no Loan Party has
filed any notice under any Requirement of Law indicating treatment, storage or
disposal of a hazardous waste, as that term is defined under 40 CFR Part 261 or
any applicable state equivalent except such as has not resulted or would not be
reasonably likely to have a Material Adverse Effect; (vi) no Loan Party has
filed any notice under applicable Requirement of Law reporting a Release of a
Contaminant into the indoor or outdoor environment except such as has not
resulted or would not be reasonably likely to have a Material Adverse Effect;
(vii) no Environmental Liens have attached to any Property of any Loan Party
securing obligations, individually or in the aggregate, in an amount of
$25,000,000 or more; (viii) no Loan Party has received any written notice or
claim to the effect that it is or may be liable to any Person as a result of the
Release or threatened Release of a Contaminant into the indoor or outdoor
environment except such as has not resulted or would not be reasonably likely to
have a Material Adverse Effect; and (ix) neither the Acquisition nor any
transaction contemplated by this Agreement is subject to any Environmental
Property Transfer Act.
(q) ERISA. Neither the Borrower nor any ERISA Affiliate maintains
-----
or contributes to any Benefit Plan as of the Closing Date other than a Benefit
Plan listed on Section 6.01(Q) of the Disclosure Letter. Each Plan which is
intended to be qualified under Section 401(a) of the Code as currently in effect
has been determined by the IRS to be so qualified, and
53
each trust related to any such Plan has been so determined to be exempt from
federal income tax under Section 501(a) of the Code as currently in effect,
except for changes for which the remedial amendment period has not expired.
Neither the Borrower nor any ERISA Affiliate maintains or contributes to any
employee welfare benefit plan within the meaning of Section 3(1) of ERISA, other
than a Multiemployer Plan, which provides benefits to employees after
termination of employment other than as required under Part 6 of Title I of
ERISA. Each of the Borrower and its Subsidiaries is in compliance in all
material respects with the responsibilities, obligations or duties imposed on it
by ERISA or regulations promulgated thereunder with respect to all Plans. No
accumulated funding deficiency (as defined in Section 302(a)(2) of ERISA and
Section 412(a) of the Internal Revenue Code) exists in respect to any Benefit
Plan. Except as set forth on Section 6.01(Q) of the Disclosure Letter, neither
the Borrower nor any ERISA Affiliate nor any fiduciary of any Plan (i) has
engaged in a nonexempt "prohibited transaction" described in Section 406 of
ERISA or Section 4975 of the Internal Revenue Code or (ii) has taken any action
which would constitute or result in a Termination Event with respect to any Plan
which would result in a material liability to the Borrower or an ERISA
Affiliate. Neither the Borrower nor any ERISA Affiliate has incurred any
material liability to the PBGC which has not been paid within the applicable
period permitted by law. Schedule B to the most recent annual report filed with
the IRS with respect to each Benefit Plan and furnished to the Administrative
Agent is complete and accurate in all material respects. Since the date of each
such Schedule B, there has been no material adverse change in the funding status
or financial condition of the Benefit Plan relating to such Schedule B which
would result in a Material Adverse Effect. Neither the Borrower nor any ERISA
Affiliate has failed to make any required installment under subsection (m) of
Section 412 of the Code and any other payment required under Section 412 of the
Code on or before the due date for such installment or other payment which could
reasonably be expected to result in a lien under Section 412 of the Code.
Neither the Borrower nor any ERISA Affiliate is required to provide security to
a Benefit Plan under Section 401(a)(29) of the Internal Revenue Code due to a
Plan amendment that results in an increase in current liability for the plan
year. The Borrower and its Subsidiaries and its ERISA Affiliates are current
with respect to all obligations they may have relating to any Multiemployer Plan
to which they are or have been obligated to contribute. Neither the Borrower nor
any ERISA Affiliate has or is likely to incur any withdrawal liability with
respect to any Multiemployer Plan which would have a Material Adverse Effect.
(r) Labor Matters. No Loan Party is a party to any labor contract
-------------
as of the Closing Date. There are no strikes, lockouts or other disputes
relating to any collective bargaining or similar agreement to which such Loan
Party is a party which would have or is reasonably likely to have a Material
Adverse Effect.
(s) Securities Activities. No Loan Party is engaged in the business
---------------------
of extending credit for the purpose of purchasing or carrying Margin Stock.
(t) Solvency. After giving effect to the receipt and application of
--------
the Loans in accordance with the terms of this Agreement, each Loan Party is
Solvent.
(u) Patents, Trademarks, Permits, etc.; Government Approvals.
--------------------------------------------------------
54
(i) Each Loan Party owns, is licensed or otherwise has the lawful
right to use the permits and other governmental approvals, patents, trademarks,
trade names, copyrights, technology, know-how and processes necessary for the
conduct of its business as currently conducted which are material to its
condition (financial or otherwise), operations, performance and prospects. There
are no claims pending or, to such Loan Party's knowledge, overtly threatened
that such Loan Party is infringing or otherwise adversely affecting the rights
of any Person with respect to such permits and other governmental approvals,
patents, trademarks, trade names, copyrights, technology, know-how and
processes, except for such claims and infringements as do not, in the aggregate,
give rise to any liability on the part of such Loan Party which has or is
reasonably likely to have a Material Adverse Effect.
(ii) The consummation of the transactions contemplated by the Loan
Documents will not impair such Loan Party's ownership of or rights under (or the
license or other right to use, as the case may be) any permits and governmental
approvals, patents, trademarks, trade names, copyrights, technology, know-how or
processes in any manner which has or is reasonably likely to have a Material
Adverse Effect.
(v) Assets and Properties. Each Loan Party has good and marketable
---------------------
or merchantable title to all of its owned assets and property (tangible and
intangible), and all such assets and property are free and clear of all Liens
except Liens permitted under Section 9.03. Substantially all of the assets and
------------
property owned by, leased to or used by such Loan Party are in good operating
condition and repair, ordinary wear and tear excepted, are free and clear of any
known defects except such defects as do not substantially interfere with the
continued use thereof in the conduct of normal operations, and are able to serve
the function for which they are currently being used, except in each case where
the failure of such asset to meet such requirements would not have or is not
reasonably likely to have a Material Adverse Effect. Neither this Agreement nor
any other Loan Document, nor any transaction contemplated under any Loan
Document, will affect any right, title or interest of such Loan Party in and to
any of such assets in a manner that would have or is reasonably likely to have a
Material Adverse Effect.
(w) Insurance. Section 6.01(W) of the Disclosure Letter accurately
---------
sets forth all insurance policies and programs currently in effect as of the
Closing Date with respect to the respective property and assets and business of
the Borrower and its Subsidiaries, specifying for each such policy and program,
(i) the amount thereof and the amount of the deductible relating thereto, (ii)
the risks insured against thereby, (iii) the name of the insurer and each
insured party thereunder, (iv) the policy or other identification number
thereof, (v) the expiration date thereof, (vi) the annual premium with respect
thereto and (vii) the current rating of such insurer by A.M. Best or an
established rating agency reasonably satisfactory to the Administration Agent.
(x) Material Adverse Agreements. After giving effect to this
---------------------------
Agreement, no Loan Party is a party to or subject to any Contractual Obligation
or other restriction contained in its Governing Documents which has or is
reasonably likely to have a Material Adverse Effect.
(y) Forfeiture Proceeding. No Loan Party is engaged in or proposes
---------------------
to be engaged in the conduct of any business or activity which could result in a
Forfeiture Proceeding and no Forfeiture Proceeding against it is pending or
threatened.
55
ARTICLE VII
REPORTING COVENANTS
The Borrower covenants and agrees so long as any Commitment is
outstanding and thereafter until payment in full of the Obligations:
7.01. Financial Statements. Each Loan Party shall maintain a system
--------------------
of accounting established and administered in accordance with sound business
practices to permit preparation of financial statements in conformity with GAAP,
and each of the financial statements described below shall be prepared from such
system and records. The Borrower shall deliver or cause to be delivered to the
Administrative Agent and the Lenders:
(a) Quarterly Reports. As soon as practicable, and in any event
-----------------
within forty-five (45) days after the end of each fiscal quarter in each Fiscal
Year, consolidated balance sheets of the Borrower and its Subsidiaries as at the
end of such period and the related consolidated statements of income and cash
flow of the Borrower and its Subsidiaries for such fiscal quarter, certified by
the Chief Financial Officer of the Borrower as fairly presenting the financial
position of the Borrower as at the dates indicated and the results of its
operations and cash flow for the fiscal quarter indicated in accordance with
GAAP, subject to normal year end adjustments and the absence of complete
footnote disclosure provided that, so long as the Borrower files quarterly
reports on Form 10-Q with the Commission, the delivery of such Form 10-Q for
such fiscal quarter shall satisfy the requirements of this Section 7.01(a).
---------------
(b) Annual Reports. As soon as practicable, and in any case within
--------------
ninety (90) days after the end of such Fiscal Year, (i) the audited consolidated
(and unaudited consolidating) balance sheet of the Borrower and its Subsidiaries
as of the end of such Fiscal Year and the related audited consolidated (and
unaudited consolidating) statements of income and audited consolidated statement
of cash flow of the Borrower and its Subsidiaries for such Fiscal Year, provided
that, so long as the Borrower files an annual report on Form 10-K with the
Commission, the delivery of such Form 10-K for such annual period accompanied by
unaudited consolidating balance sheets and statements of income of the Borrower
and its Subsidiaries shall satisfy the requirements of this Section 7.01(b)(i)
------------------
and (ii) a report thereon of PricewaterhouseCoopers, LLP or other independent
--------
certified public accountants acceptable to the Administrative Agent, which
report shall be unqualified and shall state that such financial statements
fairly present the financial position of the Borrower as at the dates indicated
and the results of its operations and cash flow for the periods indicated in
conformity with GAAP applied on a basis consistent with prior years and that the
examination by such accountants in connection with such financial statements has
been made in accordance with generally accepted auditing standards.
(c) Officer's Certificate. Together with each delivery of any
---------------------
financial statement pursuant to paragraphs (a) and (b) of this Section 7.01, (i)
---------------------- ------------
an Officer's Certificate substantially in the form of Exhibit F attached hereto
---------
and made a part hereof, stating that such officer has reviewed the terms of the
Loan Documents, and has made, or caused to be made under his supervision, a
review in reasonable detail of the transactions and consolidated financial
condition of the Borrower during the accounting period covered by such financial
statements,
56
that such review has not disclosed the existence during or at the end of such
accounting period, and that such officer does not have knowledge of the
existence as at the date of such Officer's Certificate, of any condition or
event which constitutes an Event of Default or Default, or, if any such
condition or event existed or exists, specifying the nature and period of
existence thereof and what action the Borrower has taken, is taking and proposes
to take with respect thereto and (ii) a certificate substantially in the form of
Exhibit G attached hereto (the "Compliance Certificate"), signed by the
---------
Borrower's Chief Financial Officer, setting forth calculations (with such
specificity as the Lenders may reasonably request) for the period then ended
which demonstrate compliance, when applicable, with the provisions of Article IX
----------
and Article X.
---------
(d) Budgets; Business Plans; Financial Projections. As soon as
----------------------------------------------
practicable and in any event not later than the forty-fifth day following the
beginning of each Fiscal Year, (i) a quarterly budget of the Borrower and its
Subsidiaries for such Fiscal Year; (ii) an annual business plan of the Borrower
and its Subsidiaries for such Fiscal Year, accompanied by a report explaining
the changes and departures from the business plan delivered to the
Administrative Agent and the Lenders for the preceding Fiscal Year; and (iii) a
plan and financial forecast, prepared in accordance with the Borrower's normal
accounting procedures applied on a consistent basis, for such Fiscal Year and
for the two (2) succeeding Fiscal Years of the Borrower, including, without
limitation, (A) a forecasted balance sheet of the Borrower as at the end of such
Fiscal Year and (B) forecasted statements of income and cash flow of the
Borrower for such Fiscal Year.
7.02. Management Reports. The Borrower shall deliver or cause to be
------------------
delivered to the Administrative Agent copies of any management reports delivered
to any Loan Party or to any officer or employee thereof by the independent,
certified public accountants in connection with the financial statements
delivered pursuant to Section 7.01.
------------
7.03. Other Financial Information. (a) The Borrower shall deliver or
---------------------------
cause to be delivered to the Administrative Agent, such other information,
reports, contracts, schedules, lists, documents, agreements and instruments with
respect to the business, condition (financial or otherwise), operations,
performance, properties or prospects of any Loan Party as the Administrative
Agent or any Lender may, from time to time, reasonably request.
(b) The Borrower shall deliver or cause to be delivered to the
Administrative Agent, copies of all financial statements, reports and notices,
if any, sent or made available generally by the Borrower to the holders of its
publicly-held Securities or to a trustee under any indenture or filed by the
Borrower with the Commission, and of all press releases made available generally
by the Borrower to the public concerning material developments in the Borrower's
business.
7.04. Defaults and Other Events. Promptly upon any Loan Party
-------------------------
obtaining knowledge (i) of any condition or event which constitutes a Default or
an Event of Default, (ii) that any Person has given any notice to any Loan Party
or taken any other action with respect to a claimed default or event or
condition of the type referred to in Section 11.01(e) or (iii) of any condition
----------------
or event which has or is reasonably likely to have a Material Adverse Effect,
such Loan Party shall deliver to the Administrative Agent and the Lenders an
Officer's Certificate specifying (A) the nature and period of existence of any
such claimed default, Event of Default,
57
Default, condition or event, (B) the notice given or action taken by such Person
in connection therewith and (C) what action the Borrower and such Loan Party
have taken, are taking and propose to take with respect thereto.
7.05. Lawsuits. Promptly upon any Loan Party obtaining knowledge of
--------
the institution of, or written threat of, (i) any action, suit, proceeding or
arbitration against or affecting such Loan Party or any asset of such Loan Party
not previously disclosed pursuant to Section 6.01(J) or 6.01(P) of the
Disclosure Letter and required to be publicly disclosed, the Borrower or such
Loan Party shall give written notice thereof to the Administrative Agent and the
Lenders and provide such other information as may be reasonably available to
enable each Lender and the Administrative Agent and its counsel to evaluate such
matters except, in each case, where the same is fully covered by insurance
(other than applicable deductible); and (ii) in addition to the requirements set
forth in clauses (i) of this Section 7.05, the Borrower upon request of the
----------- ------------
Administrative Agent or the Requisite Lenders shall promptly give written notice
of the status of any action, suit, proceeding, governmental investigation or
arbitration covered by a report delivered pursuant to clause (i) above and
----------
provide such other information as may be reasonably available to it to enable
each Lender and the Administrative Agent and its counsel to evaluate such
matters.
7.06. ERISA Notices. The Borrower shall deliver or cause to be
-------------
delivered to the Administrative Agent:
(i) As soon as possible, and in any event within ten (10) days
after either the Borrower or an ERISA Affiliate knows or has reason to know
that a Termination Event has occurred, a written statement of the Chief
Financial Officer of the Borrower describing such Termination Event and the
action, if any, which the Borrower or such ERISA Affiliate has taken, is
taking or proposes to take, with respect thereto, and, when known, any
action taken or threatened by the IRS, the DOL or the PBGC with respect
thereto;
(ii) as soon as possible, and in any event within ten (10) days,
after either the Borrower or an ERISA Affiliate knows or has reason to know
that a non-exempt prohibited transaction (defined in Section 406 of ERISA
and Section 4975 of the Code) that would result in a material liability to
the Borrower or an ERISA Affiliate has occurred, a statement of the Chief
Financial Officer of the Borrower describing such transaction;
(iii) within ten (10) days after the filing thereof with the IRS, a
copy of each funding waiver request filed with respect to any Benefit Plan
and all communications received by either the Borrower or an ERISA
Affiliate with respect to such request;
(iv) promptly upon, and in any event within ten (10) days after,
receipt by either the Borrower or an ERISA Affiliate of a notice of the
PBGC's intention to terminate a Benefit Plan or to have a trustee appointed
to administer a Benefit Plan, copies of each such notice;
58
(v) promptly upon, and in any event within ten (10) days after,
receipt by either the Borrower or an ERISA Affiliate of an unfavorable
determination letter from the IRS regarding the qualification of a Plan
under Section 401(a) of the Code, a copy of said determination letter, if
such disqualification would result in a material liability to the Borrower
or any of its Subsidiaries;
(vi) promptly upon, and in any event within ten (10) days after
receipt by the Borrower of a notice from a Multiemployer Plan regarding the
imposition of material withdrawal liability, a copy of said notice; and
(vii) promptly upon, and in any event within ten (10) days after, the
Borrower or any of its Subsidiaries fails to make a required installment
under subsection (m) of Section 412 of the Code or any other payment
required under Section 412 of the Code on or before the due date for such
installment or payment, a notification of such failure, if such failure
could result in either the imposition of a Lien under said Section 412 or
otherwise have a Material Adverse Effect on the Borrower or any of its
Subsidiaries.
7.07. Environmental Notices. The Borrower shall notify the
---------------------
Administrative Agent, in writing, promptly, and in any event within ten (10)
days after any Loan Party's learning thereof, of any of the following: (i)
written notice or claim to the effect that such Loan Party is or may be liable
to any Person as a result of the Release or threatened Release of any
Contaminant into the indoor or outdoor environment; (ii) written notice that
such Loan Party is subject to investigation by any Governmental Authority
evaluating whether any Remedial Action is needed to respond to the Release or
threatened Release of any Contaminant into the indoor or outdoor environment;
(iii) written notice that any Property of such Loan Party is subject to an
Environmental Lien; (iv) written notice of violation to such Loan Party or
awareness by the Borrower or such Loan Party of a condition which might
reasonably result in a notice of violation to such Loan Party of any
Environmental, Health or Safety Requirement of Law, which could have a Material
Adverse Effect on the Borrower or such Loan Party; (v) commencement or written
threat of any judicial or administrative proceeding alleging a violation of any
Environmental, Health or Safety Requirement of Law; (vi) new or proposed changes
to any existing Environmental, Health or Safety Requirement of Law that could
have a Material Adverse Effect on the operations of the Borrower or such Loan
Party; or (vii) any proposed acquisition of stock, assets, real estate or
leasing of property, or any other action by the Borrower or such Loan Party that
could subject the Borrower or such Loan Party to Environmental, Health or Safety
Liabilities and Costs that could have a Material Adverse Effect. For purposes of
clauses (i), (ii) and (iii), written notice shall include other non-written
communications given to an agent or employee of the Borrower or such Loan Party
with direct or indirect supervisory responsibility with respect to the activity,
if any, which is the subject of such communication, if such activity could have
a Material Adverse Effect. With respect to clauses (i) through (vii) above, such
notice shall be required only if (A) the liability or potential liability, or
with respect to clause (vi), the cost or potential cost of compliance, which is
the subject matter of the notice is likely to exceed Thirty-Five Million Dollars
($35,000,000), or if (B) such liability or potential liability or cost of
compliance when added to other liabilities of the Borrower and its Subsidiaries
of the kind referred to in clauses (i) through (vii) above is likely to exceed
Seventy-Five Million Dollars ($75,000,000).
59
7.08. FDA Notices. The Borrower shall provide to the Administrative
-----------
Agent:
(a) promptly after the same become available to the Borrower, with
respect to each manufacturing facility of the Borrower or its Subsidiaries, all
warning letters alleging violations of FDA regulatory requirements at such
manufacturing facility;
(b) promptly after the same become available to the Borrower, with
respect to each manufacturing facility of the Borrower or its Subsidiaries, all
inspectional observations recorded on a Form FD 483 and issued by the FDA at the
conclusion of any FDA inspections of such facility (other than pre-approval
inspections and post-approval inspections) that would be required to be publicly
disclosed by the Borrower in a filing with the Commission as determined by the
Borrower; and
(c) all written responses to the FDA by or on behalf of the
Borrower or its Subsidiaries concerning alleged violations of FDA regulatory
requirements contained in warning letters or Form FD 483s referred to in
subsections (a) or (b) of this Section 7.08.
------------
7.09. Labor Matters. The Borrower shall notify the Administrative
-------------
Agent in writing, promptly, but in any event within ten (10) days after learning
thereof, of (i) any material labor dispute to which any Loan Party may become a
party, any strikes, lockouts or other disputes relating to any Loan Party's
plants and other facilities and (ii) any material liability incurred with
respect to the closing of any plant or other facility of any Loan Party.
7.10. Other Information. Promptly upon receiving a request therefor
-----------------
from the Administrative Agent or the Requisite Lenders, the Borrower and its
Subsidiaries shall prepare and deliver to the Administrative Agent such other
information with respect to any Loan Party as from time to time may be
reasonably requested by the Administrative Agent or the Requisite Lenders.
ARTICLE VIII
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees so long as any Commitment is
outstanding and thereafter until payment in full of the Obligations:
8.01. Existence, etc. Each Loan Party and each Schein Party shall at
--------------
all times maintain its existence and preserve and keep, or cause to be preserved
and kept, in full force and effect its rights and franchises material to its
businesses except where the loss or termination of such rights and franchises
does not have or is not likely, individually or in the aggregate, to have a
Material Adverse Effect.
8.02. Powers; Conduct of Business. Each Loan Party and each Schein
---------------------------
Party shall qualify and remain qualified to do business in each jurisdiction in
which the nature of its business requires it to be so qualified except for those
jurisdictions where failure to so qualify does not have or is not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect.
60
8.03. Compliance with Laws, etc. Each Loan Party and each Schein
-------------------------
Party shall, (a) comply with all Requirements of Law and all restrictive
covenants affecting such Person or the business, property, assets or operations
of such Person, and (b) obtain as needed all Permits necessary for its
operations and maintain such Permits in good standing except in the case where
noncompliance with either clause (a) or (b) above does not have or is not
---------- ---
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect.
8.04. Payment of Taxes and Claims. Each Loan Party and each Schein
---------------------------
Party shall pay (a) all taxes, assessments and other governmental charges
imposed upon it or on any of its properties or assets or in respect of any of
its franchises, business, income or property before any penalty or interest
accrues thereon, the failure to make payment of which will have or is reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect, and
(b) all claims (including, without limitation, claims for labor, services,
materials and supplies) for sums which have become due and payable prior to the
same becoming subject to a Lien upon any of such Person's properties or assets
and prior to the time when any penalty or fine shall be incurred with respect
thereto; provided, however, that no such taxes, assessments and governmental
-----------------
charges referred to in clause (a) above or claims referred to in clause (b)
above need be paid if being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted and if adequate reserves shall have
been set aside therefor in accordance with GAAP.
8.05. Insurance. Each Loan Party and each Schein Party shall
---------
maintain, with financially sound and reputable insurers, insurance in such
amounts and against such liabilities and hazards as customarily is maintained by
other companies operating similar businesses.
8.06. Inspection of Property; Books and Records; Discussions. Each
------------------------------------------------------
Loan Party and each Schein Party shall permit any authorized representative(s)
designated by the Administrative Agent to visit and inspect any of the assets of
such Loan Party or such Schein Party, to examine, audit, check and make copies
of its financial and accounting records, books, journals, orders, receipts and
any correspondence and other data relating to its businesses or the transactions
contemplated by the Loan Documents (including, without limitation, in connection
with environmental compliance, hazard or liability), to discuss such Person's
affairs, finances and accounts with its officers and, in the presence of an
officer of such Loan Party or such Schein Party, independent certified public
accountants, all upon reasonable notice and at such reasonable times during
normal business hours, once each fiscal year; provided, however, that upon the
occurrence and during the continuance of an Event of Default each Loan Party
shall permit any authorized representative(s) designated by the Administrative
Agent or any Lender to do all of the foregoing without notice, at any time and
as often as the Administrative Agent or any Lender may request. Each such
visitation and inspection (i) by or on behalf of any Lender shall be at such
Lender's expense and (ii) by or on behalf of the Administrative Agent shall be
at the Borrower's expense. Each Loan Party shall keep and maintain in all
material respects proper books of record and account in which entries in
conformity with GAAP subject to normal year-end audit adjustments and the
absence of complete footnote disclosure shall be made of all dealings and
transactions in relation to its businesses and activities. If an Event of
Default has occurred and is continuing, each Loan Party, upon the Administrative
Agent's request, shall turn over any such records to the Administrative Agent or
its representatives.
61
8.07. ERISA Compliance. The Borrower shall, and shall cause to the
----------------
best of its ability, each ERISA Affiliate to, establish, maintain and operate
all Plans to comply in all material respects with the provisions of ERISA, the
Code, all other applicable laws, and the regulations and interpretations
thereunder and the respective requirements of the governing documents for such
Plans.
8.08. Maintenance of Property. Each Loan Party and each Schein Party
-----------------------
shall maintain in all material respects its owned and leased property in good,
safe and insurable condition and repair (ordinary wear and tear excepted) and in
accordance with any applicable manufacturers' specifications and
recommendations, and not permit, commit or suffer any waste (except in the
ordinary course of business) or abandonment of any such property and from time
to time shall make or cause to be made all repairs, renewal and replacements
thereof, except where the failure to make such repairs, renewals and
replacements would not have or is not reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect; provided, however, that such
-----------------
property may be altered or renovated in the ordinary course of business.
8.09. Maintenance of Licenses, Permits, etc. Each Loan Party and each
-------------------------------------
Schein Party shall maintain in full force and effect all licenses, permits,
governmental approvals, franchises, authorizations or other rights necessary for
the operation of its business, except where the failure to obtain any of the
foregoing would not have or is not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect; and notify the Administrative Agent in
writing, promptly after learning thereof, of the suspension, cancellation,
revocation or discontinuance of or of any pending or overtly threatened action
or proceeding seeking to suspend, cancel, revoke or discontinue any such
license, permit, governmental approval, franchise authorization or right.
8.10. Merger. (a) The Merger shall have been consummated no later
------
than December 15, 2000.
(b) As of the consummation of the Merger, the Administrative Agent
shall have received an Officer's Certificate of the Borrower certifying that (i)
the transactions described in the Merger Documents have been consummated in all
material respects in accordance with the terms and provisions thereof, (ii) the
Borrower and each other party thereto are in material compliance with all the
terms thereof, (iii) the terms and provisions of the Merger Agreement, as
applicable, have not been materially amended, waived, supplemented or otherwise
modified from the Closing Date (except for such material amendments, supplements
or modifications that have been approved by the Requisite Lenders) and (iv) on
and as of the Merger Effective Date (after giving effect the merger), all of the
representations and warranties contained in Section 6.01 and in the other Loan
------------
Documents are true and complete in all material respects.
(c) As of the consummation of the Merger, Schein and each Specified
Schein Subsidiary shall have delivered to the Administrative Agent a Guaranty,
an Acknowledgment of New Loan Party, and all other agreements, documents,
certificates, opinions and corporate resolutions described in the List of
Closing Documents under the heading "Merger Effective Date Documentation", each
duly executed where appropriate and in form and substance reasonably
satisfactory to the Administrative Agent.
62
(d) As of the consummation of the Merger, no law, regulation,
order, judgment or decree of any Governmental Authority shall, and the
Administrative Agent shall not have received any notice that any action, suit,
investigation, litigation or proceeding is pending or threatened in any court or
before any arbitrator or Governmental Authority which (i) purports to enjoin,
prohibit, restrain or otherwise affect (A) the Merger or (B) the consummation of
any transaction contemplated pursuant to the Merger Documents or (ii) would be
reasonably expected to impose or result in the imposition of a Material Adverse
Effect.
(e) Except as set forth in Section 8.10 of the Disclosure Letter,
as of the consummation of the Merger, each Schein Party shall have received all
consents and authorizations required pursuant to any material Contractual
Obligation with any other Person and shall have obtained all consents and
authorizations of, and effected all notices to and filings with, any
Governmental Authority, in each case, as may be necessary to allow such Schein
Party, lawfully and without risk of rescission, (i) to execute, deliver and
perform, in all material respects, its obligations under each Transaction
Document to which it is, or is to be, a party and each other agreement or
instrument to be executed and delivered by it pursuant thereto or in connection
therewith and (ii) to consummate the transactions contemplated by the
Transaction Documents.
8.11. Loan Party. On or prior to April 15 of each year, the Borrower
----------
will cause each Subsidiary (other than a Loan Party) that accounts for at least
5% of the Borrower's EBITDA on a consolidated basis, as determined at the end of
the immediately preceding Fiscal Year, and upon the acquisition of a Person that
accounts for at least 5% of the Borrower's EBITDA on a pro forma basis, the
---------
Borrower will cause such acquired Person, to execute and deliver to the
Administrative Agent a Guaranty and an Acknowledgment of New Loan Party and
otherwise to become a Loan Party hereunder.
ARTICLE IX
NEGATIVE COVENANTS
The Borrower covenants and agrees so long as any Commitment is
outstanding and thereafter until payment in full of the Obligations:
9.01. Indebtedness. The Loan Parties and the Schein Parties shall
------------
not, directly or indirectly, create, incur, assume or otherwise become or remain
liable with respect to any Indebtedness, except:
(i) the Obligations;
(ii) trade payables in the ordinary course of business;
(iii) Permitted Existing Indebtedness;
(iv) to the extent permitted by Section 9.13, obligations under
------------
Capital Leases and purchase money Indebtedness incurred by the Loan Parties
to finance the acquisition of Property if, when added to all other
obligations and Indebtedness or created, incurred
63
or assumed under this clause (iv) the aggregate amount of such obligations
and Indebtedness does not exceed 10% of Net Worth at such time;
(v) Indebtedness owing by one Loan Party to another Loan Party;
(vi) Accommodation Obligations that are permitted under Section
-------
9.05;
----
(vii) Interest Rate Contracts with respect to the Loans;
(viii) other unsecured Indebtedness incurred in the ordinary course of
business in an aggregate principal amount not to exceed Fifty Million
Dollars ($50,000,000) outstanding at any time;
(ix) the Floating Rate Notes during the period from the Closing Date
until the Schein Repayment Date;
(x) foreign exchange contracts entered into for the purpose of
hedging foreign exchange risk;
(xi) Attributable Debt if, when added to all other Attributable Debt
created, incurred or assumed under this clause (xi), the aggregate amount
outstanding does not exceed 10% of Net Worth;
(xii) Indebtedness in a currency other than Dollars incurred by a
Loan Party that has operations outside of the United States, provided that
the aggregate amount of such Indebtedness does not exceed $20,000,000 at
any time;
(xiii) refinancings, extensions or other modifications of any of the
items of Indebtedness described in clauses (iii), (iv), (v), (vi), (viii)
or (xi) above, provided that the principal amount thereof outstanding at
--------
such time is not increased and that the terms of such refinancing,
extensions or modifications are not materially adverse to the Lenders; and
(xiv) Indebtedness incurred by Schein or its Subsidiaries on the
Closing Date to the extent permitted under Section 9.04(viii).
------------------
9.02. Sales of Assets. The Loan Parties and the Schein Parties shall
---------------
not, directly or indirectly, sell, assign, transfer, lease, convey or otherwise
dispose of any assets, whether now owned or hereafter acquired, or enter into
any agreement to do so, except:
(i) sales of inventory in the ordinary course of business;
(ii) the disposition of Property if such Property is obsolete or no
longer used in or useful in the ordinary course of such Loan Party's
business;
(iii) leases, subleases, licenses and sublicenses of Property to
other persons in the ordinary course of business;
64
(iv) the transactions set forth in Section 9.02(iv) of the
Disclosure Letter;
(v) the sale of Property provided that (A) the value of such
Property does not exceed 10% of Net Worth at the time of such sale and (B)
when added to all other Property sold, assigned, transferred, leased,
conveyed or otherwise disposed of under this clause (v), the aggregate
amount does not exceed 20% of Net Worth at the time of such sale;
(vi) the transactions set forth in Section 9.02(vi) of the
Disclosure Letter;
(vii) the sale or transfer of Property pursuant to a transaction
permitted under Section 9.10; and
------------
(viii) other sales of assets with an aggregate market value not in
excess of $20,000,000 in any Fiscal Year.
9.03. Liens. The Loan Parties and the Schein Parties shall not,
-----
directly or indirectly, create, incur, assume or permit to exist any Lien on or
with respect to their Property, except:
(i) Permitted Existing Liens;
(ii) Customary Permitted Liens;
(iii) Liens securing Indebtedness permitted under Section 9.01(iv)
----------------
provided that the Lien extends only to the property subject to such Capital
Leases or the Property Acquired and Liens securing Indebtedness under
Section 9.01(xii) provided that the Lien extends to Property outside the
-----------------
United States;
(iv) leases or subleases and licenses or sublicenses granted to
others, in each case incidental to, and not interfering with, the ordinary
conduct of the business of the Borrower and its Subsidiaries;
(v) rights of setoff and similar arrangements and Liens in favor of
depository institutions and securities intermediaries to secure customary
fees and similar amounts related to bank accounts or securities accounts;
(vi) any Lien existing on Property of a Person (other than Schein)
immediately prior to its being consolidated with or merged into the
Borrower or a Subsidiary or its becoming a Subsidiary, or any Lien existing
on Property acquired by the Borrower or any Subsidiary at the time such
Property is so acquired (whether or not the Indebtedness secured thereby
shall have been assumed); provided that (A) no such Lien shall have been
created or assumed in contemplation of such consolidation or merger or such
Person's becoming a Subsidiary or such acquisition of Property and (B) each
such Lien shall extend solely to the item or items of Property so acquired
and, if required by the terms of the instrument originally creating such
Lien, other property which is an improvement to or is acquired for specific
use in connection with such Property;
65
(vii) attachment and judgment Liens that do not constitute an Event
of Default pursuant to Section 11.01(h); and
----------------
(viii) any Lien renewing, extending or refunding any Lien permitted by
clauses (i) through (vi), provided that such Lien is not extended to any
other Property.
9.04. Investments. The Loan Parties and the Schein Parties shall not,
-----------
directly or indirectly, make or own any Investment, except:
(i) Investments in Cash Equivalents;
(ii) Permitted Existing Investments;
(iii) the acquisition of all or substantially all of the assets of a
business conducted by another Person; provided that no Default or Event of
Default exists at the time of such acquisition or would exist after giving
effect thereto and subject to approval by the Requisite Lenders;
(iv) Investments received in connection with the bankruptcy or
reorganization in settlement of delinquent obligations of, or other
disputes with, Persons arising in the ordinary course of business;
(v) Investments by the Borrower in any Loan Party or by a Loan
Party in another Loan party;
(vi) Investments by a Loan Party in any Subsidiary of the Borrower
(other than another Loan Party) provided that the aggregate amount of such
Investments does not exceed (A) 10% of Net Worth during the period from the
Closing Date until the Merger Effective Date or (B) 5% of Net Worth
thereafter;
(vii) Investments made or owned in Strategic Partners, provided that
the aggregate amount of all such Investments made or owned under this
clause (vii), when added to the aggregate amount of all Accommodation
Obligations made, created or assumed pursuant to Section 9.05(iv), does not
----------------
exceed 20% of Net Worth;
(viii) the loan from the Borrower to Schein on the Closing Date in an
amount sufficient to repay the outstanding indebtedness of Schein;
(ix) other Investments of the Borrower consistent with the
investment policy set by the Borrower's Board of Directors from time to
time in an aggregate amount not to exceed Fifty Million Dollars
($50,000,000); and
(x) loans and advances in the ordinary course of business to
officers, directors and employees of a Loan Party or a Schein Party in an
aggregate amount, when added to the Accommodation Obligations in Section
-------
9.05(v), does not exceed Fifteen Million Dollars ($15,000,000) at any time.
-------
66
9.05. Accommodation Obligations. The Loan Parties and the Schein
-------------------------
Parties shall not, directly or indirectly, create or become or be liable with
respect to any Accommodation Obligation, except:
(i) recourse obligations resulting from endorsement of negotiable
instruments for collection in the ordinary course of business;
(ii) the Guaranties, guaranties of the Senior Notes and guaranties
by Schein of the Floating Rate Notes during the period from the Closing
Date until the Schein Payment Date;
(iii) Accommodation Obligations in respect of obligations of
customers and suppliers in an aggregate amount not to exceed Fifty Million
Dollars ($50,000,000) at any time;
(iv) Accommodation Obligations in Strategic Partners, provided that
the aggregate amount of all such Accommodation Obligations made, created or
assumed under this clause (iv), when added to the aggregate amount of all
Investments made or owned pursuant to Section 9.04(vii), does not exceed
-----------------
20% of Net Worth; and
(v) Accommodation Obligations in the ordinary course of business
with respect to the loans of officers, directors and employees of a Loan
Party or a Schein Party in an aggregate amount, when added to the loans and
advances in Section 9.04(x), does not exceed Fifteen Million Dollars
---------------
($15,000,000) at any time.
9.06. Restricted Junior Payments. The Loan Parties and the Schein
--------------------------
Parties shall not, directly or indirectly, declare or make any Restricted Junior
Payments, except any Loan Party may make dividends and other distributions to
the Borrower or another Loan Party.
9.07. Change in Nature of Business. The Loan Parties and the Schein
----------------------------
Parties shall not make any material change in the nature or conduct of their
Business.
9.08. Transactions with Affiliates. None of the Loan Parties and the
----------------------------
Schein Parties shall, directly or indirectly, enter into or permit to exist any
transaction with any Affiliate of such Loan Party or such Schein Party except
for (i) transactions the terms of which are in the ordinary course of business,
in accordance with customary practice, and not less favorable to such Loan Party
or such Schein Party than those that might be obtained in an arm's length
transaction at the time from a Person who is not an Affiliate, and (ii)
reimbursement for reasonable salaries, bonuses and other compensation paid to
officers, directors and managers of such Loan Party or such Schein Party
commensurate with salary, bonus and compensation levels of other companies
engaged in a similar business in similar circumstances.
9.09. Restriction on Fundamental Changes. Other than the Merger, no
----------------------------------
Loan Party or Schein Party shall merge into or consolidate with any other
Person, or permit any other Person to merge into it, or liquidate, wind-up or
dissolve (or suffer any liquidation or dissolution), or convey, lease, sell,
transfer or otherwise dispose of, in one transaction or series of transactions,
all or substantially all of its business or assets, whether now or hereafter
acquired except that:
67
(i) Any Loan Party may merge or consolidate into the Borrower
provided that the Borrower is the surviving entity.
(ii) Any Loan Party may merge or consolidate into any other Loan
Party (other than the Borrower).
(iii) Any Person may merge or consolidate into a Loan Party, or a
Loan Party may merge or consolidate into any Person, provided that (A) such
Person is an entity organized and existing under the laws of a State in the
United States; (B) the Loan Party is the surviving entity and if the Loan
Party is not the Borrower such Loan Party is a Wholly-Owned Subsidiary of
the Borrower; and (C) no Default or Event of Default has occurred or will
occur prior to and after giving effect to such merger or consolidation.
9.10. Sales and Leasebacks. No Loan Party and no Schein Parties shall
--------------------
become liable, by assumption or by Accommodation Obligation, with respect to any
lease of any property (whether real or personal or mixed) (i) which such Loan
Party or such Schein Party has sold or transferred or will sell or transfer to
any other Person or (ii) which such Loan Party or such Schein Party intends to
use for substantially the same purposes as any other asset which it has sold or
transferred or will sell or transfer to any other Person in connection with such
lease (a "Sale and Leaseback Transaction"); provided that a Loan Party and a
Schein Party may enter into a Sale and Leaseback Transaction if the gross cash
proceeds of such Sale and Leaseback Transaction are at least equal to the fair
market value (as determined in good faith by the board of directors of such Loan
Party or such Schein Party) of the Property that is the subject of such Sale and
Leaseback Transaction and such Loan Party or such Schein Party is not in
violation of Section 9.01(xi) after giving effect thereto.
9.11. Margin Regulations. No Loan Party and no Schein Party shall use
------------------
all or any portion of the proceeds of any Loan made under this Agreement in
violation of Regulation U.
9.12. ERISA. The Borrower shall not, nor shall it permit any ERISA
-----
Affiliate to, do any of the following:
(ii) engage, or knowingly permit any ERISA Affiliate to engage, in
any prohibited transaction described in Sections 406 of ERISA or 4975 of
the Code for which a class exemption is not available or a private
exemption has not been previously obtained from the DOL;
(iii) permit to exist any accumulated funding deficiency (as defined
in Sections 302 of ERISA or 412 of the Code), with respect to any Benefit
Plan, which has not been waived;
(iv) fail, or permit any ERISA Affiliate to fail, to pay timely
required contributions or annual installments due with respect to any
waived funding deficiency to any Plan;
68
(v) terminate, or permit any ERISA Affiliate to terminate, any
Benefit Plan which would result in any liability of the Borrower, or any
ERISA Affiliate under Title IV of ERISA or under such Benefit Plan; or
(vi) fail, or permit any ERISA Affiliate to fail, to pay any
required installment under section (m) of Section 412 of the Code or any
other payment required under Section 412 of the Code or Section 302 of
ERISA on or before the due date for such installment or other payment.
9.13. Capital Expenditures. The Loan Parties and the Schein Parties
--------------------
shall not make or incur any Capital Expenditures in any Fiscal Year if, after
giving effect to such Capital Expenditures, the aggregate amount of all Capital
Expenditures made by the Loan Parties and the Schein Parties during such Fiscal
Year would exceed the amount set forth below for such Fiscal Year:
Fiscal Year Ending Maximum Amount
------------------ --------------
December 31, 2000 $ 60,000,000
December 31, 2001 $ 70,000,000
December 31, 2002 $ 80,000,000
December 31, 2003 $110,000,000
December 31, 2004 $120,000,000
provided, however, the Borrower may carry forward from one Fiscal Year to the
-------- -------
next Fiscal Year (but not to any subsequent Fiscal Year) 100% of any Capital
Expenditures permitted but not expended during any Fiscal Year provided that the
amount of Capital Expenditures carried forward to the next Fiscal Year may only
be used after the Capital Expenditures permitted for such next Fiscal Year are
expended.
9.14. Amendment of Governing Documents. No Loan Party shall amend,
--------------------------------
supplement or otherwise change its Governing Documents in any respect that is
materially detrimental to the Lenders.
9.15. Environmental Liabilities. Except as disclosed in Section
-------------------------
6.01(P) of the Disclosure Letter, no Loan Party and no Schein Party shall become
legally obligated, whether by settlement, stipulation, nonappealable judgment,
nonappealable conclusion of an administrative proceeding, or statute, for any
Liabilities and Costs which exceed $35,000,000 in a particular instance or
$75,000,000 in the aggregate, arising out of or relating to (a) the Release or
threatened Release at any location of any Contaminant into the environment, or
any Remedial Action in response thereto or (b) any violation of any
Environmental, Health or Safety Requirement of Law.
9.16. No Activities Leading to Forfeiture. No Loan Party and no
-----------------------------------
Schein Party shall engage in the conduct of any business or activity which will
or could be reasonably expected to result in a Forfeiture Proceeding.
69
ARTICLE X
FINANCIAL COVENANTS
The Borrower covenants and agrees so long as any Commitment is
outstanding and thereafter until payment in full of the Obligations:
10.01. Minimum Net Worth. The Net Worth of the Borrower and its
-----------------
$1,000,000,000 plus (ii) an amount equal to Subsidiaries on a consolidated basis
at the 50% of Net Income since the Closing Date. end of each fiscal quarter of
each Fiscal Year shall not be less than the sum of (i)
10.02. Minimum Interest Coverage Ratio. The Interest Coverage Ratio of
-------------------------------
the Borrower and its Subsidiaries on a consolidated basis at the end of each
Financial Covenant Period set forth below shall not be less than the ratio set
forth opposite such period:
Quarter Ending Ratio
-------------- -----
December 31, 2000 5.00
March 31, 2001 5.00
June 30, 2001 5.00
September 30, 2001 5.00
December 31, 2001 6.00
March 31, 2002 6.00
June 30, 2002 6.00
September 30, 2002 6.00
December 31, 2002 7.00
March 31, 2003 7.00
June 30, 2003 7.00
September 30, 2003 7.00
December 31, 2003 7.00
March 31, 2004 7.00
June 30, 2004 7.00
September 30, 2004 7.00
December 31, 2004 7.00
March 31, 2005 7.00
June 30, 2005 7.00
10.03. Minimum Fixed Charge Coverage Ratio. The Fixed Charge Coverage
-----------------------------------
Ratio of the Borrower and its Subsidiaries on a consolidated basis at the end of
each Financial Covenant Period shall not be less than 1.25.
10.04. Maximum Leverage Ratio. The Leverage Ratio of the Borrower and
----------------------
its Subsidiaries on a consolidated basis at the end of each Financial Covenant
Period set forth below shall not be greater than the ratio set forth opposite
such period:
Quarter Ending Ratio
-------------- -----
December 31, 2000 2.50
70
March 31, 2001 2.50
June 30, 2001 2.50
September 30, 2001 2.50
December 31, 2001 2.00
March 31, 2002 2.00
June 30, 2002 2.00
September 30, 2002 2.00
December 31, 2002 1.75
March 31, 2003 1.75
June 30, 2003 1.50
September 30, 2003 1.50
December 31, 2003 1.50
March 31, 2004 1.50
June 30, 2004 1.50
September 30, 2004 1.50
December 31, 2004 1.50
March 31, 2005 1.50
June 30, 2005 1.50
ARTICLE XI
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
11.01. Events of Default. Each of the following occurrences shall
-----------------
constitute an Event of Default under this Agreement:
(a) Failure to Make Payments When Due. The Borrower shall fail to
---------------------------------
pay any principal of any Note when due, or shall fail to pay any interest on any
Note or any other Obligation within three (3) Business Days after such interest
or Obligation shall become due.
(b) Breach of Representation or Warranty. Any representation or
------------------------------------
warranty made or deemed to have been made by any Loan Party under, relating to
or in connection with this Agreement, the Notes, any of the other Loan Documents
or any certificate or statement furnished by any Loan Party pursuant to or in
connection with this Agreement shall be false or misleading in any material
respect when made.
(c) Breach of Certain Covenants. Any Loan Party shall fail duly and
---------------------------
punctually to perform or observe any agreement, covenant or obligation binding
on such Loan Party under Section 7.04, Section 8.01, Section 8.05, Section 8.06,
------------ ------------ ------------ ------------
Section 8.10, Article IX or Article X of this Agreement.
------------ ---------- ---------
(d) Other Defaults. Any Loan Party shall fail duly and punctually
--------------
to perform or observe any term, covenant or obligation binding on such Loan
Party (i) under Section 7.01 or Section 7.08 of this Agreement and such failure
------------ ------------
shall continue for ten (10) Business Days after the occurrence of such failure
or (ii) under this Agreement (other than as described in Sections 11.01(a), (c)
----------------------
or (d)(i)), and such failure shall continue for thirty (30) days after any Loan
----------
Party
71
knew, or, in the exercise of due care, should have known, of such failure (or
such lesser period of time as is mandated by applicable Requirements of Law).
(e) Default as to Other Indebtedness. Any Loan Party shall fail to
--------------------------------
make any payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) with respect to any Indebtedness (other than
an Obligation) if the aggregate amount of such other Indebtedness is Thirty-Five
Million Dollars ($35,000,000) or more; or any breach, default or event of
default shall occur, or any other condition shall exist under any instrument,
agreement or indenture pertaining to any such Indebtedness, if the effect
thereof (with or without the giving of notice or lapse of time or both) is to
cause an acceleration, mandatory redemption or other required repurchase of such
Indebtedness or permit the holder or holders of such Indebtedness to accelerate
the maturity of any such Indebtedness or require a redemption or other
repurchase of such Indebtedness; or any such Indebtedness shall be otherwise
declared to be due and payable (by acceleration or otherwise) or required to be
prepaid, redeemed or otherwise repurchased by any Loan Party (other than by a
regularly scheduled required prepayment) prior to the stated maturity thereof;
or the holder or holders of any Lien, securing obligations of Twenty-Five
Million Dollars ($25,000,000) or more, shall commence foreclosure of such Lien
upon property of any Loan Party.
(f) Involuntary Bankruptcy; Appointment of Receiver, etc. (i) An
----------------------------------------------------
involuntary case shall be commenced against any Loan Party and the petition
shall not be dismissed, stayed, bonded or discharged within sixty (60) days; or
a court having jurisdiction in the premises shall enter a decree or order for
relief in respect of any Loan Party in an involuntary case, under any applicable
bankruptcy, insolvency or other similar law now or hereinafter in effect; or any
other similar relief shall be granted under any applicable federal, state, local
or foreign law; or the board of directors of any Loan Party (or any committee
thereof) adopts any resolution or otherwise authorizes any action to approve any
of the foregoing.
(ii) A decree or order of a court having jurisdiction in the
premises for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over any Loan Party or over all
or a substantial part of the assets of any Loan Party shall be entered; or an
interim receiver, trustee or other custodian of any Loan Party or of all or a
substantial part of the assets of any Loan Party shall be appointed or a warrant
of attachment, execution or similar process against any substantial part of the
assets of any Loan Party shall be issued and any such event shall not be stayed,
dismissed, bonded or discharged; or the board of directors of any Loan Party (or
any committee thereof) adopts any resolution or otherwise authorizes any action
to approve any of the foregoing.
(g) Voluntary Bankruptcy; Appointment of Receiver, etc. Any Loan
--------------------------------------------------
Party shall commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or shall consent to
the entry of an order for relief in an involuntary case, or to the conversion of
an involuntary case to a voluntary case, under any such law, or shall consent to
the appointment of or taking possession by a receiver, trustee or other
custodian for all or a substantial part of its assets; or any Loan Party shall
make any assignment for the benefit of creditors or shall be unable or fail, or
shall admit in writing its inability, to pay its debts as such debts become due,
or the board of directors of any Loan Party (or any committee thereof) adopts
any resolution or otherwise authorizes any action to approve any of the
foregoing.
72
(h) Judgments and Attachments. Any money judgment (other than a
-------------------------
money judgment covered by insurance as to which the insurance company has
acknowledged coverage), writ or warrant of attachment, or similar process
against any Loan Party or any assets of any Loan Party involving in any case an
amount in excess of Twenty-Five Million Dollars ($25,000,000) is entered and
shall remain undischarged, unvacated, unbonded or unstayed for a period of
thirty (30) days.
(i) Dissolution. Any order, judgment or decree shall be entered
-----------
against any Loan Party decreeing its involuntary dissolution or split up and
such order shall remain undischarged and unstayed for a period of thirty (30)
days; or any Loan Party shall otherwise dissolve or cease to exist.
(j) Loan Documents. At any time, for any reason, any Loan Document
--------------
ceases to be in full force and effect or any Loan Party seeks to repudiate its
obligations thereunder.
(k) ERISA Liabilities. Any Termination Event occurs which will or
-----------------
is reasonably likely to subject either the Borrower or an ERISA Affiliate to a
liability which will, or is reasonably likely to have, a Material Adverse
Effect.
(l) Waiver Application. The plan administrator of any Benefit Plan
------------------
applies under Section 412(d) of the Code for a waiver of the minimum funding
standards of Section 412(a) of the Code and the Administrative Agent believes
that the substantial business hardship upon which the application for the waiver
is based could subject either the Borrower or any ERISA Affiliate to liability
which the Administrative Agent determines will or is reasonably likely to have a
Material Adverse Effect.
(m) Change of Control. A Change of Control shall have occurred.
-----------------
(n) FDA Compliance. The FDA shall commence any action or proceeding
--------------
asserting any material violation of current good manufacturing practices by the
Borrower or any of its Subsidiaries, or shall seize, impound or otherwise impose
restrictions on the use of material properties or assets of the Borrower or any
of its Subsidiaries and such action by the FDA has or is reasonably likely to
have a Material Adverse Effect.
An Event of Default shall be deemed "continuing" until cured or waived in
writing in accordance with Section 13.09.
-------------
11.02. Rights and Remedies.
-------------------
(a) Acceleration and Termination. Upon the occurrence of any Event
----------------------------
of Default described in Section 11.01(f) or 11.01(g), the Commitments shall
----------------------------
automatically and immediately terminate and the unpaid principal amount of, and
any and all accrued interest on, the Obligations and all accrued fees shall
automatically become immediately due and payable, without presentment, demand,
or protest or other requirements of any kind (including, without limitation,
valuation and appraisement, diligence, presentment, notice of intent to demand
or accelerate and of acceleration), all of which are hereby expressly waived by
the Borrower, and the obligations of the Lenders to make Loans hereunder shall
thereupon terminate; and upon the
73
occurrence and during the continuance of any other Event of Default, the
Administrative Agent shall, at the request, or may with the consent, of the
Requisite Lenders, declare (i) that the Commitments are terminated, whereupon
the Commitments shall immediately terminate, and/or (ii) the unpaid principal
amount of, and any and all accrued interest on, the Obligations and all accrued
fees to be, and the same shall thereupon be, immediately due and payable,
without presentment, demand, or protest or other requirements of any kind
(including, without limitation, valuation and appraisement, diligence,
presentment, notice of intent to demand or accelerate and of acceleration,
except as may be specifically provided for herein), all of which are hereby
expressly waived by the Borrower.
(b) Enforcement. The Borrower acknowledges that in the event any
-----------
Loan Party fails to perform, observe or discharge any of its obligations or
liabilities under this Agreement or any other Loan Document, any remedy of law
may prove to be inadequate relief to the Administrative Agent and the Lenders;
therefore, the Borrower agrees that the Administrative Agent and the Lenders
shall be entitled to temporary and permanent injunctive relief in any such case
without the necessity of proving actual damages.
ARTICLE XII
THE AGENT
12.01. Appointment. (a) Each Lender hereby designates and appoints SG
-----------
as the Administrative Agent of such Lender under this Agreement, and each Lender
hereby irrevocably authorizes the Administrative Agent to take such action on
its behalf under the provisions of this Agreement, the Notes and the Loan
Documents and to exercise such powers as are set forth herein or therein
together with such other powers as are reasonably incidental thereto. As to any
matters not expressly provided for by this Agreement or the other Loan
Documents, the Administrative Agent shall not be required to exercise any
discretion or take any action. Notwithstanding the foregoing, the Administrative
Agent shall be required to act or refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the instructions of the
Requisite Lenders (unless the instructions or consent of all of the Lenders is
required hereunder or thereunder) and such instructions shall be binding upon
all Lenders; provided, however, the Administrative Agent shall not be required
to take any action which (i) the Administrative Agent believes will expose it to
personal liability unless the Administrative Agent receives an indemnification
satisfactory to it from the Lenders with respect to such action or (ii) is
contrary to this Agreement, the Notes, the other Loan Documents or applicable
law. The Administrative Agent agrees to act as such on the express conditions
contained in this Article XII.
(b) The provisions of this Article XII are solely for the benefit
of the Administrative Agent and the Lenders, and none of the Loan Parties shall
have any rights to rely on or enforce any of the provisions hereof (other than
as expressly set forth in Section 12.07). In performing its functions and duties
--------------
under this Agreement, the Administrative Agent shall act solely as agent of the
Lenders and does not assume and shall not be deemed to have assumed any
obligation or relationship of agency, trustee or fiduciary with or for any Loan
Party. The Administrative Agent may perform any of its duties hereunder, or
under the Loan Documents, by or through its agents or employees.
74
12.02. Nature of Duties. The Administrative Agent shall not have any
----------------
duties or responsibilities except those expressly set forth in this Agreement or
in the Loan Documents. The duties of the Administrative Agent shall be
mechanical and administrative in nature. The Administrative Agent shall not have
by reason of this Agreement a fiduciary relationship in respect of any Holder.
Nothing in this Agreement or any of the Loan Documents, expressed or implied, is
intended to or shall be construed to impose upon the Administrative Agent any
obligations in respect of this Agreement or any of the Loan Documents except as
expressly set forth herein or therein. Each Lender shall make its own
independent investigation of the financial condition and affairs of the Borrower
and the other Loan Parties in connection with the Loans hereunder and shall make
its own appraisal of the credit worthiness of the Borrower and the other Loan
Parties initially and on a continuing basis, and the Administrative Agent shall
not have any duty or responsibility, either initially or on a continuing basis,
to provide any Holder with any credit or other information with respect thereto
(except for reports required to be delivered by the Administrative Agent under
the terms of this Agreement). If the Administrative Agent seeks the consent or
approval of the Lenders to the taking or refraining from taking of any action
hereunder, the Administrative Agent shall send notice thereof to each Lender.
The Administrative Agent shall promptly notify each Lender at any time that the
Lenders so required hereunder have instructed the Administrative Agent to act or
refrain from acting pursuant hereto.
12.03. Rights, Exculpation, etc. (a) Liabilities; Responsibilities.
------------------------- -----------------------------
None of the Agents, any Affiliate of any Agent, or any of their respective
officers, directors, employees, agents, attorneys or consultants shall be liable
to any Holder for any action taken or omitted by them hereunder, under the Notes
or under any of the Loan Documents, or in connection therewith, except that no
Person shall be relieved of any liability imposed by law for gross negligence or
willful misconduct. The Administrative Agent shall not be liable for any
apportionment or distribution of payments made by it in good faith, and if any
such apportionment or distribution is subsequently determined to have been made
in error the sole recourse of any Holder to whom payment was due, but not made,
shall be to recover from other Holders any payment in excess of the amount to
which they are determined to have been entitled. The Administrative Agent shall
not be responsible to any Holder for any recitals, statements, representations
or warranties herein or for the execution, effectiveness, genuineness, validity,
legality, enforceability, collectibility, or sufficiency of this Agreement, the
Notes or any of the other Loan Documents or the transactions contemplated
thereby, or for the financial condition of the Borrower or any other Loan Party.
The Administrative Agent is not making any representation and warranty in
connection with, and shall not be required to make any inquiry concerning, the
performance or observance of any of the terms, provisions or conditions of this
Agreement, the Notes or any of the Loan Documents, or the financial condition of
the Borrower or any other Loan Party, or the existence or possible existence of
any Default or Event of Default.
(b) Right to Request Instructions. The Administrative Agent may at
-----------------------------
any time request instructions from the Lenders (and after all Obligations owing
to the Lenders have been paid in full, from the Holders) with respect to any
actions or approvals which by the terms of any of the Loan Documents the
Administrative Agent is permitted or required to take or to grant, and the
Administrative Agent shall be absolutely entitled to refrain from taking any
action or to withhold any approval and shall not be under any liability
whatsoever to any Person for refraining from any action or withholding any
approval under any of the Loan Documents until it
75
shall have received such instructions from those Lenders or Holders, as the case
may be, from whom the Administrative Agent is required to obtain such
instructions for the pertinent matter in accordance with the Loan Documents.
Without limiting the generality of the foregoing, no Holder shall have any right
of action whatsoever against the Administrative Agent as a result of the
Administrative Agent acting or refraining from acting under the Loan Documents
in accordance with the instructions of all Lenders or, where required by the
express terms of this Agreement, a lesser proportion of the Lenders, or of all
Holders (after the Obligations owing to the Lenders have been paid in full).
(c) IntraLinks. Any information, notice, document or other
----------
communication posted by the Administrative Agent on IntraLinks shall constitute
delivery of such information, notice, document or other communication to each
Lender upon receipt by such Lender of notification from the Administrative Agent
that such information, notice, document or other communication has been posted.
12.04. Reliance. The Administrative Agent shall be entitled to rely
--------
upon any written notices, statements, certificates, orders or other documents or
any telephone message believed by it in good faith to be genuine and correct and
to have been signed, sent or made by the proper Person, and with respect to all
matters pertaining to this Agreement or any of the Loan Documents and its duties
hereunder or thereunder, upon advice of legal counsel, independent public
accountants and other experts selected by it.
12.05. Indemnification. To the extent that the Administrative Agent is
---------------
not reimbursed and indemnified by the Borrower, the Lenders will reimburse and
indemnify the Administrative Agent for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, reasonable
costs, reasonable expenses or disbursements of any kind or nature whatsoever
which may be imposed on, incurred by, or asserted against it in any way relating
to or arising out of the Loan Documents or any action taken or omitted by the
Administrative Agent under the Loan Documents, in proportion to each Lender's
Pro Rata Share; provided that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct. The obligations of the Lenders under this
Section 12.05 shall survive the payment in full of the Loans and all other
-------------
Obligations and the termination of this Agreement. In the event that after
payment and distribution of any amount by the Administrative Agent to Lenders,
any Lender or third party, including the Borrower, any creditor of the Borrower
or a trustee in bankruptcy, recovers from the Administrative Agent any amount
found to have been wrongfully paid to the Administrative Agent or disbursed by
the Administrative Agent to Lenders, then Lenders, in proportion to their
respective Pro Rata Shares, shall reimburse the Administrative Agent for all
such amounts.
12.06. The Administrative Agent Individually. With respect to the
-------------------------------------
Loans made by it, SG shall have and may exercise the same rights and powers
hereunder and is subject to the same obligations and liabilities as and to the
extent set forth herein for any other Lender. The terms "Lenders" or "Requisite
Lenders" or any similar terms shall, unless the context clearly otherwise
indicates, include SG in its individual capacity as a Lender or one of the
Requisite Lenders. SG and its Affiliates may accept deposits from, lend money
to, and generally engage in
76
any kind of banking, trust or other business with the Borrower, any of its
Subsidiaries or any of its Affiliates as if it were not acting as the
Administrative Agent pursuant hereto.
12.07. Successor Administrative Agents. (a) Resignation. The
------------------------------- -----------
Administrative Agent may resign from the performance of all its functions and
duties hereunder at any time by giving at least thirty (30) days' prior written
notice to the Borrower and the Lenders. Such resignation shall take effect upon
the acceptance by a successor Administrative Agent of appointment pursuant to
this Section 12.07.
-------------
(b) Appointment by Requisite Lenders. Upon any such notice of
--------------------------------
resignation, the Requisite Lenders shall have the right to appoint a successor
Administrative Agent selected from among the Lenders, which appointment shall be
subject to the prior written approval of the Borrower (which may not be
unreasonably withheld, and shall not be required upon the occurrence and during
the continuance of an Event of Default or Default).
(c) Appointment by Retiring Administrative Agent. If a successor
--------------------------------------------
Administrative Agent shall not have been appointed within the thirty (30) day
period provided in paragraph (a) of this Section 12.07, the retiring
-------------
Administrative Agent shall then appoint a successor Administrative Agent who
shall serve as the Administrative Agent until such time, if any, as the
Requisite Lenders appoint a successor Administrative Agent as provided above.
Each Lender shall indemnify and hold the Administrative Agent harmless for and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, reasonable costs, reasonable expenses or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by, or asserted against it in any way relating to or arising out of the
appointment of a successor Administrative Agent pursuant to the terms of this
paragraph (c).
(d) Rights of the Successor and Retiring Administrative Agents.
----------------------------------------------------------
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under this Agreement.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article XII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Administrative Agent under this Agreement.
12.08. Relations Among Lenders. Each Lender agrees that it will not
-----------------------
take any legal action, nor institute any actions or proceedings, against the
Borrower or any other Loan Party without the prior written consent of the
Requisite Lenders. Without limiting the generality of the foregoing, no Lender
may accelerate or otherwise enforce its portion of the Obligations, except in
accordance with Section 11.02(a).
----------------
12.09. Concerning the Loan Documents. (a) Authority. Each Lender
----------------------------- ---------
authorizes and directs the Administrative Agent to enter into any Loan Documents
for the benefit of the Lenders. Each Lender agrees that any action taken by the
Administrative Agent or all Lenders (or, where required by the express terms of
this Agreement, a lesser proportion of the Lenders) in accordance with the
provisions of this Agreement or the other Loan Documents, and the exercise by
the Administrative Agent or all Lenders (or, where so required, such lesser
77
proportion) of the powers set forth herein or therein, together with such other
powers as are reasonably incidental thereto, shall be authorized and binding
upon all of the Lenders. Without limiting the generality of the foregoing, the
Administrative Agent shall have the sole and exclusive right and authority to
(i) act as the disbursing and collecting agent for the Lenders with respect to
all payments and collections arising in connection with this Agreement and the
Loan Documents; (ii) execute and deliver each Loan Document and accept delivery
of each such agreement delivered by any Loan Party and (iii) except as may be
otherwise specifically restricted by the terms of this Agreement or any other
Loan Document, exercise all remedies given to the Administrative Agent or the
Lenders under the Loan Documents, applicable law or otherwise.
(b) The Administrative Agent agrees to deliver to each Lender (by
IntraLinks in accordance with Section 12.03(c), mail, courier or fax) the
----------------
information, notices, statements and other communications delivered in writing
by the Borrower to the Administrative Agent pursuant to Article VII.
ARTICLE XIII
MISCELLANEOUS
13.01. Assignments and Participations. (a) Assignments. No assignment
------------------------------ -----------
or participation of any Lender's rights or obligations under this Agreement and
the Notes shall be made except in accordance with this Section 13.01. Each
-------------
Lender may assign to one or more Eligible Assignees all or a portion of its
rights and obligations under this Agreement and the Notes in accordance with the
provisions of this Section 13.01.
-------------
(b) Limitations on Assignments. Each assignment shall be subject to
--------------------------
the following conditions: (i) each assignment shall be of a constant, and not a
varying, ratable percentage of all of the assigning Lender's rights and
obligations in respect of its interest being assigned under this Agreement and
its Note and, in the case of a partial assignment, shall be in a minimum
principal amount of Five Million Dollars ($5,000,000), or $2,500,000 in the case
of an assignment of only Term Loans, except that such limitations shall not
apply to an assignment by any Lender of any portion of its rights and
obligations to another Lender or an assignment by any Lender of all of its
rights or obligations to another Person, (ii) each such assignment shall be to
an Eligible Assignee, and (iii) the parties to each such assignment shall
execute and deliver to the Administrative Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with a
processing and recordation fee of Three Thousand Five Hundred Dollars ($3500);
provided, however, any Lender may assign any or all of its rights and
obligations under this Agreement to any of its Affiliates without notice to or
consent of the Borrower or the Administrative Agent and without being subject to
the foregoing conditions. Upon such execution, delivery, acceptance and
recording in the Register, from and after the effective date specified in each
Assignment and Acceptance and accepted by the Administrative Agent (which
effective date shall not be any earlier than the date on which the
Administrative Agent so accepts and records the Assignment and Acceptance in the
Register), (x) the assignee thereunder shall, in addition to any rights and
obligations hereunder held by it immediately prior to such effective date, if
any, have the rights and obligations hereunder that have been assigned to it
pursuant to such Assignment and Acceptance and shall, to the fullest extent
permitted by
78
law, have the same rights and benefits hereunder as if it were an original
Lender hereunder and (y) the assigning Lender shall, to the extent that rights
and obligations hereunder have been assigned by it pursuant to such Assignment
and Acceptance, relinquish its rights and be released from its obligations under
this Agreement (and, in the case of an Assignment and Acceptance covering all or
the remaining portion of such assigning Lender's rights and obligations under
this Agreement, the assigning Lender shall cease to be a party hereto).
(c) The Register. The Administrative Agent, acting for this purpose
------------
as agent for the Borrower, shall maintain at its address referred to in Section
-------
13.10 a copy of each Assignment and Acceptance delivered to and accepted by it
-----
and a register (the "Register") for the recordation of the names and addresses
of the Lenders and the Commitment of each Lender from time to time and whether
such Lender is an original Lender or the assignee of another Lender pursuant to
an Assignment and Acceptance. The Administrative Agent shall incur no liability
of any kind to the Borrower, any Loan Party, any Lender or any other Person with
respect to its maintenance of the Register or the recordation of information
therein. The Register shall include a control account and a subsidiary account
for each Lender, in which accounts (taken together) shall be recorded (i) the
date and amount of each Borrowing made hereunder, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent from the Borrower hereunder and each Lender's share
thereof. The Administrative Agent will render a monthly statement of such
accounts to the Borrower. Each such statement shall be deemed final, binding and
conclusive upon the Borrower and the other Loan Parties in all respects as to
all matters reflected therein (absent manifest error) unless the Borrower,
within thirty (30) days after the date such statement is rendered, delivers to
the Administrative Agent written notice of any objections which the Borrower may
have to any such statement. In that event, only those items expressly objected
to in such notice shall be deemed to be disputed by the Borrower. The entries in
the Register shall be final, conclusive and binding upon the Borrower and the
other Loan Parties for all purposes, absent manifest error, and the Borrower,
each of its Subsidiaries and each other Loan Party, the Administrative Agent and
the Lenders shall treat each Person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice. No assignment of any
Commitment, Loan or Note, or any interest therein, shall be effective unless and
until the Assignment and Acceptance has been accepted by the Administrative
Agent and registered in the Register. This Section 13.01(c) shall be construed
----------------
so that all Commitments, Loans and Notes, and any interest therein, are
maintained at all times in "registered form" within the meaning of sections
163(f), 871(h) and 881(c) of the Code.
(d) Fee. Upon its receipt of an Assignment and Acceptance executed
---
by the assigning Lender and an Eligible Assignee and a processing and
recordation fee of $3500 (payable by the assigning Lender or the assignee, as
shall be agreed between them), the Administrative Agent shall, if such
Assignment and Acceptance has been completed and is in compliance with this
Agreement and in substantially the form of Exhibit A hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower and the other
Lenders.
79
(e) Participations. Each Lender may sell participations to one or
--------------
more commercial banks, lending institutions, finance companies, insurance
companies, other financial institutions or funds in or to all or a portion of
its rights and obligations under and in respect of any and all facilities under
this Agreement (including, without limitation, all or a portion of any or all of
its Commitments hereunder and the Loans owing to it); provided, however, that
(i) such Lender's obligations under this Agreement (including, without
limitation, its Commitments hereunder) shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations, (iii) the Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
(iv) such participant's rights to agree or to restrict such Lender's ability to
agree to the modification, waiver or release of any of the terms of the Loan
Documents, to consent to any action or failure to act by any party to any of the
Loan Documents or any of their respective Affiliates, or to exercise or refrain
from exercising any powers or rights which any Lender may have under or in
respect of the Loan Documents, shall be limited to the right to consent to (A)
the increase in the Commitment of the Lender from whom such participant
purchased a participation, (B) the reduction of the principal of, or rate or
amount of interest on, the Loans subject to such participation (other than by
the payment or prepayment thereof), (C) the postponement of any date fixed for
any payment of principal of, or interest on, the Loan(s) subject to such
participation (except with respect to any modifications of the provisions
relating to prepayments of Loans and other Obligations) and (D) the release of
any guarantor of the Obligations.
(f) Information Regarding the Borrower. Any Lender may, in
----------------------------------
connection with any assignment or participation or proposed assignment or
participation pursuant to this Section 13.01, disclose to the assignee or
-------------
participant or proposed assignee or participant, any information relating to the
Borrower or any Subsidiary of the Borrower or any other Loan Party furnished to
such Lender by the Administrative Agent or by or on behalf of the Borrower, such
Subsidiary or such Loan Party; provided that, prior to any such disclosure, such
assignee or participant, or proposed assignee or participant, shall agree to
preserve in accordance with Section 13.23 the confidentiality of any
-------------
confidential information described therein.
(g) Payment to Participants. Anything in this Agreement to the
-----------------------
contrary notwithstanding, in the case of any participation, all amounts payable
by the Borrower under the Loan Documents shall be calculated and made in the
manner and to the parties required hereby as if no such participation had been
sold.
(h) Lenders' Creation of Security Interests. Notwithstanding any
---------------------------------------
other provision set forth in this Agreement, any Lender may at any time create a
security interest in all or any portion of its rights under this Agreement and
its Notes (including, without limitation, Obligations owing to it and the Notes
held by it) in favor of any Federal Reserve Bank of the Federal Reserve Board
without notice to or consent of the Borrower or the Administrative Agent.
13.02. Relations Among Lenders. Except as contemplated under this
-----------------------
Agreement, no Lender shall make any loan, advance or other financial
accommodation to the Borrower or any other Loan Party without the prior written
consent of Requisite Lenders. Each Lender agrees that it will not take any
action, nor institute any actions or proceedings, against the
80
Borrower or any other Loan Party with respect to the Obligations, without the
prior written consent of Requisite Lenders.
13.03. Replacement of Lender. In the event that a Replacement Event
---------------------
occurs and is continuing with respect to any Lender, the Borrower may designate
a Replacement Lender to assume such Lender's Commitment hereunder, to purchase
the Loans and participations of such Lender and such Lender's rights hereunder,
without recourse to or representation or warranty by, or expense to, such Lender
for a purchase price equal to the outstanding principal amount of the Loans
payable to such Lender plus any accrued but unpaid interest on such Loans and
accrued but unpaid fees owing to such Lender, and upon such assumption, purchase
and substitution, and subject to the execution and delivery to the
Administrative Agent by the Replacement Lender of documentation satisfactory to
the Administrative Agent (pursuant to which such Replacement Lender shall assume
the obligations of such original Lender under this Agreement), the Replacement
Lender shall succeed to the rights and obligations of such Lender hereunder and
such Lender shall no longer be a party hereto or have any rights hereunder
provided that the obligations of the Borrower to such Lender under Section 13.05
--------------
hereof with respect to events occurring or obligations arising before such
replacement shall survive such replacement.
13.04. Expenses.
--------
(a) Generally. The Borrower agrees upon demand to pay, or reimburse
---------
the Administrative Agent for, all of the Administrative Agent's reasonable
audit, legal, appraisal, valuation, filing, document duplication and
reproduction and investigation expenses and for all other out-of-pocket costs
and expenses of every type and nature (including, without limitation, the
reasonable fees, expenses and disbursements of legal counsel, auditors,
accountants, appraisers, printers, insurance and environmental advisers, and
other consultants and agents) incurred by the Administrative Agent in connection
with (i) the preparation, negotiation, and execution of this Agreement and the
other Loan Documents; (ii) the interpretation of this Agreement (including,
without limitation, the satisfaction or attempted satisfaction of any of the
conditions set forth in Article V), the other Loan Documents and the making of
the Loans hereunder; (iii) the ongoing administration of this Agreement and the
Loans, including consultation with attorneys in connection therewith and with
respect to the Administrative Agent's rights and responsibilities under this
Agreement and the other Loan Documents and the Administrative Agent's periodic
audits of the Borrower and the other Loan Parties; (iv) the protection,
collection or enforcement of any of the Obligations or the enforcement of any of
the Loan Documents; (v) the commencement, defense or intervention in any court
proceeding relating in any way to the Obligations, the assets of any Loan Party,
any Loan Party, this Agreement or any of the other Loan Documents; (vi) the
response to, and preparation for, any subpoena or request for document
production with which the Administrative Agent is served or deposition or other
proceeding in which the Administrative Agent is called to testify, in each case,
relating in any way to the Obligations, the assets of any Loan Party, any Loan
Party, this Agreement or any of the other Loan Documents; and (vii) any
amendments, consents, waivers, assignments, restatements, or supplements to any
of the Loan Documents and the preparation, negotiation, and execution of the
same.
81
(b) After Default. The Borrower further agrees to pay or reimburse
-------------
the Administrative Agent and each Lender upon demand for all out-of-pocket costs
and expenses, including, without limitation, reasonable attorneys' fees incurred
by the Administrative Agent or such Lender after the occurrence of an Event of
Default (i) in enforcing any Loan Document or any of the Obligations or any
security therefor or exercising or enforcing any other right or remedy available
by reason of such Event of Default; (ii) in connection with any refinancing or
restructuring of the credit arrangements provided under this Agreement in the
nature of a "work-out" or in any insolvency or bankruptcy proceeding; (iii) in
commencing, defending or intervening in any litigation or in filing a petition,
complaint, answer, motion or other pleadings in any legal proceeding relating to
the Obligations, the Property, any Loan Party and related to or arising out of
the transactions contemplated hereby or by any of the other Loan Documents; and
(iv) in taking any other action in or with respect to any suit or proceeding
(bankruptcy or otherwise) described in clauses (i) through (iii) above.
13.05. Indemnity. The Borrower further agrees to defend, protect,
---------
indemnify, and hold harmless the Administrative Agent, the Syndication Agent,
the Documentation Agent the Arranger and each of the Lenders and each of their
respective Affiliates, and their respective officers, directors, employees,
attorneys and agents (including, without limitation, those retained in
connection with the satisfaction or attempted satisfaction of any of the
conditions set forth in Article V) (collectively, the "Indemnitees") from and
-----------
against any and all liabilities, obligations, losses (other than loss of
profits), damages, penalties, actions, judgments, suits, claims, costs, expenses
and disbursements of any kind or nature whatsoever (excluding any taxes and
including, without limitation, the fees and disbursements of counsel for such
Indemnitees in connection with any investigative, administrative or judicial
proceeding, whether or not such Indemnitees shall be designated a party
thereto), imposed on, incurred by, or asserted against such Indemnitees in any
manner relating to or arising out of (a) this Agreement, the Notes, the other
Loan Documents, or any act, event or transaction related or attendant thereto,
the making of the Loans, the management of such Loans, the use or intended use
of the proceeds of the Loans, or any of the transactions contemplated by the
Loan Documents, or (b) any Liabilities and Costs under any Environmental Health
or Safety Requirements or Law or common law principles arising from or in
connection with the past, present or future operations of any Loan Party or any
of its predecessors in interest, or, the past, present or future environmental
condition of any Property of any Loan Party, the presence of asbestos-containing
materials at any Property of any Loan Party or the Release or threatened Release
of any Contaminant into the environment from any Property of any Loan Party or
to which any Loan Party sent any Contaminant for treatment, storage disposal or
recycling (collectively, the "Indemnified Matters"); provided, however, the
-------------------
Borrower shall have no obligation to an Indemnitee hereunder with respect to
Indemnified Matters caused by or resulting from the willful misconduct or gross
negligence of such Indemnitee, as determined by a court of competent
jurisdiction in a judgment or order. To the extent that the undertaking to
indemnify, pay and hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, the Borrower
shall contribute the maximum portion which it is permitted to pay and satisfy
under applicable law, to the payment and satisfaction of all Indemnified Matters
incurred by the Indemnitees.
13.06. Change in Accounting Principles. If any change in the
-------------------------------
accounting principles used in the preparation of the most recent financial
statements referred to in Section 7.01 are hereafter required or permitted by
------------
the rules, regulations, pronouncements and opinions
82
of the Financial Accounting Standards Board or the American Institute of
Certified Public Accountants (or successors thereto or agencies with similar
functions) and are adopted by the Borrower and its Subsidiaries with the
agreement of its independent certified public accountants and such changes
result in a change in the method or results of calculation of any of the
covenants, standards or terms found in Article IX and Article X, the parties
hereto agree to enter into negotiations in order to amend such provisions so as
to equitably reflect such changes with the desired result that the criteria for
evaluating compliance with such covenants, standards and terms by the Borrower
and its Subsidiaries shall be the same after such changes as if such changes had
not been made; provided, however, (i) no change in GAAP that would affect the
method of calculation of any of the covenants, standards or terms shall be given
effect in such calculations until such provisions are amended, in a manner
satisfactory to the Requisite Lenders and the Borrower, to so reflect such
change in accounting principles and (ii) the Borrower shall be deemed to be in
compliance with such covenants during the sixty (60) day period following any
such change in GAAP if and to the extent that the Borrower would have been in
compliance therewith under GAAP as in effect immediately prior to such change.
13.07. Setoff. In addition to any Liens granted under the Loan
------
Documents and any rights now or hereafter granted under applicable law, upon the
occurrence and during the continuance of any Event of Default, each Lender and
any Affiliate of any Lender is hereby authorized by the Borrower and each other
Loan Party at any time and from time to time, without notice to any Person (any
such notice being hereby expressly waived) to set off and to appropriate and to
apply any and all deposits (general or special, including, but not limited to,
indebtedness evidenced by certificates of deposit, whether matured or unmatured
(but not including trust accounts)) and any other Indebtedness at any time held
or owing by such Lender or any of its Affiliates to or for the credit or the
account of the Borrower or such other Loan Party against and on account of the
Obligations of the Borrower to such Lender or any of its Affiliates, including,
but not limited to, all Loans and all claims of any nature or description
arising out of or in connection with this Agreement or the Notes, irrespective
of whether or not (i) such Lender shall have made any demand hereunder or (ii)
the Administrative Agent, at the request or with the consent of the Requisite
Lenders, shall have declared the principal of and interest on the Loans and
other amounts due hereunder and under the Notes to be due and payable as
permitted by Article XI and even though such Obligations may be contingent or
unmatured. Each Lender agrees that it shall not, without the express consent of
the Requisite Lenders, and that it shall, to the extent it is lawfully entitled
to do so, upon the request of the Requisite Lenders, exercise its setoff rights
hereunder against any accounts of the Borrower or any other Loan Party now or
hereafter maintained with such Lender or any of its Affiliates.
13.08. Ratable Sharing. The Lenders agree among themselves that (i)
---------------
with respect to all amounts received by them which are applicable to the payment
of the Obligations (excluding the fees described in Sections 3.03, 3.04 and
-----------------------
4.01(f)) equitable adjustment will be made so that, in effect, all such amounts
--------
will be shared among them ratably in accordance with their Pro Rata Shares,
whether received by voluntary payment, by the exercise of the right of setoff or
banker's lien, by counterclaim or cross-action or by the enforcement of any or
all of the Obligations (excluding the amounts described in Sections 3.03, 3.04
-------------------
and 4.01(f), (ii) if any of them shall by voluntary payment or by the exercise
-----------
of any right of counterclaim, setoff, banker's lien or otherwise, receive
payment of a proportion of the aggregate amount of the Obligations held by it,
which is greater than the amount which such Lender is entitled to receive
hereunder,
83
the Lender receiving such excess payment shall purchase, without recourse or
warranty, an undivided interest and participation (which it shall be deemed to
have done simultaneously upon the receipt of such payment) in such Obligations
owed to the others so that all such recoveries with respect to such Obligations
shall be applied ratably in accordance with their Pro Rata Shares; provided,
however, that if all or part of such excess payment received by the purchasing
party is thereafter recovered from it, those purchases shall be rescinded and
the purchase prices paid for such participations shall be returned to such party
to the extent necessary to adjust for such recovery, but without interest except
to the extent the purchasing party is required to pay interest in connection
with such recovery. Each of the Loan Parties agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 13.08
-------------
may, to the fullest extent permitted by law, exercise all its rights of payment
(including, subject to Section 13.07, the right of setoff) with respect to such
-------------
participation as fully as if such Lender were the direct creditor of the
Borrower or such Loan Party in the amount of such participation.
13.09. Amendments and Waivers. Unless otherwise provided in this
----------------------
Agreement, no amendment or modification of any provision of this Agreement or
the Notes shall be effective without the written agreement of the Requisite
Lenders and the Borrower, and no termination or waiver of any provision of this
Agreement or the Notes, or consent to any departure by the Borrower or any other
Loan Party therefrom, shall be effective without the written concurrence of the
Requisite Lenders, which the Requisite Lenders shall have the right to grant or
withhold in their sole discretion. Notwithstanding the foregoing, any amendment,
modification, termination, waiver or consent with respect to any of the
following provisions of this Agreement and the Notes shall be effective only by
a written agreement, signed by each Lender: (a) waiver of any of the conditions
specified in Sections 5.01 and 5.02 (except with respect to a condition based
----------------------
upon another provision of this Agreement, the waiver of which requires only the
concurrence of the Requisite Lenders), (b) increase in the amount of the
Commitment of any Lender, (c) reduction of the principal of, rate or amount of
interest on the Loans or any fees or other amounts payable to such Lender (other
than by the payment or prepayment thereof), (d) postponement of the Commitment
Termination Date or any other date fixed for any payment of principal of, or
interest on, the Loans or any fees or other amounts payable to such Lender
(except with respect to any modifications of the provisions relating to
prepayments of Loans and other Obligations), (e) releasing any Guarantor of its
obligations under a Guaranty (other than in connection with any sale of such
Guarantor permitted hereunder), (f) amendment of the definition of "Requisite
Lenders", or (g) amendment of Section 13.08 or this Section 13.09. Any waiver or
------------- -------------
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice to or demand on the Borrower in any
case shall entitle the Borrower to any other or further notice or demand in
similar or other circumstances. Notwithstanding anything to the contrary
contained in this Section 13.09, no amendment, modification, waiver or consent
-------------
shall affect the rights or duties of the Administrative Agent under this
Agreement or the other Loan Documents, unless made in writing and signed by the
Administrative Agent in addition to the Lenders required above to take such
action.
13.10. Notices. (a) Unless otherwise specifically provided herein, any
-------
notice or other communication herein required or permitted to be given shall be
in writing and may be personally served, faxed or sent by courier service or
United States certified mail and shall be deemed to have been given when
delivered in person or by courier service, upon receipt
84
of a facsimile or three (3) Business Days after deposit in the United States
mail with postage prepaid and properly addressed. Notices to the Administrative
Agent pursuant to Articles II, III or XII shall not be effective until received
by the Administrative Agent. For the purposes hereof, the addresses of the
parties hereto (until notice of a change thereof is delivered as provided in
this Section 13.10) shall be as set forth below each party's name on the
-------------
signature pages hereof or the signature page of any applicable Assignment and
Acceptance, or, as to each party, at such other address as may be designated by
such party in a written notice to all of the other parties to this Agreement.
For purposes of any Loan Document, the address of each Loan Party shall be as
set forth on Schedule I attached hereto.
(b) The Borrower agrees to indemnify and hold harmless each
Indemnitee from and against any and all claims, damages, liabilities,
obligations, losses, penalties, actions, judgments, suits, costs, disbursements
and expenses of any kind or nature (including, without limitation, reasonable
fees and disbursements of counsel to any such Indemnitee) which may be imposed
on, incurred by or asserted against any such Indemnitee in any manner relating
to or arising out of any action taken or omitted by such Indemnitee in good
faith in reliance on any notice or other written communication in the form of a
facsimile purporting to be from the Borrower; provided that the Borrower shall
have no obligation under this Section 13.10(b) to an Indemnitee with respect to
----------------
any indemnified matter caused by or resulting from the gross negligence or
willful misconduct of that Indemnitee, as determined by a court of competent
jurisdiction in a judgment or order.
13.11. Survival of Warranties and Agreements. All representations and
-------------------------------------
warranties made herein and all obligations of the Borrower in respect of taxes,
indemnification and expense reimbursement shall survive the execution and
delivery of this Agreement and the other Loan Documents, the making and
repayment of the Loans and the termination of this Agreement and shall not be
limited in any way by the passage of time or occurrence of any event and shall
expressly cover time periods when the Administrative Agent or any of the Lenders
may have come into possession or control of any assets of any Loan Party.
13.12. Failure or Indulgence Not Waiver; Remedies Cumulative. No
-----------------------------------------------------
failure or delay on the part of the Administrative Agent or any Lender in the
exercise of any power, right or privilege under this Agreement, the Notes or any
of the other Loan Documents shall impair such power, right or privilege or be
construed to be a waiver of any default or acquiescence therein, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing under this Agreement, the Notes and the other Loan
Documents are cumulative to and not exclusive of any rights or remedies
otherwise available.
13.13. Marshalling; Payments Set Aside. Neither the Administrative
-------------------------------
Agent nor any Lender shall be under any obligation to ▇▇▇▇▇▇▇▇ any assets in
favor of the Borrower, any other Loan Party or any other Person or against or in
payment of any or all of the Obligations. To the extent that the Borrower makes
a payment or payments to the Administrative Agent or the Lenders, or any of such
Persons exercises its rights of setoff, and such payment or payments or the
proceeds of such enforcement or setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required to
be repaid to a trustee, receiver or any other party, then to the extent of such
recovery, the obligation or part thereof originally
85
intended to be satisfied, and all Liens, right and remedies therefor, shall be
revived and continued in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.
13.14. Independence of Covenants. All covenants hereunder shall be
-------------------------
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitations of, another covenant shall
not avoid the occurrence of an Event of Default or Default if such action is
taken or condition exists.
13.15. Severability. In case any provision in or obligation under this
------------
Agreement, the Notes or the other Loan Documents shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
13.16. Headings. Section headings in this Agreement are included
--------
herein for convenience of reference only and shall not constitute a part of this
Agreement or be given any substantive effect.
13.17. Governing Law. THIS AGREEMENT SHALL BE INTERPRETED, AND THE
-------------
RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED, IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
13.18. Limitation of Liability. No claim may be made by the Borrower,
-----------------------
any other Loan Party, any Lender, the Administrative Agent or any other Person
against the Administrative Agent or any other Lender or the Affiliates,
directors, officers, employees, attorneys or agents of any of them for any
special, consequential or punitive damages in respect of any claim for breach of
contract or any other theory of liability arising out of or related to the
transactions contemplated by this Agreement or the Notes or the other Loan
Documents, or any act, omission or event occurring in connection therewith; and
the Borrower, each other Loan Party, each Lender and the Administrative Agent
hereby waive, release and agree not to ▇▇▇ upon any such claim for any such
damages, whether or not accrued and whether or not known or suspected to exist
in its favor.
13.19. Successors and Assigns. This Agreement, the Notes and the other
----------------------
Loan Documents shall be binding upon the parties thereto and their respective
successors and assigns and shall inure to the benefit of the parties thereto and
the successors and permitted assigns of the Lenders. The rights hereunder of the
Borrower and the other Loan Parties, or any interest therein, may not be
assigned without the written consent of all Lenders.
13.20. Certain Consents and Waivers.
----------------------------
(a) Personal Jurisdiction. (i) EACH OF THE ADMINISTRATIVE AGENT,
---------------------
THE LENDERS, THE BORROWER AND THE OTHER LOAN PARTIES IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF ANY NEW YORK STATE COURT OR FEDERAL COURT SITTING IN NEW YORK,
NEW YORK, AND ANY COURT HAVING
86
JURISDICTION OVER APPEALS OF MATTERS HEARD IN SUCH COURTS, IN ANY ACTION OR
PROCEEDING ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT, WHETHER
ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE COURT OR, TO THE EXTENT
PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE BORROWER AND THE OTHER LOAN
PARTIES IRREVOCABLY DESIGNATES AND APPOINTS CT CORPORATION, AS ITS AGENT (THE
"PROCESS AGENT") FOR SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH
COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED TO BE EFFECTIVE AND BINDING
SERVICE IN EVERY RESPECT. EACH OF THE ADMINISTRATIVE AGENT, THE LENDERS, THE
BORROWER AND THE OTHER LOAN PARTIES AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
EACH OF THE BORROWER AND THE OTHER LOAN PARTIES WAIVES IN ALL DISPUTES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(ii) EACH OF THE BORROWER AND THE OTHER LOAN PARTIES AGREES THAT THE
ADMINISTRATIVE AGENT SHALL HAVE THE RIGHT TO PROCEED AGAINST THE BORROWER OR ANY
OF THE OTHER LOAN PARTIES OR THEIR RESPECTIVE PROPERTY IN A COURT IN ANY
LOCATION TO ENABLE THE ADMINISTRATIVE AGENT AND THE LENDERS TO REALIZE ON ANY
SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER
ENTERED IN FAVOR OF THE ADMINISTRATIVE AGENT OR ANY LENDER. EACH OF THE BORROWER
AND THE OTHER LOAN PARTIES WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION
OF THE COURT IN WHICH THE ADMINISTRATIVE AGENT OR ANY LENDER MAY COMMENCE A
PROCEEDING DESCRIBED IN THIS SECTION.
(b) Service of Process. EACH OF THE BORROWER AND THE OTHER LOAN
------------------
PARTIES IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE PROCESS AGENT
OR THE BORROWER'S OR SUCH LOAN PARTY'S NOTICE ADDRESS SPECIFIED BELOW, SUCH
SERVICE TO BECOME EFFECTIVE TEN (10) DAYS AFTER SUCH MAILING. EACH OF THE
BORROWER AND THE OTHER LOAN PARTIES IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS
OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY
OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE. NOTHING HEREIN SHALL
87
AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL
LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER TO BRING PROCEEDINGS
AGAINST THE BORROWER OR ANY OTHER LOAN PARTY IN THE COURTS OF ANY OTHER
JURISDICTION.
(c) Waiver of Jury Trial. EACH OF THE ADMINISTRATIVE AGENT, THE
--------------------
LENDERS, THE BORROWER AND THE OTHER LOAN PARTIES IRREVOCABLY WAIVES TRIAL BY
JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT, THE NOTES OR
ANY OTHER LOAN DOCUMENT.
13.21. Counterparts; Effectiveness; Inconsistencies. This Agreement
--------------------------------------------
and any amendments, waivers, consents, or supplements hereto may be executed in
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. This Agreement shall become effective against the Borrower,
each other Loan Party, each Lender and the Administrative Agent on the date
hereof when each such party hereto executes and delivers this Agreement. This
Agreement and each of the other Loan Documents shall be construed to the extent
reasonable to be consistent one with the other, but to the extent that the terms
and conditions hereof are actually inconsistent with the terms and conditions of
any other Loan Document, this Agreement shall govern.
13.22. Entire Agreement. This Agreement, taken together with all of
----------------
the other Loan Documents, embodies the entire agreement and understanding among
the parties hereto and supersedes all prior agreements and understandings,
written and oral, relating to the subject matter hereof.
13.23. Confidentiality. The Lenders shall hold all nonpublic
---------------
information obtained from any Loan Party pursuant to this Agreement or any of
the other Loan Documents in accordance with such Lender's customary procedures
for handling confidential information of this nature and in accordance with safe
and sound banking practices and in any event may make disclosure reasonably
required by a bona fide offeree, transferee or participant in connection with
the contemplated transfer or participation or as required or requested by any
Governmental Authority or representative thereof or pursuant to legal process
and shall require any such offeree, transferee or participant to agree (and
require any of its offerees, transferees or participants to agree) to comply
with this Section 13.23. In no event shall any Lender be obligated or required
-------------
to return any materials furnished by the Borrower or any other Loan Party;
provided, however, each offeree shall be required to agree that if it does not
-------- -------
become a transferee or participant it shall return all materials furnished to it
by the Borrower or any other Loan Party in connection with this Agreement or any
of the other Loan Documents.
88
IN WITNESS WHEREOF, this Agreement has been duly executed as of the
date first above written.
▇▇▇▇▇▇ PHARMACEUTICALS, INC.
By:___________________________
Title: Chairman, President and
Chief Executive Officer
Notice address:
▇▇▇▇▇▇ PHARMACEUTICALS, INC.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
with a copy to:
▇▇▇▇▇▇ Godward LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
89
SOCIETE GENERALE,
as Administrative Agent
By:____________________________
Title:
Notice address:
SOCIETE GENERALE
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
90
SOCIETE GENERALE, as Lender
By:_____________________________
Title:
REVOLVING LOAN COMMITMENT: $24,714,285.71
TERM LOAN COMMITMENT: $53,785,714.29
Notice address:
SOCIETE GENERALE
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
91
SUMMIT BANK, as Lender
By:____________________________
Title:
REVOLVING LOAN COMMITMENT: $16,928,571.43
TERM LOAN COMMITMENT: $42,321,428.57
Notice address:
Summit Bank
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
92
FIRST UNION NATIONAL BANK, as Lender
By:______________________________
Title:
REVOLVING LOAN COMMITMENT: $16,928,571.43
TERM LOAN COMMITMENT: $42,321,428.57
Notice address:
First Union National Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇-▇ ▇▇ 0760
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
93
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC., as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
Bank Austria Creditanstalt
Corporate Finance Inc.
Two ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
94
BANK HAPOALIM, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
Bank Hapoalim
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
95
THE GOVERNOR AND COMPANY OF THE
BANK OF IRELAND, as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
Bank of Ireland, Dublin
La Touche House, I.F.S.C.
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇-▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇-▇) ▇▇▇-▇▇▇▇
▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 7,142,857.14
TERM LOAN COMMITMENT: $17,857,142.86
Notice address:
The Bank of New York
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
97
BNP PARIBAS, as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $11,428,571.43
TERM LOAN COMMITMENT: $28,571,428.57
Notice address:
BNP Paribas
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
98
COMERICA BANK, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
Comerica Bank
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 7,142,857.14
TERM LOAN COMMITMENT: $17,857,142.86
Notice address:
Den Danske Bank
280 Park Avenue, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇
▇▇▇ ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, LTD., as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $2,857,142.86
TERM LOAN COMMITMENT: $7,142,857.14
Notice address:
The Dai-Ichi Kangyo Bank, Ltd.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
101
FLEET NATIONAL BANK, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $14,285,714.29
TERM LOAN COMMITMENT: $35,714,285.71
Notice address:
Fleet National Bank
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Code: ADE 10008E
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
102
THE FUJI BANK LIMITED, LOS ANGELES
AGENCY, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
The Fuji Bank Limited, Los Angeles Agency
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
103
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 7,142,857.14
TERM LOAN COMMITMENT: $17,857,142.86
Notice address:
The Industrial Bank of Japan, Limited
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇-Henachke
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
104
KBC BANK N.V., as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $2,857,142.86
TERM LOAN COMMITMENT: $7,142,857.14
Notice address:
KBC Bank, N.V.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
KBC Bank, N.V.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
105
THE MITSUBISHI TRUST AND BANKING
CORPORATION, as Lender
By:_________________________________
Title:
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 7,142,857.14
TERM LOAN COMMITMENT: $17,857,142.86
Notice address:
The Mitsubishi Trust & Banking Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
106
THE NORTHERN TRUST COMPANY,
as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
The Northern Trust Company
▇▇ ▇. ▇▇▇▇▇▇▇ ▇-▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ HIGH INCOME
INVESTMENTS LTD., as Lender
By: Pilgrim Investments, Inc.
as its investment manager
By: _________________________________
Title:
REVOLVING LOAN COMMITMENT: $ -0-
TERM LOAN COMMITMENT: $2,400,000.00
Notice address:
Pilgrim CLO 1999-1 Ltd.
c/o Pilgrim Investments, Inc.
Two Renaissance Square
▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
108
PILGRIM CLO 1999 - 1 LTD., as Lender
By: Pilgrim Investments, Inc.
as its investment manager
By: ____________________________________
Title:
REVOLVING LOAN COMMITMENT: $ -0-
TERM LOAN COMMITMENT: $5,600,000.00
Notice address:
Pilgrim CLO 1999-1 Ltd.
c/o Pilgrim Investments, Inc.
Two Renaissance Square
▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
109
THE SANWA BANK, LIMITED, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 8,571,428.57
TERM LOAN COMMITMENT: $21,428,571.43
Notice address:
The Sanwa Bank Limited
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 7,142,857.14
TERM LOAN COMMITMENT: $17,857,142.86
Notice address:
The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
111
THE SUMITOMO BANK, LIMITED, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $14,285,714.29
TERM LOAN COMMITMENT: $35,714,285.71
Notice address:
The Sumitomo Bank, Limited
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇-▇▇▇ ▇▇▇▇
BRANCH, as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 4,285,714.29
TERM LOAN COMMITMENT: $10,714,285.71
Notice address:
The Tokai Bank, Limited
▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
113
▇▇▇▇▇ FARGO BANK, N.A., as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $ 7,142,857.14
TERM LOAN COMMITMENT: $17,857,142.86
Notice address:
▇▇▇▇▇ Fargo Bank, N.A.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ floor
MAC ▇ ▇▇▇▇-▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇., as Lender
By:_________________________________
Title:
REVOLVING LOAN COMMITMENT: $14,285,714.29
TERM LOAN COMMITMENT: $35,714,285.71
Notice address:
Union Bank of California, N.A.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
115